As in effect
3/1/61
FORM 10K/A
--------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
--------------------
AMENDMENT TO APPLICATION OR REPORT
Filed Pursuant to Sections 12, 13, or 15 (d) of
THE SECURITIES EXCHANGE ACT OF 1934
OLD REPUBLIC INTERNATIONAL CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
AMENDMENT NO. 2
---
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its ANNUAL REPORT FOR 1999 on Form
10-K as set forth in the pages attached hereto: (List all such items, financial
statements, exhibits or other portions amended)
FORM 11-K
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
OLD REPUBLIC INTERNATIONAL CORPORATION
--------------------------------------
(Registrant)
Date: June 21, 2000 By: /s/ Paul D. Adams
-------------- -----------------------------------
(Signature)
Paul Dennis Adams
Senior Vice President,
Chief Financial Officer
and Treasurer
Total Pages: 18
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------
FORM 11-K
-------------
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For The Fiscal Year Ended December 31, 1999
-------------
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
-------------
OLD REPUBLIC INTERNATIONAL CORPORATION
307 NORTH MICHIGAN AVENUE
CHICAGO, ILLINOIS 60601
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administration Committee has duly caused this Annual Report to be signed
on behalf of the undersigned, thereunto duly authorized.
THE OLD REPUBLIC INTERNATIONAL CORPORATION EMPLOYEES
SAVINGS AND STOCK OWNERSHIP PLAN
(Registrant)
By: /s/ A. C. Zucaro
----------------------------------------
A. C. Zucaro, Memober of the
Administration Committee
Date: June 21, 2000
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
REPORT ON AUDITS OF FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
-------------------
Pages
-----
Report of Independent Accountants 1
Financial Statements:
Statements of Net Assets Available for Plan Benefits as of
December 31, 1999 and 1998 2
Statements of Changes in Net Assets Available for Plan Benefits
for the years ended December 31, 1999 and 1998 3
Notes to Financial Statements 4-10
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes at
December 31, 1999 12
Schedule of Reportable Transactions for the year ended
December 31, 1999 13
Note
----
Supplemental schedules required by the Employee Retirement Income Security Act
of 1974 that have not been included herein are not applicable.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Administration Committee
of the Old Republic International Corporation
Employees Savings and Stock Ownership Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Old Republic International Corporation Employees Savings and Stock
Ownership Plan (the "Plan") at December 31, 1999 and 1998, and the changes in
net assets available for benefits for the years then ended in conformity with
accounting principles generally accepted in the United States. These financial
statements are the responsibility of the Plan's management; our responsibility
is to express an opinion on these financial statements based upon our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in the
accompanying index are presented for the purpose of additional analysis and are
not a required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedules have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, are
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ PricewaterhouseCoopers LLP
June 21, 2000
Chicago, Illinois
<PAGE>
<TABLE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, 1999 and 1998
----------------------------------------------------
1999 1998
------------------------------------------ -------------------------------------------
Participant Non-Participant Participant Non-Participant
Directed Directed Combined Directed Directed Combined
Account Account Account Account Account Account
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments, at fair value (See Note 2.B.):
Collective Trusts:
Short-term Investment Fund $ 0 $ 258,567 $ 258,567 $ 69,543,031 $ 3,179,639 $ 72,722,670
Old Republic International Corporation:
Common shares 0 100,135,364 100,135,364 0 159,807,443 159,807,443
Mutual funds 85,145,843 0 85,145,843 0 0 0
------------ ------------- ------------- ------------- ------------ --------------
85,145,843 100,393,931 185,539,774 69,543,031 162,987,082 232,530,113
Contributions receivable:
Companies 0 5,315,074 5,315,074 0 7,748,407 7,748,407
Employees 419,123 0 419,123 24,312 0 24,312
Accrued interest and dividends receivable 0 209 209 186,914 32,514 219,428
------------ ------------- ------------- ------------- ------------- -------------
