Unum 2014 Annual Report Download - page 73

UNUM • 2014 ANNUAL REPORT 71
During 2015, we intend to maintain a level of capital in our U.S. and U.K. insurance subsidiaries above the applicable capital adequacy
requirements and minimum solvency margins. Although we may not utilize the entire amount of available dividends, based on applicable
restrictions under current law, approximately $605 million is available, without prior approval by regulatory authorities, during 2015 for the
payment of dividends from our traditional U.S. insurance subsidiaries, which excludes our captive reinsurers. Approximately £167 million is
available for the payment of dividends from Unum Limited during 2015, subject to regulatory approval.
Insurance regulatory restrictions do not limit the amount of dividends available for distribution from non-insurance subsidiaries
except where the non-insurance subsidiaries are held directly or indirectly by an insurance subsidiary and only indirectly by Unum Group.
Funding for Employee Benefit Plans
We made contributions of approximately $65.1 million and £3.1 million to our U.S. and U.K. defined contribution plans, respectively,
in 2014. We expect to make contributions of approximately $68.9 million and £4.6 million during 2015. We contribute to our U.K. defined
benefit pension plan sufficient to meet the minimum funding requirement under U.K. legislation and accordingly made required contributions
of £1.4 million to our U.K. defined benefit pension plan during 2014. We do not expect to make contributions in 2015 to our U.K. defined
benefit pension plan. We made no contributions to our U.S. qualified defined benefit pension plan during 2014, nor do we expect to make
any contributions during 2015. We have met all minimum pension funding requirements set forth by the Employee Retirement Income
Security Act. We have estimated our future funding requirements under the Pension Protection Act of 2006 and under applicable U.K. law,
and do not believe that any future funding requirements will cause a material adverse effect on our liquidity. See Note 9 of the “Notes to
Consolidated Financial Statements” contained herein for further discussion of our employee benefit plans.
Debt
There are no significant financial covenants associated with any of our outstanding debt obligations. We continually monitor our
compliance with our debt covenants and remain in compliance. We have not observed any current trends that would cause a breach
of any debt covenants.
Purchases and Retirement of Debt
In 2014, we purchased and retired $145.0 million principal of our outstanding 6.85% notes, including a make-whole amount of
$13.2 million, for a total cost of $158.2 million.
In 2013, we purchased and retired the outstanding principal of $62.5 million on the floating rate, senior secured non-recourse
notes issued by Tailwind Holdings, resulting in a before-tax gain of $4.0 million. During 2012, Tailwind Holdings made principal payments
of $10.0 million.
Northwind Holdings made principal payments on its floating rate, senior secured notes of $41.6 million in 2014 and $60.0 million
in both 2013 and 2012.
Issuance of Debt
In 2014, we issued $350.0 million of unsecured 10-year senior notes in a public offering. These notes, due 2024, bear interest at a
fixed rate of 4.00% and are payable semi-annually. The notes are callable at or above par and rank equally in right of payment with all
of our other unsecured and unsubordinated debt.
In 2012, we issued $250.0 million of unsecured senior notes in a public offering. These notes, due 2042, bear interest at a fixed rate
of 5.75% and are payable semi-annually. The notes are callable at or above par and rank equally in right of payment with all of our other
unsecured and unsubordinated debt.