8-KMaterial AgreementsFinancial EventsRegulation FD+1

CINCINNATI FINANCIAL CORP 8-K Report, Material Agreement (Jun 2, 2005)

Filed June 2, 2005For Securities:CINF

Summary

Cincinnati Financial Corporation (CINF) filed an 8-K on June 2, 2005, primarily detailing the establishment of a new 364-day credit agreement and providing updates through several press releases. The company secured a $50 million unsecured line of credit from Fifth Third Bank, which will be available for general corporate purposes. Notably, CINF holds a significant beneficial ownership stake (approximately 13%) in Fifth Third Bancorp, the parent of the lender, and the credit transaction was conducted on an arm's length basis. In addition to the credit agreement, the filing incorporates by reference three press releases. These include the declaration of a regular quarterly cash dividend, an announcement of CINF's participation in the Sandler O’Neill & Partners 2005 Financial Services Conference, and news regarding the appointment of a new Delaware agency to represent The Cincinnati Insurance Company. Investors should note the continued commitment to shareholder returns through the quarterly dividend and the company's active engagement with the financial community.

Key Highlights

  • 1Established a $50 million, 364-day unsecured line of credit with Fifth Third Bank for general corporate purposes.
  • 2The credit agreement includes a subsidiary, CFC Investment Company, as a borrower.
  • 3The interest rate on the credit line is tied to Fifth Third Bank's base rate or 0.50% above the federal funds rate, whichever is higher.
  • 4Cincinnati Financial Corporation owns approximately 13% of Fifth Third Bancorp, the parent of the lender, with the transaction being arm's length.
  • 5Announced a regular quarterly cash dividend declaration.
  • 6Scheduled to present at the Sandler O’Neill & Partners 2005 Financial Services Conference.
  • 7The Cincinnati Insurance Company appointed a new Delaware agency.

Frequently Asked Questions

The primary financial event is the establishment of a $50 million, 364-day unsecured line of credit by Cincinnati Financial Corporation from Fifth Third Bank. This line of credit is intended for general corporate purposes.

While Cincinnati Financial Corporation (CINF) has a significant ownership stake (approximately 13%) in Fifth Third Bancorp, the parent of Fifth Third Bank (the lender), the filing states that the credit transaction was effected on an arm's length basis, suggesting it was conducted under normal market conditions.

The filing also incorporates by reference several press releases. These include the declaration of a regular quarterly cash dividend, an upcoming presentation at a financial services conference, and an update on agency appointments for The Cincinnati Insurance Company.

The credit agreement is for $50 million, is unsecured, and has a maturity of 364 days, expiring on May 30, 2006. Interest accrues at the higher of Fifth Third Bank's announced base rate or 0.50% above the federal funds rate, calculated on a 365/366-day basis.