Total assets $ 85,564,966 $ 105,709,214 $ 191,274,180 $ 69,754,257 $ 170,768,003 $ 240,522,260
============ ============= ============= ============= ============= =============
LIABILITIES AND NET ASSETS AVAILABLE
FOR PLAN BENEFITS
Notes payable $ 0 $ 2,500,000 $ 2,500,000 $ 0 $ 5,100,000 $ 5,100,000
Interfund payable (receivable) 0 0 0 (1,358,625) 1,358,625 0
Accrued interest payable 0 28,815 28,815 0 58,379 58,379
Unpaid withdrawal and termination benefits 1,129,179 0 1,129,179 440,931 0 440,931
Unpaid administrative expenses 0 22,161 22,161 37,562 8,907 46,469
------------ ------------- ------------- ------------- ------------- -------------
Total liabilities 1,129,179 2,550,976 3,680,155 (880,132) 6,525,911 5,645,779
------------ ------------- ------------- ------------- ------------- -------------
Net assets available for plan benefits:
Allocated to participants 84,435,787 100,742,397 185,178,184 70,634,389 152,207,790 222,842,179
Not allocated to participants 0 2,415,841 2,415,841 0 12,034,302 12,034,302
------------ ------------- ------------- ------------- ------------- -------------
Total net assets available for plan
benefits 84,435,787 103,158,238 187,594,025 70,634,389 164,242,092 234,876,481
------------ ------------- ------------- ------------- ------------- -------------
$ 85,564,966 $ 105,709,214 $ 191,274,180 $ 69,754,257 $ 170,768,003 $ 240,522,260
============ ============= ============= ============= ============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
<TABLE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
For the Years ended December 31, 1999 and 1998
----------------------------------------------------
1999 1998
------------------------------------------ -------------------------------------------
Participant Non-Participant Participant Non-Participant
Directed Directed Combined Directed Directed Combined
Account Account Account Account Account Account
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Employer contributions $ 0 $ 8,198,514 $ 8,198,514 $ 0 $ 7,776,665 $ 7,776,665
Employee contributions 12,579,446 0 12,579,446 11,578,445 0 11,578,445
Interfund transfers 1,233,462 (1,233,462) 0 1,364,508 (1,364,508) 0
Interest income 2,599 6,488 9,087 1,992,702 319,608 2,312,310
Dividend income 5,643,115 3,692,013 9,335,128 476,937 3,392,336 3,869,273
Net appreciation (depreciation) in
fair value of investments 3,817,459 (65,364,037) (61,546,578) 3,486,288 (22,691,938) (19,205,650)
------------ ------------- ------------- ------------- ------------- -------------
23,276,081 (54,700,484) (31,424,403) 18,898,880 (12,567,837) 6,331,043
------------ ------------- ------------- ------------- ------------- -------------
Deductions:
Termination and withdrawal benefits 9,368,356 6,091,662 15,460,018 15,482,648 51,671,231 67,153,879
Interest expense 0 208,346 208,346 0 415,429 415,429
Administrative expenses 106,327 83,362 189,689 37,563 262,597 300,160
------------ ------------- ------------- ------------- ------------- -------------
9,474,683 6,383,370 15,858,053 15,520,211 52,349,257 67,869,468
------------ ------------- ------------- ------------- ------------- -------------
NET ADDITIONS (DEDUCTIONS) 13,801,398 (61,083,854) (47,282,456) 3,378,669 (64,917,094) (61,538,425)
Net assets available for plan benefits,
beginning of year 70,634,389 164,242,092 234,876,481 67,255,720 229,159,186 296,414,906
------------ ------------- ------------- ------------- ------------- -------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, END OF YEAR $ 84,435,787 $ 103,158,238 $ 187,594,025 $ 70,634,389 $ 164,242,092 $ 234,876,481
============ ============= ============= ============= ============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
1. Description of Plan
-------------------
A. Basis of Presentation
---------------------
The accompanying financial statements of the Old Republic
International Corporation Employees Savings and Stock
Ownership Plan (the Plan) include plan assets for employees of
Old Republic International Corporation and participating
subsidiaries (the Corporation, the Plan Sponsor, the
Company(ies) or the Employers). These financial statements and
accompanying notes together provide only general information
about the Plan. The Plan Agreement must be referred to for a
complete description of the Plan's provisions.
The financial statements have been restated to comply with the
requirements of the American Institute of Certified Public
Accountants' "Statement of Position 99-3 - Accounting for and
Reporting of Certain Defined Contribution Plan Investments and
Other Disclosure Matters" issued September 15, 1999.
