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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-1
(AMENDMENT NO. 2)
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
ALLIED LIFE FINANCIAL CORPORATION
(NAME OF SUBJECT COMPANY)
NATIONWIDE LIFE ACQUISITION CORPORATION
NATIONWIDE MUTUAL INSURANCE COMPANY
(Bidders)
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
019246107
(CUSIP Number of Class of Securities)
W. SIDNEY DRUEN
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
NATIONWIDE MUTUAL INSURANCE COMPANY
ONE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215
TELEPHONE: (614) 249-7111
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
WITH A COPY TO:
ERIC M. FOGEL, ESQ.
HAROLD W. NATIONS, ESQ.
HOLLEB & COFF
55 E. MONROE STREET, SUITE 4100
CHICAGO, ILLINOIS 60603
TELEPHONE: (312) 807-4600
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This Amendment No. 2 amends and supplements the Tender Offer Statement
on Schedule 14D-1 initially filed on June 10, 1998 (as amended, the "Schedule
14D-1") with the Securities and Exchange Commission by Nationwide Life
Acquisition Corporation ("Purchaser"), an Ohio corporation and a wholly owned
subsidiary of Nationwide Mutual Insurance Company ("Parent"), an Ohio mutual
insurance company, to purchase all outstanding shares of common stock, no par
value (the "Common Shares"), of Allied Life Financial Corporation, an Iowa
corporation, at a price of $30.00 per Common Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase dated June 10, 1998 (the "Offer to Purchase") and the
Letter of Transmittal (which, together with any amendments or supplements
thereto, constitutes the "Offer"). Capitalized terms used and not defined herein
shall have the meanings assigned such terms in the Offer to Purchase or the
Schedule 14D-1.
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ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a) (11) Third set of "Nationwide answers your Hotline
questions."
(a) (12) Fourth set of "Nationwide answers your Hotline
questions."
(a) (13) Fifth set of "Nationwide answers your Hotline
questions."
(a) (14) Letter to participants in the Allied Life Financial
Corporation Employee Stock Ownership Plan.
(a) (15) Sixth set of "Nationwide answers your Hotline
questions."
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SIGNATURE
After due inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: August 24, 1998
NATIONWIDE MUTUAL INSURANCE COMPANY
By: /s/ David A. Diamond
-------------------------------
Name: David A. Diamond
Title: Vice President - Enterprise Controller
NATIONWIDE LIFE ACQUISITION CORPORATION
By: /s/ Mark B. Koogler
-------------------------------
Name: Mark B. Koogler
Title: Vice President - Associate General Counsel
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EXHIBIT INDEX
(a)(11) Third set of "Nationwide answers your Hotline
questions."
(a)(12) Fourth set of "Nationwide answers your Hotline
questions."
(a)(13) Fifth set of "Nationwide answers your Hotline
questions."
(a)(14) Letter to participants in the Allied Life Financial
Corporation Employee Stock Ownership Plan.
(a)(15) Sixth set of "Nationwide answers your Hotline
questions."
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EXHIBIT (a)(11)
NATIONWIDE ANSWERS YOUR HOTLINE QUESTIONS
HOTLINE: 1-877-655-6417
July 8, 1998
Below are the answers to the latest Hotline Questions. Most questions
continue to deal with human resource policies and benefits. Answers reflect the
human resource policies and benefit plan provisions that generally apply to most
Nationwide Insurance Enterprise employees. You should not assume that Nationwide
human resource policies or benefit plans would automatically apply to you as you
continue employment with ALLIED. To date, no final plan has been completed
concerning benefit changes. Your ALLIED benefit plans and current policies will
generally continue through 1998.
We will provide updates of the status of the transition review, and you
will certainly be informed of any changes in human resource policies or benefits
well in advance of the time when you would be asked to make decisions or
elections.
Later in 1998, we expect Nationwide benefits representatives to be on site
to review the programs that will apply.
Q#1: WILL SALARIES REMAIN THE SAME?
Our transition plan calls for current salary programs to remain in
place for at least one year. Salary administration practices will be
developed in conjunction with other transition issues that exist
between Nationwide and ALLIED.
Q#2: WILL SICK TIME BE ROLLED OVER TO NEXT YEAR? WHAT IS THE SHORT-TERM
DISABILITY PLAN THAT CAN BE USED FOR MATERNITY LEAVE?
REGARDING SICK TIME CARRY OVER. WHAT HAPPENS TO THOSE DAYS WHEN THE
MERGER IS COMPLETE? IF NOT THE SAME TYPE OF PLAN, WILL WE BE
COMPENSATED FOR ANY UNUSED SICK TIME AT THAT POINT?
Nationwide sponsors a different sick leave program for Enterprise
employees. For the remainder of 1998, the current ALLIED sick leave
program will continue to apply and your ALLIED service will continue to
be recognized for eligibility and benefits purposes.
