Registration No. 333-__________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
Registration Statement
Under
The Securities Act of 1933
CONSECO, INC.
(Exact name of registrant as specified in its charter)
Indiana 35-1468632
(State of Incorporation) (I.R.S. Employer
Identification No.)
11825 N. Pennsylvania Street
Carmel, Indiana 46032
(Address of Principal Executive Offices) (Zip Code)
ConsecoSave Plan
(Full title of the plan)
John J. Sabl
11825 N. Pennsylvania Street
Carmel, Indiana 46032
(Name and address of agent for service)
(317) 817-6163
(Telephone number, including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate
Title of Securities to be Price Offering Amount of
to be Registered Registered Per Share Price Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, no par value 1,500,000 shares (1) $30.5313 (2) $45,796,500 (2) $12,731.55
Interests in ConsecoSave Plan (3) (4) (4) (4)
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<FN>
(1) Subject to increase (or decrease) in accordance with Rule 416 of
Regulation C to reflect a merger, consolidation, reorganization,
recapitalization, stock dividend, stock split or other change in the
corporate structure of the Registrant which results in a change in the
number of shares issuable pursuant to outstanding awards under the
Plan.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rules 457(c) and 457(h) of Regulation C, on the basis of
the average of the high and low prices of the shares of common stock
of the Registrant on July 16, 1999
(3) Pursuant to Rule 416(c) of Regulation C, there are hereby registered
on this Registration Statement an indeterminate amount of interests in
the Plan.
(4) Pursuant to Rule 457(h)(2) of Regulation C, no separate fee is
required with respect to interests in the Plan.
</FN>
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed below are hereby incorporated by reference into
this Registration Statement:
1. Annual Report on Form 10-K of Conseco, Inc. (the "Company",
"Conseco", or the "Registrant") for the year ended December
31, 1998.
2. Quarterly Report on Form 10-Q filed by the Company for the
quarterly period ended March 31, 1999.
3. The description of the Company's common stock, no par value
(the "Common Stock"), contained in its Registration Statement
on Form 8-A filed with the Commission on August 27, 1986,
including any reports filed under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), for the purpose of
updating such description.
4. Annual Report on Form 11-K filed by the ConsecoSave Plan for
the year ended December 31, 1998.
All documents filed subsequent to the foregoing by the Company or the
ConsecoSave Plan pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act, prior to the filing of a post-effective amendment which indicates that all
securities registered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference into this
Registration Statement and to be a part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
(See Item 3)
Item 5. Interests of Named Experts and Counsel.
Certain legal matters in connection with the securities offered hereby
will be passed upon for the Company by John J. Sabl, Esq., Executive Vice
President and General Counsel of the
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Company. Mr. Sabl holds options to purchase 450,000 shares of Common Stock and
owns 80,076 shares of Common Stock directly and indirectly.
Item 6. Indemnification of Directors and Officers.
The Indiana Business Corporation Law grants authorization to Indiana
corporations to indemnify officers and directors from liability for their
conduct if such conduct was in good faith and was in the corporation's best
interests or, in the case of directors, was not opposed to such best interests,
and permits the purchase of insurance in this regard. In addition, the
shareholders of a corporation may approve the inclusion of other or additional
indemnification provisions in the articles of incorporation and by-laws.
The By-Laws of the Registrant provide for the indemnification of any
person made a party to any action, suit or proceeding by reason of the fact that
he or she is a director, officer or employee of the Registrant, if (a) such
person is wholly successful with respect to such action, suit or proceeding or
(b) if such person is determined to have acted in good faith, in what he or she
reasonably believed to be the best interests of Conseco or at least not opposed
to its best interests and, in addition, with respect to any criminal claim, is
determined to have had reasonable cause to believe that his or her conduct was
lawful or had no reasonable cause to believe that his or her conduct was
unlawful. Such indemnification shall be against the reasonable expenses,
including attorneys' fees, incurred by such person in connection with the
defense of such action, suit or proceeding and amounts paid in settlement. If
such person was not wholly successful, the determination of entitlement to
indemnification shall be made by one of the following methods, such method to be
selected by the Board of Directors: (a) by the Board of Directors by a majority
vote of a quorum consisting of directors who are not and have not been parties
to the claim; (b) by the majority vote of a committee duly designated by the
Board of Directors, consisting solely of two or more directors who are not and
have not been parties to the claim; and (c) by special legal counsel.
The above discussion of Conseco's Bylaws and the Indiana Business
Corporation Law is not intended to be exhaustive and is qualified in its
entirety by such Bylaws and the Indiana Business Corporation Law.
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The Company has purchased directors and officers liabilities insurance
which would provide coverage against certain liabilities, including liabilities
under the securities laws.
Item 7. Exemption from Registration Claimed.
Not Applicable
Item 8. Exhibits.
See the Exhibit Index immediately following the signature pages to
this Registration Statement.
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933 (the "Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
Provided, however, that paragraphs (1)(i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference into this Registration Statement.
(2) That, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed
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to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the Act,
each filing of the Registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Carmel, State of Indiana, on the 23rd day of July,
1999.
CONSECO, INC.
By: /s/ Rollin M. Dick
------------------------
Rollin M. Dick,
Executive Vice President
POWER OF ATTORNEY
Each person whose signature to this Registration Statement appears
below hereby appoints John J. Sabl and Karl W. Kindig, and each of them, either
of whom may act without the joinder of the other, as his or her attorney-in-fact
to sign on his or her behalf individually and in the capacity stated below and
to file all amendments and post-effective amendments to this Registration
Statement, which amendments may make such changes in and additions to this
Registration Statement as such attorney-in-fact may deem necessary or
appropriate.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signatures Title (Capacity) Date
---------- ---------------- ----
/s/ Stephen C. Hilbert
- -------------------------- Chairman of the July 23, 1999
Stephen C. Hilbert Board, President and
Chief Executive
Officer (Principal
Executive Officer)
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Signatures Title (Capacity) Date
---------- ---------------- ----
/s/ Rollin M. Dick
- -------------------------- Executive Vice July 23, 1999
Rollin M. Dick President, Chief
Financial Officer
and Director
(Principal Financial
Officer)
/s/ James S. Adams
- -------------------------- Senior Vice July 23, 1999
James S. Adams President, Chief
Accounting Officer
and Treasurer
(Principal
Accounting Officer)
/s/ Lawrence M. Coss
- -------------------------- Director July 23, 1999
Lawrence M. Coss
/s/ Ngaire E. Cuneo
- -------------------------- Director July 23, 1999
Ngaire E. Cuneo
/s/ David R. Decatur
- -------------------------- Director July 23, 1999
David R. Decatur
/s/ Donald F. Gongaware
- -------------------------- Director July 23, 1999
Donald F. Gongaware
/s/ M. Phil Hathaway
- -------------------------- Director July 23, 1999
M. Phil Hathaway
/s/ James D. Massey
- -------------------------- Director July 23, 1999
James D. Massey
/s/ Dennis E. Murray, Sr.
- -------------------------- Director July 23, 1999
Dennis E. Murray, Sr.
/s/ John M. Mutz
- -------------------------- Director July 23, 1999
John M. Mutz
/s/ Robert S. Nickoloff
- -------------------------- Director July 23, 1999
Robert S. Nickoloff
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The Plan.
Pursuant to the requirements of the Securities Act of 1933, the Plan has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Carmel, State of Indiana,
on July 23, 1999.
ConsecoSave Plan
By: /s/ Rollin M. Dick
---------------------------------------
Rollin M. Dick, Trustee
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EXHIBITS
Exhibit No.
- -----------
4(a) Amended and Restated ConsecoSave Plan dated as of January 1,
1997, as amended.
5(a) Opinion of Counsel re: legality*
23(a) Consent of Counsel [See Exhibit 5(a)]
23(b) Consent of PricewaterhouseCoopers LLP
23(c) Consent of KPMG LLP
24(a) Powers of Attorney of Stephen C. Hilbert, Rollin M. Dick,
James S. Adams, Lawrence M. Coss, Ngaire E. Cuneo, David R.
Decatur, Donald F. Gongaware, M. Phil Hathaway, James D.
Massey, Dennis E. Murray, Sr., John M. Mutz, and Robert S.
Nickoloff are included on the signature page of this
Registration Statement and are incorporated herein by
reference.
* In lieu of an opinion of counsel concerning compliance with the
requirements of ERISA or any Internal Revenue Service determination
letter that the Plan is qualified under Section 401 of the Internal
Revenue Code, the Registrant will submit or has submitted the Plan
and any amendments thereto to the Internal Revenue Service in a
timely manner and has made or will make all changes required by the
Internal Revenue Service in order to qualify the Plan.
CONSECOSAVE PLAN
(amended and restated, January 1, 1997)
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TABLE OF CONTENTS
Page
<S> <C> <C>
ARTICLE 1 ESTABLISHMENT AND PURPOSE OF PLAN.............................................................1
ARTICLE 2 DEFINITIONS...................................................................................1
2.1 Definitions...................................................................................1
2.2 Gender and Number.............................................................................7
ARTICLE 3 PARTICIPATION.................................................................................8
3.1 Participation.................................................................................8
3.2 Termination of Participation..................................................................8
3.3 Reemployment..................................................................................8
3.4 Cessation of Eligible Status..................................................................9
ARTICLE 4 EMPLOYEE CONTRIBUTIONS.......................................................................10
4.1 Employee Contributions.......................................................................10
4.2 Dates of Election............................................................................10
ARTICLE 5 EMPLOYER CONTRIBUTIONS.......................................................................11
5.1 Employer Matching Contributions..............................................................11
5.2 Discretionary Employer Contributions.........................................................12
5.3 Allocation of Annual Employer Contributions
and Forfeitures..............................................................................12
5.4 Restoration of Forfeited Amounts Upon Reemployment...........................................12
5.5 Rollover Contributions.......................................................................13
ARTICLE 6 LIMITATIONS..................................................................................14
6.1 Limitations on Annual Account Additions......................................................14
6.2 Maximum Amount of Before-Tax Deposits........................................................18
6.3 Actual Deferral Percentage Tests.............................................................18
6.4 Adjustment to Actual Deferral Percentage Tests...............................................20
6.5 Maximum Contribution Percentage..............................................................21
6.6 Adjustment For Excessive Contribution Percentage.............................................23
6.7 Limit on Total Contribution of Employer;
Precluding Excess Allocations................................................................25
ARTICLE 7 CREDITING OF CONTRIBUTIONS AND DEPOSITS TO
INVESTMENT FUNDS.............................................................................25
7.1 Investment Funds.............................................................................25
7.2 Investment of Employer Contribution Accounts.................................................26
7.3 Participant's Choice of Investments..........................................................26
7.4 Change of Prior Investments..................................................................27
(i)
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Page
ARTICLE 8 ACCOUNTS.....................................................................................27
8.1 Separate Accounts............................................................................27
8.2 Valuation of Separate Accounts...............................................................28
8.3 Determination of Fund Performance............................................................28
8.4 Voting of Company Stock......................................................................29
ARTICLE 9 WITHDRAWALS DURING EMPLOYMENT................................................................29
9.1 After-Tax Deposit Account withdrawals........................................................29
9.2 Withdrawals After Age Fifty-nine and one-half
(592)........................................................................................30
9.3 Hardship Withdrawals.........................................................................30
9.4 Withdrawal of Rollover Contributions by Prior
Plan Participants............................................................................32
9.5 Loans........................................................................................33
ARTICLE 10 DISTRIBUTIONS................................................................................35
10.1 Retirement...................................................................................35
10.2 Death........................................................................................35
10.3 Permanent Disability.........................................................................35
10.4 Other Termination of Employment..............................................................35
10.5 Designation of Beneficiary...................................................................37
10.6 Timing of Distributions......................................................................37
10.7 Manner of Benefit Distribution...............................................................38
10.8 Manner of Distribution and Timing of Death
Distributions................................................................................41
10.9 Limitation on Benefits and Distributions.....................................................42
10.10 Distributions Payable to Incompetents........................................................42
10.11 Distribution of Before-Tax Deposits..........................................................43
ARTICLE 11 NONASSIGNABILITY.............................................................................43
ARTICLE 12 TRUST AGREEMENT..............................................................................44
ARTICLE 13 MANAGEMENT AND ADMINISTRATION................................................................44
13.1 Administrator................................................................................44
13.2 Claims Review Procedure......................................................................45
13.3 Delegation...................................................................................46
13.4 Expenses of Administration...................................................................46
ARTICLE 14 COMPANY AND EMPLOYER RIGHTS..................................................................46
14.1 Company's Interest in Trust..................................................................46
(ii)
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Page
14.2 Inspection of Records........................................................................46
14.3 Amendment....................................................................................47
14.4 Employment Rights............................................................................47
14.5 Company and Employer Liability...............................................................47
ARTICLE 15 PARTICIPATING EMPLOYERS......................................................................47
15.1 Adoption By Other Employers..................................................................47
15.2 Requirements of Participating Employers......................................................47
15.3 Designation of Agent.........................................................................48
15.4 Employee Transfers...........................................................................49
15.5 Participating Employer's Contribution........................................................49
15.6 Discontinuance of Participation..............................................................49
15.7 Administrator's Authority....................................................................50
15.8 Participating Employer Contribution For
Affiliate....................................................................................50
ARTICLE 16 TERMINATION..................................................................................51
16.1 Event of Termination.........................................................................51
16.2 Effect of Termination........................................................................51
ARTICLE 17 TRANSFERS, MERGERS AND CONSOLIDATIONS........................................................51
ARTICLE 18 SUCCESSORS...................................................................................52
ARTICLE 19 INTERPRETATION QF AGREEMENT..................................................................52
19.1 Interpretation of Plan.......................................................................52
19.2 Forms........................................................................................52
19.3 Applicable Law...............................................................................52
APPENDIX I TOP-HEAVY PROVISIONS.........................................................................53
APPENDIX MERGER OF INDEPENDENT PROCESSING SERVICES
SAVINGS INVESTMENT PLAN......................................................................61
APPENDIX MERGER OF TRANSPORT HOLDINGS, INC.
401(k) PLAN..................................................................................63
APPENDIX MERGER OF CAPITOL AMERICAN FINANCIAL
CORPORATION INVESTMENT PLAN..................................................................64
APPENDIX MERGER OF AMERICAN TRAVELLERS LIFE INSURANCE
COMPANY RETIREMENT SAVINGS PLAN AND TRUST....................................................66
(iii)
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Page
APPENDIX MERGER OF CONTINENTAL FINANCIAL CORPORATION
401(k) RETIREMENT PLAN.......................................................................67
APPENDIX TRANSFER OF INTRAMERICA LIFE INSURANCE COMPANY
EMPLOYEE ACCOUNTS............................................................................69
APPENDIX MERGER OF PIONEER FINANCIAL SERVICES, INC.
EMPLOYEE SAVINGS AND STOCK OWNERSHIP PLAN....................................................72
</TABLE>
(iv)
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CONSECOSAVE PLAN
ARTICLE 1
ESTABLISHMENT AND PURPOSE OF PLAN
Effective as of April 1, 1989, Conseco, Inc. (the "Company") adopted
the Conseco Savings Plan in recognition of the contribution made to its
successful operation by its employees and for the exclusive benefit of its
eligible employees. The ConsecoSave Plan (the "Plan") was last amended and
restated effective October 1, 1995 and is intended to meet the requirements of
the Internal Revenue Code of 1986 (the "Code"), and the Employee Retirement
Income Security Act of 1974 ("ERISA"), as both may be amended from time to time.
This document constitutes a further amendment and restatement of the Plan.
Except as otherwise noted below, this amendment and restatement, made
and entered on this 1st day of December, 1997, shall be effective as of January
1, 1997, except to the extent later internal effective dates are provided, in
which event the provisions of the Plan as in effect prior to the amendment and
restatement shall continue to apply until that date. The provisions of the Plan,
as set forth herein, shall apply only to Participants who are Employees on or
after January 1, 1997. The rights and benefits of all former employees shall be
determined in accordance with the provisions of the Plan as in effect on the
date his employment terminated.
ARTICLE 2
DEFINITIONS
2.1 Definitions. Wherever used in the Plan, the following terms shall
have the meanings set forth below unless the context clearly indicates
otherwise:
(a) Account: The bookkeeping account established and maintained by
the Administrator for each Participant with respect to his interest in the
Trust.
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(b) Administrator: The Administrator of the Plan is the Company.
(c) Affiliate: Any corporation which is a member of a controlled
group of corporations (as defined in Code Section 414(b)) which includes the
Employer; any trade or business (whether or not incorporated) which is under
common control (as defined in Code Section 414(c)) with the Employer; any
organization (whether or not incorporated) which is a member of an affiliated
service group (as defined in Code Section 414(m)) which includes the Employer;
and any other entity required to be aggregated with the Employer pursuant to
Regulations under Code Section 414(o).
(d) Board: The Board of Directors of the Company.
(e) Break-in-Service: A twelve (12) month period during which a
Participant does not have Credited Service.
(f) Company: Conseco, Inc., an Indiana corporation.
(g) Compensation: The amount of compensation actually paid to the
Participant by the Employer which is reportable on the Participant's IRS Form
W-2, plus any before-tax deposits and any salary reduction contributions made on
behalf of a Participant under a plan which qualifies under Code Section 401(k)
and/or Code Section 125, but excluding income resulting from payments of
insurance premiums, moving expenses, tuition expenses, automobile expenses,
severance payments, the value of any noncash incentive awards (including any
stock options, restricted stock or other stock-based compensation), income
attributable to an Employer's forgiveness of a loan made by the Employer to a
Participant, and income attributable to a distribution to a Participant from a
nonqualified deferred compensation arrangement (including a voluntary or
incentive deferred compensation arrangement) maintained by an Employer or to the
exercise of stock options, lapse of restrictions on restricted stock, or to
other stock-based remunerations. Notwithstanding the foregoing, Compensation
shall not include any payments made pursuant to an insurance agent or agency
contract. Compensation shall not include any amounts in excess of $150,000, as
adjusted by the Commissioner for increases in the cost-of-living in accordance
with Code Section 401(a)(17)(B).
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(h) Credited Service: Credited Service means a Participant's years
of employment with the Employer. For purposes of calculating Credited Service,
years of employment with Conseco, Inc., or any Affiliate and any predecessors
thereto, as determined by the Plan Administrator in its sole discretion, shall
be recognized. A Participant's period of employment by an Employer is measured
from the date a Participant first completes an Hour of Service, and
anniversaries of that date, to the date of a Participant's termination of
employment for any reason; provided, however, if a Participant who has a
termination of employment resumes employment with an Employer prior to having a
Break-in-Service, such termination of employment shall be disregarded and his
employment shall be treated as continuous through the date he resumes his
employment. In calculating a Participant's Credited Service, all periods of
employment with the Employer shall be considered, except service performed prior
to 5 consecutive 1-year Breaks-in-Service unless the Participant is reemployed
and the prior service is reinstated in accordance with Section 3.3. For purposes
of this Section and Section 3.1, an Hour of Service shall mean:
(1) Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for an Employer or an Affiliate thereof.
These hours shall be credited to the Employee for the computation period in
which the duties are performed,
(2) Each hour for which an Employee is paid, or entitled to
payment, by an Employer or an Affiliate thereof on account of a period of time
during which no duties are performed (irrespective of whether the employment
relationship is terminated) due to vacation, holiday, illness, incapacity
(including disability), layoff, jury duty, military leave or leave of absence.
No more than five hundred one (501) hours shall be credited under this
subsection for any single continuous period of absence (whether or not such
period occurs in a single computation period),
(3) Each hour for which back pay, irrespective of mitigation
of damages, is either awarded or agreed to by an Employer or an Affiliate
thereof. The same shall not be credited both under paragraph (1) or (2), as the
case may be, and under this paragraph (3). These hours shall be credited to the
Employee for the computation period or periods to which the award or agreement
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pertains rather than the computation period in which the award, agreement or
payment is made,
(4) Solely for purposes of determining whether an Employee has
a Break-in-Service under Section 2.1(e), each hour, based on the number of hours
per week that the Employee would have normally worked, or a pro rata portion
thereof, during which an Employee is absent from work (i) by reason of the
pregnancy of the Employee, (ii) by reason of the birth of a child of the
Employee, (iii) by reason of the placement of a child with the Employee, or (iv)
due to the caring of a child during the period immediately after the birth,
placement or adoption of the child by the Employee. Not more than five hundred
one (501) Hours of Service shall be credited to any Employee under this
paragraph for any one occurrence. Such hours shall be credited to the
computation period during which the event occurs to the extent necessary to
prevent a Break-in-Service, and to the extent not so necessary, to the next
following computation period, and
(5) Each hour, other than hours credited under paragraphs (1),
(2), (3) and (4), during any customary period of work, based on a forty-hour
week or pro rata portion thereof, during which the employee is laid off, is on
an Employer approved leave of absence or sick or disability leave, or is on jury
or military duty.
(6) The provisions of Department of Labor regulations
2530.2006(b) and (c) are incorporated by reference.
(i) Employee: Any person who is employed by the Company, and any
person who is employed by any Participating Employer, excluding (1) any employee
located at the Company's offices in Jackson, Mississippi, (2) any independent
contractor, (3) any leased employee, (4) any person employed by Washington
National Insurance Company on December 31, 1997, (5) any person employed by
United Presidential Life Insurance Company on December 31, 1997 other than a
person who prior to December 31, 1997 signed an offer letter with Conseco
Services LLC acknowledging that the person's principal place of business at some
time in 1998 will not be Kokomo, Indiana, (6) any person hired by Conseco
Services LLC after December 31, 1997 to perform services predominantly at the
Company's Kokomo, Indiana, facility, and
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(7) any individual who is included within a unit of employees covered by a
collective bargaining agreement for whom retirement benefits were the subject of
good faith bargaining, unless the collective bargaining agreement provides for
said individual's participation in this Plan. A "leased employee" means any
person who is not an employee of the Employer, and provides services to the
Employer if (1) such services are provided pursuant to an agreement between the
Employer and any other person (the "leasing organization"), (2) such person has
performed such services for the Employer (or for the Employer and related
persons determined in accordance with Code Section 414(n)) on a substantially
full-time basis for a period of at least one year, and (3) such services are
performed under the primary direction or control of the Employer.
