<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)*
PennCorp Financial Group, Inc.
-----------------------------------------------------
(Name of Issuer)
$3.375 Convertible Preferred Stock
$3.50 Convertible Preferred Stock
-----------------------------------------------------
(Title of Class of Securities)
708094206
-----------------------------------------------------
(CUSIP Number)
Copy to:
<TABLE>
<S> <C>
Paul Chute James Learner
Brown's Dock, L.L.C. Kirkland & Ellis
56 Prospect St. 200 E. Randolph Drive
Hartford, Connecticut 06115 Chicago, Illinois 60601
(860) 403-5594 (312) 861-2000
</TABLE>
- --------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 27, 1999
-----------------------------------------------------
(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 Rule 13d-1(b)(3) or (4), check the following box |_|.
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) 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).
(Continued on following pages)
Page 1 of 18 Pages
<PAGE>
13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 2 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Brown's Dock, L.L.C.
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Deleware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivalents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
OO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
13D
- ----------------------- ---------------------
CUSIP No. 708094206 Page 3 of 18 Pages
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Phoenix Home Life Mutual Insurance Company
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) or 2(E) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
New York
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivilents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
IC
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
13D
- ----------------------- ---------------------
CUSIP No. 708094206 Page 4 of 18 Pages
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Phoenix Investment Partners, Ltd.
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
OO
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) or 2(E) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivilents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
IA
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
13D
- ----------------------- ---------------------
CUSIP No. 708094206 Page 5 of 18 Pages
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Inverness Management Fund I LLC
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) or 2(E) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivilents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
00
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
13D
- ----------------------- ---------------------
CUSIP No. 708094206 Page 6 of 18 Pages
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
WMD LLC
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) or 2(E) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivilents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
00
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
13D
- ----------------------- ---------------------
CUSIP No. 708094206 Page 7 of 18 Pages
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
J.C Comis LLC
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivilents (See Item
5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
OO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 8 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
W. McComb Dunwoody
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [x]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
United States
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares
of Common Stock) = 3,301,266.32 shares of common stock equivalents
(See Item 5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
IN
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 9 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
James C. Comis, III
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [x]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
United States
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares
of Common Stock) = 3,301,266.32 shares of common stock equivalents
(See Item 5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
IN
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 10 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Inverness/Phoenix Partners LP
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivalents (See
Item 5)
- -------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
PN
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 11 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Executive Capital Partners I LP
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivalents (See
Item 5)
- -------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
PN
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 12 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
Inverness/Phoenix Capital LLC
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Delaware
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
1,346,600 shares of $3.375 Convertible Preferred Stock
OWNED BY 224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) and 224,800 shares of
$3.50 Series II Preferred Stock (per share convertible in 1.4326 shares of
Common Stock) = 3,301,266.32 shares of common stock equivalents (See
Item 5)
- -------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
00
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 708094206 PAGE 13 OF 18 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON
1
DCPM Holdings, Inc.
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
2 (a) [X]
(b) [_]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS*
4
Not Applicable
- ------------------------------------------------------------------------------
CHECK BOX 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
OWNED BY 1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
1,346,600 shares of $3.375 Convertible Preferred Stock
224,800 shares of $3.50 Series II Preferred Stock
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,346,600 shares of $3.375 Convertible Preferred Stock (per share
convertible into 2.2124 shares of Common Stock) = 3,301,266.32 shares of
common stock equivalents (See Item 5)
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
9.89% of Common Stock and common stock equivalents
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON*
14
CO
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D
(AMENDMENT NO. 3)
This Amendment No. 3 amends and supplements the statements on Schedule 13D
of (i) Brown's Dock, L.L.C. (the "Buyer"), (ii) Phoenix Home Life Mutual
Insurance Company, (iii) Phoenix Investment Partners, Ltd., (iv) Inverness
Management Fund I LLC, (v) WMD LLC, (vi) W. McComb Dunwoody, (vii) J.C. Comis
LLC, (viii) James C. Comis III (ix) Inverness/Phoenix Partners LP (the "Fund"),
(x) Executive Capital Partners I, LP (the "Executive Fund"), (xi)
Inverness/Phoenix Capital LLC and (xii) DCPM Holdings, Inc., dated September 9,
1998, as amended by Amendment No. 1, dated September 30, 1998 and by Amendment
No. 2, dated December 1, 1999 (the "Statement"). This Amendment No. 3 is being
filed to amend Item 4 (Purpose of Transaction).