The major difference between ALLIED and Nationwide sick leave programs
is that Nationwide's plan is not an accrual based program. Instead, it
provides an annual sick leave award, provisions for partial sick leave
benefits and no limitations for pre-existing conditions. Nationwide
does not offer a sick leave carry over provision since there is a new
award every year.
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Q#3: DOES NATIONWIDE OFFER REIMBURSEMENT FOR MILITARY LEAVE?
Nationwide generally pays the difference between the pay you receive
for military service and your regular salary for training duty up to 10
days each year.
Q#4: THE 401(k) DIFFERS FROM THE DEFINED BENEFIT PLAN. WE NEED HIGHLIGHTS OF
THE DEFINED PLAN.
The Nationwide Insurance Enterprise Retirement Plan (NIERP) is a
tax-qualified, final average pay, defined benefit pension plan. The
companies currently pay for all benefits. Benefits accrue in the NIERP
based on service and compensation. Benefits can start as early as age
55 or they can be delayed until normal retirement date or longer. NIERP
benefits are in addition to Social Security.
Q#5: I AM A NEW ALLLIED EMPLOYEE, AND LIKE MANY OTHERS WHO WERE AT THE
JANUARY TRAINING SCHOOL, THE CHANCES OF HAVING A YEAR OF EMPLOYMENT
BEFORE THE NATIONWIDE TAKEOVER ARE RELATIVELY SLIM (I WAS HIRED
12/30/97). WITH ALLIED, I AM ELIGIBLE TO PARTICIPATE IN THE ESOP ON
JANUARY 1999, BUT IF THE TAKEOVER HAPPENS BEFORE MY FIRST YEAR OF
SERVICE IS UP, DOES THAT MEAN I HAVE TO WAIT UNTIL JANUARY 2000 TO BE
ELIGIBLE TO PARTICIPATE IN THE NATIONWIDE RETIREMENT PROGRAM?
No. If the Nationwide Insurance Enterprise Retirement Plan (NIERP) is
adopted for ALLIED employees, your past service with ALLIED will be
counted in determining whether you have met the one-year of service
eligibility requirement.
Q#6: DOES THE 401(k) PLAN CHANGE EVERY TIME YOU MAKE A CHANGE TO YOUR PLAN?
IF SO, HOW MUCH? IS THERE A CERTAIN PERCENTAGE OF SALARY BEFORE
NATIONWIDE WILL MATCH CONTRIBUTIONS? IS THERE A CAP TO THE PERCENTAGE
THAT NATIONWIDE MATCHES?
Enterprise employees are paid biweekly. Participants can change their
deferral percentage every payday. In 1998, participants can defer 1% to
22% of covered compensation, to a maximum of $10,000.
The plan also includes a company matching contribution of 70% on a
participant's deferral of 2% of covered compensation. So, participants
who defer 6% of covered compensation received a company matching
contribution of 3% of covered compensation (.7 x .02) + (.4 x .04).
Covered compensation includes most items of pay such as regular salary,
bonus, overtime, etc. The maximum covered compensation for calendar
year 1998 is $160,000.
Participants control the investment of both their deferrals and
the company matching contributions. Assets can be invested among 15
fund options. Those options include some Nationwide funds, some
publicly traded Nationwide mutual funds, and a number of funds
sponsored by other mutual fund companies-including Dreyfus, Fidelity,
Templeton and others. Participants can redirect where future
contributions are allocated every payday-26 times a year. Participants
can redirect existing assets every day the New York Stock Exchange and
Nationwide are open for business--approximately 250 times a year.
Each investment option has an asset management fee. Participants
pay no brokers' fees or commissions.
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Q#7: DOES NATIONWIDE HAVE AN EMPLOYEE STOCK PURCHASE PLAN AVAILABLE FOR
EMPLOYEES TO PURCHASE STOCK THROUGH THE COMPANY AND A DISCOUNT OF ANY
NATURE?
No. However, we have designed a program that will offer Nationwide
Financial Services, Inc. common stock through a payroll deduction
program. Our application is pending regulatory approval.
Q#8: DOES NATIONWIDE OFFER TRIPS TO ANNUAL MEETINGS AND CONFERMENTS? FOR HOW
LONG AND WHICH TRIP WILL BE AVAILABLE?
Yes. Enterprise employees are generally eligible for the Nationwide
Insurance Enterprise Educational Assistance Plan. For example, employees
who complete a CPCU designation are eligible to attend the respective
society's next Annual Meeting to receive their designation in person.
Reasonable expenses for hotel, meals and transportation are paid for the
employees and one guest to attend the Annual Meeting.
Q#9: ALLIED ALLOWS US TO BUY A WEEK OF VACATION. WILL WE BE ABLE TO DO THIS?
Nationwide Insurance Enterprise human resources policies currently
provide to each supervisor the authority to approve up to a two-week
absence. This vacation is "purchased" as a period of unpaid time off.
The current ALLIED vacation provisions will continue to apply through
year-end 1998.
Q#10: WHAT IS MEANT BY PERSONAL TIME OFF SCHEDULES?
Personal time includes vacation, personal days, family illness days,
medical leave, absences for jury duty, funeral and military leave.