(j) Employer: The Company and such Participating Employers as have
adopted the Plan with the consent of the Board.
(k) Former Participant: A person who has been a Participant, but
who has ceased to be a Participant for any reason.
(l) Highly Compensated Participant: A Highly Compensated
Participant means an individual described in Code Section 414(q) and the
Regulations thereunder, and generally means an Employee who performed services
for the Employer during the determination year and is in one or more of the
following groups:
(1) Employees who at any time during the determination year or
the preceding year were 5% owners of the Employer. A 5% owner means any person
who owns (or is considered as owning within the meaning of Code Section 318)
more than 5% of the outstanding stock of the Employer or stock possessing more
than 5% of the total combined voting power of all stock of the Employer or, in
the case of an unincorporated business, any person who owns more than 5% of the
capital or profits interest in the Employer. In determining percentage ownership
hereunder, employers that would otherwise be aggregated under Code Sections
414(b), (c), (m) and (o) should be treated as separate employers.
(2) Employees who for the preceding year had compensation from
the Employer in excess of $80,000 (as adjusted at the same time and in such
manner as prescribed by the Secretary of
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the Treasury) and were in the Top Paid Group of Employees for the Plan Year.
The determination year shall be the Plan Year for which
testing is being performed.
Highly Compensated Participant shall include a former Employee
who had a separation year prior to the determination year and was a Highly
Compensated Participant in the year of separation from service or in any
determination year after attaining age fifty-five (55).
"Top Paid Group" means the top 20% of employees who performed
services for the Employer during the applicable year, ranked according to the
amount of Compensation received from the Employer during such year. For the
purpose of determining the number of active Employees in any year, the following
Employees shall be excluded; however, such Employees shall still be considered
for the purpose of identifying the particular Employees in the Top Paid Group:
(i) Employees with less than six (6) months of service;
(ii) Employees who normally work less than seventeen and
one-half (172) hours per week;
(iii) Employees who normally work less than six (6) months
during a year; and
(iv) Employees who have not yet attained age twenty-one
(21).
In-addition, if 90% or more of the Employees of the Employer
are covered under agreements the Secretary of Labor finds to be collective
bargaining agreements between Employee representatives and the Employer, and the
Plan covers only Employees who are not covered under such agreements, then
Employees covered by such agreements shall be excluded from both the total
number of active Employees as well as from the identification of particular
Employees in the Top Paid Group.
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The foregoing exclusions set forth in this Section shall be
applied on a uniform and consistent basis for all purposes for which the Code
Section 414(q) definition is applicable.
(m) Non-Highly Compensated Participant: Any Participant or
Former Participant who is not a Highly Compensated Participant.
(n) Participant: An Employee who meets the participation
requirements of Section 3.1.
(o) Permanent Disability: A Participant's total and permanent
disability, as determined in accordance with the long term disability plan
applicable to the Participant.
(p) Plan Year: Plan Year means the twelve-month period
beginning on January 1 and ending on December 31.
(q) Trust: Shall mean the legal entity created by the trust
agreement between the Company and Trustee, fixing the rights and liabilities of
each with respect to managing and controlling the trust funds for the purposes
of the Plan.
(r) Trustee: The individual or individuals, bank or trust
company which at a particular time shall be the trustee under the Trust.
(s) Valuation Date: Effective May 1, 1997, each business day
on which the New York Stock Exchange is open and which is not a national banking
holiday or a normally scheduled Company holiday and such other dates as may be
designated by the Administrator in a uniform and nondiscriminatory manner.
(t) Prior Plan: The ICH Savings Investment Plan.
2.2 Gender and Number. Except as otherwise indicated by the context,
masculine terminology shall include the feminine and the singular shall include
the plural.
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ARTICLE 3
PARTICIPATION
3.1 Participation. Each Employee who was a Participant in the Plan on
June 30, 1997 pursuant to the terms of the Plan as in effect prior to this
restatement, shall continue as such, subject to the terms and provisions of this
Plan. Effective July 1, 1997, every other Employee shall be eligible to become a
Participant in the Plan on the first day of the second month immediately
following his date of hire if such Employee's customary employment is for at
least one thousand (1,000) Hours of Service per year; or if such Employee's
customary employment is for less than one thousand (1,000) Hours of Service per
year, the first day of the month immediately following either (a) the Employee's
initial six-month period of employment, or (b) any subsequent six-month period,
during which such Employee actually completes five hundred (500) Hours of
Service. Eligible Employees shall become Participants in the Plan upon the first
Valuation Date following enrollment in the Plan in accordance with procedures
and rules established by the Plan Administrator.
3.2 Termination of Participation. Subject to the provisions of Section
3.4 hereof, an individual shall cease to be a Participant when he terminates
employment with all Employers hereunder.
3.3 Reemployment. A former Employee's eligibility to participate in the
Plan and the reinstatement of his Credited Service following his reemployment by
the Employer shall be governed by the following rules:
(a) Return Prior to Five (5) Consecutive Breaks-in-Service. The
former Employee shall resume participation in the Plan and his Credited Service
shall be reinstated immediately upon his reemployment if he was a Participant in
the Plan prior to his departure and he is reemployed by the Employer prior to
incurring five (5) consecutive 1-year Breaks-in-Service. If the former Employee
terminated employment after completing at least six (6) months of service but
prior to becoming a Participant, his Credited Service will be reinstated and he
will become a Participant as of the later of his date of reemployment or the day
on which he would have become a Participant if his employment had not been
terminated
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as long as he is reemployed prior to incurring five (5) consecutive
1-year Breaks-in-Service.
(b) Return After Five (5) Consecutive Breaks-in-Service. If a
former Employee had a nonforfeitable right to all or a portion of his Account at
the time of his termination of employment, his Credited Service will be
reinstated and he shall resume participation in the Plan immediately upon his
reemployment if he is reemployed by the Employer after incurring five (5)
consecutive 1-year Breaks-in-Service. If the former Employee did not have a
nonforfeitable right to any portion of his Account at the time of his
termination, he shall be considered a new Employee for all purposes if the
number of his consecutive 1-year Breaks-in-Service equal or exceed the greater
of (1) five (5) years or (2) the aggregate number of years of Credited Service
before such breaks. If such former Participant's years of Credited Service
before his termination exceed the greater of (1) five (5) years or (2) the
number of consecutive 1-year Breaks-in-Service after such termination, his
Credited Service will be reinstated and the Participant shall participate
immediately. In determining a former Employee's aggregate number of years of
Credited Service before the consecutive Breaks-in-Service, years of Credited
Service disregarded in accordance with this Section as the result of prior
periods of consecutive Breaks-in-Service shall not be considered.
Except as noted above, for participation purposes a former
Employee will be treated as a new Employee, and his prior Credited Service shall
be disregarded upon his reemployment.
3.4 Cessation of Eligible Status. If any Participant does not suffer a
Break-in-Service but ceases to be an Employee, such Participant shall not be
credited with any Employer contributions or forfeitures for continuous service
during the period in which he ceases to be an eligible Participant; however,
such Participant shall receive credit for vesting purposes for continuous
service during the period in which he is not an eligible Participant.
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ARTICLE 4
EMPLOYEE CONTRIBUTIONS
4.1 Employee Contributions. Effective December 1, 1997, subject to the
limitations of Article 6, each Participant may make contributions to the Plan,
only by payroll deduction, of before-tax and/or after-tax deposits in any whole
percentage of his Compensation, between 0% and 15%, as he elects, in accordance
with the procedures and rules established by the Administrator. The before-tax
and after-tax deposits elected by the Participant will be subject to a combined
total of 15% and will be deducted from his Compensation for each payroll period
and shall be paid by the Employer to the Trust not later than the fifteenth
(15th) business day of the month following the month in which the deposits were
deducted.
4.2 Dates of Election.
(a) A Participant may elect to make before-tax deposits and
after-tax deposits, as provided in Section 4.1, by authorizing payroll
deductions, in accordance with the procedures and rules established by the
Administrator.
(b) A Participant may change his before-tax deposit percentage
or after-tax deposit percentage to any other percentage authorized under Section
4.1 effective the first practicable payroll following the 1st or 15th day of the
month following the Participant's election, in accordance with the procedures
and rules established by the Administrator.
(c) A Participant may discontinue before-tax deposits and/or
after-tax deposits, as provided by Section 4.1, at any time effective the first
practicable payroll following the 1st or 15th day of the month following the
Participants' election, in accordance with the procedures and rules established
by the Administrator.
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ARTICLE 5
EMPLOYER CONTRIBUTIONS
5.1 Employer Matching Contributions. The Employer shall contribute to
the Plan on behalf of each Eligible Participant (as defined below) to be paid in
Company stock or in cash to be used to purchase Company stock for each Plan
Year, an amount equal to 50% of that portion of each Eligible Participant's
before-tax deposits made during the Plan Year which do not exceed 4% of the
Compensation paid to the Participant during the Plan Year and while such
Participant made contributions to the Plan.
For this purpose, an Eligible Participant is one who is active and
contributing to the Plan pursuant to Section 4.1 on the last day of the
applicable Plan Year or who is on an authorized leave of absence or who
terminated employment due to death, disability, or retirement on or after Normal
Retirement Age during the Plan Year.
In addition, the Employer may contribute to the Plan for any Plan Year
such additional amount or percentage in cash or Company stock based on all or a
portion of before-tax deposits of each Participant who is active and
contributing to the Plan pursuant to Section 4.1 on the last day of the Plan
Year or who is on an authorized leave of absence or who terminated employment
due to death, disability or retirement on or after Normal Retirement Age during
the Plan Year as the Employer determines in its sole discretion.
In the event contributions pursuant to this section are made in Company
stock, the number of shares of Company stock to be contributed shall be
determined by using the average price of Company stock for that Plan Year which
shall be determined by averaging the closing prices of Company stock each day to
obtain a monthly average price and averaging the monthly average prices to
obtain an annual average price.
Notwithstanding any other provision of the Plan to the contrary,
contributions, benefits, and service credit with respect to qualified military
service will be provided in accordance with Code Section 414(u).
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<PAGE>
5.2 Discretionary Employer Contributions. The Employers may make, in
Company stock or in cash to be used to purchase Company stock, a discretionary
contribution to the Trust in such amount, if any, as determined by the Board.
5.3 Allocation of Annual Employer Contributions and Forfeitures. As of
the last day of each Plan Year, each eligible Participant's allocable share, if
any, of the Employer's contributions for that Plan Year shall be credited to his
Account. As of the last day of the Plan Year, any amount which becomes a
forfeiture during the Plan Year, shall first be used, in accordance with Section
15.2(d), if applicable, to reinstate previously forfeited Accounts of former
Participants, if any, in accordance with Section 5.4, and the remaining
forfeitures, if any, shall be used to reduce contributions which would otherwise
be made by the forfeiting Participant's Employer.
Discretionary Employer contributions for the Plan Year, if any, arising
under the Plan during that year shall be allocated among the Accounts of those
Participants who are employed on the last day of the Plan Year and those
Participants who terminated employment during the Plan Year due to retirement,
disability or death, in the ratio that each Participant's Compensation for the
Plan Year bears to all Participant's Compensation for that Plan Year.
5.4 Restoration of Forfeited Amounts Upon Reemployment. If a person:
(a) who was a Participant on or after April 1, 1975 who terminated
participation nonvested, is reemployed by an employer before
he incurs five (5) consecutive 1-year Breaks-in-Service, or
(b) who terminated participation partially vested is reemployed by
the Employer before he incurs a break longer than the longer
of (i) the length of the person's prior service with the
Employer or (ii) five (5) consecutive 1-year
Breaks-in-Service,
he shall receive a special allocation equal to the amount forfeited, if any,
from such Participant's Account upon the
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<PAGE>
Participant's prior termination of employment. The special allocation will be
made as of the end of the Plan Year in which the Participant is reemployed and
shall be in addition to the contributions described above. The source of the
special allocation shall first be any forfeitures occurring during the Plan Year
and, if that source is insufficient, then the Employer shall make a special
contribution to the Participant's Account in an amount sufficient to cover the
special allocation. However, for Participants who terminated participation
partially vested and who are reemployed as provided above, the special
contribution shall be allocated to a separate subaccount and the reemployed
Participant's vested interest in the subaccount at the relevant time shall be an
amount ("X") determined by the formula:
X = P(AB + (R x D)) - (R x D)
For purposes of applying this formula: P is the nonforfeitable
percentage at the relevant time, AB is the Account balance at the relevant time,
D is the amount of the distribution, and R is the ratio of the Account balance
at the relevant time to the Account balance after distribution.
5.5 Rollover Contributions. An Employee who receives or is credited
with a distribution described in subsection (a), (b) or (c) of this Section may,
but need not, make a special contribution to this Plan, which contribution will
hereafter be referred to as a "Rollover Contribution." In making a Rollover
Contribution, the Employee must transfer, or direct the transfer of, cash equal
to the value of all or part of the property the Employee received or is entitled
to receive in the distribution to the Trustees, to the extent the fair market
value of such property exceeds an amount equal to after-tax contributions made
by the Employee to the plan from which the distribution is being made. In
addition, prior to the acceptance of a Rollover Contribution, the Employer may
require the submission of such evidence as the Employer deems necessary or
desirable to enable it to determine whether the transfer qualifies as a Rollover
Contribution. If the Employer determines subsequent to any Rollover Contribution
that any such Rollover Contribution did not in fact qualify as such, the value
of such Rollover Contribution shall be immediately distributed to the Employee.
For purposes of this Section 5.5, the following shall be eligible to be treated
as a Rollover Contribution:
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(a) A distribution to an Employee from an employee's trust
described in Code Section 401(a), which trust is exempt from tax under Code
Section 501(a), or from an annuity plan qualified under Code Section 403(a),
which distribution qualifies for rollover treatment pursuant to the Code, which
was received by the Employee not earlier than 60 days prior to the date the
Rollover Contribution is credited to the Trust; or
(b) A distribution to an Employee from an Individual Retirement
Account or an Individual Retirement Annuity (other than an endowment contract)
within the meaning of Code Section 408(a) or 408(b), the assets of which are
derived solely from a rollover or transfer thereto of a prior distribution to
the Employee described in (a) above, which was received by the Employee not
earlier than sixty (60) days prior to the date the Rollover Contribution is
credited to the Trust; or
(c) A distribution directly to the Plan from an eligible
retirement plan (as defined in Code Section 401(a)(31)(D)) of all or any portion
of the balance to the credit of the Employee, except that the following amounts
shall not be included: any distribution that is one (1) of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the distributee or the joint lives (or
joint life expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten (10) years or more; any
distribution to the extent such distribution is required under Code Section
401(a)(9); and that portion of any distribution that would not have been
includible in gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities) if it would have
been distributed directly to the Employees.
ARTICLE 6
LIMITATIONS
6.1 Limitations on Annual Account Additions.
(a) Annual Account Additions. The term "Annual Account Additions"
means, for any Participant for any Plan Year, the sum of --
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<PAGE>
(1) Employer and Affiliate contributions made for the
Participant under "any defined contribution plan" for the
Plan Year, including before-tax deposits and Matching
Contributions hereunder; and
(2) the Participant's after-tax contributions to "any defined
contribution plan"; and
(3) forfeitures, if any, allocated to the Participant for the
year under "any defined contribution plan"; and
(4) amounts allocated on the Participant's behalf to a
medical account, as defined in Code Section 415(l)(1) or
419A(d)(2), although the percent age limit described in
Subsection(b) (2) below shall not apply to such amounts;
but shall not include any Rollover Contributions under the Plan. "Any defined
contribution plan" means this Plan and all other defined contribution plans of
the Employer and Affiliates considered as one plan.
(b) Limitation. Notwithstanding the foregoing provisions of this
Section 6.1, the Annual Account Additions of a Participant for any Plan Year,
which shall be the limitation year, shall not exceed the lesser of --
(1) the greater of $30,000 or 1/4 of the defined benefit
dollar limitation set forth in Code Section 415(b) in
effect for such Plan Year, or
(2) 25% of the Participant's compensation as defined in
Subsection (c) below, for such Plan Year.
(c) Compensation. The term "compensation" as used herein, means
compensation as defined in Code Section 415(c)(3) and Treasury Regulation
thereunder, which generally means amounts actually paid during a limitation year
which are the Participant's wages, salary, fees for personal services actually
rendered in the
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<PAGE>
course of employment with the Employer or other Affiliate, including amounts
described in Treasury Regulation 1.415-2(d)(1), and excluding amounts which are
reduced pursuant to a salary reduction arrangement and other amounts described
in Treasury Regulation 1.415-2(d)(2). Such "compensation" may not exceed
$150,000 as adjusted by the Commissioner for increases in the cost-of-living in
accordance with Code Section 401(a)(17)(B). Notwithstanding anything herein to
the contrary, for Plan Years beginning on or after November 1, 1998, the term
"compensation" shall include elective deferrals pursuant to a salary reduction
agreement (as defined in Code Section 402(g)(3)) and any amount which is
contributed or deferred by the Employer at the election of the Employee and
which is not includable in the gross income of the Employee by reason of Code
Section 125 or 457.
(d) Reduction in Annual Account Additions. If in any Plan Year a
Participant's Annual Account Additions exceed the applicable limitation
determined under Subsection (b) above, by reason of a reasonable error in
estimating a Participant's compensation or otherwise, such excess (referred to
herein as the "Annual Account Excess") shall not be allocated to the
Participant's Account, but shall be treated in the following manner:
(1) The Participant's after-tax contributions, if any, under
"any defined contribution plan" shall be refunded, up to
the amount of the Annual Account Excess.
(2) If there is any remaining Annual Account Excess after the
application of paragraph (1) above, the Participant's
before-tax deposits and any matching Employer
contributions relating thereto for that year shall be
reduced proportionately, up to the remaining amount of
the Annual Account Excess, and such before-tax deposits
shall be returned to the Participant.
(3) If there is any remaining Annual Account Excess after the
application of paragraph (2) above, the Participant's
share of Employer or other Affiliate contributions, if
any,
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<PAGE>
allocated to the Participant under any other defined
contribution plan for that year shall be reduced in
accordance with such plan, up to the remaining amount of
the Annual Account Excess.
(4) Any reduction in such a Participant's allocation of
matching Employer contributions under paragraph (3) above
shall be deemed to be a forfeiture for such Plan Year and
used to reduce matching Employer contributions.
(5) Hold any excess amount remaining after (1) through (4)
above in a Code Section 415 suspense account.
(6) Allocate and reallocate the Section 415 suspense account
in the next limitation year (and succeeding limitation
years if necessary) to all Participants in the Plan
before any Employer contributions which would constitute
annual additions are made to the Plan for such limitation
year.
(7) Reduce Employer contributions to the Plan for such
limitation year by the amount of the Section 415 suspense
account allocated and reallocated during such limitation
year.
(e) Dual Plan Limitation. For Plan Years beginning prior to
January 1, 2000, if in any Plan Year a Participant is both an active participant
in any defined contribution plan and a participant of any "qualified" defined
benefit plan of the Employer or other Affiliate, the sum of the defined benefit
plan fraction (as defined in Code Section 415(e)(2)) and the defined
contribution plan fraction (as defined in Code Section 415(e)(3)) shall not
exceed 1.0. For Plan Years beginning prior to January 1, 2000, it is intended to
reduce the Annual Account Additions under the defined contribution plan to the
extent possible, if necessary, to prevent the sum of the defined benefit plan
fraction and the defined contribution fraction from exceeding 1.0, before
reducing the accrued benefits under any defined benefit plan.
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6.2 Maximum Amount of Before-Tax Deposits. In no event shall a
Participant's aggregate before-tax deposits for any calendar year, when combined
with all other elective pre-tax deferrals under Code Section 402(g) on behalf of
the Participant, exceed $7,000 (or such higher annual amount as may be
determined by the Secretary of the Treasury to reflect increases in the cost of
living). The annual limit shall be reduced as provided under Section 9.3
following a Participant's hardship withdrawal. To the extent that such a
Participant's before-tax deposits exceed the applicable dollar limit for a
calendar year, such deposits shall be treated as income to the Participant for
such calendar year. Such excess deferral, adjusted for earnings or losses
thereon, shall be distributed to the Participant not later than April 15 of the
calendar year following the calendar year in which such excess deferral was
made.
Any such distribution of earnings on excess deferrals shall be treated
as income to the Participant in the year of distribution.
6.3 Actual Deferral Percentage Tests. The limits described in this
Section 6.3 apply to before-tax deposits made pursuant to Section 4.1.
Notwithstanding any provision to the contrary in this Plan concerning the
amount, availability, or allocation of before-tax deposits, no amount of
before-tax deposits shall be allocated to a Participant's Account in excess of
the limits contained in this Section 6.3.
(a) Actual Deferral Percentage means for each Plan Year the
average of the ratios (ADR) (calculated separately for each
active Participant) of:
(1) the amount of before-tax deposits of each such Participant
for such Plan Year, to
(2) such Participant's Compensation;
provided, however, that if a Highly Compensated Participant
also participates in another qualified retirement plan with a
salary reduction feature maintained by the Employer under Code
Sections 401(a) and 401(k), such Participant's Actual Deferral
Percentage shall be determined as if all
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<PAGE>
such qualified plans with a salary reduction feature
ending within the same calendar year were a single plan.