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed to such terms in the Statement. Except as expressly set forth
in this Amendment No. 3, there have been no material changes in the information
contained in the Statement.
ITEM 4. PURPOSE OF TRANSACTION.
----------------------
The information set forth in Item 4 of the Statement is hereby amended and
supplemented as follows:
On December 21, 1999, the Issuer and its advisors invited holders of
approximately 74% of its outstanding Preferred Stock and Series II Preferred
(the "Ad Hoc Committee"), including the Buyer, the Fund and the Executive Fund
(the "Holders"), to a meeting to hear a presentation regarding a proposed
restructuring of the Issuer (the "Restructuring") and the Issuer's progress on a
proposed plan to sell substantially all of the assets of its operating
subsidiaries (the "Sale Alternative"). Although the Holders believed that the
Issuer's goal in calling the meeting was to build a consensus among the members
of the Ad Hoc Committee for the Restructuring, the Issuer instead indicated its
intention to move forward with the Sale Alternative and then consummate a
liquidation of the Issuer in a Chapter 11 bankruptcy. In response to this
information, on December 23, 1999, the Ad Hoc Committee delivered a letter to
the board of directors of the Issuer (the "Board") objecting to this course of
action and calling for the Board's acceptance of a Restructuring of the Issuer
pursuant to a term sheet attached as an exhibit to the letter. The letter and
the term sheet are attached hereto as Exhibit F. The Holders believe that the
Restructuring on the terms set forth in the term sheet is the only viable
alternative for the Issuer at this juncture to insure maximum value to the
Issuer's stakeholders, including holders of Preferred Stock and Series II
Preferred, or any value to the holders of the Issuer's common stock. The
Holders, as part of the Ad Hoc Committee, intend to take all actions at their
disposal (including litigation) to prevent the consummation of the Sale
Alternative. Each of the filing persons of this Statement may be deemed to be a
member of a group within the meaning of Rule 13d-5(b) with the other members of
the Ad Hoc Committee, but hereby expressly disclaims such membership in a group
and beneficial ownership of the shares held by such other members of the Ad Hoc
Committee.
Page 14 of 18 Pages
<PAGE>
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
---------------------------------
Exhibit F: Letter to the Board of Directors of PennCorp Financial
Group, Inc., dated December 23, 1999.
Exhibit G: Agreement of Joint Filing, dated as of December 27,
1999, among Buyer, the Fund, the Executive Fund, DCPM,
Phoenix, PXP, Inverness, WMD, JCC, Dunwoody and Comis.
Page 15 of 18 Pages
<PAGE>
SIGNATURE
After reasonable 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.
Date: December 27, 1999
BROWN'S DOCK, L.L.C.
By: /s/ James C. Comis III
------------------------------------
Print Name: James C. Comis III
Its: Managing Director
INVERNESS/PHOENIX PARTNERS LP
By: Inverness/Phoenix Capital LLC,
Its: General Partner
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
-------------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
Page 16 of 18 Pages
<PAGE>
EXECUTIVE CAPITAL PARTNERS I LP
By: Inverness/Phoenix Capital LLC,
Its: General Partner
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
-------------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
INVERNESS/PHOENIX CAPITAL LLC
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
-------------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
DCPM HOLDINGS, INC.
By: /s/ Michael E. Haylon
--------------------------
Print Name: Michael E. Haylon
Its: Vice-President
PHOENIX HOME LIFE MUTUAL
INSURANCE COMPANY
By: /s/ John H. Beers
--------------------------
Print Name: John H. Beers
Its: Vice-President
Page 17 of 18 Pages
<PAGE>
PHOENIX INVESTMENT PARTNERS, LTD.