B. General
-------
The Plan is a defined contribution plan covering a majority of
employees of the Corporation and its Subsidiaries and is
subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA) as amended from time-to-time.
Employees become participants in the Plan on the first January
1, they are employees and they elect to make contributions to
the Plan.
C. Contributions
-------------
Contributions from employees (savings) are made on a post-tax
basis and are recorded in the period in which the Companies
make payroll deductions from Plan participants. Participants
elect the amount of contribution which ranges from a minimum
of 1% to a maximum of 15% of recognized compensation as
defined in the Plan. Any employee who does not contribute to
the Plan does not receive a Company matching contribution.
Only employee contributions up to 6% are matched. However, the
maximum amount of contribution which can be matched per
employee cannot exceed $9,000 (6% of $150,000) per Plan year.
The maximum amount which can be withheld is 15%, but is
limited to $22,500 (15% of $150,000). Contributions are also
subject to other Internal Revenue Code limitations (including
the limits imposed by Internal Revenue Code Section 415).
Participants direct the investment of their contributions into
various mutual funds offered by the Plan, of which there are
currently thirteen.
4
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
1. Description of Plan, Continued
------------------------------
The company matching contribution is based on the following
formula:
<TABLE>
Percentage of If the percentage increase in average operating
Recognized Compen- earnings per share for the most recent five year
Contributed period is:
------------------- ---------------------------------------------------
Less Than 6.01% 9.01% 15.01% Over
6% to 9% to 15% to 20% 20%
--------- ----- ------ ------ ----
The Resulting Employer Matching Contribution on the
First 6% of Employee Savings Will Be:
---------------------------------------------------
<S> <C> <C> <C> <C> <C>
1.00% 30% 40% 65% 100% 140%
1.01 to 2.00% 28% 38% 63% 98% 138%
2.01 to 3.00% 26% 36% 61% 96% 136%
3.01 to 4.00% 24% 34% 59% 94% 134%
4.01 to 5.00% 22% 32% 57% 92% 132%
5.01 to 6.00% 20% 30% 55% 90% 130%
6.01 to 15.00% None None None None None
---------------------------------------------------
</TABLE>
The percentage increase in average operating earnings per
share is obtained by comparing the average diluted
operating earnings per share for the Company for the five
years ending with the calculation year, with the same
average for the five years ending the year prior to the
calculation year. Operating earnings per share are
determined pursuant to generally accepted accounting
principles and are equal to net income per share exclusive
of realized capital gains or losses and extraordinary
items and income taxes applicable thereto.
Company matching contributions are allocated on December 31,
and a Plan participant receives a matching contribution only
if:
the Companies meet certain minimum profit objectives;
the participant completes 1,000 or more hours of service
during the year; and
the participant is employed by one of the Companies on
December 31 of that year, died or became fully disabled
during the year, or retired during the year after attaining
age 65.
Additional amounts from consolidated annual net profits after
taxes or accumulated earnings as the Board of Directors of the
Companies may determine from time to time may be added to the
contributions resulting from the above formula. The amount of
the Companies' contributions are subject to the following
limitations:
No contribution shall be made if the Companies'consolidated
annual net profit before extraordinary items and taxes is
less than $2,500,000.
No contribution shall be made by any Employer for any
fiscal year which exceeds the maximum amount currently
deductible by that Employer under section 404 of the
Internal Revenue Code.
No contribution shall be made by any Employer for any
fiscal year which would cause its total contribution to
exceed the amount of its annual net profit before taxes and
its accumulated earnings.
5
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
1. Description of Plan, Continued
------------------------------
D. Employee Account
----------------
When a plan participant makes employee contributions, the
contributions are allocated to the mutual fund(s) designated
by the participant. These funds constitute the participants
Employee Account (Participant Directed Account). Earnings are
allocated to each plan participant's Employee Account on a
daily basis (semi-annual basis prior to 1999), based upon the
performance of the mutual fund(s) that the plan participant
selected. Following termination of service for any reason, a
plan participant receives all amounts in his/her Employee
Account.
E. Company Account
---------------
Each year, the matching contributions and any discretionary
contributions are allocated to the Company Account
(Non-participant Directed Account) of plan participants. If a
plan participant terminates service with the Companies, the
amount that he/she receives from his/her Company Account
depends upon his/her vested interest in such account. A plan
participant vests in his/her Company Account based on his/her
"Years of Service," over a seven year period.