(b) The Actual Deferral Percentage test described hereinafter
shall be made as of the end of each Plan Year. The
Administrator in its discretion may choose to make the
Actual Deferral Percentage test more frequently than
annually. Any excess deferral described in Section 6.2
shall be included in the computation of the Actual
Deferral Percentage notwithstanding the distribution of
any portion thereof, unless otherwise provided under
rules prescribed by the Secretary of the Treasury. For
any Plan Year, the Actual Deferral Percentage for the
group of Highly Compensated Participants must not exceed
the greater of:
(1) 125% of such percentage for the preceding Plan Year
for all other eligible Employees; or
(2) the lesser of 200% of such percentage for the
preceding Plan Year for the Non-Highly Compensated
Participants, or such percentage for the preceding
Plan Year for the Non-Highly Compensated
Participants plus two (2) percentage points. The
provisions of Code Section 401(k)(3) and Regulation
1.401(k)1(b) are incorporated herein by reference.
However, in order to prevent the multiple use of the
alternative method described in this paragraph and
in Code Section 401(m)(9)(A), any Highly Compensated
Participant eligible to make before-tax deposits
pursuant to Section 4.1 and to make after-tax
deposits contributions or to receive matching
Employer contributions under this Plan or under any
other plan maintained by the Employer shall have his
Actual Contribution Percentage reduced pursuant to
Regulation 1.401(m)-2, the provisions of which are
incorporated herein by reference.
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If two (2) or more qualified plans which include a salary reduction
feature described in Code Section 401(k) are considered as one plan for purposes
of Code Section 401(a)(4) or 410(b), the salary reduction feature included in
such plans shall be treated as one salary reduction arrangement for purposes of
the Actual Deferral Percentage test. Plans may be aggregated in order to satisfy
Code Section 401(k) only if they have the same Plan Year. In the event the
Actual Deferral Percentage test is not met as of the end of any Plan Year, the
provisions of Section 6.4 shall apply.
6.4 Adjustment to Actual Deferral Percentage Tests. In the event the
Actual Deferral Percentage test is not met as of the end of any Plan Year, the
Administrator shall take the actions called for in this Section 6.4. Excess
Contributions with respect to any Participant are before-tax deposits which do
not meet the Actual Deferral Percentage test described in Section 6.3.
If it appears that there will be Excess Contributions as of the end of
any Plan Year, the Administrator shall inform the Employer. The Employer, in its
discretion, may make a supplemental contribution which shall be allocated to the
Accounts of Participants who are Non-Highly Compensated Participants. Any such
supplemental contribution shall be allocated in a uniform and nondiscriminatory
manner in an amount sufficient to eliminate any Excess Contributions. Such
supplemental contribution by the Employer must be made, if at all, within the
first two and one-half (22) months after the close of the Plan Year in which the
Excess Contributions arose. Such supplemental contribution shall be treated for
all purposes as a before-tax deposit. The allocation of a portion of any such
supplemental contribution to the Account of an affected Participant is subject
to the Code Section 415 limits. If the Employer chooses to make a supplemental
contribution in an amount less than that required to completely eliminate all
Excess Contributions, the remaining Excess Contributions shall be disposed of in
the manner hereinafter described.
Should the Employer not choose to make a supplemental contribution for
the purpose of eliminating any Excess Contributions, or if Excess Contributions
remain after a supplemental contribution has been made, the before-tax deposits
of the Participants who are Highly Compensated Participants shall be
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<PAGE>
reduced to the extent necessary so that the Actual Deferral Percentage test set
forth in Section 6.3 is met as of the end of the applicable Plan Year. Such
reduction shall be accomplished first by determining the maximum deferral for
the group of Participants who are Highly Compensated Participants permitted by
the Actual Deferral Percentage test. Next, the before-tax deposits of the
Participants with the largest deferrals shall be reduced in the order of their
actual deferral amounts beginning with the highest of such deferrals in
accordance with procedures adopted by the Administrator until the actual
deferrals for the group of Participants who are Highly Compensated Participants
does not exceed the maximum deferral determined for that group.
The Administrator shall cause the amount of Excess Contributions (and
income allocable thereto) attributable to each affected Participant to be
returned to such Participant not later than the end of the Plan Year following
the Plan Year as of which the Excess Contributions arose. However, the
Administrator shall use its best efforts to cause the amount of Excess
Contributions (and any income allocable thereto) attributable to each affected
Participant to be returned to such Participant within two and one-half (22)
months following the end of the Plan Year as of which the Excess Contributions
arose. The income allocable to the Excess Contributions of each affected
Participant is equal to the sum of (a) the income allocable to the Account of
the affected Participant for the applicable Plan Year, and (b) the income
allocable to the Account of the affected Participant for the period between the
end of the applicable Plan Year and the date of distribution with the sum of (a)
and (b) being multiplied by a fraction. The numerator of the fraction is the
Excess Contribution attributable to each affected Participant and the
denominator of the fraction is the closing balance (inclusive of any income), as
of the end of the applicable Plan Year, of the Participant's Account containing
the Excess Contributions.
6.5 Maximum Contribution Percentage. The limits described in this
Section 6.5 apply to matching Employer contributions and after-tax
contributions. Notwithstanding any provision to the contrary in this Plan
concerning the amount, availability, or allocation of matching Employer
contributions, no amount of such contributions shall be allocated to the Account
of any Participant in excess of the limits contained in this Section 6.5.
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(a) Actual Contribution Percentage means for each Plan Year the
average of the ratios (ACR) (calculated separately for each
Participant) of:
(1) the amount of matching Employer contributions and
after-tax contributions of each such Participant for such
Plan Year, to
(2) such Participant's Compensation;
provided, however, that if a Highly Compensated Participant
who also participates in another qualified retirement plan
maintained by the Employer to which matching contributions,
employee contributions, or elective deferrals are made, such
active Participant's Actual Contribution Percentage shall be
determined by aggregating all Employer matching contributions
and after-tax contributions in plans which end within the same
calendar year.
(b) The Actual Contribution Percentage test described hereinafter
shall be made as of the end of each Plan Year. The
Administrator in its discretion may choose to make the Actual
Contribution Percentage test more frequently than annually.
For any Plan Year, the Actual Contribution Percentage for the
group of Highly Compensated Participants must not exceed the
greater of:
(1) 125% of such percentage for the preceding Plan Year for
all other Participants; or
(2) the lesser of 200% of such percentage for the preceding
Plan Year for the Non-Highly Compensated Participants, or
such percentage for the preceding Plan Year for the
Non-Highly Compensated Participants plus two (2)
percentage points. However, to prevent the multiple use
of the alternative method described in this paragraph and
Code Section 401(m)(9)(A), any Highly Compensated
Participant eligible to make before-tax deposits pursuant
to Section 4.1 or any other
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<PAGE>
cash or deferred arrangement maintained by the Employer
and to make after-tax deposits or to receive matching
contributions under this Plan or under any other plan
maintained by the Employer shall have his Actual
Contribution Percentage reduced pursuant to Regulation
1.401(m)-2. The provisions of Code Section 401(m) and
Regulations 1.401(m)1(b) and 1.401(m)-2 are incorporated
herein by reference.
For purposes of this Subsection (b), the amount taken into account as
the Actual Contribution Percentage of Non-Highly Compensated Participants for
the preceding Plan Year shall be 3%.
If two (2) or more qualified plans which include matching
contributions, employee contributions, or elective deferrals are considered as
one plan for purposes of Code Section 410(b), such plans shall be treated as one
plan for purposes of the Actual Contribution Percentage test. Plans may be
aggregated in order to satisfy Code Section 401(m) only if they have the same
Plan Year. In the event the Actual Contribution Percentage test is not met as of
the end of any Plan Year, the provisions of Section 6.6 shall apply.
6.6 Adjustment For Excessive Contribution Percentage. In the event the
Actual Contribution Percentage test is not met as of the end of any Plan Year,
the Administrator shall take the actions called for in this Section 6.6. Excess
Aggregate Contributions with respect to any Participant are matching Employer
contributions and after-tax deposits which do not meet the Actual Contribution
Percentage test described in Section 6.5.
If it appears that there will be Excess Aggregate Contributions as of
the end of any Plan Year, the Administrator shall inform the Employer. The
Employer, in its discretion, may make an additional matching Employer
contribution which shall be allocated to the Accounts of all Participants who
are not Highly Compensated Participants. In lieu of making an additional
matching Employer contribution, the Employer may make a supplemental
contribution which shall be allocated to the Accounts of all active Participants
who are not Highly Compensated Participants. Any
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additional matching Employer contribution or supplemental contribution shall be
allocated in a uniform and nondiscriminatory manner in an amount sufficient to
eliminate any Excess Aggregate Contributions. Such additional matching Employer
contribution or supplemental contribution by the Employer must be made, if at
all, within the first two and one-half (22) months after the close of the Plan
Year in which the Excess Aggregate Contributions arose.
Any additional matching Employer contribution shall be treated for all
purposes as a matching Employer contribution and any supplemental contribution
shall be treated for all purposes as an after-tax Employee contribution. The
allocation of either an additional matching Employer contribution or a
supplemental contribution to the Participant Account of an affected Participant
is subject to the Code Section 415 limits. If the Employer chooses to make an
additional matching Employer contribution, a supplemental contribution, or a
combination of both in an amount less than that required to completely eliminate
all Excess Aggregate Contributions, the remaining Excess Aggregate Contributions
shall be disposed of in the manner hereinafter described.
Should the Employer not choose to make an additional matching Employer
contribution, a supplemental contribution, or a combination of both for the
purpose of eliminating any Excess Aggregate Contributions or if Excess Aggregate
Contributions remain after any such contributions have been made, the matching
Employer contributions and/or after-tax deposits of the Participants who are
Highly Compensated Participants shall be reduced to the extent necessary so that
the Actual Contribution Percentage test set forth in Section 6.5 is met as of
the end of the applicable Plan Year. Such reduction shall be accomplished first
by determining the maximum contribution for the group of Participants who are
Highly Compensated Participants permitted by the Actual Contribution Percentage
test. Next, the matching Employer contributions and/or after-tax deposits of the
Participants with the largest contributions shall be reduced in the order of
their actual contribution amounts beginning with the highest of such
contributions in accordance with procedures adopted by the Administrator until
the actual contributions for the group of Participants who are Highly
Compensated Participants does not exceed the maximum contribution determined for
that group.
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The Administrator shall cause the amount of Excess Aggregate
Contributions (and any income allocable thereto) attributable to each affected
Participant to be returned to such Participant not later than the end of the
Plan Year following the Plan Year as of which the Excess Aggregate Contributions
arose. However, the Administrator shall use its best efforts to cause the amount
of Excess Aggregate Contributions (and any income allocable thereto)
attributable to each affected Participant to be returned to such Participant
within two and one-half (22) months following the end of the Plan Year as of
which the Excess Aggregate Contributions arose. The income allocable to the
Excess Aggregate Contributions of each affected Participant is equal to the sum
of (a) the income allocable to the Account of the affected Participant for the
applicable Plan Year, and (b) the income allocable to the Account of the
affected Participant for the period between the end of the applicable Plan Year
and the date of distribution, with the sum of (a) and (b) being multiplied by a
fraction. The numerator of the fraction is the Excess Aggregate contribution
attributable to each affected Participant and the denominator of the fraction is
the closing balance (inclusive of any income), as of the end of the applicable
Plan Year, of the Account containing the Excess Aggregate Contribution.
6.7 Limit on Total Contribution of Employer; Precluding Excess
Allocations. The total contributions of the Employer, as determined under
Sections 4.1, 5.1 and 5.2, for any Plan Year shall not exceed the maximum tax
deductible contribution permitted by law. In addition, in no event will the
amount allocated to a Participant's Account in any Plan Year exceed the
limitations set forth in this Article 6.
ARTICLE 7
CREDITING OF CONTRIBUTIONS AND DEPOSITS TO INVESTMENT FUNDS
7.1 Investment Funds. The Administrator shall establish Investment
Funds which shall be used as investment vehicles for contributions and deposits
credited to each Participant's Account. The Administrator may add, eliminate, or
change Investment Funds in its complete direction at any time. Effective October
1, 1997, the Investment Funds are as follows:
(a) Conseco Stock Fund;
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(b) Money Market Fund;
(c) Interest Income Fund;
(d) Government Securities Fund;
(e) S & P 500 Index Fund;
(f) Conseco Fund Group Fixed Income Fund;
(g) Conseco Fund Group Equity Fund;
(h) Conseco Fund Group Asset Allocation Fund;
(i) Travellers Stock Fund; and
(j) Contingent Rights Fund.
Notwithstanding any other provision herein to the contrary, dividends
received on the Travellers Stock Fund shall be automatically invested in the
Money Market Fund and a Participant's interest in the Travellers Stock Fund
shall not be liquidated for purposes of loans, hardship withdrawals or 592
withdrawals unless all the assets have already been liquidated. Further, a
Participant's interest in the Contingent Rights Fund shall not be liquidated for
any purpose until the liquidation of the Contingent Rights contained in the
Contingent Rights Fund, at which time such funds shall automatically be
transferred to the Money Market Fund and the Contingent Rights Fund shall
terminate.
7.2 Investment of Employer Contribution Accounts. Employer Contribution
Accounts shall be invested and reinvested in the Conseco Stock Fund.
7.3 Participant's Choice of Investments. Effective May 1, 1997, a
Participant may elect, in accordance with such procedures and rules as
established by the Administrator, on any Valuation Date, other than during any
earnings release blackout, as determined in the sole discretion of the Plan
Administrator and communicated to Plan Participants, that all future
contributions subject to investment direction (other than Employer Matching
Contributions) be invested, in 1% increments, in one (1) or more of the
investment funds established pursuant to Section 7.1; provided,
26
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however, that no Participant may elect that future contributions be invested in
the Travellers Stock Fund or the Contingent Rights Fund. Effective May 1, 1997,
Participants are limited to five (5) investment elections per calendar quarter.
Effective May 1, 1997, notwithstanding anything herein to the contrary,
elections may not be made, in accordance with such procedures and rules as
established by the Administrator, during the two week period prior to each
quarterly earnings release and the two business days following each quarterly
earnings release, as determined in the sole discretion of the Plan Administrator
and communicated to Plan Participants. If a Participant fails to make any
election or makes an election prohibited hereunder, 100% of his contributions
subject to investment direction shall be invested in the Money Market Fund.
7.4 Change of Prior Investments. Effective May 1, 1997, each
Participant may reallocate on any Valuation Date all or a portion of his Account
subject to investment direction from one investment fund established pursuant to
Section 7.1 to another such investment fund, in 1% increments on any Valuation
Date in accordance with such procedures and rules as established by the
Administrator; provided, however, that Participants shall not reallocate any
portion of their Account to the Travellers Stock Fund or to or from the
Contingent Rights Fund. Effective May 1, 1997, Participants are limited to five
(5) investment transfers per calendar quarter. Effective May 1, 1997,
notwithstanding anything herein to the contrary, transfers involving Conseco
Stock may only be made during a ten (10) business day period each calendar
quarter, beginning on the third (3rd) business day following the quarterly
earnings release as determined in the sole discretion of the Plan Administrator
and communicated to Plan Participants. The Administrator may, in its sole
discretion, designate more frequent investment transfer dates if the
Administrator deems it appropriate in light of the market volatility to which
the investment alternatives may reasonably be expected to be subject.
ARTICLE 8
ACCOUNTS
8.1 Separate Accounts. The Administrator shall maintain the following
subaccounts:
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(a) a Before-Tax Deposit Account for each Participant who elects
to direct the Employer to make before-tax deposits on his
behalf;
(b) an Employer Contribution Account shall be maintained for each
Participant for Employer matching contributions allocated to a
Participant's Account for any annual discretionary employer
contributions allocated to a Participant's Account;
(c) a pre-1987 After-Tax Deposit Account shall be maintained for
each Participant for any After-Tax Deposits made prior to
January 1, 1987;
(d) a Post-1986 After-Tax Deposit Account shall be maintained for
each Participant for any After-Tax Deposits made on or after
January 1, 1987;
(e) a Rollover Account shall be maintained for all Rollover
contributions allocated to a Participant's Account; and
(f) a Prior Plan Match Account shall be maintained for matching
contributions transferred to the BankersSave Plan pursuant to
a Prior Plan Merger by Participants who were participants in
the Prior Plan.
The Administrator shall also create such other subaccounts as it deems necessary
or desirable.
8.2 Valuation of Separate Accounts. As of each Valuation Date, the
Administrator shall adjust the previous Account balances for before-tax
deposits, matching contributions, discretionary employer contributions,
after-tax contributions, earnings, gains or losses, withdrawals, expenses,
Participant loans and any Participant rollover and transfer contributions in
order to obtain new Account balances.
8.3 Determination of Fund Performance. For purposes of determining
Account values, each Account's share of the income, appreciation and
depreciation of each Investment Fund as of any Valuation Date shall be that
proportion of the total income,
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appreciation or depreciation of such Investment Fund during such period that the
balance of such accounts during such period bears to the balance of all such
accounts in such investment fund during such period. The value of each account,
each Investment Fund, and the Trust fund as of the end of any period shall be
the fair market value of such account or fund. The total before-tax deposits and
after-tax deposits for the period will be reflected in said determination.
8.4 Voting of Company Stock. Voting, tender and similar rights shall be
passed through to Participants and beneficiaries pursuant to the provisions of
the Trust.
ARTICLE 9
WITHDRAWALS DURING EMPLOYMENT
9.1 After-Tax Deposit Account withdrawals. Each active Participant who
has made After-Tax Deposits may withdraw such deposits at any time, in
accordance with the procedures and rules established by the Administrator but,
effective December 1, 1997, not more often than once in any calendar quarter,
provided, that the Participant has not made a Hardship Withdrawal during the
calendar quarter. Effective May 1, 1997, payment shall be made to the
Participant as soon as practicable, in accordance with the bi-weekly processing
schedule, following the date the request is filed with the Plan Administrator.
The withdrawal may not exceed the lesser of the value of the Participant's
After-Tax Deposit Accounts or his total After-Tax Deposits, and may not be less
than the lesser of (i) $1,000 or (ii) the maximum after-tax deposit withdrawal
as determined above. Any such withdrawal will be taken from the Participant's
Pre-1987 After-Tax Deposit Account and Post-1986 After-Tax Deposit Account, in
the following order:
(a) Pre-1987 after-tax deposit contributions;
(b) Post-1986 after-tax deposit contributions and earnings on all
after-tax deposit contributions.
After-Tax Deposit Account Withdrawals under this Section 9.1 shall be charged
against the value of the withdrawing Participant's subaccount in each of the
Investment Funds proportionally.
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9.2 Withdrawals After Age Fifty-nine and one-half (592). An active
Participant who has attained age fifty-nine and one-half (592) may withdraw all
or a portion of his vested Account balance determined as of the Valuation Date
determined in accordance with the bi-weekly processing schedule in accordance
with the procedures and rules established by the Administrator. Effective May 1,
1997, payment shall be made to the Participant as soon as practicable, in
accordance with the bi-weekly processing schedule, following the Participant's
submission of his request for distribution to the Plan Administrator. Any such
withdrawal will be taken from the Participant's Account in the following order:
(a) Pre-1987 after-tax contributions;
(b) Post-1986 after-tax contributions and earnings on all
after-tax contributions;
(c) Rollover contributions and earnings;
(d) Before-tax deposits and earnings;
(e) Prior Plan matching contributions and earnings; and
(f) Employer contributions and earnings.
Post-fifty-nine and one-half (592) withdrawals under this Section 9.2 shall be
charged against the value of the withdrawing Participant's subaccount in each of
the Investment Funds proportionally.
9.3 Hardship Withdrawals. Upon the request of a Participant made in
accordance with such uniform and nondiscriminatory rules as the Administrator
may prescribe and, effective December 1, 1997, not more frequently than once in
any calendar quarter, provided that the Participant has not made an after-tax
withdrawal during that calendar quarter, the Administrator shall permit a
Participant to make a hardship withdrawal from his Before-Tax Deposit Account
from the Plan prior to the Participant's termination of employment or Permanent
Disability if (a) the withdrawing Participant is either under fifty-nine and
one-half (592) years of age on the date the withdrawal is being made or has
previously made a withdrawal after age fifty-nine and one-half (592) pursuant to
Section 9.2 hereof, and (b) the Trustee, in
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accordance with the provisions of Internal Revenue Regulation Section
1.401(k)-l(d)(2) and with the following paragraph, finds that such withdrawal is
necessary because of the Participant's immediate and heavy financial need. The
maximum amount that can be withdrawn under this Section 9.3 shall be the lesser
of (a) the amount which the Trustee, in accordance with the provisions of
Internal Revenue Regulation Section 1.401(k)-l(d)(2) and with the following
paragraph, deem to be necessary to meet the immediate and heavy financial need
of the withdrawing Participant created by the hardship, and (b) the value of the
Participant's Before-Tax Deposit, After-Tax and Rollover Accounts determined on
the last Valuation Date reduced by the appreciation on any before-tax deposits
credited to the Participant's Before-Tax Deposit Account subsequent to December
31, 1988.
For purposes of this Section, a distribution will be deemed to be on
account of immediate and heavy financial need if the distribution is on account
of:
(1) Medical expenses described in Code Section 213(d) incurred by the
Employee, the Employee's spouse, or any dependents of the Employee (as defined
in Code Section 152);
(2) Purchase (excluding mortgage payments) of a principal residence for
the Employee; or
(3) Payment of tuition for the next year of post-secondary education
for the Employee, his or her spouse, children, or dependents.
