10-K/A 1 f10ka3.txt FORM 10K/A - 3 - BITUMINOUS 401(K) SAVINGS PLAN As in effect 3/1/61 FORM 10K/A -------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 -------------------- AMENDMENT TO APPLICATION OR REPORT Filed Pursuant to Sections 12, 13, or 15 (d) of THE SECURITIES EXCHANGE ACT OF 1934 OLD REPUBLIC INTERNATIONAL CORPORATION -------------------------------------------------------------------------------- (Exact name of registrant as specified in charter) AMENDMENT NO. 3 --- The undersigned registrant hereby amends the following items, financial statements, exhibits or other portions of its ANNUAL REPORT FOR 2002 on Form ------------------- 10-K as set forth in the pages attached hereto: (List all such items, financial ---- statements, exhibits or other portions amended) FORM 11-K Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. OLD REPUBLIC INTERNATIONAL CORPORATION -------------------------------------- (Registrant) Date: May 5, 2003 By: /s/ John S. Adams ----------- ----------------------------------- (Signature) John S. Adams Senior Vice President and Chief Financial Officer Total Pages: 12 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 --------------- FORM 11-K --------------- ANNUAL REPORT Pursuant to Section 15(d) of the Securities Exchange Act of 1934 For The Years Ended December 31, 2002 and 2001 --------------- BITUMINOUS 401(k) SAVINGS PLAN (Formerly Known as BITCO Savings Plan) --------------- OLD REPUBLIC INTERNATIONAL CORPORATION 307 NORTH MICHIGAN AVE CHICAGO, ILLINOIS 60601 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Committee Members have duly caused this annual report to be signed on behalf of the undersigned, thereunto duly authorized. BITUMINOUS 401(K) SAVINGS PLAN, Registrant By /s/ Greg Ator ------------------------------------- Greg Ator, Committee Member By /s/ Janine Happ ------------------------------------- Janine Happ, Committee Member By /s/ Robert Rainey ------------------------------------- Robert Rainey, Committee Member Dated: April 15, 2003 BITUMINOUS 401(k) SAVINGS PLAN Index to Financial Statements Page No. Report of Independent Accountants 1 Financial Statements: Statements of Net Assets Available for Benefits at December 31, 2002 and 2001 2 Statements of Changes in Net Assets Available for Benefits for the years ended December 31, 2002 and 2001 3 Notes to Financial Statements 4 - 7 Supplemental Schedule: Schedule of Assets (Held at End of Year) 8 Report of Independent Accountants To the Participants and Administrator of the Bituminous 401(k) Savings Plan: In our opinion, the accompanying statements of net assets available for benefits and the related statements of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Bituminous 401(k) Savings Plan (the "Plan") at December 31, 2002 and 2001, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. 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 of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets (held at end of year) 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. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audit 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. /s/ PricewaterhouseCoopers, LLP April 4, 2003 Chicago, Illinois BITUMINOUS 401(k) SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS December 31, 2002 and 2001 2002 2001 ---- ---- ASSETS Investments, at fair value: Old Republic International Corporation (ORI) common stock $4,935,427 $ 5,643,446 Pooled separate accounts 9,751,089 9,820,081 Participant loans 306,128 309,172 ----------- ----------- 14,992,644 15,772,699 Cash - 1,082 ----------- ----------- Net assets available for benefits $14,992,644 $15,773,781 =========== ===========
The accompanying notes are an integral part of these financial statements. 2 BITUMINOUS 401(k) SAVINGS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS For the years ended December 31, 2002 and 2001 2002 2001 ---- ---- Additions: Contributions: Employer $192,123 $187,223 Employee 1,004,889 931,048 Rollover 16,946 444,510 ----------- ----------- Total contributions 1,213,958 1,562,781 ----------- ----------- Investment income (loss): Dividends from ORI common stock 117,816 131,557 Net investment loss from pooled separate accounts (1,355,807) (474,465) Net appreciation (depreciation) of the ORI stock account 68,038 (1,003,903) Interest from participant loans 23,855 23,333 ----------- ----------- Total investment loss (1,146,098) (1,323,478) ----------- ----------- Other income: Total other income - 45 ----------- ----------- Total additions 67,860 239,348 ----------- ----------- Deductions: Benefits paid to participants 833,969 901,456 Administrative expenses 8,841 9,986 Participant loans 6,186 6,039 ----------- ----------- Total deductions 848,996 917,481 ----------- ----------- Net decrease (781,136) (678,133) Net assets available for benefits: Beginning of year 15,773,781 16,451,914 ----------- ----------- End of year $14,992,644 $15,773,781 =========== ===========