Q#11: WHAT IS GOING TO HAPPEN TO ALLIED GROUP MORTGAGE COMPANY?
As reported elsewhere, Nationwide's current intention is to continue to
grow the ALLIED operations. However, we are not aware that any decisions
have been made with respect to specific business units.
3
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Exhibit (a)(12)
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NATIONWIDE ANSWERS YOUR QUESTIONS
NATIONWIDE HOTLINE: 1-877-655-6417
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JULY 22, 1998
Q#1: WHAT IS THE NATIONWIDE SICK-LEAVE PROGRAM? WILL THERE BY ANY COMPENSATION
ON ACCUMULATED SICK LEAVE HOURS OR WILL THE HOURS BE ROLLED OVER TO NEXT
YEAR?
The Nationwide sick leave program is not an accrual based plan. Instead,
sick leave benefits are awarded on July 1 of each calendar year. The award
is based on service according to the following schedule:
If you Weeks Paid Weeks Paid
Have Been at 100% of Base at 80% of Base
Employed Salary Salary
-------- ------ ------
Less than 1 year 1 --
1 year, less than 2 1 4
2 years, less than 3 2 8
3 years, less than 4 3 12
4 years, less than 5 4 16
5 years or more 5 20
Your ALLIED sick leave and Long Term Disability benefits will continue
through 12-31-98. No decisions have been made concerning future sick leave
and Long Term Disability benefits. We will provide employees with enough
time to make informed benefits decisions.
Should the Nationwide schedule be adopted, the award will be based on
combined ALLIED and Nationwide service without any carryover of unused
ALLIED sick leave accruals.
Q#2: WILL NATIONWIDE'S MEDICAL COVERAGE BE OFFERED OR WILL CURRENT MEDICAL
COVERAGE APPLY?
Your ALLIED medical coverage will continue through 12-31-98. No decisions
have been made concerning medical coverage options for ALLIED employees. We
expect to announce all benefit changes in advance of the time when
employees would be called upon to make decisions.
Our past practice has been to offer the same medical options to all
Enterprise employees and to time such an offer with a calendar year
effective date--since
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some of the benefit plan provisions have calendar year deductibles. Should
the Nationwide medical options be adopted, we will credit for ALLIED
service for eligibility purposes. Treatment in progress is not likely to be
a significant issue in any such transition since the Nationwide medical
options do not include pre-existing condition exclusions.
Nationwide offers a variety of medical coverage options. Depending on where
employees live, they may have a choice of indemnity options or managed care
organizations (MCOs). The MCOs include health maintenance organizations
(HMOs), preferred provider organizations (PPOs) and point of Service (POS).
Nationwide contracts with Kaiser, Pacificare/FHP and Principal, for
example.
Q#3: HOW IS OVERTIME PAID? HOW IS IT CALCULATED OVER A HOLIDAY? IF YOU ARE
SICK, DO YOU RECEIVE REGULAR PAY UNTIL YOU REACH 40 HOURS?
Non-exempt employees (those eligible to receive overtime payments) are paid
straight time for time worked up to 40 hours. Overtime is paid at the rate
of 1-1/2 times the normal hourly rate for hours in excess of 40 hours in a
work week. A separate overtime policy applies in California. Hours taken
for holidays, sick time or vacation time, whether paid or unpaid, are
counted as hours worked for overtime purposes.
Q#4: WILL EXEMPT EMPLOYEES RECEIVE HOLIDAY PAY?
The Nationwide holiday policy includes both holidays and personal days
(except in California, where personal days are included with vacation
days). Holidays are scheduled days where the companies close all offices.
Generally, however, personal days are scheduled by agreement between the
employee and his/her supervisor.
The Nationwide holiday/personal day award is 11 days per calendar year. The
number of personal days are generally either 2 or 3 per year, depending on
the number of scheduled holidays or scheduled personal days, unless the
local office management schedules an office-wide personal day, such as to
celebrate Patriot's Day in Boston.
Holidays for part-time employees and employees working an alternative work
schedule, are prorated and applied to match the hours worked.
2
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Q#5: HOW MANY WEEKS OF VACATION DO NEW EMPLOYEES RECEIVE WITHIN THE FIRST YEAR
OF EMPLOYMENT?
At Nationwide, the amount of vacation awarded is determined on service with
the company and is based on the following schedule (a separate schedule
applies in California).
First Calendar Year of Employment Second Calendar Year
Hired during Award Award
------------ ----- -----
1st Calendar Qtr. 5 days after 7-1 10 days on 1-1
2nd Calendar Qtr. 5 days after 10-1 10 days on 1-1
3rd Calendar Qtr. 0 days 10 days on 4-1
4th Calendar Qtr. 0 days 10 days on 7-1
Calendar Year
During Which Your Award
----------------- -----
2nd anniversary occurs 10 days
3rd anniversary occurs 10 days
4th anniversary occurs 10 days
5th thru 14th anniversary occurs 15 days
15th thru 24th anniversary occurs 20 days
25th or more anniversary occurs 25 days
Should the Nationwide schedule be applied for ALLIED employees, awards will
be based on combined ALLIED/Nationwide service.