By: /s/ Michael E. Haylon
-------------------------------------
Print Name: Michael E. Haylon
Its: Executive Vice-President
INVERNESS MANAGEMENT FUND I LLC
By: WMD LLC, its General Partner
By: /s/ W. McComb Dunwoody
-------------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
WMD LLC
By: /s/ W. McComb Dunwoody
-------------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
J.C. COMIS LLC
By: /s/ James C. Comis III
------------------------------------
Print Name: James C. Comis III
Its: Managing Member
/s/ W. McComb Dunwoody
-------------------------------
W. McComb Dunwoody
/s/ James C. Comis III
-------------------------------
James C. Comis III
Page 18 of 18 Pages
<PAGE>
EXHIBIT F
December 23, 1999
PennCorp Financial Group, Inc.
717 North Harwood Street
Dallas, Texas 75201
Attention: Board of Directors
To the Board of Directors of PennCorp Financial Group, Inc.:
The undersigned, as members of the Ad Hoc Committee of the Preferred
Stockholders (the "Ad Hoc Committee") of PennCorp Financial Group, Inc. (the
"Company"), represent 74% of the Company's outstanding shares of $3.375
Convertible Preferred Stock (the "Series I Preferred") and $3.50 Convertible
Preferred Stock (the "Series II Preferred" and together with the Series I
Preferred, the "Preferred Shares"). On December 21, 1999, the Ad Hoc Committee
was invited by the Company to hear a presentation regarding a proposed
restructuring of the Company (the "Restructuring") and the Company's progress on
a proposed plan to sell substantially all of the assets of its operating
subsidiaries (the "Sale Alternative"). Although the Ad Hoc Committee believed
that the Company's goal in calling the meeting was to build a consensus among
the members of the Ad Hoc Committee for the Restructuring, the Company instead
presented its plan to move forward with the Sale Alternative and then consummate
a liquidation of the Company in a Chapter 11 bankruptcy. At the meeting, the
Company stated that the Board of Directors of the Company (the "Board") intended
to approve the Sale Alternative at its next meeting on January 6, 2000, and
would cause the Company to execute definitive agreements with two buyers for the
Company's operating subsidiaries.
The Ad Hoc Committee strenuously objects to this course of action by
the Company. The Ad Hoc Committee believes that (i) the proposed sale of
Security Life and Trust and Southwestern Life (the "Dallas Operations") severely
undervalues these assets and will significantly impair the ability of the
Company's stakeholders, in particular the holders of the Preferred Shares, to
realize maximum value for their respective interests in the Company, or in the
case of the common stockholders, any value and (ii) an extended Chapter 11
bankruptcy proceeding will have a devastating and irreversible effect on the
value of the Company. Should the Board move forward with the Sale Alternative
by executing definitive purchase agreements with the proposed buyers, the Ad Hoc
Committee will take all steps at its disposal to prevent these transfers
(including litigation) and will seek all possible remedies against the Company,
the Board and its officers.
The Ad Hoc Committee favors the Restructuring on the terms set forth
on Exhibit A attached hereto. These terms are substantially similar to those
previously discussed by certain
<PAGE>
holders of Preferred Shares and the Company, and include a sale of the Company's
American Amicable subsidiary. At the December 21 meeting, the Company indicated
its willingness to support the Restructuring alternative if the Ad Hoc Committee
could deliver binding commitment letters for the financing of the Restructuring
from third party financing sources prior to the Board's next meeting and a
commitment to support the plan from 80% of the holders of Preferred Stock. Given
that this request comes four days before the Christmas holiday and less than two
weeks before the end of the Millennium, it is impracticable for the Ad Hoc
Committee to meet this timetable. However, the Ad Hoc Committee has had
substantially discussions regarding the financing of the Restructuring with a
consortium of lenders consisting of GE Capital Corporation, Bank One and CIBC
and is highly confident that it can arrange the necessary financing in short
order. The Ad Hoc Committee expects to deliver a highly confident letter from
this consortium to the Board on Monday, December 27, 1999, and expects to
deliver final financing commitment letters to the Company shortly thereafter.
This is a reasonable timetable to secure the financing and for the Board to vote
on the Restructuring proposal.
