-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, r4gHjwkhmVefG2ARDDmfKmWeUAaKUiVfqzou0Uu8o9mq03qRZuykFBvgG17Skl2R e3cDL6g0KAYAQIkDgnLopA== 0000719241-94-000033.txt : 19940706 0000719241-94-000033.hdr.sgml : 19940706 ACCESSION NUMBER: 0000719241-94-000033 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19931231 FILED AS OF DATE: 19940629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSECO INC CENTRAL INDEX KEY: 0000719241 STANDARD INDUSTRIAL CLASSIFICATION: 6311 IRS NUMBER: 351468632 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09250 FILM NUMBER: 94537037 BUSINESS ADDRESS: STREET 1: 11825 N PENNSYLVANIA ST CITY: CARMEL STATE: IN ZIP: 46032 BUSINESS PHONE: 3175736100 FORMER COMPANY: FORMER CONFORMED NAME: SECURITY NATIONAL OF INDIANA CORP DATE OF NAME CHANGE: 19840207 11-K 1 CONSECOSAVE FORM 11-K 12-31-93 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 11-K [ X ] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] FOR THE FISCAL YEAR ENDED December 31, 1993 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM TO Commission file number: 0-11164 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: CONSECOSAVE PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive offices: Conseco, Inc. 11825 North Pennsylvania Street Carmel, Indiana 46032 2 CONSECOSSAVE PLAN INDEX a) Financial Statements Report of Independent Accountants 3 Statement of Net Assets Available for Plan Benefits - December 31, 1993 and 1992 4 Statement of Changes in Net Assets Available for Plan Benefits For the Years ended December 31, 1993 and 1992 5 Notes to Financial Statements 6 Schedule of Reportable Transactions 11 b) Exhibit 23 Consent of Independent Accountants 3 REPORT OF INDEPENDENT ACCOUNTANTS To the Plan Trustees ConsecoSave Plan Carmel, Indiana We have audited the accompanying statement of net assets available for plan benefits of the ConsecoSave Plan (the "Plan") as of December 31, 1993 and 1992, and the related statement of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan as of December 31, 1993 and 1992, and the changes in net assets available for plan benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of reportable transactions for the year ended December 31, 1993, is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. Indianapolis, Indiana Coopers & Lybrand June 28, 1994 4 CONSECOSAVE PLAN STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS December 31, 1993 and 1992
1993 1992 ---- ---- Assets: Investments: Investments in ConsecoSave Trust portfolios at market value: Corporate Bond Portfolio (cost $3,025,335) $3,041,766 $ - Interest Income Portfolio (cost $1,416,055) 1,416,055 - Equity Portfolio (cost $440,349) 450,900 - Money Market Portfolio (cost $218,834) 218,834 - Government Securities Portfolio (cost $100,937) 100,634 - Conseco Stock Portfolio (cost $1,832,586) 3,829,173 - CCP Stock Portfolio (cost $109,075) 134,465 - ---------- ---------- Subtotal 9,191,827 - ---------- ---------- Common stocks at market value (cost $962,921) - 2,367,870 Corporate bonds at market value (cost $1,906,075) - 1,873,415 Short term investments at cost - 924,000 Guaranteed interest contract at accumulated contract value - 867,822 ---------- ---------- Total investments 9,191,827 6,033,107 ---------- ---------- Cash and cash equivalents - (203) Employer contribution receivable 310,760 371,574 Accrued investment income - 31,637 ---------- ---------- Total assets 9,502,587 6,436,115 Liabilities: Custodial fees payable - 506 ---------- ---------- Net assets available for plan benefits $9,502,587 $6,435,609 ========== ========== The accompanying notes are an integral part of these financial statements.
5 CONSECOSAVE PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS For the Years Ended December 31, 1993 and 1992
1993 1992 ---- ---- Additions: Employee contributions $2,260,288 $1,265,891 Employer contributions 310,760 1,105,944 Interest and dividends 329,104 212,329 Net appreciation in market value of plan investments 1,019,124 1,389,911 ---------- ---------- Total additions 3,919,276 3,974,075 ---------- ---------- Deductions: Benefits paid 848,336 244,079 Custodial fees 3,962 8,443 ---------- ---------- Total deductions 852,298 252,522 ---------- ---------- Net increase in net assets available for plan benefits 3,066,978 3,721,553 Net assets available for plan benefits, beginning of year 6,435,609 2,714,056 ---------- ---------- Net assets available for plan benefits, end of year $9,502,587 $6,435,609 ========== ========== The accompanying notes are an integral part of these financial statements.