At this time, Nationwide uses an informal program of unpaid personal leave
as a method some employees use to "purchase" vacation. We are considering
an Enterprise-wide vacation purchase program to enable exchanges of pay for
time off-subject to supervisor approval.
Q#6: WILL I BE PAID OUT WHATEVER VACATION TIME I DON'T USE OR WILL I HAVE TO
TAKE THE TIME BEFORE YEAR END TO RECEIVE A CREDIT?
Your ALLIED vacation schedule will continue to apply through 12-31-98.
Should the Nationwide schedule be adopted for ALLIED employees effective
1-1-99, you will receive vacation according to the schedule presented in
Question #5. The Nationwide Plan provides for a 10-day carryover which
would apply.
Q#7: WHAT IS THE MINIMUM REQUIRED NUMBER OF PART-TIME HOURS WORKED NECESSARY TO
PARTICIPATE IN THE BENEFIT PROGRAM? WILL PART-TIME SERVICE TRANSFER OVER TO
NATIONWIDE?
Nationwide pays employees on a biweekly basis. The minimum number of hours
an individual must be regularly scheduled to work during a two week period
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(biweekly) is 38.75. All individuals scheduled to work at least 38.75
hours per biweekly pay period are eligible for Nationwide benefits.
To the extent ALLIED employees participate in the various Nationwide
benefits plans, all part-time, salaried employee service will be
recognized.
Q#8: ALLIED HAS A HEALTH CARE REIMBURSEMENT PROGRAM FOR HALF OF THE HEALTH CLUB
DUES FOR UP TO $200.00. WILL NATIONWIDE STILL HONOR THE SAME PROGRAM?
Nationwide does not currently provide financial support for health club
dues. No decision has been made as to whether the ALLIED health club
reimbursement program will continue.
Q#9: ALLIED FURNISHES LIFE INSURANCE AT A REDUCED RATE FOR EMPLOYEES. WILL
THERE BE LIFE INSURANCE FURNISHED THROUGH NATIONWIDE?
Nationwide provides three forms of death benefits to employees--term life
insurance, group accident coverage, and a death benefit from the
Nationwide Insurance Enterprise Retirement Plan. Term life insurance and
group accident coverage is available at low employee contribution levels
for up to 3 x annual pay (term life) or up to $300,000 (Group Accident). A
non-contributory, death benefit equal to 1 x pay is provided to active
participants in the retirement plan.
Nationwide does not currently offer subsidized permanent, universal or
variable life insurance products to employees.
Q#10: WHAT IS THE MAXIMUM LOAN AMOUNT YOU CAN BORROW FROM THE 401(k) PROGRAM?
Under the Nationwide Insurance Enterprise Savings Plan, the maximum loan
is the lesser of $50,000 or 50% of your vested account balance.
Q#11: WHAT IS THE NATIONWIDE INSURANCE ENTERPRISE?
The Nationwide Insurance Enterprise is the business combination of
Nationwide and affiliated companies that were established to provide
insurance and financial services. It includes Nationwide Mutual Insurance
Company, Nationwide Life Insurance Company, Nationwide Financial Services,
Inc., Employers Insurance of Wausau, Farmland Mutual Insurance Company,
Scottsdale Insurance Company, Colonial Insurance Company, Gates, McDonald
& Company, Public Employees Benefits Services Corporation, Morley Neckura,
Insurance Intermediaries, Inc., Nationwide Financial Institution
Distributor Agency, Inc., Nationwide Financial Services, NEA Valuebuilder
Investor Services, Inc., and Public Employees Benefit Services Corporation
(PEBSCO).
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Q#12: PLEASE EXPLAIN HOW YOUR TUITION ASSISTANCE PROGRAM WORKS. I AM WORKING
TOWARD A DEGREE. PLEASE EXPLAIN WHICH CLASSES YOU WILL COVER.
The Nationwide Education Assistance Plan consists of reimbursement of
specific expenses for the following types of degree programs and courses:
technical insurance courses, certifications courses, undergraduate/
graduate degrees/courses, and specially approved courses.
Employees who receive a grade of "C" or better or Pass/Satisfactory will
receive 100% reimbursement for tuition and fees for application,
registration, graduation, transfer, and labs.
Nationwide employees receive a 50% reimbursement for those college
courses, which are not part of a degree program, if successfully completed
with a grade of "C" or better. The courses must be academic courses
offered at an accredited school recognized by the Commission of
Recognition of Post-secondary Accreditation (CORPA).
Q#13: I HAVE A CHILD ON A FULL SCHOLARSHIP PROGRAM THROUGH ALLIED GROUP. HOW
WILL THE MERGER AFFECT HER SCHOLARSHIP?
Nationwide does maintain a National Merit Scholarship Program, however, it
is too early in the transition planning process for a response to your
question. As plans are finalized, you will be kept informed.