The Ad Hoc Committee is committed to expeditiously completing the
Restructuring as described in Exhibit A, and strongly encourages the Board to
reject the Sale Alternative and move forward with the Restructuring.
Sincerely yours,
The Ad Hoc Committee of Preferred Shareholders
<PAGE>
AIG - Soundshore Partners Camden Asset Management
By: Andrew W. Gitlin By: /s/ Cheryl Suzuki
---------------- -----------------
Its: Director Its: Operations
---------------- --------------------
Forest Investment Management Highbridge Capital LLC
By: /s/ Michael A. Boyd By: Highbridge Capital
Management LLC
------------------- -----------------
Its: Chairman By: Richard Potapchuk
------------------- -----------------
Its: Managing Director
-----------------
Inverness Management LLC Loeb Partners Corp.
By: /s/ James Comis By: /s/ Robert Grubin
--------------- -----------------
Managing Director
Its: ___________________ Its:------------------
Paloma Securities LLC Q Investments, LP
By: /s/ Michael J. Berner By: /s/ Geoffrey Raynor
--------------------- -------------------
Its: Executive Vice President Its: Partner
------------------------ -------
Steadfast Financial LLC Vicuna Advisors LLC
By: /s/ Andrew Foote By: /s/ Josh Welch
---------------- ---------------------
Its: ___________________ Its: Managing Partner
----------------
W.G. Trading /s/ William M. McCormick
------------------------
William M. McCormick
By: /s/ John Bello
--------------
Its: Risk Manager
--------------------
Paloma Strategic Securities Limited
By: /s/ Michael J. Bermer
---------------------
Its: Attorney-in-Fact
---------------------
<PAGE>
PENNCORP FINANCIAL GROUP, INC. SUMMARY OF TERMS
AND CONDITIONS FOR PROPOSED
RECAPITALIZATION
Purpose: To recapitalize PennCorp Financial Group, Inc.
("PFG," and together with its subsidiaries, the
"Company") such that the Company may, at a
minimum, retain its current A.M. Best rating that
is necessary to maintain its current distribution
systems.
Methodology: Reduction of the Company's obligations with
respect to its outstanding preferred stock (by
reclassification into Units (as described below)
consisting of a new series of preferred stock and
common stock) and reduction of the Company's
obligations with respect to indebtedness for
borrowed money to a level at which the Company's
pro forma EBITDA after consummation of the
recapitalization and the sale of Pioneer Security
Life Insurance Company and its subsidiaries (the
"Waco Companies") will provide the coverage ratios
necessary to, at a minimum, retain its current
A.M. Best rating. Based on the Company's projected
EBITDA following the recapitalization, the maximum
debt capacity of the Company following the
recapitalization and the sale of the Waco
Companies is agreed to be $110 million.
Target Consummation Date: May 31, 2000.
Senior Debt: The Company's existing senior credit facility,
including accrued and unpaid interest, will be
repaid.
Subordinated Debt: The Company will offer to purchase all of the
existing $114.6 million principal amount of 9.25%
Senior Subordinated Notes (the "Notes") at a
purchase price equal to 98% of the principal
amount thereof, plus accrued and unpaid interest.
The offer to purchase the Notes would close
simultaneously with the closing of the
recapitalization. Any Notes not tendered pursuant
to the offer to purchase would remain outstanding
following the recapitalization.
<PAGE>
Reclassification/Conversion
of Preferred Stock: In the event that the approval of at least two-
thirds of the outstanding shares of common stock
and the approval of at least two-thirds of the
outstanding shares of PFG's $3.375 Convertible
Preferred Stock (the "Series I Preferred Stock")
and $3.50 Series II Convertible Preferred Stock
(the "Series II Preferred Stock," and together
with the Series I Preferred Stock, the "Preferred
Stock") is obtained, the recapitalization will be
effected by an amendment to PFG's charter.
Pursuant to the charter amendment, each
outstanding share of Preferred Stock will be
reclassified (the "Preferred Stock
Reclassification") into a unit (a "Preferred
Unit") consisting of (i) a share of new PFG
preferred stock with the terms described below
("New Preferred Stock") and (ii) 1.0 shares of
post-recapitalization common stock of PFG.
