Phoenix solicits consents for 7.45% bonds to avoid covenant breach

By Tali Rackner

Minneapolis, Jan. 23 - Phoenix Cos., Inc. began a consent solicitation on Jan. 22 to amend the terms of the indenture for its 7.45% quarterly interest bonds due 2032, according to an 8-K filing with the Securities and Exchange Commission.

The solicitation will expire at 5 p.m. ET on Feb. 20.

The company previously announced that it wants to extend the date for providing the third-quarter 2012 Form 10-Q, its 2012 annual report on Form 10-K, its first-, second- and third-quarter 2013 10-Qs, its 2013 annual 10-Ks and its first-, second- and third-quarter 2014 10-Qs to the trustee to March 16, 2015, and it needs the consent of holders representing a majority in principal amount of the bonds to do so.

According to an earlier company announcement, Phoenix is restating its financial statements for prior periods and, as a result, delayed filing its 2012 third-quarter 10-Q, 2013 first-, second- and third-quarter 10-Qs with the SEC. The company also announced its announced inability to file the 2013 10-K and one or more of the 2014 10-Q on a timely basis.

Because of the delays, the trustee for the securities sent a notice of default initiating the 60-day cure period under the indenture. The company is seeking to remedy this covenant violation through the amendment.

Phoenix said it will pay consenting holders a consent fee of $0.0625 per $25 principal amount of bonds.

Holders of record as of 5 p.m. ET on Jan. 22 are eligible to participate.

Hartford-based Phoenix is a boutique life insurance and annuity company.

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