6 CONSECOSAVE PLAN NOTES TO FINANCIAL STATEMENTS 1. Summary of Significant Accounting Policies The financial statements of the ConsecoSave Plan (the "Plan") have been prepared in accordance with generally accepted accounting principles. Investments The Plan provides the following seven investment options for voluntary employee contributions: Corporate Bond Portfolio, Interest Income Portfolio, Equity Portfolio, Money Market Portfolio, Government Securities Portfolio, Conseco Stock Portfolio, and CCP Stock Portfolio. Employer contributions are invested solely in the common stock of Conseco. The Plan's investments are maintained either in a separate account of Bankers National Life Insurance Company ("BNL"), a wholly-owned subsidiary of the Plan sponsor, Conseco, Inc. ("Conseco") or are held by the Trustees of the Plan (in the case of affiliated stock portfolios). Investments in each portfolio are valued on the last business day of the New York Stock Exchange each month, with the exception of regional business holidays. The cost of investments sold is determined on the specific identification basis. Investment transactions are accounted for on the settlement date. The Corporate Bond Portfolio invests in investment-grade and high-yield corporate bonds. Securities for which representative market quotes are readily available are valued at the mid-day mean between the bid and ask prices as quoted by one or more dealers who make a market in such securities. For securities not actively traded, the estimated fair values are determined using values obtained from independent pricing services. The Interest Income Portfolio invests in six guaranteed interest contracts issued by affiliated life insurance companies. These contracts are carried at their accumulated contract values, which are cost adjusted for interest credited (at a blended rate of 6.81 percent and at 7.25 percent at December 31, 1993 and 1992, respectively). The contracts by affiliated company and interest rate are as follows: Bankers National Life Insurance Company 6.90% Beneficial Standard Life Insurance Company 7.05% Great American Reserve Insurance Company 6.90% Jefferson National Life Insurance Company 6.90% Western National Life Insurance Company 7.25% Western National Life Insurance Company 7.05%
The Equity Portfolio invests in selected equity securities and other securities having the investment characteristics of common stocks. The equity portion of the portfolio is widely diversified by both industry and number of issuers. Investment opportunities are sought among securities of larger, established companies, although securities of smaller, less well known companies may also be selected. Equity securities traded on a national securities exchange are valued at their closing market prices. Fixed income securities for which representative market quotes are readily available are valued at the mid-day mean between the bid and ask prices as quoted by one or more dealers who make a market in such securities. For fixed income securities not actively traded, the estimated fair values are determined using values obtained from independent pricing services. 7 CONSECOSAVE PLAN NOTES TO FINANCIAL STATEMENTS, CONTINUED 1. Summary of Significant Accounting Policies - continued The Money Market Portfolio invests in money market instruments maturing within one year, with an average maturity of 120 days or less. Such investments are carried at amortized cost which approximates market value. The Government Securities Portfolio invests in securities issued by the U.S. Government or an agency or instrumentality of the U.S. Government, including mortgage-backed securities. The U.S. Government securities which may be purchased include direct obligations issued by the U. S. Treasury, such as Treasury Bills, certificates of indebtedness, notes and bonds. Securities for which representative market quotes are readily available are valued at the mid-day mean between the bid and ask prices as quoted by one or more dealers who make a market in such securities. For securities not actively traded, the estimated fair values are determined using values obtained from independent pricing services. Short term investments are carried at amortized cost which approximates market value. The Conseco Stock Portfolio invests in the common stock of Conseco only. The return is based on changes in the market value of Conseco common stock and dividends