In the event that the approval of at least two-
thirds of the shares of the Preferred Stock is
obtained, but only a majority (but not two-thirds)
of the outstanding shares of common stock is
obtained, the recapitalization will be effected by
a merger (the "Merger"). Pursuant to the Merger,
each outstanding share of Preferred Stock will be
converted into a Preferred Unit.
In the case of either the Preferred Stock
Reclassification or the Merger, the shares of
common stock of PFG to be issued to the existing
holders of the Preferred Stock will represent
73.3% of the post-recapitalization common stock of
PFG.
Reverse Split/Conversion
of Common Stock: If the recapitalization is effected by a charter
amendment, upon the effectiveness of the amendment
each existing share of PFG's common stock will be
reclassified by means of a one-for-ten reverse
stock split (the "Reverse Stock Split").
Additionally, on consummation of the
recapitalization each existing holder of PFG
common stock will receive a warrant with the terms
described below (the "Warrants") to purchase PFG's
post-recapitalization common stock.
If the recapitalization is effected through the
Merger, on consummation of the Merger each
existing share of PFG's common stock will be
converted into a share of post-recapitalization
common stock of PFG (representing approximately
one-tenth of a share of pre-recapitalization
common stock) and a Warrant.
<PAGE>
In either case, the shares of PFG common stock
held by existing holders of common stock will
represent 26.7% of the post-recapitalization
common stock of PFG.
Sale of the Waco Companies: The Company will cause its subsidiary, American-
Amicable Holdings Corporation ("American-
Amicable"), to sell the stock of the Waco
Companies for net cash proceeds of at least $102
million. This transaction will be consummated as
soon as practicable, notwithstanding the timing of
the consummation of the recapitalization.
Merger of SLT and SW Life: Prior to the recapitalization, Security Life and
Trust Insurance Company will be merged with and
into Southwestern Life Insurance Company ("SW
Life").
Reinsurance: SW Life will reinsure substantially all of its
existing annuity blocks of business.
New Credit Facility: In connection with the recapitalization, the
Company will enter into a new $110 million
revolving senior credit facility (the "New Senior
Facility"), of which approximately $90 million
would be drawn upon consummation of the
recapitalization.
Extraordinary Dividend: As part of the recapitalization, SW Life will
request approval from the Texas Department of
Insurance for the payment of an extraordinary
dividend of approximately $75 million (the
"Extraordinary Dividend"). Prior to the payment of
the Extraordinary Dividend, the outstanding notes
issued by American-Amicable will be repaid, the
outstanding preferred stock of Southwestern
Financial Corp. will be removed from SW Life, and
the reserves of SW Life will be strengthened by
$10 million. In no event will the Extraordinary
Dividend be paid in an amount that would cause the
Risk Based Capital Ratio of SW Life to be less
than 300%.
Preferred Unit Offering: The Company will make a $35 million offering of
Preferred Units (the "Unit Offering") to all
holders of the Preferred Stock and the Company's
common stock. The holders of the Preferred Stock
will have the right to subscribe for approximately
73% of the Units subject to the Unit Offering, and
the holders of the common stock will have the
right to subscribe for approximately 27% of the
Units subject to the Unit Offering. The Unit
Offering will be conducted and will remain open
during the same period as the proxy solicitation
<PAGE>
for the charter amendment to effect the Preferred
Stock Reclassification and the Reverse Stock Split
(or the Merger) and will close simultaneously with
such transactions.
The right to purchase Units offered in the Units
Offering will be detachable and transferable and
will have an oversubscription privilege for only
the existing holders of common stock, pursuant to
which such holders will have the right to
oversubscribe for Units not purchased by other
existing holders of common stock. The holders of
Preferred Stock will not have the right to
oversubscribe, and any Preferred Units not
purchased by holders of Preferred Stock and common
stock will be purchased by Inverness pursuant to
its Standby Commitment as described below. The
purchase price for each Preferred Unit will be
$12.50 (the "Rights Offering Price").