(4) The need to prevent the eviction of the Employee from his principal
residence or foreclosure on the mortgage of the Employee's principal residence.
Further, a distribution will be deemed to be necessary to satisfy the
immediate and heavy financial need if the distribution is not in excess of the
amount necessary to relieve the need and cannot be satisfied from other
resources that are reasonably available to the Employee including other
withdrawals and loans currently available under all plans maintained by the
Employer; provided, however, a Participant may obtain a hardship withdrawal
without obtaining all loans for which the Participant is eligible if the
Participant certifies to the Trustee that the receipt of a loan would increase
the amount of the Participant's immediate financial need and would therefore not
serve to relieve the Participant's immediate financial need.
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<PAGE>
Hardship withdrawals under this Section 9.3 shall be charged against
the value of the withdrawing Participant's subaccount in each of the Investment
Funds proportionally. Any such hardship withdrawal will be taken from the
Participant's Account in the following order:
(a) Pre-1987 after-tax contributions;
(b) Post-1986 after-tax contributions and earnings on all after-tax
contributions;
(c) Rollover contributions and earnings; and
(d) Before-tax deposits and earnings (prior to April 1, 1989).
Any Participant receiving a hardship distribution must certify and
agree to satisfy all of the following conditions:
(a) The distribution is not in excess of the amount of the
Participant's immediate and heavy financial need;
(b) The Participant has obtained all distributions, other than hardship
distributions, and all non-taxable loans currently available under all plans
maintained by the Employer or its Affiliates;
(c) The Participant's before-tax deposits and after-tax deposits shall
be suspended for at least twelve (12) months after the receipt of the hardship
distribution; and
(d) The Participant shall not be eligible to make any before-tax
deposits until the first day of the first Plan Year following the first
anniversary of the date on which the hardship distribution was made.
9.4 Withdrawal of Rollover Contributions by Prior Plan Participants.
Any active Participant who was previously an active Participant in the Prior
Plan may withdraw at any time in accordance with the procedures and rules
established by the Administrator, but not more often than once in any six (6)
month period, an amount not less than the lesser of (i) the value of the
Participant's Rollover Account, and (ii) $1,000. Payment shall be made to the
Participant as soon as practicable, in accordance with the bi-weekly processing
schedule, following the Participant's request for distribution to the Plan
Administrator. Any such
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<PAGE>
withdrawal shall be taken from the Participant's Rollover Account and shall be
charged against the value of the withdrawing Participant's subaccount in each of
the Investment Funds proportionately.
9.5 Loans. Upon request of a Participant, made with the consent of the
Participant's spouse, if applicable, in accordance with such uniform procedures
and rules as the Administrator may prescribe, the Administrator will permit the
Plan to make a loan to a Participant provided that:
(a) Only active Participants will be eligible to request a loan.
(b) The minimum amount a Participant can request is $1,000.
(c) A Participant cannot have more than one (1) outstanding loan at
any time.
(d) A Participant must wait a minimum of six (6) months between new
loan requests.
(e) The interest rate shall be based on the prime rate and shall be
reset on the first business day of every month. The interest rate and term of
the loan will be set as the date the loan is made and will not be changed during
the life of the loan.
(f) A Participant can pay off a loan in full at any time during the
life of the loan without penalty. However, no partial prepayments will be
accepted.
(g) The Participant's obligation is represented by a negotiable
promissory note which shall provide for level amortization with payments to be
made not less frequently than quarterly over a period not to exceed four (4)
years and six (6) months after the date of such loan unless the loan is to be
used by the Participant to acquire any dwelling unit which within a reasonable
time (determined at the time the loan is made) is to be used as a principal
residence of the Participant, and calling for payments to be made by payroll
deduction and for a period not to exceed ten (10) years.
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(h) The Participant agrees that any unpaid balance of the loan,
including accrued interest thereon, may be deducted from any distribution of his
Account to which the Participant or his beneficiary may be entitled, and if the
amount of such distribution is not sufficient to repay the remaining principal
and interest of any such loan, the Participant or his personal representative
shall be liable for and continue to make payments on any balance still due,
which payments may be withheld by the Employer from any Compensation due that
Participant;
(i) The amount loaned plus interest due thereon over the term of
the indebtedness is not more than the lesser of (i) $50,000 reduced by the
excess, if any, of the highest outstanding balance of loans from the Plan to the
Participant during the one year period ending on the day before the date on
which such loan is made, over the outstanding balance of loans from the Plan to
the Participant on the date on which such loan was made, and (ii) one-half (2)
of the Participant's vested Account balance, excluding the value of that portion
of the Account attributable to Employer contributions; and
(j) The written consent of the Participant's spouse must be
obtained within the ninety-day period prior to the date the loan was made.
Loans made to a Participant under this Section 9.5 shall constitute
a separate earmarked investment of the Account of the Participant to whom the
loan is being made. The amount of the loan shall be charged pro rata against the
value of said Participant's subaccounts in the following order and shall be
returned in the Participant's subaccounts in the reverse order:
(a) Pre-1987 after-tax contributions;
(b) Post-1986 after-tax contributions and earnings on all
after-tax contributions;
(c) Rollover contributions and earnings;
(d) Before-tax deposits and earnings; and
(e) Prior Plan matching contributions and earnings.
Effective December 12, 1994, loan repayments will be suspended
under this Plan as permitted under Code Section 414(u)(4).
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Amounts paid to the Plan by the Participant in repayment of an outstanding loan
shall be credited to and invested in the Participant's Account in each of the
Investment Funds in accordance with the Participant's direction covering new
deposits for the Plan year in which said amounts are repaid, or if none, in
accordance with the Participant's next preceding direction.
ARTICLE 10
DISTRIBUTIONS
10.1 Retirement. The Account of a Participant whose employment is
terminated on or after his sixtieth (60) birthday shall be nonforfeitable and
such Account will be distributed to the Participant as provided in Sections 10.6
and 10.7.
10.2 Death. Subject to Section 10.5, the designated beneficiary of a
Participant or beneficiary who dies during a Plan Year shall be eligible to
receive the full value of the Participant's or beneficiary's Account as provided
in Section 10.8.
10.3 Permanent Disability. The Account of a Participant whose
employment is terminated due to Permanent Disability shall be nonforfeitable and
such Account will be distributed to the Participant for his benefit as provided
in Sections 10.6 and 10.7 provided his Permanent Disability is established to
the satisfaction of the Administrator.
10.4 Other Termination of Employment. If a Participant's employment is
terminated other than in accordance with Sections 10.1 through 10.3, he shall be
eligible to receive the sum of the following as provided below:
(a) The full value of his Before-Tax Deposit Account, After-Tax
Deposit Accounts, and Rollover Account, if not previously withdrawn; and
(b) A percentage (determined as of the date of his termination) of
the value of his Employer Contribution Account, Prior Plan Match Account and
Discretionary Employer Contribution Account, if any, as determined below:
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(i) For Participants who were Participants in the Prior Plan
on December 31, 1992:
Completed Years of Vested
Credited Service Percentage
---------------- ----------
Less than 1 year 0%
1 year but less than 2 20%
2 years but less than 3 40%
3 years but less than 4 60%
4 years but less than 5 80%
After 5 or more years 100%
(ii) For all other Participants:
Completed Years of Vested
Credited Service Percentage
---------------- ----------
Less than 2 years 0%
2 20%
3 40%
4 60%
5 80%
6 or more years 100%
Provided, however, notwithstanding any other provision herein to the contrary,
any individual who was an Employee prior to January 1, 1995 shall be 100% vested
after the completion of five (5) years of Credited Service. Further, individuals
who were Employees (as that term was defined in the Statesman Savings Plan
401(k)) of American Life Holdings, Inc. prior to April 1, 1995 shall be 100%
vested in their Accounts. A Participant's before-tax and after-tax deposits and
rollovers shall be non-forfeitable and fully vested at all times.
The non-vested portion of a Participant's Account, if any, shall be forfeited as
of the earlier of (i) the date the Participant receives his distribution, or
(ii) the date on which the Participant suffers his fifth (5th) consecutive
one-year Break in Service, but is subject to reinstatement in accordance with
Section 5.4. The vested portion of the Participant's Employer Contribution
Account, Prior Plan Match Account, and the Participant's Before-Tax Deposit
Account, After-Tax Deposit Accounts, and Rollover Account,
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will be distributed to the Participant as provided in Sections 10.6 and 10.7.
10.5 Designation of Beneficiary.
(a) The Participant's spouse shall automatically be the designated
beneficiary to receive any distributions by reason of his death and shall be
paid in the manner prescribed in Section 10.8. However, if there is no spouse,
or if the spouse has consented then distribution by reason of the Participant's
death shall be made to his designated beneficiary in the manner prescribed in
Section 10.8.
(b) If there shall be a failure of all designated beneficiaries
(because of prior death, failure to designate in the manner herein provided, or
otherwise) with respect to any Participant the amount payable hereunder after
the death of such Participant shall be paid and distributed, in the order named,
to each of the following as shall be living on the date of any distribution:
(1) Such Participant's spouse;
(2) His descendants, per stirpes;
(3) His parents in equal shares; and
(4) His brothers and sisters in equal shares and their descendants, per
stirpes.
If no such person shall be living on the date of any distribution, such
amount shall be payable to the estate of the last survivor of said persons.
(c) The Trustee shall be fully protected in making their distributions
to the next successor designated beneficiary if, within six (6) months after any
date fixed for distribution they have no actual knowledge that a predecessor
designated beneficiary survived, or was existing on, such date.
10.6 Timing of Distributions. Effective May 1, 1997, the distribution
of a Participant's Account pursuant to Sections 10.1 and 10.3 will be made in
accordance with uniform rules and
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procedures established by the Administrator within one year following the
Participant's termination of employment if the vested Account is not and never
was in excess of $3,500 (effective January 1, 1998, $5,000). If the vested
Account is or ever was in excess of $3,500 (effective January 1, 1998, $5,000),
effective May 1, 1997, distribution shall commence on the later of (i) as soon
as administratively practicable following the Participant's termination of
employment, or (ii) as soon as administratively practicable following the
Participant's request for distribution. Further, distribution to an alternate
payee pursuant to a qualified domestic relations order, as defined in Code
Section 414(p), may be made as soon as practicable following the alternate
payee's request for distribution.
Provided, however, notwithstanding anything herein to the contrary,
payment of benefits shall commence not later than the sixtieth (60th) day after
the close of the Plan Year in which the latest of the following events occur:
(i) the Participant attains age sixty-five (65) or, if earlier, his Normal
Retirement Age; (ii) ten (10) Plan Years have elapsed from the time the
Participant commenced participation in the Plan; or (iii) the Participant
terminates his service with the Employer. Further, a Participant's benefits
shall commence not later than April 1 of the calendar year following the
calendar year in which (i) for a Participant who is not a 5% Owner, the later of
the following to occur: (a) the Participant attains age seventy and one-half
(702), or (b) the Participant retires; and (ii) for a Participant who is a 5%
Owner, the Participant attains age seventy and one-half (702). Alternatively,
distributions to a Participant must begin not later than April 1 following such
calendar year and must be made over the life of the Participant (or the lives of
the Participant and the Participant's designated beneficiary) or the life
expectancy of the Participant (or the life expectancies of the Participant and
the Participant's designated beneficiary).
10.7 Manner of Benefit Distribution.
(a) Except as otherwise provided herein, all distributions shall be
made in a lump sum. The distribution of a Participant's or beneficiary's Account
pursuant to Sections 10.1, 10.2 and 10.3, if the Account exceeds or ever
exceeded $3,500 (effective January 1, 1998, $5,000), shall be made in either of
the following forms as the Participant or beneficiary in his sole discretion
shall select:
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(1) a lump sum; or
(2) quarterly or annual installment payments over a period not to
exceed nine (9) years eleven months (11), as the Participant
elects; provided, that each installment payment must be at
least $500.
Installment distribution shall be made in accordance with procedures
and rules established by the Plan Administrator. Installment distribution
elections pursuant to (a) (2) above may be modified to accelerate distributions
at the option of the Participant or beneficiary. If a Participant's Account is
to be distributed in other than a lump sum, the amount to be distributed each
year must be at least an amount equal to the quotient obtained by dividing the
Participant's entire interest by the life expectancy of the Participant or joint
and last survivor expectancy of the Participant and his beneficiary. Life
expectancy and joint and last survivor expectancy are computed by the use of the
return multiples contained in Section 1.72-9 of the income tax regulations.
Further, if the Participant's spouse is not the beneficiary, the method of
distribution selected must assure that more than 50% of the present value of the
amount available for distribution is paid within the life expectancy of the
Participant.
(b) Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a distributee's election under this subsection, a
distributee may elect, at the time and in the manner prescribed by the
Administrator, to have any portion of an eligible rollover distribution paid
directly to an eligible retirement plan specified by the distributee in a direct
rollover.
For purposes of this subsection, the following terms shall have the following
meaning:
(1) Eligible rollover distribution. An eligible rollover
distribution is any distribution of all or any portion of the balance to the
credit of the distributee, except that an eligible rollover distribution does
not include: any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint life expectancies)
of the distributee and the distributee's designated beneficiary, or for a
specified period of ten years or more; any
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distribution to the extent such distribution is required under Code Section
401(a)(9); and the portion of any distribution that is not includible in gross
income (determined without regard to the exclusion of net unrealized
appreciation with respect to employer securities).
(2) Eligible retirement plan. An eligible retirement plan is
an individual retirement account described in Code Section 408(a), an individual
retirement annuity described in Code Section 408(b), an annuity plan described
in Code Section 403(a), or a qualified trust described in Code Section 401(a),
that accepts the distributee's eligible rollover distribution. However, in the
case of an eligible rollover distribution to the surviving spouse, an eligible
retirement plan is an individual retirement account or individual retirement
annuity.
(3) Distributee. A distributee includes an Employee or former
Employee. In addition, the Employee's or former Employee's surviving spouse and
the Employee's or former Employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order, as defined in Code Section
414(p), are distributees with regard to the interest of the spouse or former
spouse.
(4) Direct rollover. A direct rollover is a payment by the
Plan to the eligible retirement plan specified by the distributee.
If a distribution is one to which Code Sections 401(a)(11) and 417 do
not apply, such distribution may commence less than thirty (30) days after the
notice required under Section 1.411(a)11(c) of the Income Tax Regulations is
given, provided that:
(i) the Administrator clearly informs the Employee that the
Employee has a right to a period of at least thirty (30) days after receiving
the notice to consider the decision of whether or not to elect distribution and,
if applicable, a particular distribution option; and
(ii) the Employee, after receiving the notice, affirmatively
elects a distribution.
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(c) Installment distributions shall be made in cash and charged against
the value of the withdrawing Participant's subaccount in each of the Investment
Funds proportionately. Such installments shall be taken from the Participant's
Account in the following order:
(1) Rollover Account;
(2) Before-Tax Deposit Account;
(3) Pre-1987 After-Tax Account;
(4) Post-1986 After-Tax Account;
(5) Prior Plan Company Match Account; and
(6) Employer Contribution Account.
Lump sum distributions will be made in cash; provided, however,
Participants who elect immediate lump sum distributions pursuant to (a)(1) above
whose Accounts are invested in the Conseco Stock Fund at the time distribution
is to commence may elect to receive cash or the number of shares equal to the
value of the Conseco Stock Fund. However, distribution in shares shall only be
made if the value of the Participant's interest in such fund is at least $5,000
on the date that the Plan Administrator processes the Participant's request for
distribution. For purposes of determining the number of shares to distribute,
the shares shall be valued based on the closing price as reported on the New
York Stock Exchange Composite Transactions Tape on the date that the Plan
Administrator processes the Participant's request for distribution. Further,
effective December 1, 1997, Participants with aggregate account balances of at
least $5,000, as determined on the date the Plan Administrator processes the
Participant's distribution request, may request distribution from any of the
following funds in units if the value of the Participant's interest in the
individual fund, as determined on the date the Plan Administrator processes the
Participant's request, is at least $1,000: the Conseco Fund Group Fixed Income
Fund, the Conseco Fund Group Equity Fund or the Conseco Fund Group Asset
Allocation Fund.
10.8 Manner of Distribution and Timing of Death Distributions.
Effective May 1, 1997, the distribution of a
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deceased Participant's Account will be made in accordance with rules and
procedures established by the Administrator within one year after benefits
become due if the deceased Participant's Account is not and never was in excess
of $3,500 (effective January 1, 1998, $5,000). If the deceased Participant's
Account exceeds or ever exceeded $3,500 (effective January 1, 1998, $5,000),
distribution shall be made as soon as administratively practicable after the
beneficiary requests distribution. Payments will be made in a lump sum or in
installments as the beneficiary shall elect pursuant to the provisions of
Section 10.7; provided, however, notwithstanding anything herein to the
contrary, if the distribution of a Participant's Account has begun pursuant to
Section 10.7(a)(3) and the Participant dies after the required commencement date
under Section 10.6 but before the Participant's entire Account has been
distributed, the remaining portion of the Participant's Account shall be
distributed at least as rapidly as under the method in effect on the date of the
Participant's death.
If a Participant dies before he receives distribution of his accounts,
the Participant's Account shall be distributed within five (5) years after the
date of the Participant's death. If the Participant designates his surviving
spouse as his beneficiary, however, the distribution need not be made earlier
than the date on which the Participant would have attained age seventy and
one-half (702). If the surviving spouse dies before distribution is made, this
Section 10.8 shall be applied as if the surviving spouse was the Participant.
10.9 Limitation on Benefits and Distributions. All rights and benefits,
including elections, provided to a Participant in this Plan shall be subject to
the rights afforded to any "alternate payee" under a "qualified domestic
relations order" as those terms are defined in Code Section 414(p).
10.10 Distributions Payable to Incompetents. If any person entitled to
distribution payments hereunder shall be under a legal disability or, in the
sole judgment of the Administrator shall otherwise be unable to apply such
payments to his own best interest and advantage, the Administrator in the
exercise of his discretion, may direct all or any portion of such payments to be
made in any one or more of the following ways:
(a) Directly to such person;
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(b) To his legal guardian or conservator; or
(c) To his spouse or to any other person, to be expended for his
benefit.
The decision of the Administrator will, in each case, be final and
binding upon all persons, and the Administrator shall not be obliged to see to
the proper application or expenditure of any payment so made. Subject to the
claims review provisions of Section 13.2, any payment made pursuant to the power
herein conferred upon the Administrator shall operate as a complete discharge of
all obligations under the Plan as to such payments.
10.11 Distribution of Before-Tax Deposits. Except as otherwise provided
in Section 6.4, in no event may a Participant's before-tax deposits be
distributed earlier than:
(a) a Participant's separation from service, death, or disability;
(b) termination of the Plan without establishment of a successor plan;
(c) the date of the sale by the Employer of substantially all the
assets (within the meaning of section 409(d)(2) of the Code) used by the
Employer in a trade or business of the Employer with respect to an Employee who
continues employment with the corporation acquiring such assets;
(d) the date of the sale by the Employer of the Employer's interest in
a subsidiary (within the meaning of section 409(d)(3) with respect to an
Employee who continues employment with such subsidiary; or
(e) the attainment of age fifty-nine and one-half (592).
ARTICLE 11
NONASSIGNABILITY
It is a condition of the Plan to which all rights of any person shall
be subject, that payments hereunder shall be made only to those persons entitled
thereto under the terms of this Plan, and
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no right or interest in the Plan or Trust shall be transferable or assignable;
such right or interest may not be anticipated, charged or encumbered, and shall
not be subject to or reached by any legal or equitable process (including
execution, garnishment, attachment, pledge or bankruptcy) in satisfaction of any
debt, liability, or obligation prior to its receipt; provided, however, that
notwithstanding any provisions of the Plan or Trust to the contrary, compliance
with a domestic relations order of a court of competent jurisdiction which the
Administrator finds to be a "qualified domestic relations order" within the
meaning of the Code shall not be prohibited hereunder and shall satisfy all
provisions of the Plan and Trust.
ARTICLE 12
TRUST AGREEMENT
The Company has entered into the Trust with the Trustee establishing a
Trust to fund and implement the Plan. The Trust shall be deemed to form a part
of the Plan and any and all rights and benefits which may accrue to any person
under the Plan shall be subject to all of the terms and provisions thereof.
ARTICLE 13
MANAGEMENT AND ADMINISTRATION
13.1 Administrator. Conseco, Inc. shall be the Administrator of the
Plan. The Administrator shall have full power and authority, within the limits
of the Plan, to supervise the operation and administration of the Plan. The
Administrator shall from time to time establish rules for the administration of
the Plan including the establishment of procedures for making claims and
appealing decisions under the Plan. The Administrator shall have the exclusive
right to interpret the Plan and decide any matters arising hereunder in the
administration and the operation of the Plan, and any interpretations or
decisions so made will be conclusive and binding on any persons having an
interest in the Plan and will be determined and applied so as not to
discriminate in favor of Participants who are officers, shareholders or highly
compensated employees. The Company shall be deemed to be the "named fiduciary"
under the Plan within the meaning of ERISA, and
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the Administrator shall be deemed to be the "named plan administrator."