received, which are reinvested in Conseco common stock. The Conseco common stock is valued at its closing market price. The CCP Stock Portfolio invests in the common stock of CCP Insurance, Inc. ("CCP") only. The return is based on changes in the market value of CCP common stock and dividends received, which are reinvested in CCP common stock. The CCP common stock is valued at its closing market price. The net appreciation in the market value of plan investments consists of net realized gains and losses and the net change in unrealized appreciation on those investments. Administrative Expenses Operating expenses and maintenance fees incurred during the years ended December 31, 1993 and 1992, except for investment custodial fees, were paid by BNL on behalf of the Plan. Future payment of such expenses by BNL is at Conseco's discretion. Income Taxes Under Sections 401(a) and 501(a), respectively, of the Internal Revenue Code, the Plan is qualified and the ConsecoSave Trust, a collective trust, established under the Plan is tax-exempt. 8 CONSECOSAVE PLAN NOTES TO FINANCIAL STATEMENTS, CONTINUED 2. Plan Description The Plan is a defined contribution plan pursuant to Section 401(k) of the Internal Revenue Code. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Established April 1, 1989, and amended and restated on January 1, 1993, the Plan includes all employees of Conseco and its subsidiaries (other than employees of Bankers Life Holding Corporation) who have completed six consecutive months of service. Participation is voluntary and may begin on the first day of any calendar quarter. Employee contributions to the Plan are made through periodic payroll deductions in increments of 1.0 percent of the participant's annual earnings, not to exceed the lesser of 15.0 percent of the participant's annual earnings or the maximum amount specified by federal tax law ($8,994 and $8,728 for 1993 and 1992, respectively, for pre-tax contributions). Participants designate the portfolios to which their contributions are made. Payroll deductions may be made on a pre-tax and after-tax basis. Participants must contribute at least 4.0 percent pre-tax in order to make concurrent after-tax contributions. Prior to 1993, participants could contribute up to 6.0 percent of annual earnings on a pre-tax basis only. Conseco matches 50.0 percent of each participant's contribution up to a maximum of 4.0 percent of the participant's annual earnings. Additional amounts may be contributed by Conseco at the option of Conseco's Board of Directors. In February 1992, in honor of Conseco's tenth anniversary, Conseco contributed ten shares of Conseco stock to the Plan for each employee of Conseco whether participating in the Plan or not. Participant accounts were established for all nonparticipating employees to hold these ten shares. All Conseco contributions are made to the Conseco Stock Portfolio, which invests solely in Conseco common stock. Such contributions are made no later than the due date for filing Conseco's federal income tax return, including extensions. Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Participants are fully vested in Conseco's contributions after five years of service. The non-vested interests of withdrawn participants (forfeitures) are used to reduce Conseco's future contributions. All benefits under the Plan are paid in cash in a lump sum, whole shares of Conseco or CCP common stock, or a combination of both. A participant may make withdrawals after age 59 1/2, and under certain circumstances, early hardship withdrawals and after-tax withdrawals. Portfolio transfers are allowed quarterly in 5 percent increments. Effective January 1, 1993, loan provisions were added to the plan whereby participants may obtain temporary tax-free loans from the vested portion of their accounts, excluding employer contributions in Conseco stock, without any tax penalty. Repayment of both principal and interest is made to the participant's account via payroll deduction. Loans may be obtained for up to 50.0 percent of the vested balance to a maximum of $50,000. Only one loan may be outstanding at a time. 9 CONSECOSAVE PLAN NOTES TO FINANCIAL STATEMENTS, CONTINUED 2. Plan Description - continued The Plan is administered by the Plan Administrator, who is appointed by Conseco's Board of Directors and who establishes rules and procedures necessary for the Plan's operations. Although it has not expressed any intent to do so, Conseco has the right to terminate the Plan. In the event the Plan is terminated, each participant's account shall be nonforfeitable with respect to both the participant's and employer's contributions and the net assets shall be set aside for payment to the participants. The foregoing description of the Plan provides only limited information. Participants should refer to the Summary Plan Description for a more complete description of the Plan's provisions. 