Standby Underwriting
Commitment: Inverness Management LLC ("Inverness") will
execute and deliver to the Company a binding
agreement pursuant to which Inverness will commit
to fully underwrite the Unit Offering (the
"Standby Commitment") at a price equal to the
Rights Offering Price. The Company will pay
Inverness an underwriting commitment fee of
$1,361,000 (5% of $27,227,000) on the Standby
Commitment in cash at closing.
Warrants: Number of Shares: The Warrants will be
exercisable, in the aggregate, for approximately
10% of PFG's post-recapitalization common stock.
Exercise Price: $30 per share.
Exercise Period: The Warrants will be immediately
exercisable upon issuance and will remain
exercisable for a period of ten years.
New Preferred Stock: Liquidation Preference: $20.00 per share (the
"Stated Value"), plus accrued and unpaid
dividends.
Dividends: The New Preferred Stock will initially
earn cumulative dividends at the rate of 8.0% per
annum on the sum of the Stated Value plus unpaid
dividends which accrued in prior semi-annual
periods. Dividends will not be paid in cash except
as described below.
<PAGE>
Reset: Upon a change of control of the Company,
the initial dividend rate will be reset to the
lesser of (A) the rate that in the opinion of an
investment banking firm reasonably acceptable to
the Company would be necessary to cause each share
of New Preferred Stock to "trade" at its
liquidation preference, or (B) 20% per annum.
After the reset, future dividends would become
payable in cash.
Voting: Each share will be entitled to one vote
and will vote together with shares of PFG's common
stock.
Redemption: The Company will have the right to
redeem the New Preferred Stock, in whole or in
part, after the first anniversary of issuance
thereof at the following redemption prices:
if redeemed after the first anniversary, but prior
to the second anniversary, then at 107.5% of the
liquidation preference;
if redeemed after the second anniversary, but
prior to the third anniversary, then at 105.0% of
the liquidation preference;
if redeemed after the third anniversary, but prior
to the fourth anniversary, then at 102.5% of the
liquidation preference; and
if redeemed after the fourth anniversary, then at
100% of the liquidation preference.
Management Incentive Plan/
Executive Compensation: Approximately 7% of the post-recapitalization
common stock of PFG and $5,000,000 of New
Preferred Stock will be reserved for issuance to
the Company's post-recapitalization officers and
directors. Prior to the closing of the
recapitalization, the Company will not increase
the compensation of its officers or directors,
except in the ordinary course of business.
Proxy Statement/Prospectus: Because the Preferred Stock Reclassification and
the Reverse Stock Split/1/ (or the Merger) will
require the approval of the holders of PFG's
common stock and the Preferred Stock, it will be
necessary to file a proxy statement with the SEC.
- --------------
/1/ In the event that it is determined to effect a "quasi-reorganization," the
approval of the holders of the Company's common stock will be required.
<PAGE>
This proxy statement will be combined with a
prospectus for the registration of (i) the New
Preferred Stock to be issued in connection with
the Preferred Stock Reclassification (or the
Merger); (ii) the common stock to be issued in
connection with the Preferred Stock
Reclassification (or the Merger); (iii) the
Warrants to be issued to the existing holders of
PFG's common stock; (iv) the New Preferred Stock
underlying the Units to be offered in the Unit
Offering or pursuant to the Standby Commitment;
and (v) the new common stock underlying the Units
to be offered in the Unit Offering or pursuant to
the Standby Commitment. See "Registration/Listing"
below. The Company will distribute the proxy
statement/prospectus to the holders of the common
stock and the Preferred Stock and will hold a
special stockholders meeting to vote on the
Preferred Stock Reclassification and the Reverse
Stock Split (or the Merger). Also see "Chapter 11
"Prepackaged" Alternative."