A plan participant earns a Year of Service for each calendar
year during which he/she completes 1,000 or more hours of
service for the Companies. However, a plan participant will
become 100% vested in his Company Account prior to seven years
of service if:
the plan participant has reached age 65, or
termination is caused by death, or
termination is caused by total and permanent disability
which renders the employee incapable of performing
satisfactory service for the Companies.
The amount a plan participant receives from his\her Company
Account is also affected by forfeitures, earnings, and
released shares. If a plan participant terminates service
prior to full vesting, the non-vested portion of his Company
Account is forfeited. Forfeited amounts are re-allocated to
remaining participants who made employee contributions,
completed 1,000 or more hours of service for the Companies
during the year, and are employed by the Companies on December
31 or terminated service due to retirement on or after age 65,
death, or total and permanent disability. Forfeitures are
allocated based upon the ratio of the plan participant's
recognized compensation to the recognized compensation of all
plan participants.
In addition to forfeitures, the balance in a plan
participant's Company Account is affected by the net cash
revenues over expenses of the Corporation's stock fund plus
the market value of shares released to participants from
payment of loan principal and/or interest during the year.
Effective January 1, 1989, the Tax Reform Act provided that
plan participants who reach age 55 and have 10 years of
service in the Plan are provided with the option of
diversifying a portion of their companies' account balance out
of company stock and into alternative investment funds. The
diversification is limited to 25% of all company stock
acquired after December 31, 1986. After age 60 (and with 10
years of service in the Plan), such participants have the
right to diversify up to 50% of all company stock acquired
after December 31, 1986. The period to make the election to
diversify is during the first 90 days of the calendar year in
which a participant attains age 55 and has completed 10 years
of service in the plan.
6
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
1. Description of Plan, Continued
------------------------------
The investment options available for diversification at
December 31, 1999, are the same Mutual Funds available for
investment of Employee contributions. Diversified funds are
included in the Participant Directed Account in the financial
statements.
2. Summary of Accounting Policies
------------------------------
A. Use of Estimates
----------------
The preparation of financial statements in conformity with
generally accepted accounting principles requires the Plan's
administrator to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the
financial statements and the reported amounts of additions and
deductions during the reporting period. Actual results can
differ from those estimates.
B. Investment Valuation and Income Recognition
-------------------------------------------
The Plan's investments are stated at fair value. Investments
in the Collective Trust-Short-term Investment Fund of the
Northern Trust Company (Northern), are valued by the Northern
at cost which approximates fair value, and consist of
short-term obligations. Shares of mutual funds are valued at
the net asset value of shares held by the Plan at the
valuation date. Old Republic International Corporation common
shares (Company Stock) are stated at closing market value on
the last business day of the year.
Effective January 1, 1999, Fidelity Investments (Fidelity)
began providing recordkeeping services to the Plan and also
became the Plan's investment management company, except for
the Company Stock. Accordingly, to facilitate the transfer of
recordkeeping and investment management services, the mutual
funds and other investments in place through 1998 were
liquidated late in 1998 and the proceeds were invested in
short-term investments prior to their transfer to Fidelity
which, on January 4, 1999, invested such proceeds in
alternative mutual funds made available through Fidelity. As a
result of the above changes, a transition period took effect
in mid-December, 1998 and continued until late April, 1999.
The statements of changes in net assets reflect the net
appreciation (depreciation) in the fair value of the Plan's
investments which consists of the realized gains or losses and
the unrealized appreciation (depreciation) on those
investments. For purposes of generally accepted accounting
principles, the Plan uses the historical cost method for
determining the basis of its investments, whereas, for ERISA
reporting purposes, the Plan uses the current value method for
determining the basis of its investments. Purchases and sales
of securities are reflected on a trade-date basis. Gains or
losses on sales of securities are based on the average cost
method. Interest income is recorded as earned and dividend
income is recorded as earned on the ex-dividend date.
7
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
3. Investments
-----------
The following presents investments, the fair value of which, are 5
percent or more of Plan assets at December 31:
1999 1998
------------ ------------
Collective Trusts:
Short-term Investment Fund $ 72,722,670
Mutual Funds:
Fidelity Equity-Income Fund $ 9,778,048
Fidelity Dividend Growth Fund 16,271,861
Fidelity Short-term Bond Fund 22,161,759
Old Republic International
Corporation Common
stock (7,349,384 and
7,102,553 shares,
respectively) 100,135,364* 159,807,443*
============ ============
* - Non-participant directed.