Q#14: CAN I TRADE ALLIED STOCK FOR NATIONWIDE'S STOCK WITHOUT IT HAVING TO BE A
TAXABLE EVENT?
Nationwide Mutual is a mutual insurance company and has no stock traded on
a public basis. Nationwide Financial Service, Inc. is a subsidiary where a
portion of the stock is publicly traded. There are no plans to create an
option to simply exchange shares.
Q#15: THE BULLETINS HAVE NOT TALKED ABOUT THE ALLIED SUBSIDIARIES. WHAT WILL
HAPPEN TO US?
Nationwide's current intention is to continue to grow the ALLIED
operations including subsidiaries. We are not aware that any decisions
have been made with respect to specific business units.
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Exhibit (a)(13)
NATIONWIDE ANSWERS YOUR QUESTIONS
NATIONWIDE HOTLINE: 1-877-655-6417
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JULY 29, 1998
Q#1: NATIONWIDE'S 401(k) PROGRAM HAS AN ASSET MANAGEMENT FEE. HOW IS THIS FEE
DETERMINED? IF IT IS A FLAT FEE, WHAT IS THE DOLLAR AMOUNT?
As is generally true for investment fund options offered in Section 401(k)
plans, the funds offered in the Nationwide Insurance Enterprise Savings
Plan (NIESP) are subject to asset management fees. These include the fees
charged by the fund manager and an annual fee, generally set at .05% of the
assets in each fund, which compensates the Nationwide Life Insurance
Company for services it provides in connection with the annuity contract
held by the plan. The fee is monitored periodically for appropriateness and
is expected to decline over time.
Q#2: AS A PART-TIME EMPLOYEE WORKING 1,000 OR MORE HOURS A YEAR, I AM ELIGIBLE
FOR 401(k) AND ESOP CONTRIBUTIONS AT ALLIED. WHAT DOES NATIONWIDE OFFER
FOR PART-TIME EMPLOYEES? 401(k)? SICK LEAVE?
Salaried employees who are regularly scheduled to work at least 38.75 hours
bi-weekly (two-week period) are eligible to participate in all benefit
plans. If you continue as a part-time employee you will be eligible for the
Nationwide 401(k) program. Sick leave, vacation, personal days and family
illness day benefits are pro-rated based upon the number of hours the
employee is regularly scheduled to work as of the award date. Under these
plans, for part-time and alternative work environment employees, one day
equals 1/10 of their regularly scheduled bi-weekly hours.
Q#3: IS THERE A PENALTY FEE IF A WITHDRAWAL IS TAKEN FROM THE ENTERPRISE
SAVINGS PLAN WITHIN TEN YEARS OF RETIREMENT?
Generally, federal tax law provides that if funds are distributed from a
tax qualified retirement plan such as the Enterprise Savings Plan, a 10%
tax penalty applies, unless the employee has attained age 55 and
terminated. You should check with your tax advisor for rules that may apply
to you.
Q#4: IF YOU ROLL OVER ALLIED ESOP MONEY INTO NATIONWIDE 401(k) IN A LUMP SUM
DOES NATIONWIDE MATCH 50%? EXAMPLE: $10,000 FROM ALLIED ESOP TO THE
NATIONWIDE 401(k), WOULD THE MATCH BE $5,000.00?
The match at Nationwide does not apply to rollover funds. The match applies
only to salary deferrals once you become a Nationwide employee.
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Q#5: COULD YOU PLEASE PROVIDE AN OVERVIEW OF THE NATIONWIDE PENSION PLAN?
The Nationwide Insurance Enterprise Retirement Plan (NIERP) is a tax
qualified, defined benefit pension plan. The companies currently pay for
all benefits. Benefits accrue in the NIERP based on service and
compensation. Benefits can start as early as age 55 or they can be delayed
until normal retirement date or longer. NIERP benefits are in addition to
Social Security.
Q#6: WHAT QUESTIONS SHOULD I ASK BEFORE BUYING ANYTHING FROM A BROKER OR
INVESTMENT ADVISOR?
o What are your qualifications?
o What designations do you hold? Look for designations such as CLU
(Chartered Life Underwriter), ChFC (Chartered Financial
Consultant), CFP (Certified Financial Planner), and CPA
(Certified Public Accountant).
o What types of products do you sell?
o What are the major features of the product?
o What documents disclose the details of the product?
o How do you get paid if I buy a product from you?
o How is your compensation determined?
o How much will you get paid?
o What services do you provide for your compensation? Remember that
whatever compensation your broker or financial advisor receives
will be assessed from your account, in one way or another.
o What types of charges will my account incur?
o How much are Front-end charges, Back-end charges, asset
management fees, 12b-1 fees, administrative and other fees?
o Please estimate the total fees or charges that will be assessed
against my account in a year and show me how you calculated them.
o How have the investments you are selling performed in the last
year, three years, five years, and ten years?
o How do these returns compare to other investments of a similar
type?
o You should insist on receiving answers you understand and
compare the answers from several advisors before buying.