Registration/Listing: Rule 145 under the Securities Act of 1933, as
amended (the "Securities Act"), requires the New
Preferred Stock and the common stock to be issued
in connection with the Preferred Stock
Reclassification (or the Merger) to be registered
under the Securities Act. In addition, the Company
will register the Warrants to be issued to the
existing holders of PFG's common stock and the New
Preferred Stock and the common stock underlying
the Units to be offered in the Unit Offering or
pursuant to the Standby Commitment. The Company
will apply for the listing of the New Preferred
Stock and the common stock to be issued in the
Preferred Stock Reclassification (or the Merger),
the Warrants to be issued to the existing holders
of PFG's common stock, and the New Preferred Stock
and the common stock underlying the Units to be
offered in the Unit Offering or pursuant to the
Standby Commitment on the NYSE or NASDAQ, assuming
the Company is able to meet the applicable listing
requirements at such time.
Chapter 11 "Prepackaged"
Alternative: To encourage the common stockholders of the
Company to vote in favor of the recapitalization,
the proxy statement/prospectus will provide that
if neither the amendment to the charter nor the
Merger is approved by the requisite vote of the
holders of the common stock, the votes of the
holders of the Preferred Stock accepting the
Preferred Stock Reclassification (or the Merger)
will constitute the votes of the holders of the
Preferred Stock accepting a
<PAGE>
"prepackaged" chapter 11 plan of reorganization
that may be filed by the Company, in its sole
discretion, providing for the implementation of
the contemplated recapitalization modified to
provide for the existing common stock to be
cancelled and the holders of existing common stock
being "crammed down" (i.e., receiving nothing,
including any right to acquire Warrants or Units
pursuant to the Unit Offering)./2/
Settlement of
Class Action Lawsuit: Not later than the consummation of the
recapitalization (or in the event that
the recapitalization occurs in a
"prepackaged" chapter 11 case, then
prior to the commencement of the chapter
11 case), the pending class action
lawsuit (the "Class Action Suit")
involving certain of the Company's
common stockholders and certain holders
of the Notes would be settled as
contemplated for $1.5 million, plus
interest.
Conditions to the
Effectiveness of Term Sheet: This term sheet will become effective upon
satisfaction of each of the following conditions
(or waiver by the Company and the holders of
Preferred Stock): (i) approval of the transactions
contemplated by this term sheet by the Board of
Directors of the Company; (ii) the execution by
holders of at least 66 2/3% of the outstanding
shares of Preferred Stock (voting together as a
single class) of a letter agreement pursuant to
which such holders agree to support and vote in
favor of the transactions contemplated by this
term sheet (and waive any appraisal rights to
which they would be entitled); (iii) the receipt
by the Company of the Standby Commitment described
above under the heading "Standby Underwriting
Commitment"; (iv) the receipt by the Company of
preliminary indications of support reasonably
acceptable to the Company and Inverness from A.M.
Best and the Texas Department of Insurance
regarding the transactions contemplated by this
term sheet, which for purposes of this term sheet
will mean, with respect to A.M. Best, that the
Company does not receive from A.M. Best an
indication that A.M. Best intends to downgrade the
rating of SW Life in connection with the
recapitalization, and will mean, with
- ---------------
/2/ In the event that the recapitalization occurs in a "prepackaged" chapter 11
case, the right of holders of common stock to acquire 30% of the Units offered
in the Unit Offering will be eliminated (and any election by a holder of common
stock would be automatically rescinded) and such right will accrue to Inverness
under its Standby Commitment.
<PAGE>
respect to the Texas Department of Insurance, that
the Company receives an indication from the Texas
Department of Insurance that the Extraordinary
Dividend will be approved; and (v) the receipt by
the Company of a commitment letter from a
financial institution reasonably acceptable to the
Company relating to the New Senior Facility.