The accompanying notes are an integral part of these financial statements. 3 BITUMINOUS 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 1. Description of Plan The following description of the Bituminous 401(k) Savings Plan (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. A. General The Plan is a defined contribution plan covering substantially all of the employees of Bituminous Casualty Corporation (the "Company"), who prior to October 1, 1997, had completed one year of service, attained age twenty-one and had completed 1,000 hours of service during the 12 month period commencing on their date of hire or during a plan year. Subsequent to October 1, 1997, employees are eligible to participate in the plan on the last to occur: (A) date of hire or (B) the start of the payroll period in which the employee attains age twenty-one. Participation in the Plan is optional. If an employee does not elect to join the Plan on the first date he/she is eligible to do so, he/she may join the plan at the start of any subsequent payroll period. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA), as amended. B. Contributions Participants may contribute up to 9 percent of their annual compensation on a before-tax basis. The Company provides a matching contribution equal to 25 percent of the participant's contribution on the first 6 percent of earnings. Participants may elect to have their voluntary contributions invested in any one or more of the ten Pooled Separate Accounts as well as the ORI Stock Account. C. Participant Accounts Each participant's account is credited with the participant's contributions, an allocation of the Company's contribution and Plan earnings. The Pooled Separate Accounts are each divided into units of participation. When an amount is allocated or transferred to the Pooled Separate Accounts, the number of units is increased and when an amount is withdrawn from the Pooled Separate Accounts, the number of units is decreased. Such increase or decrease in the number of units is determined by dividing the amount allocated to or withdrawn from the Pooled Separate Accounts by the then current Pooled Separate Account unit value. Cash dividends received with respect to Old Republic International Corporation stock previously credited to participants shall be applied to purchase additional shares of Old Republic International Corporation stock in the ORI Stock Account. Such dividends and the additional shares (including fractional shares) subsequently purchased with the dividends shall be allocated and credited to the accounts of participants, pro rata, according to the shares (including fractional shares) credited to the accounts of participants on the applicable dividend record date. Any Old Republic International Corporation stock received as a stock split or stock dividend or as a result of a reorganization or recapitalization of Old Republic International Corporation shall be allocated and credited to the accounts of participants in proportion to the Old Republic International Corporation stock previously credited to their accounts. 4 BITUMINOUS 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 1. Description of Plan (continued) D. Vesting Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Participants are immediately vested in the remainder of their accounts upon death, disability, attainment of normal retirement age or based on the participant's number of years of service using the following table for the years ended December 31, 2002 and 2001: Years of Service Vested Percentage 2002 2001 Fewer than 1 0% 0% 1 10% 10% 2 20% 20% 3 40% 30% 4 60% 40% 5 80% 60% 6 100% 80% 7 or More 100% 100% E. Payment of Benefits On termination of service, retirement, or death, a participant or his/her beneficiary may elect to leave funds in the Plan or receive either a single-sum payment or purchase of a single premium life annuity contract. Net assets at December 31, 2002 and 2001, include funds totaling $2,599,793 and $1,890,724, respectively, which represent the account balance of retired and terminated participants who have elected to leave the funds in the Plan upon retirement or termination. F. Forfeitures All forfeitures are segregated annually. At that time, forfeitures are used as an offset to the Company's matching contribution. There were unallocated assets of $14,708 and $7,098 at December 31, 2002 and 2001, respectively, related to these forfeitures. G. Participant Loans Participants may elect to borrow from their accounts a maximum amount equal to the lesser of $50,000 or 50% of their vested account balance. Loan transactions are treated as a transfer to (from) the investment account from (to) the Participant Loans account. Loan terms shall not extend beyond five years. The loans are secured by the balance in the participant's account and bear interest at a rate which is based on the prevailing prime rate as published in The Wall Street Journal on the first business day of the month in which the loan is made plus one percentage point. Interest rates range from 5.25 percent to 10.50 percent. Principal and interest is paid ratably through bi-weekly payroll deductions. H. Administrative Expenses It is the policy of the Company to provide administrative support for the Plan and to pay for certain administrative and trustee fees. 5 BITUMINOUS 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 2. Summary of Significant Accounting Policies A. Basis of Accounting The accompanying financial statements have been prepared on the accrual basis of accounting. The Plan presents in the statements of changes in net assets available for benefits the net appreciation (depreciation) in the fair value of the ORI Stock Account, which consists of realized gains or losses and the unrealized appreciation (depreciation) of this investment. B. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of net assets available for benefits and disclosures of contingent assets and liabilities at the date of the financial statements and the changes in net assets available for benefits during the reporting period. Actual results could differ from those estimates. C. Risks and Uncertainties The Plan provides for various investment options in any combination of stocks, bonds, fixed income securities, mutual funds, and other investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is possible that changes in risks in the near term could materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits and the statements of changes in net assets available for benefits. D. Investments Old Republic International Corporation stock is stated at the closing market value on the last business day of the year. The Plan has a group annuity contract with Connecticut General Life Insurance Company (CGLIC), where CGLIC maintains contributions in a contract holder's account and such contributions are allocated to ten Pooled Separate investment funds according to participant elections. The accounts are credited with earnings on the underlying investments and charged for Plan benefits paid and deductions for investment expenses, risk, profit and annual management fees charged by CGLIC. The Pooled Separate Accounts are included in the financial statements at fair value at December 31, 2002 and 2001, as reported to the Plan by CGLIC. Realized investment gains and losses in the separate investment funds are recognized in the year of sale. 6 BITUMINOUS 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 3. Assets Greater Than 5% of Plan Assets Investments that represent 5% or more of plan assets at December 31, 2002 and 2001, are as follows: December 31, 2002 2001 ---- ---- S&P 500 Index $1,137,295 $1,343,841 Timessquare Short-term Bond Fund 3,391,837 3,067,389 Balanced 1 Wellington Management Fund 1,309,991 1,493,716 Large Cap Value John A. Levin & Co. Fund 1,045,037 1,183,050 ORI Stock Account 4,935,427 5,643,446 4. Tax Status The Internal Revenue Service has issued a determination letter, dated May 29, 2002, stating that the Plan is designed in accordance with applicable sections of the Internal Revenue Code (IRC). The Plan has been amended since receiving the determination letter. However, the Plan's Committee Members still believe that the Plan is designed and is currently being operated in compliance with the applicable requirements of the IRC. 5. Plan Termination Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contribution at any time and to terminate the Plan subject to the provisions of ERISA. In the event of plan termination, participants shall become 100 percent vested in their accounts and are entitled to a distribution of their account balances. 6. Related-Party Transactions The ORI stock account is invested in common or preferred stock of Old Republic International Corporation, the ultimate parent of the Company. 7. Plan Amendments Effective, July 5, 2001, participants could transfer any or all of their company matching account balance into any of the available investment options. Company matching contributions are invested the same as participant investment elections for their contributions. In addition, the ORI Stock Account is available as an investment election for employee contributions. Prior to July 5, 2001, participants' company match contributions were invested entirely in the ORI Stock Account. 7 BITUMINOUS 401(K) SAVINGS PLAN SUPPLEMENTAL SCHEDULE SCHEDULE H, LINE 4I SCHEDULE OF ASSETS (HELD AT END OF YEAR) Description of investment Contract/ Identity of issue including interest rate current value ----------------- ------------------------- ---------------- S&P 500 Index Pooled separate account $1,137,295 Timessquare Short-term Pooled separate account 3,391,837 Bond Fund Balanced I Pooled separate account 1,309,991 Wellington Management Fund Large Cap Growth Pooled separate account 422,393 Goldman Sachs Fund Large Cap Value Pooled separate account 1,045,037 John A. Levin & Co. Fund Small Cap Value Pooled separate account 714,747 Berger Fund Small Cap Growth Pooled separate account 480,276 Timessquare Fund Global Value Pooled separate account 199,806 Morgan Stanley Fund State Street Global Advisor Pooled separate account 536,625 Interm Bond Invesco Dynamics Pooled separate account 513,082 ORI Stock Account Common stock 4,935,427 Participant loans, interest rates range from 5.25% to 10.50% 306,128 ----------- Total assets held for investment purposes $14,992,644 ===========
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