13.2 Claims Review Procedure. A Participant or beneficiary shall make
all claims for benefits under the Plan in writing addressed to the Administrator
at the address of the Administrator. Each claim shall be reviewed by the
Administrator within a reasonable time after it is submitted, but in no event
longer than ninety (90) days after it is received by the Administrator. If a
claim is wholly or partially denied, the claimant shall be sent written notice
of such fact within fourteen (14) days of the denial. The denial notice, which
shall be written in a manner calculated to be understood by the claimant, shall
contain (a) the specific reason or reasons for the denial, (b) specific
reference to pertinent Plan provisions on which the denial is based, (c) a
description of any additional material information necessary for the claimant to
perfect his claim and an explanation of why such material or information is
necessary, and (d) an explanation of the Plan's claim review procedure.
Within sixty (60) days after receipt by the claimant of written notice
of the denial, the claimant or his duly authorized representative may appeal
such denial by filing a written application for review with the Company. Such
application shall be addressed to the Company and may include a statement of the
issues and other comments. Each such application shall state the grounds upon
which the claimant seeks to have the claim reviewed. The claimant or his
representative to for the purpose of preparing the application. The individual
or individuals appointed by the Company shall then review the decision and
notify the claimant in writing of the results of the redetermination within
sixty (60) days of receipt of the application for review, which decision shall
be in writing, written in a manner calculated to be understood by the claimant
and include specific reasons for the decision and specific reference to the
pertinent Plan provisions on which the decision is based. The sixty-day period
for the decision of the individual or individuals appointed by the Company may
be extended if specific circumstances require an extension of time for
processing, in which case the decision shall be rendered as soon as possible,
but no later than one hundred twenty (120) days after receipt of the application
for review.
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13.3 Delegation. The Administrator shall have the right, from time to
time, to delegate in writing to any person or persons, subject to such terms,
conditions and restrictions as they may prescribe, such of its rights, powers,
authorities, discretions and duties hereunder, except those dealing with
interpretation of the provisions of the Plan, as it shall determine; and all
actions taken by any such person or persons pursuant to and in accordance with
any such delegations shall be effective and binding upon all parties to the same
extent as though taken by the Administrator.
13.4 Expenses of Administration. All expenses and liabilities incurred
in connection with the administration of the Plan may be paid by the Employer,
but if not so paid shall be paid from the Trust.
ARTICLE 14
COMPANY AND EMPLOYER RIGHTS
14.1 Company's Interest in Trust. The Trust and Plan hereby created
shall be maintained for the exclusive benefit of Participants and their
beneficiaries, and is intended to qualify under Code Sections 401(a) and 501(a)
and under ERISA, as amended from time to time. In no event shall the Company or
any other employer have any right, claim, or beneficial or reversionary interest
in any Trust assets, and the Trustee shall make no payment or other distribution
to the Company or any other employer except to repay loans made by the Company
to the Trust and interest thereon, or taxes which the Company or any other
employer is obligated to withhold and remit to tax collecting agencies and to
return to the Company or any other employer a contribution made by a mistake of
facts within one year of such contribution; but nothing contained in the Trust
agreement shall be construed to impair the Company's right to see to the proper
administration of the Trust in accordance with Plan provisions.
14.2 Inspection of Records. The Company shall have the right to have
the books, accounts and records of the Trustee examined at any time, or from
time to time, by such accountants, attorneys, agents or employees as the Company
may select, and to make such copies of, or extracts from, such books, accounts
and records as the Company desires. The cost of such examination and report
shall be paid by the Company.
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14.3 Amendment. The Company alone reserves the right by action of the
Board to amend the Plan at any time, and from time to time, except that no
amendment shall be made to the Plan which reduces a Participants' accrued
benefit. The Company shall promptly notify the Trustee of any amendment.
However, the Trustee's duties and responsibilities may not be increased without
their consent, and no such amendment shall vest in the Company or any other
employer any right, title or interest in and to Trust assets, divest
Participants or their beneficiaries of any vested rights in their accounts, or
allow any part of Trust assets to be used for, or diverted to, purposes other
than for the exclusive benefit of Participants and their beneficiaries within
the meaning of the Code and ERISA, as amended from time to time, except to the
extent necessary to conform the Plan and Trust to the requirements of any
applicable future legislation, regulation or other rule of law.
14.4 Employment Rights. This Plan shall not be construed to create a
contract of employment between an Employer and any Participant, to create a
right in any Participant to be continued in employment, or to limit an
Employer's right to discharge any Participant with or without cause.
14.5 Company and Employer Liability. Neither the Company nor any other
Employer does in any manner guarantee that the Trust will not sustain losses,
that Trust assets will not depreciate or that the value of the Trust may not
otherwise be reduced.
ARTICLE 15
PARTICIPATING EMPLOYERS
15.1 Adoption By Other Employers. Notwithstanding anything herein to
the contrary, with the consent of the Company, any other corporation or entity,
whether an Affiliate or not, may adopt this Plan and all of the provisions
hereof, and participate herein and be known as a Participating Employer, by a
properly executed separate document or by executing this document evidencing
said intent and will of such Participating Employer.
15.2 Requirements of Participating Employers.
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(a) Each such Participating Employer shall be required to use the same
Trustee as provided in this Plan.
(b) The Trustee may, but shall not be required to, commingle, hold and
invest as one Trust all contributions made by the Company and Participating
Employers, as well as all increments thereof.
(c) The transfer of any Participant from or to an Employer
participating in this Plan, whether he be an Employee of the Company or a
Participating Employer, shall not affect such Participant's rights under the
Plan, and all amounts credited to such Participant's Account as well as his
accumulated service time with the transferor or predecessor, and his length of
participation in the Plan, shall continue to his credit.
(d) All rights and values forfeited by termination of employment shall
inure only to the benefit of the Employee-Participants of the Participating
Employer by which the forfeiting Participant was employed, except if the
forfeiture is for an Employee whose Employer is a member of an affiliated or
controlled group, then said forfeiture shall be allocated, based on Compensation
to all Participant's Accounts or Participating Employer who are members of the
affiliated or controlled group. Should an Employee of one ("First") Employer be
transferred to an associated ("Second") Employer (the Employer, an affiliate or
subsidiary), such transfer shall not cause his Account balance (generated while
an Employee of "First" Employer) in any manner or by any amount to be forfeited.
Such Employee's Participant Account balance for all purposes of the Plan,
including length of service, shall be considered as though he had always been
employed by the "Second" Employer and as such had received contributions,
forfeitures, earnings or losses, and appreciation or depreciation in value of
assets totaling amount so transferred.
(e) Any expenses of the Trust which are to be paid by the Employer or
borne by the Trust shall be paid by each Participating Employer in the same
proportion that the total amount standing to the credit of all Participants
employed by such Employer bears to the total amount standing to the credit of
all Participants.
15.3 Designation of Agent. Each Participating Employer shall be deemed
to be a part of this Plan; provided, however, that with respect to all of its
relations with the Trustee and Administrator
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for the purpose of this Plan, each Participating Employer shall be deemed to
have designated irrevocably the Company as its agent. Unless the context of the
Plan clearly indicates the contrary, the word "Employer" shall be deemed to
include each Participating Employer as related to its adoption of the Plan.
15.4 Employee Transfers. It is anticipated that an Employee may be
transferred between Participating Employers, and in the event of any such
transfer, the Employee involved shall carry with him his accumulated service and
eligibility. No such transfer shall effect a termination of employment
hereunder, and the Participating Employer to which the Employee is transferred
shall thereupon become obligated hereunder with respect to such Employee in the
same manner as was the Participating Employer from whom the Employee was
transferred.
15.5 Participating Employer's Contribution. All contributions made by a
Participating Employer, as provided for in this Plan, shall be determined
separately by each Participating Employer, and shall be paid to and held by the
Trustee for the exclusive benefit of the Employees of such Participating
Employer and the beneficiaries of such Employees, subject to all the terms and
conditions of this Plan. Any forfeiture by an Employee of a Participating
Employer subject to allocation during each Plan Year shall be allocated only for
the exclusive benefit of the Participants of such Participating Employer in
accordance with the provisions of this Plan. On the basis of the information
furnished by the Administrator, the Trustee shall keep separate books and
records concerning the affairs of each Participating Employer hereunder and as
to the accounts and credits of the Employees of each participating Employer. The
Trustee may, but need not, register contracts so as to evidence that a
particular Participating Employer is the interested Employer hereunder, but in
the event of an Employee transfer from one Participating Employer to another,
the employing Employer shall immediately notify the Trustee thereof.
15.6 Discontinuance of Participation. Any Participating Employer shall
be permitted to discontinue or revoke its participation in the Plan. At the time
of any such discontinuance or revocation, satisfactory evidence thereof and of
any applicable conditions imposed shall be delivered to the Trustee. The Trustee
shall thereafter transfer, deliver and assign contracts and other
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Trust assets allocable to the Participants of such Participating Employer to
such new Trustee as shall have been designated by such Participating Employer,
in the event that it has established a separate pension plan for its Employees.
If no successor is designated, the Trustee shall retain such assets for the
employees of said Participating Employer. In no such event shall any part of the
corpus or income of the Trust as it relates to such Participating Employer be
used for or diverted for purposes other than for the exclusive benefit of the
Employees of such Participating Employer.
15.7 Administrator's Authority. The Administrator shall have authority
to make any and all necessary rules or regulations, binding upon all
Participating Employers and all Participants, to effectuate the purpose of this
Article.
15.8 Participating Employer Contribution For Affiliate. If any
Participating Employer is prevented in whole or in part from making a
contribution to the Trust which it would otherwise have made under the Plan by
reason of having no current or accumulated earnings or profits, or because such
earnings or profits are less than the contribution which it would otherwise have
made, then, pursuant to Code Section 404(a)(3)(B), so much of the contribution
which such Participating Employer was so prevented from making may be made, for
the benefit of the participating employees of such Participating Employer, by
the other Participating Employers who are members of the same affiliated group
within the meaning of Code Section 1504 to the extent of their current or
accumulated earnings or profits, except that such contribution by each such
other Participating Employer shall be limited to the proportion of its total
accumulated earnings or profits remaining after adjustment for its contribution
of the Plan made without regard to this paragraph which the total prevented
contribution bears to the current and accumulated earning or profits of all the
Participating Employers remaining after adjustment for all contributions made to
the Plan, without regard to this paragraph.
A Participating Employer on behalf of whose employees a contribution is
made under this paragraph shall not reimburse the contributing Participating
Employers.
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ARTICLE 16
TERMINATION
16.1 Event of Termination. The Company alone reserves the right to
terminate the Plan and Trust by giving written notice to the Trustee at any
time, in which event there shall be no Employer duty to make contributions to
the Trust for the year in which such notice is given. A permanent discontinuance
of Employer contributions shall constitute a termination of the Plan as to the
Employees of the Employer. However, the Employer reserves the right to suspend
its contribution for any year, without terminating the Plan, by providing
written notice to the Trustee not less than thirty days prior to the beginning
of such year.
16.2 Effect of Termination. Upon the termination or partial termination
of the Plan and Trust, each Participant affected by such termination or partial
termination or his beneficiary or beneficiaries, as to the case may be, shall be
entitled to 100% of his account, determined on the termination date as if it
were a Valuation Date. Distribution, in the event of a termination or partial
termination of the Plan, shall be made by the Trustee in one sum or in
substantially equal installments during a period not exceeding one year
following such termination. In the case of complete termination, when all Trust
assets have been distributed, the Trustee shall be discharged, but the Trust
shall nevertheless continue as a legal entity during the period for the purpose
of distributing all property to the persons entitled thereto.
ARTICLE 17
TRANSFERS, MERGERS AND CONSOLIDATIONS
The Plan may not merge or consolidate with, or transfer its assets or
liabilities to, any other plan unless each Participant would (if the Plan then
terminated) receive a benefit immediately after the merger, consolidation or
transfer which is equal to or greater than the benefit he would have been
entitled to receive immediately before the merger, consolidation or transfer (if
the Plan had then terminated).
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ARTICLE 18
SUCCESSORS
This Plan shall be binding upon all persons entitled to distributions
hereunder, their respective heirs, next-of-kin and legal representatives; and
upon the Employer, its successors and assigns.
ARTICLE 19
INTERPRETATION OF AGREEMENT
19.1 Interpretation of Plan. The Administrator may, from time to time,
adopt resolutions for carrying out the purposes of the Plan. All questions of
interpretation of the Plan, or amendments thereto, or the resolutions pertaining
thereto, or relating to any matter of accounting, values, profits or any other
matters or differences which may arise, shall be determined solely by the
Administrator, and except as otherwise provided in Section 14.1, the decisions
of the Administrator shall be final and conclusive upon all Participants and
their beneficiaries hereunder.
19.2 Forms. The Administrator may prescribe or provide for appropriate
forms to be used by Participants of the Plan.
19.3 Applicable Law. Since the Company's principal office and the
Administrator's domicile are in the State of Indiana and since it is
contemplated that the situs of administration of the Plan will continue in such
State, all rights under the Plan shall be governed, construed and administered
in accordance with the laws of the State of Indiana to the extent such law is
not superseded by ERISA.
IN WITNESS WHEREOF, Conseco, Inc. has caused this instrument to be
signed by its duly authorized officers on its behalf this 1st day of December,
1997.
DATE: December 1, 1997 CONSECO, INC.
By: /s/ Rollin M. Dick
-------------------------
Rollin M. Dick, Executive
Vice President and Chief
Financial Officer
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APPENDIX I
----------
TOP-HEAVY PROVISIONS
--------------------
(I) Top-Heavy Provisions. If the Plan is or becomes a Top-Heavy Plan in
any Plan Year, the provisions of this Appendix I will supersede any conflicting
provisions in the Plan.
(II) Definitions of Terms. For purposes of this Appendix I, the
following words and terms shall have the respective meanings hereinafter set
forth unless a different meaning is clearly required by context.
(a) Determination Date. For any Plan Year subsequent to the first
Plan Year, the last day of the preceding Plan Year. For the first Plan Year of
the Plan, the last day of that year.
(b) Determination Period. The Plan Year containing the
Determination Date and the four preceding Plan Years.
(c) Key Employee. Any Employee or former Employee (and the
Beneficiaries of such Employee) who at any time during the Determination Period
was:
(1) An officer of the Employer or its Affiliates whose annual
Compensation is greater than 50% of the amount in effect under Code Section
415(b)(1)(A) for such Plan Year; provided, however, that no more than the lesser
of:
(A) fifty (50) Employees, or
(B) the greater of (i) three (3) Employees or (ii) 10% of
all Employees, shall be treated as officers, and such officers shall be those
with the highest annual Compensation in the five-year period.
(2) An owner (or considered an owner under Code Section 318
of one (1) of the ten (10) largest interests in the Employer if such
individual's Compensation exceeds the dollar limitation under Section
415(c)(1)(A) of the Internal Revenue Code (if two (2) Employees have the same
interest in the Employer, the
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Employee having greater annual Compensation shall be treated as having a larger
interest);
(3) A 5% owner of the Employer; or
(4) A 1% owner of the Employer who has an annual Compensation
of more than $150,000.
The determination of who is a Key Employee will be made in
accordance with Section 416(i)(1) of the Internal Revenue Code and the
regulations thereunder.
(d) Non-Key Employee. An Employee who is not a Key Employee.
(e) Permissive Aggregation Group. The Required Aggregation Group
of plans plus any other plan or plans of the Employer which, when considered as
a group with the Required Aggregation Group, would continue to satisfy the
requirements of Sections 401(a)(4) and 410 of the Internal Revenue Code.
(f) Present Value of Accrued Benefits. Present Value of Accrued
Benefits shall be based on the interest and mortality rates specified in the
defined benefit plan for determining the top-heavy status of the Plan. If the
defined benefit plan does not specifically provide for this determination, the
Present Value of Accrued Benefits shall be based on 5% interest per annum and,
on the 1984 Unisex Pension mortality tables.
(g) Required Aggregation Group.
(1) Each Qualified Plan of the Employer in which at least one
Key Employee participates; and
(2) Any other Qualified Plan of the Employer which enables a
plan described in (1) to meet the requirements of Code Sections 401(a) and 410.
(h) Super Top-Heavy Plan. This Plan is a Super Top-Heavy Plan if
any of the following conditions exists:
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(1) If the Top-Heavy Ratio for this Plan exceeds 90% and this
Plan is not part of any Required Aggregation Group or Permissive Aggregation
Group of plans;
(2) If this Plan is a part of a Required Aggregation Group of
plans (but which is not part of any Permissive Aggregation Group) and the
Top-Heavy Ratio for the group of plans exceeds 90%; or
(3) If this Plan is a part of a Required Aggregation Group of
plans and part of a Permissive Aggregation Group and the Top-Heavy ratio for the
Permissive Aggregation Group exceeds 90%.
(i) Top-Heavy Plan. This Plan is a Top Heavy Plan if any of the
following conditions exist:
(1) If the Top-Heavy Ratio for this Plan exceeds 60% and this
Plan is not part of any Required Aggregation of Group or Permissive Aggregation
Group of plans;
(2) If this Plan is a part of a Required Aggregation Group of
plans (but which is not part of a Permissive Aggregation Group) and the
Top-Heavy Ratio for the group of plans exceeds 60%; or
(3) If this Plan is a part of a Required Aggregation Group of
plans and part of a Permissive Aggregation Group and the Top-Heavy Ratio for the
Permissive Aggregation Group exceeds 60%.
(j) Top-Heavy Ratio:
(1) If the Employer maintains one (1) or more defined
contribution plans (including any Simplified Employee Pension Plan) and the
Employer has never maintained any defined benefit plan which has covered or
could cover a Participant in this Plan, the Top-Heavy Ratio is a fraction, the
numerator of which is the sum of the Accounts of all Key Employees as of the
Determination Date (including any part of any account distributed in the
five-year period ending on the Determination Date and any amount distributed in
the five-year period ending on the Determination Date from a terminated plan
which, if it has not been
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terminated, would have been part of a Required Aggregation Group), and the
denominator of which is the sum of all Accounts (including any part of any
Account distributed in the five-year period ending on the Determination Date) of
all Participants as of the Determination Date. However, if an individual has not
been an Employee with respect to the Plan and has not performed service for the
Employer during the five-year period ending on the Determination Date, the
Account of that individual shall be disregarded. Both the numerator and
denominator of the Top-Heavy Ratio are adjusted to reflect any contribution
which is due but unpaid as of the Determination Date.
(2) If the Employer maintains one (1) or more defined
contribution plans (including any Simplified Employee Pension Plan) and the
Employer maintains or has maintained one (1) or more defined benefit plans which
have covered or could cover a Participant in this Plan, the Top-Heavy Ratio is a
fraction, the numerator of which is the sum of accounts under the defined
contribution plans for all Key Employees and the Present Value of Accrued
Benefits under the defined benefit plans for all Key Employees, and the
denominator of which is the sum of the accounts under the defined contribution
plans for all Participants and the Present Value of Accrued Benefits under the
defined benefit plans for all Participants. Both the numerator and denominator
of the Top-Heavy Ratio are adjusted for any distribution of an Account or an
Accrued Benefit made in the five-year period ending on the Determination Date
and any contribution due but unpaid as of the Determination Date, and any amount
distributed in the five-year period ending on the Determination Date from a
terminated plan which, if it had not been terminated, would have been part of a
Required Aggregation Group. However, if an individual has not been an Employee
with respect to the Plan and has not performed services for the Employer during
the five-year period ending on the Determination Date, the Account and the
Accrued Benefit of that individual shall be disregarded.
(3) For purposes of (1) and (2) above, the value of Accounts
and the Present Value of Accrued Benefits will be determined as of the most
recent Valuation Date that falls within or ends with the twelve-monthly period
ending on the Determination Date. The Accounts and Accrued Benefits of a
Participant who is not a Key Employee but who was a Key Employee in a prior year
will be disregarded. The calculation of the Top-Heavy Ratio, and the
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extent to which Distributions, Rollovers, and Transfers are taken into account
will be made in accordance with Code Section 416 and the regulations thereunder.
Deductible Employee Contributions will not be taken into account for purposes of
computing the Top-Heavy Ratio. When aggregating plans, the value of Accounts and
Present Value of Accrued Benefits will be calculated with reference to the
Determination Dates that fall within the same calendar year.
(III) Minimum Vesting Schedule. For any Plan Year in which this is a
Top-Heavy Plan, the following vesting schedule shall apply:
Years of Vested Percentage
Service (Nonforfeitable)
------- ----------------
0-1 0%
2 20%
3 40%
4 60%
5 80%
6 or more 100%
The minimum vesting schedule applies to all accounts within the meaning
of Code Section 411(a)(7) except those attributable to Employee contributions,
including allocations credited before the Effective Date of Section 416 and
allocations credited before the Plan became a Top-Heavy Plan. Further, no
reduction in vested Accounts may occur in the event the Plan's status as a
Top-Heavy Plan changes for any Plan Year. However, this section does not apply
to the Account of any Employee who does not have an Hour-of-Service after the
Plan has initially become a Top-Heavy Plan and such Employee's Account
attributable to Employer contributions will be determined without regard to this
section.
If the vesting schedule under the Plan shifts in or out of the above
schedule for any Plan Year because of a change in Top-Heavy Plan status, such
shift is an amendment to the vesting schedule and the election below applies:
(a) If the vesting schedule under this Plan is amended, each
Participant who has completed at least three (3) years of Credited Service may
elect, during the election period
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specified in Section III(b), to have the vested percentage of his or her Account
determined without regard to such amendment.
(b) For the purpose of Section III(a), the election period shall
begin as of the date on which the amendment changing the vesting schedule is
adopted, and shall end on the latest of the following dates:
(1) The date occurring sixty (60) days after the Plan
amendment is adopted; or
(2) The date which is sixty (60) days after the day on which
the Plan amendment becomes effective; or
(3) The date which is sixty (60) days after the day the
Participant is issued written notice of the Plan amendment by the Plan
Administrator; or
(4) Such later date as may be specified by the Plan
Administrator.
