UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 2, 2020 (April 2, 2020)
 
STATE AUTO FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter)
 
Ohio
 
000-19289
 
31-1324304
(State or other jurisdiction of
incorporation or organization)
 
(Commission File Number)
 
(I.R.S. Employer
Identification No.)
 
 
 
 
 
518 East Broad Street, Columbus, Ohio
 
43215-3976
(Address of principal executive offices)
 
(Zip Code)
 
 
 
Registrant’s telephone number, including area code: (614) 464-5000
Not Applicable
(Former name or former address, if changed since last report.)
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2)
Emerging growth company
o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol
Name of each exchange on which registered
Common shares, without par value
STFC
The NASDAQ Global Select Market
 






Section 1.
 
Registrant's Business and Operations
 
Item 1.01
 
Entry into a Material definitive Agreement.
State Auto Property & Casualty Insurance Company (the “ Company ” or “ State Auto P&C ”), a wholly owned insurance subsidiary of State Auto Financial Corporation (“ State Auto Financial ”),has an existing Blanket Security Agreement dated February 15, 2013, with the Federal Home Loan Bank of Cincinnati (the "FHLB") under which the Company can elect various forms of financing. On April 2, 2020, the Company entered into an Open Line of Credit Commitment (the "2020 OLC") with the FHLB providing State Auto P&C with a $100.0 million one-year open line of credit available for general corporate purposes. Draws under the 2020 OLC are to be funded with a daily variable rate advance with a term of no more than 180 days with interest payable monthly. All advances under the 2020 OLC are to be fully secured by a pledge of specific investment securities of State Auto P&C. The terms of the 2020 OLC are identical to the Company’s previous Open Line of Credit Commitment with the FHLB which expired on April 2, 2020.
The 2020 OLC is undrawn as of the date of this Current Report on Form 8-K.
Section 2.
 
Financial Information
 
Item 2.03
 
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Information concerning State Auto P&C’s 2020 OLC is set forth in Item 1.01, which information is incorporated herein by reference.
Section 9.
 
Financial Statements and Exhibits
Item 9.01.
 
Financial Statements and Exhibits
(d)
Exhibits.
 
See Exhibit Index




EXHIBIT INDEX
Exhibit No.
 
Description of Exhibit
 
Open Line of Credit dated as of April 2, 2020, between State Auto Property & Casualty and Federal Home Loan Bank of Cincinnati.





SIGNATURES

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 hereunto duly authorized.

 
STATE AUTO FINANCIAL CORPORATION
 
 
Date: April 2, 2020
/s/ Melissa A. Centers
 
Senior Vice President, Secretary and General Counsel





Ex. 10.01
^
FHLB
CINCINNATI
                                    

OPEN LINE OF CREDIT APPLICATION
Email: CreditOperations@fhlbcin.com
Phone: 800-828-4191 Fax: 513-852-5747

D.D.A. #    389001    Date: 04/02/2020

Pursuant to the BLANKET SECURITY AGREEMENT ("Agreement") and the RESOLUTION FOR ADVANCES ("Resolution") currently on file with the Federal Home Loan Bank of Cincinnati ("Bank"), the undersigned, who by the authority of the Member's Board of Directors are authorized to borrow from time to time under the "Agreement", hereby apply for an Open Line of Credit Commitment ("OLC"), to mature twelve months after approval of this application, in the amount of $100,000,000 PROVIDED, however, that if the Member is in default under the terms of the "Agreement" or any other agreement with the Bank, which default is not waived by the Bank, such funds need not be made available by the Bank hereunder. In addition, the Bank will not be obligated to fund commitments for Advances previously made to Members who become tangible capital insolvent or if the Bank is notified by the Members primary regulator or insurer that the Member has been restricted from using Federal Home Loan Bank Advances.

COMMITMENT FEE: A non-refundable fee of 10 basis points of the amount of line approved by the Bank will be charged at the time the commitment is issued.

This OLC is subject to the following terms and conditions:

1.
The OLC is a guarantee funds only commitment (optional takedown).

2.
Draws under the OLC will be funded with a daily variable rate Advance with a term of no more than 180 days.

3.
Interest Calculation:The interest on the Advance is calculated on the opening balance on an actual/360 basis and will be charged monthly to the member's DOA.

4.
Notification to draw funds must be made prior to 12:00 noon, Eastern Standard Time, on the day funding is requested.

5.
No prepayment fee will be assessed for early termination of any Advance drawn against the OLC.

6.
This commitment is subject to the requirements detailed in the Bank's Credit Policy and Collateral Guide, in effect at the time of issuance of the commitment, with which the Borrower acknowledges it is fully familiar, as well as any subsequent amendments of such Credit Policy and Collateral Guide.





State Auto Property & Casualty Insurance Co.
Columbus, Ohio
(FHLB Member)
(City, State)
/s/ Michael E. LaRocco
/s/ Steven E. English
(Authorized Signature)
(Authorized Signature)
Michael E. LaRocco
Steven E. English
(Typed Name of Authorized Signature)
(Typed Name of Authorized Signature)

APPLICATION REQUIRES TWO SIGNATURES OF INDIVIDUALS AUTHORIZED BY THE RESOLUTION FOR ADVANCES ON FILE WITH THE BANK.
By signing above, the member certifies, (A. That this application has not been modified from its original terms as provided by the Bank) and (B. This application complies with and is subject to the Bank's Credit Policy terms in effect at the time of application).

The Bank reserves the right to suspend or modify the advance commitment options at any time. Immediate funding may be available If application is received prior to 3:00 P.M., Eastern Standard Time. (Revised July 2016)