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EXHIBIT (a)(14)
To: Participants in the ALLIED Life Financial
Corporation Employee Stock Ownership Plan
As many of you know, Nationwide Mutual Insurance Company and its wholly
owned subsidiary Nationwide Life Acquisition Corporation have announced a cash
tender offer for all of the outstanding common stock of ALLIED Life Financial
Corporation at a price of $30 per share, net to the seller in cash, without
interest thereon. As a participant in the ALLIED Life Financial Corporation
Employee Stock Ownership Plan, you have the opportunity to decide whether to
tender the shares of common stock into which the ESOP Preferred Shares held for
your benefit by the Plan are convertible. Each ESOP Preferred Share is
convertible to one share of common stock.
If the tender offer is successful, you will be allocated $30 for every
share in your account. The $30 per share price represents a premium of $6.12 1/2
over the closing price on May 15, 1998 (the last full trading day prior to
Nationwide's disclosure of its previous proposal to purchase the common stock of
ALLIED Life Financial Corporation at $30 per share).
This letter accompanies tender offer materials to help you make an informed
decision. Upon successful conclusion of the tender offer, Nationwide will
terminate the Plan and distribute the benefits to the participants. All
qualifying ALLIED employees will thereafter be eligible to participate in
Nationwide's 401(k) plan.
As of the date of the change in control, all participants' accounts will
become fully vested and nonforfeitable. Participants can then choose to roll
over the distribution to an IRA, roll over the distribution to Nationwide's
401(k) plan, or otherwise receive it as a taxable distribution.
We believe that your positive response will maximize your account and,
therefore, strongly urge you to tender your shares. If you have any questions or
would like more information, contact Georgeson & Company Inc., the information
agent, at (800) 223-2064.
Nationwide reaffirms its commitment to increase the current level of ALLIED
employment, and looks forward to making its benefits program available to its
new employees.
Your directions regarding your tender of shares is, by law and under the
terms of the Plan, confidential. We encourage you to give your instructions to
the Plan Trustee in order to accomplish the tender of your shares.
Very truly yours,
NATIONWIDE MUTUAL INSURANCE COMPANY
NATIONWIDE LIFE ACQUISITION CORPORATION
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Exhibit (a)(15)
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NATIONWIDE ANSWERS YOUR QUESTIONS
NATIONWIDE HOTLINE: 1-877-655-6417
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August 5, 1998
Q#1: IS IT POSSIBLE TO DISTRIBUTE A PACKET DETAILING NATIONWIDE'S CURRENT
BENEFITS PACKAGE?
As part of the enrollment process Nationwide provides a packet describing
the benefits plans that you may enroll in to obtain coverage. If the
Nationwide benefit plans are adopted on behalf of ALLIED employees, you
will also receive a set of booklets detailing the provisions of the various
benefit plans.
Q#2: QUESTION #10 IN THE JULY 22 UPDATE STATES THAT THE MAXIMUM LOAN AMOUNT YOU
CAN BORROW FROM THE NATIONWIDE 401(k) IS LESSER OF $50,000 OR 50% OF YOUR
VESTED ACCOUNT BALANCE. IN ONE OF THE EMPLOYEE MEETINGS IT WAS STATED THAT
THE MAXIMUM LOAN AMOUNT CANNOT BE MORE THAN 33% OF YOUR SALARY. WHICH IS
CORRECT?
The maximum loan amount a participant can borrow from the Nationwide 401(k)
is the lesser of $50,000 or 50% of the vested account balance. In addition,
there is a limit on the maximum amount of the loan repayment. The
combination of loan repayments cannot exceed 33% of net pay. The test is
performed at the time the loan is requested.
Q#3: PLEASE GIVE AN EXAMPLE OF THE HOW VACATION IS AWARDED.
Someone hired in May of 1998 (second quarter) would receive five days on
October 1, 1998 and another 10 days on January 1, 1999. Another example,
someone hired in October of 1999 receives 10 days on April 1, 2000 and
another ten days on January 1, 2001.
1st Calendar 2nd Calendar
Hired during Year Award Year Award
1st Calendar Qtr. 5 days on 7-1 10 days on 1-1
2nd Calendar Qtr. 5 days on 10-1 10 days on 1-1
3rd Calendar Qtr. 0 days 10 days on 4-1
4th Calendar Qtr. 0 days 10 days on 7-1
Vacation for employees with more than one year of service is awarded each
January 1st. Note that a separate accrual schedule applies in California.
Q#4: IF THE NATIONWIDE VACATION SCHEDULE IS APPLIED TO ALLIED EMPLOYEES, HOW
WILL IT WORK FOR EMPLOYEES WHO WERE HIRED IN THE THIRD OR FOURTH QUARTER OF
1997 AND HAVE BEEN HERE FOR ONE YEAR?
ALLIED service will be credited for vacation award purposes therefore, an
employee hired in the third or fourth quarter of 1997 would receive an
award of 10 days vacation on January 1, 1999, under the Nationwide vacation
schedule.