The election provided for in this Section III shall be made in
writing and shall be irrevocable when made.
For the purposes of Section III and IV, years of Credited Service
shall not include:
(a) years of Credited Service before age eighteen (18); or
(b) years of Credited Service during which the Employer did not
maintain the Plan or a predecessor plan.
(IV) Change in Top-Heavy Status. If the Plan becomes a Top-Heavy Plan
and subsequently ceases to be a Top-Heavy Plan, the vesting schedule in Section
III shall continue to apply in determining the vested percentage of any
Participant who had at least three (3) years of Credited Service as of the last
day of the last Plan Year during which the Plan is a Top-Heavy Plan.
For Participants with less than three (3) years of Credited Service,
the schedule in Section III shall apply only to their
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Accounts as of the last day of the last Plan Year during which the Plan is a
Top-Heavy Plan.
(V) Compensation Limitation. The term Compensation for purposes of
determining the minimum benefit pursuant to Section (VII) of this Appendix I
shall be defined as provided in Section 6.1(c) of the Plan. All other references
to Compensation in this Appendix I shall refer to Compensation as defined in
Section 2.1(g) of the Plan.
(VI) Impact on Maximum Benefits. For any year in which the Plan is a
Top-Heavy Plan, Article 6 items (b) (1) and (2) shall be read by substituting
the number "100" for the number "125" wherever it appears therein except such
substitution shall not have the effect of reducing any benefit accrued under a
defined benefit plan prior to the first day of the Plan Year in which this
provision becomes applicable.
(VII) Maximum Benefit Exception. Notwithstanding anything herein to the
contrary, in any Plan Year in which a Non-Key Employee is a Participant in a
Plan that is Top-Heavy, the minimum contribution benefit shall be 3% of
Compensation.
(VIII) Nonduplication of Top-Heavy Minimum Benefits. Notwithstanding
anything herein to the contrary, in any Plan Year in which a Non-Key Employee is
a Participant in both this Plan and a defined benefit plan, and both such plans
are Top-Heavy Plans, the Employer shall not be required to provide a Non-Key
Employee with both the full separate minimum defined contribution plan
allocations and the full separate defined benefit plan benefit.
The minimum allocation when a Participant is covered by another
qualified plan shall be as follows:
(1) If the Employer maintains one or more other defined
contribution plans covering Employees who are Participants in this Plan, the
minimum allocation shall be provided under this Plan unless such other defined
contribution plans make explicit reference to this Plan and provide that the
minimum allocation shall not be provided under this Plan.
(2) If the Employer maintains one or more defined benefit plans
covering employees who are Participants in this Plan,
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and such defined benefit plan(s) provide that Employees who are participants
therein shall accrue the minimum benefit applicable to top-heavy defined benefit
plans notwithstanding their participation in this Plan (making explicit
reference to this Plan), then the minimum benefit shall be provided under such
defined benefit plan(s).
(3) If the Employer maintains one or more defined benefit plans
covering Employees who are Participants in this Plan, and the provisions of
paragraph (2) do not apply, then each Participant who is not a Key Employee and
who is covered by such defined benefit plan(s) shall receive a minimum
allocation of 5%.
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APPENDIX
MERGER OF INDEPENDENT PROCESSING SERVICES
SAVINGS INVESTMENT PLAN
1. Purpose. Effective August 2, 1996, the Company acquired Independent
Processing Services, Inc. ("IPS"). Effective on or as soon as administratively
feasible following October 9, 1996 (the "Merger Date"), the Independent
Processing Services Savings Investment Plan (the "IPS Plan"), as last amended
and restated effective July 1, 1996, is hereby merged into this Plan. Certain of
the individuals who are employees of IPS on August 30, 1996 ("IPS Employees")
will become Employees eligible to participate in the Plan on September 3, 1996.
It is the purpose of this Appendix to provide for the merger into this Plan of
the IPS Plan effective as of the Merger Date, and the participation in the Plan
of the IPS employees effective as of September 3, 1996.
2. Participation in the Plan. Each IPS Employee who was a participant
in the IPS Plan on August 30, 1996 who becomes an Employee on September 3, 1996
will become eligible to participate in the Plan on September 3, 1996.
3. Transfer and Merger of IPS Plan Assets. Effective as of the Merger
Date (i) a "Before-Tax Deposit Account" will be established for each IPS
Employee's Elective Deferral Contributions, Non-Elective Contributions, Rollover
Contributions and Employer Matching Contributions credited to his participant's
account under the IPS Plan;(ii) a "Pre-1987 After-Tax Deposit Account" for each
IPS Employee's pre-1987 Employee Contributions credited to his participant's
account under the IPS Plan, and (iii) a "Post-1986 After-Tax Deposit Account"
for each IPS Employee's post-1986 Employee Contributions credited to his
participant's account under the IPS Plan. All amounts held in Before-Tax Deposit
and After-Tax Deposit Accounts for IPS Employees will be 100% nonforfeitable and
will be subject to the provisions of the Plan (except insofar as they conflict
with paragraph 4 below) and to the provisions of paragraph 4 below.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary the following forms of
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distribution shall be available to IPS Employees in addition to the form of
distribution provided in Section 10.7 of the Plan.
(a) The optional forms of retirement benefit shall be (i) in lump sum;
or (ii) in installments over a period not to exceed the life expectancy of the
Participant or the joint and last survivor life expectancy of the Participant
and his designated beneficiary, provided that each installment payment must be
at least $500; or (iii) for IPS Employees who were formerly Whitehall Management
Services, Inc. employees only, applied to the purchase of any annuity contract
requested by the Participant and approved by the Administrator provided that
such annuity is available from an appropriate insurance company at commercially
reasonable rates.
(b) The optional forms of death benefit are a single-sum payment, and
installment payouts over a period not to exceed the life expectancy of the
beneficiary, provided that each installment payment must be at least $500, and,
for IPS Employees who were formerly Whitehall Management Services, Inc.
employees, any annuity that is an optional form of retirement benefit.
(c) This paragraph applies only to IPS Employees who were formerly
Whitehall Management Services, Inc. employees. If a married Participant selects
an annuity, the annuity shall be in the form of a qualified joint and survivor
annuity (as defined in Code Section 417) unless the Participant selects another
form of annuity and the Participant's spouse consents to such alternate form and
such consent is witnessed by a notary public.
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APPENDIX
MERGER OF TRANSPORT HOLDINGS, INC.
401(k) PLAN
1. Purpose. Effective December 23, 1996, the Company acquired Transport
Holdings, Inc. Effective on or as soon as administratively feasible following
May 20, 1997 (the "Merger Date"), the Transport Holdings, Inc. 401(k) Plan, as
established October 6, 1995, (the "Transport Plan") is hereby merged into this
Plan. Certain of the individuals who are employees of Transport Holdings, Inc.
on April 4, 1997 ("Transport Employees") will become Employees eligible to
participate in the Plan on April 7, 1997. It is the purpose of this Appendix to
provide for the merger into this Plan of the Transport Plan effective as of the
Merger Date, and the participation in the Plan of the Transport Employees
effective as of April 7, 1997.
2. Participation in the Plan. Each Transport Employee who was a
participant in the Transport Plan on April 4, 1997 who becomes an Employee on
April 7, 1997 will become eligible to participate in the Plan on April 7, 1997.
3. Transfer and Merger of Transport Plan Accounts. Effective as of the
Merger Date all funds previously held on behalf of a Transport Employee under
the Transport Plan will be transferred to a Before-Tax Deposit Account. All
amounts held in the Before-Tax Deposit Accounts for Transport Employees will be
100% nonforfeitable and will be subject to the provisions of the Plan (except
insofar as they conflict with paragraph 4 below) and to the provisions of
paragraph 4 below.
4. Distributions. Notwithstanding any other provisions in the Plan to
the contrary, a Transport Employee who is eligible to receive distribution of
his Account pursuant to Sections 10.1 through 10.4 of the Plan whose vested
Account is or ever was in excess of $3,500 (effective January 1, 1998, $5,000),
may elect, in addition to the options set forth in Section 10.7 of the Plan, and
subject to the provisions of Section 10.7 of the Plan, in accordance with such
rules as the Administrator may prescribe, to receive his Account in the form of
substantially equal quarterly or annual installments; provided that each
installment payment must be at least $500.
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APPENDIX
MERGER OF CAPITOL AMERICAN FINANCIAL
CORPORATION INVESTMENT PLAN
1. Purpose. Effective March 4, 1997, the Company acquired Capitol
American Financial Corp. Effective on or as soon as practicable following July
1, 1997 (the "Merger Date"), the Capitol American Financial Corporation
Investment Plan, as last amended and restated on December 29, 1994 (the "Capitol
Plan") is hereby merged into this Plan. Certain of the individuals who are
employees of Capitol American Financial Corporation immediately prior to the
Merger Date ("Capitol Employees") will become Employees eligible to participate
in the Plan on the Merger Date. It is the purpose of this Appendix to provide
for the merger into this Plan of the Capitol Plan, and the participation in the
Plan of the Capitol Employees, both effective as of the Merger Date.
2. Participation in the Plan. Each Capitol Employee who is a
participant in the Capitol Plan on May 23, 1997 who becomes an Employee on May
27, 1997 will become eligible to participate in the Plan on May 27, 1997.
3. Transfer and Merger of Capitol Plan Accounts. Effective as of the
Merger Date all funds previously held on behalf of a Capitol Employee under the
Capitol Plan will be transferred to a Before-Tax Deposit Account. All amounts
held in the Before-Tax Deposit Accounts for Capitol Employees will be 100%
nonforfeitable and will be subject to the provisions of the Plan (except insofar
as they conflict with paragraph 4 below) and to the provisions of paragraph 4
below.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary, this section shall only apply to distributions to
Capitol Employees who have become Participants hereunder as of the Merger Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in installment payments over a period not to exceed the life
expectancy of the Participant or the joint and last survivor life expectancy of
the Participant and his designated beneficiary, provided that each installment
must be at least $500;
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or (iii) applied to the purchase of any annuity contract requested by the
Participant and approved by the Administrator provided that such annuity is
available from an appropriate insurance company at commercially reasonable
rates.
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed the life expectancy of the
beneficiary, provided that each installment must be at least $500, and any
annuity that is an optional form of retirement benefit.
(c) If a married Participant selects an annuity, the annuity shall
be in the form of a qualified joint and survivor annuity (as defined in Code
Section 417) unless the Participant selects another form of annuity and the
Participant's spouse consents to such alternate form and such consent is
witnessed by a notary public.
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APPENDIX
MERGER OF AMERICAN TRAVELLERS LIFE INSURANCE COMPANY
RETIREMENT SAVINGS PLAN AND TRUST
1. Purpose. Effective December 17, 1996, the Company acquired American
Travellers Life Insurance Company ("American Travellers"). Effective on or as
soon as administratively feasible following August 29, 1997 (the "Merger Date"),
the American Travellers Life Insurance Company Retirement Savings Plan and Trust
(the "American Travellers Plan"), as last amended and restated effective January
1, 1993, is hereby merged into this Plan. Certain of the individuals who are
employees of American Travellers on August 29, 1997 ("American Travellers
Employees") will become Employees eligible to participate in the Plan on
September 2, 1997. It is the purpose of this Appendix to provide for the merger
into this Plan of the American Travellers Plan effective as soon as
administratively feasible following the Merger Date, and the participation in
the Plan of the American Travellers Employees effective as of September 2, 1997.
2. Participation in the Plan. Each American Travellers Employee who was
a participant in the American Travellers Plan on August 29, 1997 who becomes an
Employee on September 2, 1997 will become eligible to participate in the Plan on
September 2, 1997.
3. Transfer and Merger of American Accounts. Effective as of the Merger
Date all funds previously held on behalf of an American Travellers Employee
under the American Travellers Plan will be transferred to a Before-Tax Deposit
Account. All amounts held in the Before-Tax Deposit Accounts for American
Travellers Employees will be 100% nonforfeitable and will be subject to the
provisions of the Plan.
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APPENDIX
MERGER OF CONTINENTAL FINANCIAL CORPORATION
401(k) RETIREMENT PLAN
1. Purpose. Effective May 30, 1997, the Company acquired Pioneer
Financial Services, Inc. Effective on or as soon as administratively feasible
following December 31, 1997 (the "Merger Date"), the Continental Financial
Corporation 401(k) Retirement Plan, as established October 1, 1989, (the
"Continental Plan") is hereby merged into this Plan. Certain of the individuals
who are employees of Continental Marketing Corporation of Illinois, Inc. on
December 31, 1997 ("Pioneer Employees") will become Employees eligible to
participate in the Plan on January 1, 1998. It is the purpose of this Appendix
to provide for the merger into this Plan of the Continental Plan effective as of
the Merger Date, and the participation in the Plan of the Pioneer Employees
effective as of January 1, 1998.
2. Participation in the Plan. Each Pioneer Employee who was a
participant in the Continental Plan on December 31, 1997 who becomes an Employee
on January 1, 1998 will become eligible to participate in the Plan on January 1,
1998.
3. Transfer and Merger of Continental Plan Accounts. Effective as of
the Merger Date all funds previously held on behalf of a Pioneer Employee under
the Continental Plan will be transferred to a Before-Tax Deposit Account. All
amounts held in the Before-Tax Deposit Accounts for Pioneer Employees who were
participants in the Continental Plan will be 100% nonforfeitable and will be
subject to the provisions of the Plan (except insofar as they conflict with
paragraph 4 below) and to the provisions of paragraph 4 below.
4. Distributions. Notwithstanding any other provisions in the Plan to
the contrary, a Pioneer Employee who was a participant in the Continental Plan
and who is eligible to receive distribution of his Account pursuant to Sections
10.1 through 10.4 of the Plan whose vested Account is or ever was in excess of
$3,500 (effective January 1, 1998, $5,000), may elect, in addition to the
options set forth in Section 10.7 of the Plan, and subject to the provisions of
Section 10.7 of the Plan, in accordance with such rules as the
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Administrator may prescribe, to receive his Account in the form of substantially
equal monthly, quarterly, or annual installments, provided that each installment
must be at least $500.
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APPENDIX
TRANSFER OF INTRAMERICA LIFE INSURANCE COMPANY
EMPLOYEE ACCOUNTS
1. Purpose. Effective September 30, 1997 the Company acquired certain
operations of Intramerica Life Insurance Company. Effective on or as soon as
practicable following October 1, 1997 (the "Transfer Date"), the accounts
currently held under the Colonial Penn Group Savings Plan ("CPG Plan") of
certain individuals who were employees of Intramerica Life Insurance Company on
September 30, 1997 who became employees of Conseco Services, L.L.C. on October
1, 1997 ("Intramerica Employees") will be transferred to this Plan. The
Intramerica Employees will become Employees eligible to participate in the Plan
on the Transfer Date. It is the purpose of this Appendix to provide for the
transfer to this Plan of the Intramerica Employee's accounts in the CPG Plan,
and the participation in the Plan of the Intramerica Employees, both effective
as of the Transfer Date.
2. Participation in the Plan. Each Intramerica Employee who is a
participant in the CPG Plan on September 30, 1997 who becomes an Employee on
October 1, 1997 will become eligible to participate in the Plan on October 1,
1997.
3. Transfer of the Intramerica Employees Accounts. Effective as of the
Transfer Date: (i) a "Before-Tax Deposit Account" will be established for each
Intramerica Employee's elective deferral contributions; credited to his
participant's account under the CPG Plan; (ii) a "CPG Employer Matching
Contribution Account" will be established for each Intramerica Employee's
employer matching contributions credited to his participant's account under the
CPG Plan;(iii) a "CPG Rollover Account" will be established for each Intramerica
Employee's rollover contributions credited to his participant's account under
the CPG Plan;(iv) a "Pre-1987 After-Tax Deposit Account" for each Intramerica
Employee's after-tax contributions made prior to January 1, 1987 credited to his
participant's account under the CPG Plan; and (v) a "Post-1986 After-Tax Deposit
Account" for each Intramerica Employee's after-tax contributions made on or
after January 1, 1987 credited his participant's account under the CPG Plan. All
amounts held in Before-Tax Deposit, After-Tax Deposit, CPG Rollover and CPG
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Employer Matching Contribution Accounts for Intramerica Employees will be 100%
nonforfeitable and will be subject to the provisions of the Plan including the
investment transfer provisions of Section 7.4 (except insofar as they conflict
with paragraphs 4 and 5 below) and to the provisions of paragraphs 4 and 5
below.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary, this section shall only apply to distributions to
Intramerica Employees who have become Participants hereunder as of the Transfer
Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in quarterly or annual installment payments over a period not to
exceed nine years and eleven months, provided that each installment must be at
least $500; or (iii) if the Participant terminates employment on or after his
Permitted Retirement Age or due to Disability or terminates employment prior to
his or her Permitted Retirement Age but does not elect to take distribution of
his or her Account until the later of age 62 or his or her Permitted Retirement
Age, applied to the purchase of any annuity contract requested by the
Participant and approved by the Administrator provided that such annuity is
available from an appropriate insurance company at commercially reasonable
rates. For purposes of this paragraph 4, "Permitted Retirement Age" shall mean a
date on which the sum of the Participant's then age and service (both measured
in years and completed monthly fractions of years) equals or exceeds age 65. For
purposes of determining a Participant's Permitted Retirement Age, all periods of
employment which are taken into account for purposes of vesting shall count as
service.
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed nine years and eleven months,
provided that each installment must be at least $500, and any annuity that is an
optional form of retirement benefit.
(c) If a married Participant selects an annuity, the annuity shall be
in the form of a qualified joint and survivor annuity (as defined in Code
Section 417) unless the Participant selects another form of annuity and the
Participant's spouse consents to such alternate form and such consent is
witnessed by a notary public.
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5. CPG Rollover and CPG Matching Employer Contribution Account
Withdrawals. Notwithstanding any other provision in the Plan to the contrary,
this section shall allow Intramerica Employees who have become Participants
hereunder as of the Transfer Date to take withdrawals from their CPG Rollover
Account and CPG Employer Matching Contribution Account at any time, in
accordance with the procedures and rules established by the Administrator but,
not more often than twice in any year. Payment shall be made to the Participant
as soon as practicable, in accordance with the bi-weekly processing schedule,
following the date the request is filed with the Plan Administrator. The minimum
withdrawal is the lesser of $300.00 or the total amount available under this
paragraph 5. An eligible Participant's entire CPG Rollover Account will be
available for withdrawal pursuant to the provisions of this paragraph as well as
the eligible Participant's entire CPG Matching Employer Contribution Account if
the Participant has been employed by the Company or its predecessors for five or
more years, otherwise, that portion of the eligible Participant's CPG Matching
Employer Contribution Account which was not credited to the Participant's CPG
Matching Employer Contribution Account within two years prior to the withdrawal
will be available. Withdrawals will be taken first from the CPG Rollover Account
and then from the CPG Matching Employer Contribution Account. Withdrawals under
this paragraph 5 shall be charged against the value of the withdrawing
Participant's sub-account in each of the investment funds proportionally.
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APPENDIX
MERGER OF PIONEER FINANCIAL SERVICES, INC.
EMPLOYEE SAVINGS AND STOCK OWNERSHIP PLAN
1. Purpose. Effective May 30, 1997, the Company acquired Pioneer
Financial Services, Inc. and certain of its subsidiaries. Effective on or as
soon as practicable following March 31, 1998 (the "Merger Date"), the Pioneer
Financial Services, Inc. Employee Savings and Stock Ownership Plan, as last
amended and restated effective April 1, 1990 (the "Pioneer Plan") is hereby
merged into this Plan. Effective January 1, 1998 all loans then outstanding
under the Pioneer Plan are hereby merged into this Plan. Certain of the
individuals who are employees of Pioneer Financial Services, Inc. or its
affiliates on December 31, 1997 ("Pioneer Employees") will become Employees
eligible to participate in the Plan on January 1, 1998. It is the purpose of
this Appendix to provide for the merger into this Plan of the Pioneer Plan
effective as of the Merger Date, and the participation in the Plan of the
Pioneer Employees effective January 1, 1998.
2. Participation in the Plan. Each Pioneer Employee who is a
participant in the Pioneer Plan on December 31, 1997 who becomes an Employee on
January 1, 1998 will become eligible to participate in the Plan on January 1,
1998.
3. Transfer and Merger of Pioneer Plan Accounts. Effective as of the
Merger Date (i) a "Before-Tax Deposit Account" will be established for each
Pioneer Employee's elective deferral contributions credited to his participant's
account under the Pioneer Plan; (ii) a "Rollover Account" will be established
for each Pioneer Employee's rollover contribution to his participant's account
under the Pioneer Plan;(iii) an "Employer Contribution Account" for each Pioneer
Employee's employer matching contributions credited to his participant's account
under the Pioneer Plan; (iv) a "Prior Plan Match Account" for each Pioneer
Employee's discretionary employer contributions credited to his participant's
account under the Pioneer Plan; (v) a "Pre-1987 After-Tax Deposit Account" for
each Pioneer Employee's pre-1987 after-tax employee contributions credited to
his participant's account under the Pioneer Plan; and (vi) a "Post-1987
After-Tax Deposit Account" for each Pioneer Employee's post-1987 after-tax
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employee contributions credited to his participant's account under the Pioneer
Plan. All amounts held in Before-Tax Deposit and After-Tax Deposit Accounts for
Pioneer Employees will be 100% nonforfeitable and will be subject to the
provisions of the Plan (except insofar as they conflict with paragraphs 4 and 5
below) and to the provisions of paragraph 4 and 5 below. Notwithstanding
anything in the Plan to the contrary, all amounts held in Prior Plan Match
Accounts and Employer Contribution Accounts for Pioneer Employees shall vest in
accordance with the provisions of Section 10.4(b)(ii) of the Plan except that
all such amounts shall be 100% vested and nonforfeitable after the Participant
completes 5 years of Credited Service.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary, this section shall only apply to distributions to
Pioneer Employees who become Participants hereunder on January 1, 1998.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in installment payments over a period not to exceed nine years and
eleven months, provided that each installment must be at least $500; (iii) for
Participants who were participants in the Pioneer Plan prior to January 1, 1992,
in installment payments over a period not to exceed the life expectancy of the
Participant or the joint and last survivor life expectancy of the Participant
and his designated beneficiary; or (iv) for Participants who were Participants
in the Pioneer Plan prior to January 1, 1992, applied to the purchase of any
annuity contract requested by the Participant and approved by the Administrator
provided that such annuity is available from an appropriate insurance company at
commercially reasonable rates.