10 CONSECOSAVE PLAN NOTES TO FINANCIAL STATEMENTS, CONTINUED 3. Allocation of Changes in Net Assets Available for Plan Benefits: The allocation of the activity shown in the Statement of Changes in Net Assets Available for Plan Benefits for the year ended December 31, 1993, to each fund, was as follows:
Corporate Interest Money Government Conseco CCP Bond Income Equity Market Securities Stock Stock Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Total --------- --------- --------- --------- --------- --------- --------- ----- Additions: Employee contributions $ 951,916 $ 517,217 $276,020 $ 55,646 $ 59,610 $ 300,601 $ 99,278 $2,260,288 Employer contributions - - - - - 310,760 - 310,760 Interest and dividends 227,404 64,864 3,140 8,714 2,167 22,324 491 329,104 Net appreciation in market value of plan investments 272,136 - 6,899 - 1,267 713,432 25,390 1,019,124 ---------- ---------- -------- -------- -------- ---------- -------- ---------- Total additions 1,451,456 582,081 286,059 64,360 63,044 1,347,117 125,159 3,919,276 ---------- ---------- -------- -------- -------- ---------- -------- ---------- Deductions: Benefits paid 312,360 267,061 (2,219) 21,308 (5,334) 230,973 24,187 848,336 Custodial fees 3,406 7 84 177 27 151 110 3,962 ---------- ---------- -------- -------- -------- ---------- -------- ---------- Total deductions 315,766 267,068 (2,135) 21,485 (5,307) 231,124 24,297 852,298 ---------- ---------- -------- -------- -------- ---------- -------- ---------- Employee transfers in (out) (683,799) 233,220 162,706 (60,988) 32,283 282,975 33,603 - ---------- ---------- -------- -------- -------- ---------- -------- ---------- Net increase (decrease) in net assets available for plan benefits 451,891 548,233 450,900 (18,113) 100,634 1,398,968 134,465 3,066,978 Net assets available for plan benefits, beginning of year 2,589,875 867,822 - 236,947 - 2,740,965 - 6,435,609 ---------- ---------- -------- -------- -------- ---------- -------- ---------- Net assets available for plan benefits, end of year $3,041,766 $1,416,055 $450,900 $218,834 $100,634 $4,139,933 $134,465 $9,502,587 ========== ========== ======== ======== ======== ========== ======== ==========
11 CONSECOSAVE PLAN ITEM 27 (D) - SCHEDULE OF REPORTABLE TRANSACTIONS For the Year Ended December 31, 1993
Current Expenses Value of Identity Description Number Incurred Cost Asset on of Party of of Purchase Selling with of Transaction Gain Employee Involved Transactions Transactions Price Price Transaction Asset Date (Loss) Withdrawal -------- ------------ ------------ ----- ----- ----------- ----- ---- ------ ---------- ConsesoSave ConsecoSave Corporate Trust Bond Portfolio 46 $1,040,664 $ - $ - $1,040,664 $1,040,664 $ - $ - ConsesoSave ConsecoSave Interest Trust Income Portfolio 46 884,639 - - 884,639 884,639 - - ConsesoSave ConsecoSave Equity Trust Portfolio 46 455,314 - - 455,314 455,314 - - ConsesoSave ConsecoSave Conseco Trust Stock Portfolio 46 590,228 - - 590,228 590,228 - - Various Employee Withdrawals 28 - - - - 848,336 - 848,336 ConsesoSave ConsecoSave Corporate Trust Bond Portfolio 28 - 772,547 - - 772,547 - -
12 CONSECOSAVE PLAN SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the Plan has duly caused this annual report to be signed by the undersigned thereunto duly authorized. CONSECOSAVE PLAN Dated: June 28, 1994 By: ROLLIN M. DICK ------------------------ Rollin M. Dick, Trustee EX-23 2 EXHIBIT 23 CONSECOSAVE FORM 11-K 12/31/93 1 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statements of Conseco, Inc. on Form S-8 (File Nos. 33-40556, 33-58710 and 33- 58712) of our report dated June 28, 1994, on our audits of the financial statements and financial statement schedule of the ConsecoSave Plan as of December 31, 1993 and 1992, and for the year then ended, which report is included in this Annual Report on Form 11-K. Coopers & Lybrand Indianapolis, Indiana June 28, 1994 -----END PRIVACY-ENHANCED MESSAGE-----