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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
[X] FORM 10-Q
For the quarterly period ended: September 30, 1999
Commission file number: 001-12294
Part I. - Registrant Information
ARM FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 61-1244251
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
515 WEST MARKET STREET
LOUISVILLE, KENTUCKY 40202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (502) 582-7900
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Part II-Rules 12b-25 (b) and (c)
If the subject report could not be filed without unreasonable effort or
expense and the registrant seeks relief pursuant to Rule 12b-25(b), the
following should be completed. (Check box if appropriate)
(a) The reasons described in reasonable detail in Part III of this
form could not be eliminated without unreasonable effort or
expense; [x]
(b) The subject annual report, semi-annual report, transaction report
on Form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof,
will be filed on or before the fifteenth calendar day following
the prescribed due date; or the subject quarterly report or
transition report on Form 10-Q, or portion thereof, will be filed
on or before the fifth calendar day following the prescribed due
date; and [x]
(c) The accountant's statement or other exhibit required by Rule
12b-25 (c) has been attached if applicable. [ ]
Part III--Narrative
State below in reasonable detail the reasons why Form 10-K and Form 10-KSB,
20-F, 11-K, 10-Q and Form 10-QSB, N-SAR, or the transition report or portion
thereof, could not be filed within the prescribed period.
ARM Financial Group, Inc. (the "Company") has devoted substantial resources
towards significant transactions which include restructuring its institutional
business and positioning its retail business and technology operations for the
sale of the Company. Under normal circumstances, many of these same resources
would be devoted to preparation of the Company's Form 10-Q. The Company would
not be able to devote sufficient resources towards progress on the significant
transactions and file the Company's Form 10-Q by the date required without
unreasonable effort or expense.
Part IV--Other Information
(1) Name and telephone number of person to contact in regard to this
notification.
Edward L. Zeman, Executive Vice President and Chief Financial Officer
(502) 582-7957
(2) Have all other periodic reports required under section 13 or 15 (d) of
the Securities Exchange Act of 1934 or section 30 of the Investment
Company Act of 1940 during the preceding 12 months or for such shorter
period that the registrant was required to file such report(s) been
filed? If the answer is no, identify report(s).
[x] Yes [ ] No
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(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be
reflected by the earnings statements to be included in the subject
report or portion thereof?
[x] Yes [ ] No
If so: attach an explanation of the anticipated change, both narratively
and quantitatively, and, if appropriate, state the reasons why a reasonable
estimate of the results cannot be made.
When filed, the Company's Form 10-Q for the quarterly period ended
September 30, 1999 will show a significant loss for the quarter and nine month
period there ended. The net loss will primarily be related to a loss of $48.2
million and $193.0 million for the three and nine months ended September 30,
1999, respectively, on the Company's discontinued institutional business.
During July 1999, the Company announced that it was restructuring its
institutional business and positioning its retail business and technology
operations for the sale of the Company. As part of the institutional
restructuring, on August 3, 1999, the Company and General American completed a
transaction whereby General American recaptured approximately $3.4 billion of
assets and related liabilities previously ceded through a reinsurance agreement
to one of the Company's insurance subsidiaries, Integrity Life Insurance Company
("Integrity") (the "Transaction"). The Transaction, which terminated the
reinsurance and related agreements, including a marketing partnership agreement,
was effective as of July 26, 1999. These assets and related liabilities were
part of a joint product development, marketing and reinsurance relationship with
General American involving funding agreements and guaranteed investment
contracts. As a result of the Transaction, the Company recorded a charge of $90
million during the second quarter of 1999.
By October 15, 1999, the Company reached settlement agreements with its
remaining three institutional clients. Pursuant to these settlement agreements,
the parties agreed to transactions (collectively, the "Termination
Transactions") whereby all of the liabilities of the Company's institutional
business with these remaining three clients were terminated and discharged
subject only to certain payment obligations. The Company recorded a
$47.3 million charge during the third quarter of 1999 as a result of the
Termination Transactions.
Regardless of whether the Company is able to find a suitable buyer for
its insurance subsidiaries or its businesses or assets or receive an infusion of
capital from an investor or investors, the holding company is likely to cease
doing business as a going concern. Even in the event of a sale of the Company's
insurance subsidiaries, the Company is most likely to liquidate its other assets
rather than seek new business initiatives without its insurance subsidiaries.
Accordingly, the Company is considering all of the options available to it,
including a bankruptcy filing at the holding company level. Depending upon
whether a potential sale occurs or not, and depending upon the amount of the
proceeds of any potential sale, there can be no assurance that the Company is or
will be solvent or will be able to avoid a voluntary or involuntary Chapter 11
or Chapter 7 proceeding under federal bankruptcy law.
On November 15, 1999, the Company secured an extension of the maturity date
for the $38 million note payable to General American to November 29, 1999.
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ARM Financial Group, Inc.
Has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized, on November 15, 1999.
By: /s/ EDWARD L. ZEMAN
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Edward L. Zeman
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