(b) The optional forms of death benefit are a single-sum payment,
installment payments over a period not to exceed nine years and eleven months,
provided that each installment must be at least $500, and, for beneficiaries of
Participants who were participants in the Pioneer Plan prior to January 1, 1992,
installment payments over a period not to exceed the life expectancy of the
beneficiary or any annuity that is an optional form of retirement benefit,
provided that each installment must be at least $500.
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(c) If a married Participant selects an annuity, the annuity shall
be in the form of a qualified joint and survivor annuity (as defined in Code
Section 417) unless the Participant selects another form of annuity and the
Participant's spouse consents to such alternate form and such consent is
witnessed by a notary public.
5. Loans. Notwithstanding anything in Section 9.5 of the Plan to the
contrary, Pioneer Employees and former Pioneer employees with loans outstanding
on January 1, 1998 may continue to make loan payments in accordance with rules
and procedures established by the Trustees on a monthly basis by certified check
payable to the Trustee until the earlier of: (i) if their employment with the
Company or its affiliates terminated on or after November 1, 1997, the date
which is thirty (30) days after the first anniversary of the termination of
their employment with the Company and its affiliates, and (ii) the date the loan
is repaid in full. Loan repayments made prior to the end of the blackout period
provided for in paragraph 6 below shall be credited to the investment funds in
accordance with the Participant's pre-transfer investment election and shall be
subject to redirection on the last day of each calendar quarter until the end of
the blackout period.
6. Blackout period. Notwithstanding any provision of the Plan to the
contrary: (i) due to the merger of the Pioneer Plan from quarterly valuation to
daily valuation, request for withdrawals, loans, and distributions can not be
processed during the blackout period beginning April 1, 1998 and ending on or
about August 1, 1998, (ii) funds transferred from the Pioneer Plan may only be
reallocated on the last day of each calendar quarter until the end of the
blackout period.
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APPENDIX
MERGER OF PROVIDENTIAL LIFE INSURANCE
401(k) RETIREMENT PLAN
1. Purpose. Effective Sept. 30, 1997, the Company acquired Providential
Life Insurance Company. Effective on or as soon as practicable following October
1, 1998 (the "Merger Date"), the Providential Life Insurance Company 401(k)
Retirement Plan, as last amended and restated effective April 1, 1994 (the
"Providential Plan") is hereby merged into this Plan. Certain of these
individual who are employees of Providential Life Insurance Company on March 31,
1998 ("Providential Employees") will become Employees eligible to participate in
the Plan on April 1, 1998. It is the purpose of this Appendix to provide for the
merger into this Plan of the Providential Plan effective as soon as
administratively feasible following the Merger Date, and the participation in
the Plan of the Providential Employees effective as of April 1, 1998.
2. Participation in the Plan. Each Providential Employee who is a
participant in the Providential Plan on March 31, 1998 will be eligible to
participate in the Plan on April 1, 1998.
3. Transfer and Merger of Providential Plan Accounts. Effective as of
the Merger Date (i) a "Before-Tax Deposit Account" will be established for each
Providential Employee's elective deferral, rollover and employer contributions
rollovers credited to his participant's account under the Providential Plan;
(ii) a "Pre-1987 After-Tax Deposit Account" will be established for each
Providential Employee's Pre-1987 after-tax employee contributions credited to
his participant's account under the Providential Plan; and (iii)a "Post-1986
After-Tax Deposit Account" will be established for each Providential Employee's
post-1986 after-tax employee contributions credited to his participant's account
under the Providential Plan. All amounts held in Before-Tax Deposit, Pre-1987
After-Tax Deposit, Post-1986 After-Tax Deposit, and Rollover Accounts for
Providential Employees will be 100% nonforfeitable and all Accounts will be
subject to the provisions of the Plan (except insofar as they conflict with
paragraphs 4 and 5 below) and to the provisions of paragraph 4 and 5 below.
4. Joint and Survivor Annuities.
(a) Notwithstanding anything herein to the contrary, this section
shall apply to former employees of Providential Life Insurance Company whose
Providential Plan accounts were transferred to this Plan on the Merger Date.
(b) Unless an optional form of benefit is selected pursuant to a
Qualified Election within the ninety (90) day period ending on the Benefit
Commencement Date, the vested Account of a married Providential Employee will be
paid in the form of a Qualified Joint and Survivor Annuity and the vested
Account of an unmarried Providential Employee will be paid in the form of a
straight-life annuity. The Qualified Election by an unmarried Providential
<PAGE>
Employee must comply with the provisions of this section as if it were an
election to waive the Qualified Joint and Survivor Annuity by a married
Providential Employee, but without the spousal consent requirement.
(c) Unless an optional form of benefit has been selected within the
Election Period pursuant to a Qualified Election, if a Providential Employee
dies before the Benefit Commencement Date then fifty percent (50%) of the
Providential Employee's vested Account shall be paid to the eligible spouse in
the form of a Qualified Pre-Retirement Survivor Annuity.
(d) Definitions:
(1) Benefit Commencement Date. The date upon which payment of
benefits commences.
(2) Election Period. The period which begins on the first day
of the Plan Year in which the Providential Employee attains age thirty-five (35)
and ends on the date of the Providential Employee's death. If a Providential
Employee separates from service prior to the first day of the Plan Year in which
age thirty-five (35) is attained, with respect to the Account as of the
severance from service date, the Election Period shall begin on the severance
from service date.
(3) Earliest Retirement Age. The earliest date on which,
under the Plan, the Providential Employee could elect to receive retirement
benefits.
(4) Qualified Election. A waiver of a Qualified Joint and
Survivor Annuity or a Qualified Pre-Retirement Survivor Annuity. The waiver must
be in writing and must be consented to by the Providential Employee's eligible
spouse. The eligible spouse's consent to a waiver must be witnessed by the Plan
Administrator or notary public. Notwithstanding this consent requirement, if the
Providential Employee establishes to the satisfaction of the Plan Administrator
that such written consent may not be obtained because there is no eligible
spouse or the eligible spouse cannot be located, a waiver will be deemed a
Qualified Election. Any consent necessary under this provision will be valid
only with respect to the eligible spouse who signs the consent, or in the event
of a deemed Qualified Election, the designated eligible spouse. Additionally, a
revocation of a prior waiver may be made by a Participant without the consent of
the eligible spouse at any time before the Benefit Commenc ment Date. The number
of revocations shall not be limited.
(5) Qualified Joint and Survivor Annuity. An annuity for the
life of the Providential Employee with a survivor annuity for the life of the
eligible spouse which is 50% of the amount of the annuity which is payable
during the joint lives of the Providential Employee and the eligible spouse and
which is the amount of benefit which can be purchased with the Providential
Employee's vested Account.
2
<PAGE>
(6) Qualified Pre-Retirement Survivor Annuity. An annuity for
the life of the eligible spouse, the payments under which must be equal to the
amount of benefits which can be purchased with fifty percent (50%) of the
Account of a Providential Employee used to provide the death benefit under the
Plan.
(e) In the case of a Qualified Joint and Survivor Annuity, the Plan
Administrator shall provide each Providential Employee within a reasonable
period prior to the Benefit Commencement Date a written explanation of: (1) the
terms and conditions of a Qualified Joint and Survivor Annuity; (2) the
Providential Employee's right to make and the effect of an election to waive the
Qualified Joint and Survivor Annuity form of benefit; (3) the rights of a
Providential Employee's eligible spouse; and (4) the right to make, and the
effect of, a revocation of a previous election to waive the Qualified Joint and
Survivor Annuity.
(f) In the case of a Qualified Pre-Retirement Survivor Annuity as
described, the Plan Administrator shall provide each Providential Employee
within the period beginning on the first day of the Plan Year in which the
Providential Employee attains age thirty-two (32) and ending with the close of
the Plan Year in which the Providential Employee attains age thirty-five (35), a
written explanation of the Qualified Pre-Retirement Survivor Annuity in such
terms and in such manner as would be comparable to the explanation provided for
meeting the requirements of Subsection 4(e) applicable to a Qualified Joint and
Survivor Annuity.
If a Providential Employee enters the Plan after the first day
of the Plan Year in which the Providential Employee attained age thirty-two
(32), the Plan Administrator shall provide notice no later than the close of the
second Plan Year succeeding the entry of the Providential Employee in the Plan.
(g) Notwithstanding the other requirements of Subsections 4(e) and
(f), the respective notices prescribed by this section need not be given to a
Providential Employee if the Plan "fully subsidizes" the costs of a Qualified
Joint and Survivor Annuity or Qualified Pre-Retirement Survivor Annuity. For
purposes of this subsection, the Plan fully subsidizes the costs of a benefit if
under the Plan the failure to waive such benefits by a Providential Employee
would not result in a decrease in any Plan benefits with respect to such
Prudential Employee and would not result in increased contributions from the
Participant.
5. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary except for the provisions of Section 4 above, this
section shall apply to former employees of Providential Life Insurance Company
whose Providential Plan accounts were transferred to this Plan on the Merger
Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in installment payments over a period not to exceed the life
expectancy of the Participant or the joint and last survivor life expectancy of
the Participant and his designated beneficiary, provided that each installment
must be at least $500; or (iii) applied to the purchase of any annuity contract
requested by the Participant and approved by the Administrator provided that
such annuity is available from an appropriate insurance company at commercially
reasonable rates.
3
<PAGE>
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed the life expectancy of the
beneficiary, provided that each installment must be at least $500, and any
annuity that is an optional form of retirement benefit.
4
<PAGE>
APPENDIX
MERGER OF MARKMAN INTERNATIONAL
EMPLOYEE PROFIT SHARING PLAN
1. Purpose. Effective May 30, 1997, the Company acquired Markman
International, L.L.C. Effective on or as soon as practicable following August 1,
1998 (the "Merger Date"), the Markman International Employee Profit Sharing
Plan, as originally effective January 1, 1992 (the "Markman Plan") is hereby
merged into this Plan. It is the purpose of this Appendix to provide for the
merger into this Plan of the Markman Plan effective as soon as administratively
feasible following the Merger Date.
2. Participation in the Plan. Each former employee of Markman
International, L.L.C. who is not already a Participant in the Plan on August 1,
1998 and who is a participant in the Markman Plan on July 31, 1998 will become
an inactive participant in the Plan on August 1, 1998.
3. Transfer and Merger of Markman Plan Accounts. Effective as of the
Merger Date a "Before-Tax Deposit Account" will be established for each former
employee of Markman International, L.L.C. who had an account in the Markman Plan
on July 31, 1998 ("Markman Employee") for elective deferral, rollover, and
employer contributions credited to his participant's account under the Markman
Plan. All amounts held in Before-Tax Deposit Accounts for Markman Employees will
be 100% nonforfeitable and all Accounts will be subject to the provisions of the
Plan (except insofar as they conflict with paragraphs 4 and 5 below) and to the
provisions of paragraph 4 and 5 below.
4. Joint and Survivor Annuities.
(a) Notwithstanding anything herein to the contrary, this section
shall apply to distributions made to Markman Employees on and after the Merger
Date.
(b) Unless an optional form of benefit is selected pursuant to a
Qualified Election within the ninety (90) day period ending on the Benefit
Commencement Date, the vested Account of a married Markman Employee will be paid
in the form of a Qualified Joint and Survivor Annuity and the vested Account of
an unmarried Markman Employee will be paid in the form of a straight-life
annuity. The Qualified Election by an unmarried Markman Employee must comply
with the provisions of this section as if it were an election to waive the
Qualified Joint and Survivor Annuity by a married Markman Employee, but without
the spousal consent requirement.
(c) Unless an optional form of benefit has been selected within the
Election Period pursuant to a Qualified Election, if a Markman Employee dies
before the Benefit
<PAGE>
Commencement Date then fifty percent (50%) of the Markman Employee's vested
Account shall be paid to the eligible spouse in the form of a Qualified
Pre-Retirement Survivor Annuity.
(d) Definitions:
(1) Benefit Commencement Date. The date upon which payment of
benefits commences.
(2) Election Period. The period which begins on the first day of
the Plan Year in which the Markman Employee attains age thirty-five (35) and
ends on the date of the Markman Employee's death. If a Markman Employee
separates from service prior to the first day of the Plan Year in which age
thirty-five (35) is attained, with respect to the Account as of the severance
from service date, the Election Period shall begin on the severance from service
date.
(3) Earliest Retirement Age. The earliest date on which, under
the Plan, the Markman Employee could elect to receive retirement benefits.
(4) Qualified Election. A waiver of a Qualified Joint and
Survivor Annuity or a Qualified Pre-Retirement Survivor Annuity. The waiver must
be in writing and must be consented to by the Markman Employee's eligible
spouse. The eligible spouse's consent to a waiver must be witnessed by the Plan
Administrator or notary public. Notwithstanding this consent requirement, if the
Markman Employee establishes to the satisfaction of the Plan Administrator that
such written consent may not be obtained because there is no eligible spouse or
the eligible spouse cannot be located, a waiver will be deemed a Qualified
Election. Any consent necessary under this provision will be valid only with
respect to the eligible spouse who signs the consent, or in the event of a
deemed Qualified Election, the designated eligible spouse. Additionally, a
revocation of a prior waiver may be made by a Participant without the consent of
the eligible spouse at any time before the Benefit Commencement Date. The number
of revocations shall not be limited.
(5) Qualified Joint and Survivor Annuity. An annuity for the
life of the Markman Employee with a survivor annuity for the life of the
eligible spouse which is 50% of the amount of the annuity which is payable
during the joint lives of the Markman Employee and the eligible spouse and which
is the amount of benefit which can be purchased with the Markman Employee's
vested Account.
(6) Qualified Pre-Retirement Survivor Annuity. An annuity for
the life of the eligible spouse, the payments under which must be equal to the
amount of benefits which can be purchased with fifty percent (50%) of the
Account of a Markman Employee used to provide the death benefit under the Plan.
<PAGE>
(e) In the case of a Qualified Joint and Survivor Annuity, the Plan
Administrator shall provide each Markman Employee within a reasonable period
prior to the Benefit Commencement Date a written explanation of: (1) the terms
and conditions of a Qualified Joint and Survivor Annuity; (2) the Markman
Employee's right to make and the effect of an election to waive the Qualified
Joint and Survivor Annuity form of benefit; (3) the rights of a Markman
Employee's eligible spouse; and (4) the right to make, and the effect of, a
revocation of a previous election to waive the Qualified Joint and Survivor
Annuity.
(f) In the case of a Qualified Pre-Retirement Survivor Annuity as
described, the Plan Administrator shall provide each Markman Employee within the
period beginning on the first day of the Plan Year in which the Markman Employee
attains age thirty-two (32) and ending with the close of the Plan Year in which
the Markman Employee attains age thirty-five (35), a written explanation of the
Qualified Pre-Retirement Survivor Annuity in such terms and in such manner as
would be comparable to the explanation provided for meeting the requirements of
Subsection 4(e) applicable to a Qualified Joint and Survivor Annuity.
If a Markman Employee enters the Plan after the first day of the
Plan Year in which the Markman Employee attained age thirty-two (32), the Plan
Administrator shall provide notice no later than the close of the second Plan
Year succeeding the entry of the Markman Employee in the Plan.
(g) Notwithstanding the other requirements of Subsections 4(e) and
(f), the respective notices prescribed by this section need not be given to a
Markman Employee if the Plan "fully subsidizes" the costs of a Qualified Joint
and Survivor Annuity or Qualified Pre-Retirement Survivor Annuity. For purposes
of this subsection, the Plan fully subsidizes the costs of a benefit if under
the Plan the failure to waive such benefits by a Markman Employee would not
result in a decrease in any Plan benefits with respect to such Markman Employee
and would not result in increased contributions from the Participant.
5. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary except for the provisions of Section 4 above, this
section shall only apply to distributions made to Markman Employees on and after
the Merger Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in installment payments over a period not to exceed the life
expectancy of the Participant or the joint and last survivor life expectancy of
the Participant and his designated beneficiary, provided that each installment
must be at least $500; or (iii) applied to the purchase of any annuity contract
requested by the Participant and approved by the Administrator provided that
such annuity is available from an appropriate insurance company at commercially
reasonable rates.
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed the life expectancy of the
beneficiary, provided that each installment must be at least $500, and any
annuity that is an optional form of retirement benefit.
<PAGE>
APPENDIX
MERGER OF COLONIAL PENN LIFE INSURANCE COMPANY SAVINGS PLAN
1. Purpose. Effective September 30, 1997, the Company acquired Colonial
Penn Life Insurance Company. Effective on or as soon as practicable following
December 31, 1998 (the "Merger Date"), the Colonial Penn Life Insurance Company
Savings Plan, as adopted effective August 1, 1997(the "CPL Plan") is hereby
merged into this Plan. Certain of the individuals who are employees of Colonial
Penn Life Insurance Company on December 31, 1998 ("CPL Employees") will become
Employees eligible to participate in the Plan on January 1, 1999. It is the
purpose of this Appendix to provide for the merger into this Plan of the CPL
Plan effective as of the Merger Date, and the participation in the Plan of the
CPL Employees effective January 1, 1999.
2. Participation in the Plan. Each CPL Employee who is a participant in
the CPL Plan on December 31, 1998 who becomes an Employee on January 1, 1999
will become eligible to participate in the Plan on January 1, 1999.
3. Transfer and Merger of CPL Plan Accounts. Effective as of the Merger
Date (i) a "Before-Tax Deposit Account" will be established for each CPL
Employee's elective deferral contributions credited to his participant's account
under the CPL Plan; (ii) a "CPL Employer Matching Contribution Account" will be
established for each CPL Employee's employer matching contributions credited to
his participant's account under the CPL Plan;(iii) a "CPL Rollover Account" will
be established for each CPL Employee's rollover contributions credited to his
participant's account under the CPL Plan; (iv) a "Rollover Account" will be
established for each CPL Employee's employer profit sharing contributions
credited to his participant's account under the CPL Plan; (v) a "Pre-1987
After-Tax Deposit Account" for each CPL Employee's after-tax contributions made
prior to January 1, 1987 credited to his participant's account under the CPL
Plan; and (vi) a "Post-1986 After-Tax Deposit Account" for each CPL Employee's
after-tax contributions made on or after January 1, 1987 credited his
participant's account under the CPL Plan. All amounts held in Before-Tax
Deposit, After-Tax Deposit, CPL Rollover and CPL Employer Matching Contribution
Accounts for CPL Employees will be 100% nonforfeitable and will be subject to
the provisions of the Plan including the investment transfer provisions of
Section 7.4 (except insofar as they conflict with paragraphs 4 through 7 below)
and to the provisions of paragraphs 4 through 7 below.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary, this section shall only apply to distributions to
CPL Employees who have become Participants hereunder as of the Merger Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in quarterly or annual installment payments over a period not to
exceed nine years and eleven
<PAGE>
months, provided that each installment must be at least $500; or (iii) if the
Participant terminates employment on or after his Permitted Retirement Age or
due to Disability or terminates employment prior to his or her Permitted
Retirement Age but does not elect to take distribution of his or her Account
until the later of age 62 or his or her Permitted Retirement Age, applied to the
purchase of any annuity contract requested by the Participant and approved by
the Administrator provided that such annuity is available from an appropriate
insurance company at commercially reasonable rates. For purposes of this
paragraph 4, "Permitted Retirement Age" shall mean a date on which the sum of
the Participant's then age and service (both measured in years and completed
monthly fractions of years) equals or exceeds age 65. For purposes of
determining a Participant's Permitted Retirement Age, all periods of employment
which are taken into account for purposes of vesting shall count as service.
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed nine years and eleven months,
provided that each installment must be at least $500, and any annuity that is an
optional form of retirement benefit.
(c) If a married Participant selects an annuity, the annuity shall
be in the form of a qualified joint and survivor annuity (as defined in Code
Section 417) unless the Participant selects another form of annuity and the
Participant's spouse consents to such alternate form and such consent is
witnessed by a notary public.
5. CPL Rollover and CPL Matching Employer Contribution Account
Withdrawals. Notwithstanding any other provision in the Plan to the contrary,
this section shall allow CPL Employees who have become Participants hereunder as
of January 1, 1999 to take withdrawals from their CPL Rollover Account and CPL
Employer Matching Contribution Account at any time, in accordance with the
procedures and rules established by the Administrator but, not more often than
twice in any year. Payment shall be made to the Participant as soon as
practicable, in accordance with the bi-weekly processing schedule, following the
date the request is filed with the Plan Administrator. The minimum withdrawal is
the lesser of $300.00 or the total amount available under this paragraph 5. An
eligible Participant's entire CPL Rollover Account will be available for
withdrawal pursuant to the provisions of this paragraph as well as the eligible
Participant's entire CPL Matching Employer Contribution Account if the
Participant has been employed by the Company or its predecessors for five or
more years, otherwise, that portion of the eligible Participant's CPL Matching
Employer Contribution Account which was not credited to the Participant's CPL
Matching Employer Contribution Account within two years prior to the withdrawal
will be available. Withdrawals will be taken first from the CPL Rollover Account
and then from the CPL Matching Employer Contribution Account. Withdrawals under
this paragraph 5 shall be charged against the value of the withdrawing
Participant's sub-account in each of the investment funds proportionally.