Conditions to the
Consummation of the
Recapitalization: The consummation of the recapitalization is
subject to the satisfaction (or waiver by the
Company and holders of Preferred Stock) of each of
the following conditions: (i) the New Senior
Facility shall have been funded; (ii) the Class
Action Suit shall have been settled as
contemplated; (iii) the pre-recapitalization
transactions shall have been completed as
contemplated, including the payment by SW Life of
the Extraordinary Dividend; (iv) the Company shall
have consummated the sale of the Waco Companies;
(v) all regulatory approvals necessary for the
recapitalization and the transactions contemplated
thereby shall have been received; (vi) the Company
shall have received the proceeds from the Unit
Offering and/or the Standby Commitment; (vii) the
necessary parties shall have executed definitive
binding documentation embodying all of the
transactions contemplated by and/or related to the
recapitalization, including, without limitation,
mutually agreeable releases in favor of all of the
directors and officers of PFG and its subsidiaries
fully and unconditionally releasing such directors
and officers from any and all liabilities arising
prior to or in connection with the
recapitalization, with customary exclusions;
(viii) the board of directors of PFG shall not
have terminated the recapitalization in response
to a superior proposal; (ix) the Company shall
have agreed to maintain for a period of six years
following the consummation of the recapitalization
(A) the existing provisions in its Certificate of
Incorporation relating to exculpation and
indemnification of its current officers and
directors (or such lesser indemnification if the
law is more restrictive) and (B) officers' and
directors' liability insurance covering the
current officers and directors of the Company on
substantially the same terms as the Company's
current policy; provided, however, that the
Company shall not be obligated to maintain such
coverage to the extent such coverage costs two
times the cost of the Company's current coverage
(which in such case
<PAGE>
the Company shall only be obligated to provide as
much coverage as can be obtained by paying two
times the cost of the Company's current coverage);
(x) the Company shall have reimbursed Inverness
and the Ad Hoc Committee of holders of Preferred
Stock for their expenses incurred in connection
with the recapitalization; and (xi) the Company
shall have received the requisite approval of the
holders of the Preferred Stock and its common
stock, or, in the event the "prepackaged" chapter
11 case is commenced by the Company, an order
confirming the plan of reorganization that
incorporates the transactions described herein
shall have been entered and such order shall be
unstayed and in effect.
<PAGE>
EXHIBIT G
AGREEMENT RE JOINT FILING OF
SCHEDULE 13D
------------
The undersigned hereby agrees as follows:
(i) Each of them is individually eligible to use the Schedule 13D to
which this Exhibit is attached, and such Schedule 13D is filed on behalf of each
of them; and
(ii) Each of them is responsible for the timely filing of such
Schedule 13D and any amendments thereto, and for the completeness and accuracy
of the information concerning such person contained therein; but none of them is
responsible for the completeness or accuracy of the information concerning the
other persons making the filing, unless such person knows or has reason to
believe that such information is inaccurate.
Dated: December 27, 1999
BROWN'S DOCK, L.L.C.
By: /s/ James C. Comis III
----------------------------------
Print Name: James C. Comis III
Its: Managing Director
INVERNESS/PHOENIX PARTNERS LP
By: Inverness/Phoenix Capital LLC,
Its: General Partner
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
-----------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
<PAGE>
EXECUTIVE CAPITAL PARTNERS I LP
By: Inverness/Phoenix Capital LLC,
Its: General Partner
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
-----------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
INVERNESS/PHOENIX CAPITAL LLC
By: Inverness Management Fund I LLC
Its: Managing Member
By: WMD LLC
Its: General Partner
By: /s/ W. McComb Dunwoody
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Print Name: W. McComb Dunwoody
Its: Managing Member
DCPM HOLDINGS, INC.
By: /s/ Michael E. Haylon
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Print Name: Michael E. Haylon
Its: Vice-President
PHOENIX HOME LIFE MUTUAL
INSURANCE COMPANY
By: /s/ John H. Beers
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Print Name: John H. Beers
Its: Vice-President
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PHOENIX INVESTMENT PARTNERS, LTD.
By: /s/ Michael E. Haylon
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Print Name: Michael E. Haylon
Its: Executive Vice-President
INVERNESS MANAGEMENT FUND I LLC
By: WMD LLC, its General Partner
By: /s/ W. McComb Dunwoody
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Print Name: W. McComb Dunwoody
Its: Managing Member
WMD LLC
By: /s/ W. McComb Dunwoody
-----------------------------
Print Name: W. McComb Dunwoody
Its: Managing Member
J.C. COMIS LLC
By: /s/ James C. Comis III
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Print Name: James C. Comis III
Its: Managing Member
/s/ W. McComb Dunwoody
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W. McComb Dunwoody
/s/ James C. Comis III
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James C. Comis III
