SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 21, 2001
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UICI
(Exact name of registrant as specified in its charter)
Delaware 001-14953 75-2044750
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(State or other jurisdiction (Commission File (IRS Employer
of incorporation or organization) Number) Identification No.)
4001 McEwen Drive, Suite 200, Dallas, Texas 75244
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (972) 392-6700
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Not Applicable
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(Former name or former address, if changed since last report)
Item 5. OTHER EVENTS
Settlement of Shareholder Derivative Litigation
On December 21, 2001, the District Court of Dallas County,
Texas, approved the terms of a Settlement Agreement and Mutual Release
between UICI ("UICI" or the "Company") and each of Richard J. Estell,
Vernon Woelke, J. Michael Jaynes, Gary L. Friedman, John E. Allen,
Charles T. Prater, Richard T. Mockler, and Robert B. Vlach
(collectively, the "Individual Defendants"), on the one hand, and
Richard Schappel and Mr. Schappel's counsel, on the other hand.
Pursuant to the Settlement Agreement, the parties reached agreement
with respect to the payment of attorneys' fees and expenses on
termination of the shareholder derivative action captioned Richard
Schappel v. UICI, Ronald Jensen, Richard Estell, Vernon Woelke, J.
Michael Jaynes, Gary Friedman, John Allen, Charles T. Prater, Richard
Mockler and Robert B. Vlach (the "Shareholder Derivative Litigation"),
which was initially filed in June 1999. The Court also entered a
Modified Final Judgment in the case, vacating certain findings of fact
that formed a part of an earlier ruling by the Court rendered on
October 14, 2001.
The Settlement Agreement and the Modified Final Judgment have
the effect of fully and finally resolving the matters in dispute in the
Shareholder Derivative Litigation between UICI and the Individual
Defendants, on the one hand, and Mr. Schappel, on the other hand. The
terms of the settlement will not have a material effect on the results
of operations or financial condition of UICI.
Ronald L. Jensen (the Chairman of the Company and a defendant
in the Shareholder Derivative Litigation) is not a party to the
Settlement Agreement. In its earlier judgment rendered on October 14,
2001, the Court found that certain statements made by plaintiff in the
pleadings in the case were "groundless, false and brought for the
purpose of harassment and with the intent to cause harm to or injure"
Mr. Jensen and UICI, for which the plaintiff was ordered to pay to Mr.
Jensen $5,000 as a judicial sanction in accordance with Texas law. The
plaintiff retains the right to appeal, and Mr. Jensen retains the right
to defend, that ruling in the Shareholder Derivative Litigation.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
None
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.
UICI
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(Registrant)
Date December 26, 2001. By /s/ Matthew R. Cassell
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Matthew R. Cassell
Vice President and Chief
Financial Officer