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Q#5: WILL EMPLOYEES BE COMPENSATED FOR THEIR ACCUMULATED SICK DAYS?
Nationwide's current benefit program does not provide for a payment for
unused sick leave. Should the Nationwide benefit's programs be adopted for
the ALLIED employees, we anticipate no payment or compensation will be made
for prior accumulated sick days under the ALLIED program. Sick leave
benefits will be awarded based on combined ALLIED and Nationwide service
effective 1-1-99.
Q#6: WHAT IS NATIONWIDE'S WORK WEEK? IS IT BASED ON 38.75 HOURS OR 40 HOURS?
Nationwide's workweek varies by location. For example, Farmland Insurance
Company, located in Des Moines, Iowa works a 40 hour week. You may
anticipate a 40 hour work-week.
Q#7: I STARTED WITH ALLIED ON APRIL 15, 1993 AND LEFT ON JANUARY 7, 1996. I WAS
REHIRED ON DECEMBER 31, 1996. ALLIED DID NOT TREAT THIS AS A BREAK IN
SERVICE, THEREFORE, I AM FULLY VESTED IN THE ESOP PLAN. WHAT AMOUNT OF
VESTING WILL I HAVE WITH NATIONWIDE ON THE DATE OF CHANGE OF CONTROL?
Once your combined ALLIED and Nationwide service reaches 60 months, you
will be fully vested in the Nationwide Insurance Enterprise Retirement Plan
(NIERP) and the Nationwide Insurance Enterprise Savings Plan (NIESP).
You will always be vested in any rollover contributions, such as your ESOP
money, that is placed in the Nationwide Insurance Enterprise Savings Plan
(NIESP). Under the NIESP, you will receive credit for your ALLIED service
towards the 60 months of service vesting requirement for future company
matching contributions to that plan. Once your combined ALLIED and
Nationwide service reaches 60 months, you will be 100% vested in the
company matching contributions and earnings on those contributions in the
NIESP. Of course, you are always 100% vested in your contributions, any
rollover contributions and any earnings on those contributions.
Q#8: I HAVE BEEN REHIRED BY ALLIED. WILL NATIONWIDE GIVE ME CREDIT FOR ALL MY
YEARS OF SERVICE WITH ALLIED OR JUST THE PRESENT PERIOD FOR VESTING
PURPOSES AND FOR VACATION?
If your prior service was counted by ALLIED for purposes of their benefits
plans after your rehire, it will generally be counted in the Nationwide
pension, savings, vacation and sick leave plans if they are adopted on
behalf of ALLIED employees.
Q#9: DO YOU HAVE ANY MORE DETAILS AVAILABLE ON MATERNITY LEAVE?
The policy typically followed by the companies for uncomplicated
pregnancy/maternity situations is that maternity leave may begin two weeks
prior to the estimated date of delivery and continue for up to six weeks
after a normal delivery or up to eight weeks after a caesarian delivery.
Typically, we treat employees as disabled during this period of time. Sick
leave/disability income benefits can begin earlier than this time if
pregnancy prevents
<PAGE> 3
an employee from working and can continue beyond these typical periods of
absence should there be a continuing disability post-partum. The amount of
benefit during this leave is determined by the sick leave schedule
presented in the July 22 Update.
Q#10: I WORK 30 HOURS PER WEEK. AS A PART-TIME EMPLOYEE WILL I RECEIVE BENEFITS?
As described in Answer #2 of the July 29 Update, sick leave, vacation,
personal days and family illness day benefits are pro-rated based upon the
number of hours the employee is regularly scheduled to work. For part-time
employees, one day equals 1/10 of their regularly scheduled bi-weekly
hours. As a part time employee you will be eligible for the Nationwide
401(k) program.
Q#11: I WAS HIRED IN SEPTEMBER OF 1995. I DO NOT MEET THE 60 MONTH RULE. IF I
ROLL MY ESOP MONEY INTO A NATIONWIDE 401(k) CAN I BORROW AGAINST THAT? IF
I CAN BORROW AGAINST THIS MONEY QUICKLY AND WITH LITTLE RESTRICTION, WHY
GIVE HALF TO THE GOVERNMENT BY TAKING A CASH SETTLEMENT?
You would typically be able to take loans against any monies that you
rolled into the NIESP. The NIESP provides for a maximum loan of the lesser
of (1) $50,000 reduced by your highest outstanding loan balance under all
plans in the twelve months, or (2) 50% of your vested account balance. The
combination of loan repayments cannot exceed 33% of net pay. So, any
existing loans you may have outstanding in the ALLIED 401(k) plans may
have an impact on the maximum amount you may borrow.
Employees will have the opportunity to decide what action, withdrawal or
rollover, best suits their needs, and whether they can meet their needs
through the loan program in the NIESP. With the diversity of individual
situations, there is no one correct answer for all employees. However, the
government reinforces the position that these funds are intended to be
used for long term savings by applying a penalty tax to early withdrawals
but not to rollovers. And, implicit in your comments, is the recognition,
that, as long as you defer taxation, by rolling your funds into the
Nationwide 401(k), 100% of your monies work for you.