6. Loans. Notwithstanding anything in Section 9.5 of the Plan to the
contrary, loan repayments made prior to the end of the blackout period provided
for in paragraph 7 below shall
<PAGE>
be credited to the investment funds in accordance with the Participant's
pre-transfer investment election and shall be subject to redirection on the last
day of each calendar quarter until the end of the blackout period.
7. Blackout period. Notwithstanding any provision of the Plan to the
contrary: (i) due to the merger of the CPL Plan into this Plan and the resulting
conversion of the CPL funds from monthly valuation to daily valuation, request
for withdrawals, loans, and distributions can not be processed during the
blackout period beginning January 1, 1999 and ending on or about March 31, 1999,
(ii) funds transferred from the CPL Plan may only be reallocated on the last day
of each calendar quarter until the end of the blackout period.
<PAGE>
APPENDIX
MERGER OF WASHINGTON NATIONAL EMPLOYEE SAVINGS PLAN,
WASHINGTON NATIONAL PENSION PLAN PLUS
AND WASHINGTON NATIONAL PROFIT SHARING PLAN
1. Purpose. Effective December 5, 1997, the Company acquired Washington
National Insurance Company and United Presidential Life Insurance Company.
Effective on or as soon as practicable following June 30, 1999 (the "Merger
Date"), the Washington National Employee Savings Plan, as last amended and
restated effective January 1, 1989 (the "Savings Plan"), the Washington National
Pension Plan Plus, originally effective January 1, 1991 (the "Pension Plan"),
and the Washington National Profit Sharing Plan, originally effective January 1,
1991 (the "Profit Sharing Plan"), collectively referred to as the "Washington
National Plans", are hereby merged into this Plan. It is the purpose of this
Appendix to provide for the merger into this Plan of the Washington National
Plans effective as soon as administratively feasible following the Merger Date.
2. Transfer and Merger of the Washington National Plans' Accounts.
Effective as of the Merger Date (i) a "Before-Tax Deposit Account" will be
established for each former Savings Plan participant's elective deferral
contributions credited to his participant's account under the Savings Plan; (ii)
a "Pre-1987 After-Tax Deposit Account" will be established for each former
Savings Plan participant's pre-1987 after-tax employee contributions credited to
his participant's account under the Savings Plan; (iii) a "Post-1986 After-Tax
Deposit Account" will be established for each former Savings Plan participant's
post-1986 after-tax employee contributions credited to his participant's account
under the Savings Plan; (iv) a "Rollover Account" will be established for each
former Savings Plan participant's rollover contributions credited to his
participant's account under the Savings Plan; (v) a "Washington National
Matching Contribution Account" will be established for each former Savings Plan
participant's employer contributions credited to his participant's account under
the Savings Plan; and (vi) a "Prior Plan Account" will be established for each
former Pension Plan participant's employer contributions credited to his
participant's account under the Pension Plan and each former Profit Sharing Plan
participant's employer contributions credited to his participant's account under
the Profit Sharing Plan. All amounts held in Before-Tax Deposit, Pre-1987
After-Tax Deposit, Post-1986 After-Tax Deposit, Rollover, Prior Plan, and
Washington National Matching Contribution Accounts will be 100% nonforfeitable.
Further, all amounts held in an Employer Contribution Account under the Plan for
former employees of Washington National Insurance Company and/or United
Presidential Life Insurance Company whose Washington National Plan accounts were
transferred to this Plan will be 100% nonforfeitable. All Accounts will be
subject to the provisions of the Plan (except insofar as they conflict with
paragraphs 3 through 6 below) and to the provisions of paragraph 3 through 6
below.
<PAGE>
3. Joint and Survivor Annuities.
(a) Notwithstanding anything herein to the contrary, this section
shall apply to former employees of Washington National Insurance Company and/or
United Presidential Life Insurance Company whose Washington National Plan
accounts were transferred to this Plan on the Merger Date.
(b) Unless an optional form of benefit is selected pursuant to a
Qualified Election within the ninety (90) day period ending on the Benefit
Commencement Date, the vested Account of a married former Washington National
Plan participant will be paid in the form of a Qualified Joint and Survivor
Annuity and the vested Account of an unmarried former Washington National Plan
participant will be paid in the form of a straight-life annuity. The Qualified
Election by an unmarried former Washington National Plan participant must comply
with the provisions of this section as if it were an election to waive the
Qualified Joint and Survivor Annuity by a married former Washington National
Plan participant, but without the spousal consent requirement.
(c) Unless an optional form of benefit has been selected within the
Election Period pursuant to a Qualified Election, if a former Washington
National Plan participant dies before the Benefit Commencement Date then fifty
percent (50%) of the former Washington National Plan participant's vested
Account shall be paid to the eligible spouse in the form of a Qualified
Pre-Retirement Survivor Annuity.
(d) Definitions:
(1) Benefit Commencement Date. The date upon which payment of
benefits commences.
(2) Election Period. The period which begins on the first day of
the Plan Year in which the former Washington National Plan participant attains
age thirty-five (35) and ends on the date of the former Washington National Plan
participant's death. If a former Washington National Plan participant separates
from service prior to the first day of the Plan Year in which age thirty-five
(35) is attained, with respect to the Account as of the severance from service
date, the Election Period shall begin on the severance from service date.
(3) Earliest Retirement Age. The earliest date on which, under
the Plan, the former Washington National Plan participant could elect to receive
retirement benefits.
(4) Qualified Election. A waiver of a Qualified Joint and
Survivor Annuity or a Qualified Pre-Retirement Survivor Annuity. The waiver must
be in writing and must be consented to by the former Washington National Plan
participant's eligible spouse. The eligible spouse's consent to a waiver must be
witnessed by the Plan Administrator or notary
<PAGE>
public. Notwithstanding this consent requirement, if the former Washington
National Plan participant establishes to the satisfaction of the Plan
Administrator that such written consent may not be obtained because there is no
eligible spouse or the eligible spouse cannot be located, a waiver will be
deemed a Qualified Election. Any consent necessary under this provision will be
valid only with respect to the eligible spouse who signs the consent, or in the
event of a deemed Qualified Election, the designated eligible spouse.
Additionally, a revocation of a prior waiver may be made by a Participant
without the consent of the eligible spouse at any time before the Benefit
Commencement Date. The number of revocations shall not be limited.
(5) Qualified Joint and Survivor Annuity. An annuity for the
life of the former Washington National Plan participant with a survivor annuity
for the life of the eligible spouse which is 50% of the amount of the annuity
which is payable during the joint lives of the former Washington National Plan
participant and the eligible spouse and which is the amount of benefit which can
be purchased with the former Washington National Plan participant's vested
Account.
(6) Qualified Pre-Retirement Survivor Annuity. An annuity for
the life of the eligible spouse, the payments under which must be equal to the
amount of benefits which can be purchased with fifty percent (50%) of the
Account of a former Washington National Plan participant used to provide the
death benefit under the Plan.
(e) In the case of a Qualified Joint and Survivor Annuity, the Plan
Adminis trator shall provide each former Washington National Plan participant
within a reasonable period prior to the Benefit Commencement Date a written
explanation of: (1) the terms and conditions of a Qualified Joint and Survivor
Annuity; (2) the former Washington National Plan participant's right to make and
the effect of an election to waive the Qualified Joint and Survivor Annuity form
of benefit; (3) the rights of a former Washington National Plan participant's
eligible spouse; and (4) the right to make, and the effect of, a revocation of a
previous election to waive the Qualified Joint and Survivor Annuity.
(f) In the case of a Qualified Pre-Retirement Survivor Annuity as
described, the Plan Administrator shall provide each former Washington National
Plan participant within the period beginning on the first day of the Plan Year
in which the former Washington National Plan participant attains age thirty-two
(32) and ending with the close of the Plan Year in which the former Washington
National Plan participant attains age thirty-five (35), a written explanation of
the Qualified Pre-Retirement Survivor Annuity in such terms and in such manner
as would be comparable to the explanation provided for meeting the requirements
of Subsection 4(e) applicable to a Qualified Joint and Survivor Annuity.
If a former Washington National Plan participant enters the Plan
after the first day of the Plan Year in which the former Washington National
Plan participant attained age thirty-two (32), the Plan Administrator shall
provide notice no later than the close of the second Plan Year succeeding the
entry of the former Washington National Plan participant in the Plan.
<PAGE>
(g) Notwithstanding the other requirements of Subsections 4(e) and
(f), the respective notices prescribed by this section need not be given to a
former Washington National Plan participant if the Plan "fully subsidizes" the
costs of a Qualified Joint and Survivor Annuity or Qualified Pre-Retirement
Survivor Annuity. For purposes of this subsection, the Plan fully subsidizes the
costs of a benefit if under the Plan the failure to waive such benefits by a
former Washington National Plan participant would not result in a decrease in
any Plan benefits with respect to such former Washington National Plan
participant and would not result in increased contributions from the
Participant.
4. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary except for the provisions of Section 3 above, this
section shall apply to former employees of Washington National Insurance Company
and/or United Presidential Life Insurance Company whose Washington National Plan
accounts were transferred to this Plan on the Merger Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in quarterly or annual installment payments over a period not to
exceed the life expectancy of the Participant or the joint and last survivor
life expectancy of the Participant and his designated beneficiary, provided that
each installment must be at least $500; or (iii) applied to the purchase of any
annuity contract requested by the Participant and approved by the Administrator
provided that such annuity is available from an appropriate insurance company at
commercially reasonable rates.
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed the life expectancy of the
beneficiary, provided that each installment must be at least $500, and any
annuity that is an optional form of retirement benefit.
5. Washington National Matching Contribution Account Withdrawals.
Notwithstanding any other provision in the Plan to the contrary, this section
shall allow former Washington National Plan participants who have become
Participants hereunder as of the Merger Date to take withdrawals from their
Washington National Matching Contribution Account at any time, in accordance
with the procedures and rules established by the Administrator but, not if an
After-Tax Deposit Account Withdrawal is available and not if an After-Tax
Deposit Account Withdrawal or a Washington National Matching Contribution
Account Withdrawal has been made in the last six (6) months. Payment shall be
made to the Participant as soon as practicable following the date the request is
filed with the Plan Administrator. That portion of the eligible Participant's
Washington National Matching Contribution Account which was not credited to the
Participant's Washington National Matching Contribution Account within two years
prior to the withdrawal will be available.
6. Blackout period. Notwithstanding any provision of the Plan to the
contrary, due to the merger of the Washington National Plan into this Plan
effective on or as soon as practicable following June 30, 1999: (i) requests for
withdrawals, loans, and distributions can not be processed during the blackout
period beginning June 30, 1999 and ending on or about
<PAGE>
September 23, 1999, (ii) funds transferred from the Washington National Plan may
only be reallocated on the last day of each calendar quarter until the end of
the blackout period.
<PAGE>
APPENDIX
MERGER OF LUK-CPG SAVINGS PLAN
1. Purpose. Effective on or as soon as practicable following January 1,
1998 (the "Merger Date"), the accounts currently held for participants ("CPG
Participants") under the LUK- CPG Savings Plan ("CPG Plan") will be transferred
to this Plan. CPG Participants will become Participants in the Plan on the
Merger Date. It is the purpose of this Appendix to provide for the merger of the
CPG Plan into this Plan and the participation in the Plan of the CPG
Participants, both effective as of the Merger Date.
2. Merger of the CPG Accounts. Effective as of the Merger Date: (i) a
"CPG Before- Tax Deposit Account" will be established for each CPG Participant's
elective deferral contributions credited to his participant's account under the
CPG Plan; (ii) a "CPG Employer Matching Contribution Account" will be
established for each CPG Participant's employer matching contributions credited
to his participant's account under the CPG Plan; (iii) a "CPG Rollover Account"
will be established for each CPG Participant's rollover contributions credited
to his participant's account under the CPG Plan; and (iv) an "After-Tax Deposit
Account" will be established for each CPG Participant's after-tax contributions
credited to his participant's account under the CPG Plan. All amounts held in
CPG Before-Tax Deposit, After-Tax Deposit, CPG Rollover and CPG Employer
Matching Contribution Accounts for CPG Participants will be 100% nonforfeitable
and will be subject to the provisions of the Plan (except insofar as they
conflict with paragraphs 3, 4, and 5 below) and to the provisions of paragraphs
3, 4, and 5 below.
3. Optional Forms of Distribution. Notwithstanding any other provision
in the Plan to the contrary, this section shall only apply to distributions to
CPG Participants who have become Participants hereunder as of the Merger Date.
(a) The optional forms of retirement benefit shall be (i) in a lump
sum; (ii) in quarterly or annual installment payments over a period not to
exceed nine years and eleven months, provided that each installment must be at
least $500; or (iii) if the Participant terminates employment on or after his
Permitted Retirement Age or due to Disability or terminates employment prior to
his or her Permitted Retirement Age but does not elect to take distribution of
his or her Account until the later of age 62 or his or her Permitted Retirement
Age, applied to the purchase of any annuity contract requested by the
Participant and approved by the Administrator provided that such annuity is
available from an appropriate insurance company at commercially reasonable
rates. For purposes of this paragraph 3, "Permitted Retirement Age" shall mean a
date on which the sum of the Participant's then age and service (both measured
in years and completed monthly fractions of years) equals or exceeds age 65. For
purposes of determining a Participant's Permitted Retirement Age, all periods of
employment which are taken into account for purposes of vesting shall count as
service.
<PAGE>
(b) The optional forms of death benefit are a single-sum payment,
installment payouts over a period not to exceed nine years and eleven months,
provided that each installment must be at least $500, and any annuity that is an
optional form of retirement benefit.
(c) If a married Participant selects an annuity, the annuity shall
be in the form of a qualified joint and survivor annuity (as defined in Code
Section 417) unless the Participant selects another form of annuity and the
Participant's spouse consents to such alternate form and such consent is
witnessed by a notary public.
4. CPG Rollover and CPG Matching Employer Contribution Account
Withdrawals. Notwithstanding any other provision in the Plan to the contrary,
this section shall allow CPG Participants who have become Participants hereunder
as of the Merger Date to take withdrawals from their CPG Rollover Account and
CPG Employer Matching Contribution Account at any time, in accordance with the
procedures and rules established by the Administrator but, not more often than
twice in any year. Payment shall be made to the Participant as soon as
practicable following the date the request is filed with the Plan Administrator.
The minimum withdrawal is the lesser of $300.00 or the total amount available
under this paragraph 4. An eligible Participant's entire CPG Rollover Account
will be available for withdrawal pursuant to the provisions of this paragraph as
well as the eligible Participant's entire CPG Matching Employer Contribution
Account if the Participant has been employed by the Company or its predecessors
for five or more years, otherwise, that portion of the eligible Participant's
CPG Matching Employer Contribution Account which was not credited to the
Participant's CPG Matching Employer Contribution Account within two years prior
to the withdrawal will be available. Withdrawals will be taken first from the
CPG Rollover Account and then from the CPG Matching Employer Contribution
Account.
5. CPG Before-Tax Deposit Account Withdrawals. Notwithstanding any
other provision in the Plan to the contrary, this Section allow CPG Participants
who have become participants hereunder as of the Merger Date to take withdrawals
from the CPG Before-Tax Deposit Accounts at any time after reaching age 59 1/2 ,
in accordance with the procedures and rules established by the Administrator.
Payment shall be made to the Participant as soon as practicable following the
date the request is filed with the Plan Administrator.
2
<PAGE>
WRITTEN CONSENT TO RESOLUTIONS
OF THE BENEFITS COMMITTEE OF THE
CONSECOSAVE PLAN
The undersigned, being all of the members of the Benefits Committee
(the "Committee") of the ConsecoSave Plan (the "Plan") hereby unanimously
consent to the adoption of and do hereby adopt the following preambles and
resolutions without a meeting of the Committee:
WHEREAS, Conseco, Inc. (the "Corporation") is the sponsor of the Plan,
last amended and restated effective January 1, 1997, and retains the power to
amend said Plan; and
WHEREAS, the Corporation has delegated its power to make certain
amendments to the Plan to the Committee; and
WHEREAS, the Committee desires to amend the Plan in order to reflect
various changes in the investment fund options available under the Plan;
NOW, THEREFORE, BE IT RESOLVED, that Section 7.1 of the Plan be and is
hereby amended to reflect the following:
(1) Effective June 21, 1999, the Asset Allocation Fund is renamed the
Balanced Fund; and
(2) Effective June 21, 1999, the Government Securities Fund will be
eliminated as an investment option under the Plan; and
(3) Effective June 21, 1999, the Conseco Fund Group Conseco 20 Fund,
the Conseco Fund Group High Yield Fund and the Conseco Fund Group
Convertible Securities Fund will be added as new investment
options under the Plan.
FURTHER RESOLVED, that any Participant who fails to redirect his
contributions or prior investments subject to investment direction by June 18,
1999 from the Government Securities Fund to an existing investment fund will
have 100% of his contributions and prior investments which were directed to the
Government Securities Fund on June 21, 1999 directed to the Money Market
Portfolio.
FURTHER RESOLVED, that effective October 1, 1999, the last sentence of
Section 7.3 of the Plan be and is hereby amended to read as follows:
If a Participant fails to make any election or makes an election
prohibited hereunder, 100% of his contributions subject to investment
direction shall be invested in the Conseco Fund Group Balanced Fund.
<PAGE>
FURTHER RESOLVED, that the appropriate officers of the Corporation be
and are each hereby authorized and directed to take any such actions as shall be
deemed necessary or desirable, with the advice of counsel, to effectuate the
foregoing resolutions.
IN WITNESS WHEREOF, the undersigned have executed this unanimous
written consent to be effective as of the 18th day of June, 1999.
/s/ James S. Adams /s/ Rollin M. Dick
- ------------------------- -------------------------
James S. Adams Rollin M. Dick
/s/ Thomas J. Kilian /s/ John J. Sabl
- ------------------------- -------------------------
Thomas J. Kilian John J. Sabl
Approved by:
/s/ Stephen C. Hilbert
- -------------------------
Stephen C. Hilbert
Chairman of the Board, President
and Chief Executive Officer
2
Exhibit 5(a)
July 23, 1999
Board of Directors
Conseco, Inc.
11825 N. Pennsylvania Street
Carmel, Indiana 46032
Re: Conseco, Inc.
Registration Statement on Form S-8
Gentlemen and Madam:
I am Executive Vice President and General Counsel for Conseco, Inc., an
Indiana corporation (the "Company"), and in such capacity, I exercise general
supervision over the Company's legal affairs. I and lawyers over whom I exercise
general supervision ("we") have acted as counsel to the Company in connection
with the Registration Statement on Form S-8 concerning shares of common stock,
no par value, of the Company ("Common Stock") to be issued in connection with
the ConsecoSave Plan (the "Plan"). In connection with our representation, we
have examined the corporate records of the Company, including its Amended and
Restated Articles of Incorporation, its Amended and Restated ByLaws and other
corporate records and documents and have made such other examinations as we
consider necessary to render this opinion. Based upon the foregoing, I am of the
opinion that:
1. The Company is a corporation duly organized and validly
existing under the laws of the State of Indiana.
2. The Plan and the shares of Common Stock covered by the Plan
have been duly authorized by all requisite corporate action.
3. With respect to the authorized but unissued shares of Common
Stock covered by the Plan, such shares, when issued in
accordance with the terms and provisions for their issuance,
will be validly issued, fully paid and non-assessable.
<PAGE>
I consent to the filing of this opinion as an exhibit to the
registration statement referred to above and to all references to me in such
registration statement.
Very truly yours,
/s/ John J. Sabl
-----------------------------
John J. Sabl
Executive Vice President,
General Counsel and Secretary
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement
of Conseco, Inc. on Form S-8 (File No. 333-00000), of our report dated March 30,
1999 on our audits of the consolidated financial statements and financial
statement schedules of Conseco, Inc. and subsidiaries as of December 31, 1998
and 1997, and for the years ended December 31, 1998, 1997 and 1996, included in
the Annual Report on Form 10-K, which as to the years 1997 and 1996, insofar as
such financial statements relate to Green Tree Financial Corporation, is based
on the report of KPMG LLP, independent auditors.
/s/ PricewaterhouseCoopers LLP
------------------------------
PricewaterhouseCoopers LLP
Indianapolis, Indiana
July 23, 1999
EXHIBIT 23(c)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Conseco, Inc.:
We consent to the incorporation by reference in the Registration Statement for
the registration of 1,500,000 shares of Conseco, Inc. common stock on Form S-8
of Conseco, Inc. of our report dated January 27, 1998, relating to the
consolidated balance sheet of Green Tree Financial Corporation and subsidiaries
as of December 31, 1997, and the related consolidated statements of operations,
stockholders' equity and cash flows for each of the years in the two-year period
ended December 31, 1997, not separately presented in or incorporated by
reference in the Annual Report on Form 10-K of Conseco, Inc. for the year ended
December 31, 1998. Our report refers to the Company's adoption of the Financial
Accounting Standards Board's Statement No. 125 "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities," in 1997.
/s/ KPMG LLP
------------
KPMG LLP
Minneapolis, Minnesota
July 23, 1999