Q#12: DOES NATIONWIDE HAVE ANY BENEFIT TO PAY THE ADOPTIVE MOTHER FOR LEAVE
TIME AS MATERNITY LEAVE?
Nationwide complies with the Family Medical Leave Act of 1933 and provides
up to 12 weeks of time off. Employees typically use a combination of
vacation, personal days and unpaid time off to meet their bonding needs
following the placement.
The companies have long treated adopted children the same as birth
children-in terms of their eligibility to participate in the various
benefits plans (medical, dental, life, accident, etc.) Similarly, the
companies also recognize the additional needs of parents by providing up
to three family illness days per calendar year to care for a sick child.
<PAGE> 4
Q#13: I HAVE AN ANNUITY WITH ALLIED. I AM INTERESTED IN THE NATIONWIDE
ANNUITY PLAN. PLEASE PROVIDE ME INFORMATION ON THE NATIONWIDE PLAN.
Nationwide offers employees a number of non-qualified, tax-deferred
annuities, such as The BEST of AMERICA- and Multi-flex product that are
sold to the general public. The annuities are offered on a favorably-
priced/reduced fee basis to employees, spouses, children and certain other
family members. These products will become available to you once you
become an Enterprise employee. Information on these products will be made
available soon.
Q#14: WHAT IS THE PENSION PLAN FORMULA FOR NATIONWIDE?
The pension plan formula defines the annual benefit you would receive at
normal retirement, currently age 65. The formula is:
.0125 x 5 year final average pay x years of service +
.005 x (5 year final average pay - Social Security Covered
Compensation) x years of service.
The Internal Revenue Code limits the maximum covered compensation in any
one year to $160,000 and also limits the maximum service to 35 years.
Benefits are reduced for commencement prior to age 65.
For example, an employee with $40,000 of final average compensation,
retiring in 1998, would receive a pension benefit of approximately:
Age 55 with 15 years of service $4,800/year or 12% of final
average compensation
Age 55 with 25 years of service $8,000/year or 20% of final
average compensation
Age 55 with 35 years of service $10,800/year or 27% of final
average compensation
Age 62 with 15 years of service $8,000/year or 20% of final
average compensation
Age 62 with 25 years of service $13,200/year or 33% of final
average compensation
Age 62 with 35 years of service $18,800/year or 47% of final
average compensation
The percentages of pay replaced by the plan vary with accumulated service,
compensation, and the age at which benefits begin.
Q#15: IS THE NATIONWIDE INSURANCE ENTERPRISE SAVINGS PLAN PROTECTED AGAINST
FRAUD OR EMBEZZLEMENT?
We are protected through a bonding policy, and there is additional
protection provided according to the various state insurance guaranty
associations. In addition, The Nationwide Insurance Enterprise Savings
Plan incorporates all of the protections provided under the Employee
Retirement Income Security Act.
<PAGE> 5
Q#16: WE ARE CONFUSED ABOUT VARIABLE ANNUITIES. HOW DO THEY WORK?
Variables annuities are products available through insurance companies in
which the investment returns vary depending upon the performance of
underlying investment pools, usually mutual funds. In addition, these
products usually have certain guarantees, for instance, that if the owner
dies, beneficiaries will receive at least the initial amount invested.
Investment earnings within variable annuities are not taxed until the
assets are withdrawn. Nationwide Life Insurance Company is one of the
largest writers of variable annuities.
Q#17: PLEASE PROVIDE ME WITH A COMPARISON OF IRA AND NATIONWIDE 401(k) PLAN
ROLLOVER OPTIONS.
<TABLE>
<CAPTION>
Comparison of IRAs and Nationwide 401(k) Plan as Rollover Options for your ESOP Money
- -------------------------------------------------------------------------------------
Nationwide Insurance
Similarities Rollover IRA Enterprise Savings Plan
- ------------ ------------ -----------------------
<S> <C> <C>
No tax on ESOP rollover Yes Yes
Earnings continue tax-deferred Yes Yes
Maximum rollover amount Unlimited Unlimited
Can roll your money over to Yes, but some IRA Yes
another IRA or 401(k) plan products may have
without tax exit fees
Differences
- -----------
Investment choices available Virtually any financial 15 investment choices
asset, but not collectibles
or real estate
Available if your retire when you Yes No
take the ESOP distribution
Access to your money through loans No Yes, up to lesser of 50%
of vested balance or $50,000
10% penalty tax applied to... All withdrawals taken before Same as IRA, except with
age 59 1/2, with limited early retirement provision
exceptions at age 55
Spread tax liability on lump sum Not available Available in limited
withdrawals over a 5 or 10 year period circumstances - seek
advice of a tax expert
Mandatory 20% federal withholding No Yes, unless rolled to
on withdrawals another plan or IRA
Payout options available Varies by product Installment, lump sum or
ad hoc
</TABLE>