Net appreciation (depreciation) in fair value of investments is broken
down as follows for the years ended December 31:
1999 1998
------------ ------------
Old Republic International Corporation:
Common Stock $(65,364,037) $(23,973,007)
United States Government obligations - 152,128
Corporate bonds - 184,400
Other common stock - (169,660)
Mutual funds 3,817,459 4,600,489
------------ ------------
$(61,546,578) $(19,205,650)
============ ============
Unallocated net assets available for plan benefits, in the Companies'
Account, at December 31, are comprised of items not allocated to
participants, as follows:
Assets 1999 1998
------ ------------ ------------
Unreleased Common Shares:
364,537 shares at $13.625 $ 4,966,817
764,515 shares at $22.50 $ 17,201,588
------------ ------------
Total 4,966,817 17,201,588
------------ ------------
Liabilities
-----------
Unpaid loan principal at December 31 2,500,000 5,100,000
Accrued interest expense payable on
loans at December 31 28,815 58,379
Accrued administrative expenses 22,161 8,907
------------ ------------
Total 2,550,976 5,167,286
------------ ------------
Unallocated net assets available
for plan benefits $ 2,415,841 $ 12,034,302
============ ============
8
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
4. Administrative and Operating Expenses
-------------------------------------
Office personnel, space and equipment are furnished by the Companies at
no charge to the Plan. All other administrative expenses of the Plan
are paid by and reflected as expenses of the Plan.
5. Termination Priorities
----------------------
The Corporation reserves the right, either with or without formal
action, to terminate the Plan. Each Employer reserves the right to
permanently discontinue its contributions to the Plan. In the event
that an Employer permanently discontinues its contributions to the
Plan, or the Corporation terminates the Plan, or the Plan is partially
terminated under operation of law, the accounts of the affected
participants shall be fully vested and non-forfeitable. In addition,
because the Plan is a defined contribution plan and not a defined
benefit plan, no termination priorities apply to the Plan under ERISA.
6. Tax Status
----------
The Internal Revenue Service on April 25, 1995, issued a determination
letter stating that the Plan, as amended through December 1, 1994, was
qualified under Section 401 of the Internal Revenue Code and the Plan
was exempt under the provisions of Section 501(a). The Plan has not
been amended since the determination letter was received. The Plan's
Sponsor and Tax Counsel believe that the Plan is designed and is
currently being operated in compliance with the applicable requirements
of the Internal Revenue Code.
7. Notes Payable
-------------
The following table sets forth certain data with respect to debt assumed
by the Plan and guaranteed by the Corporation:
Original loan principal $ 51,500,000
==============
Cost of shares acquired $ 49,899,963
==============
Unpaid principal balance
at December 31, 1999 $ 2,500,000
==============
Shares acquired:
Series B 14,822,906
Series D 50,077,535
Common 67,451
==============
Unreleased shares at December 31, 1999:
Common 364,537
==============
Principal due April 30, 2000 $ 2,500,000
==============
9
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
---------------
7. Notes Payable, Continued
------------------------
Except for loan proceeds of $100,037, all proceeds were used by the Plan
to acquire preferred and common shares of the Corporation, as indicated
above, at appraised values. Remaining funds were utilized to meet
periodic cash needs or to refinance existing loans. The Series "D"
preferred stock had a cumulative annual dividend rate of $.058 per share,
had a minimum redemption value of $0.58 at the option of the Corporation,
had one vote per share and was convertible into common stock of the
Corporation at any time at the rate of five shares of Series "D"
preferred stock for one common share. During 1997, the Plan exercised its
option to convert its holdings of Series "D" preferred stock (48,863,825
shares) into common stock of the Corporation (9,772,764 shares).
It is anticipated that principal and interest payments on the Plan's
loans are to be met by the Companies' annual profit sharing
contributions, interest on funds invested, and dividends on the
Corporation's common stock.
The interest rate on notes payable is set at 1.5% in excess of the
current rate on six month certificates of deposit on the note with the
Corporation and ranges from 75% to 85% of the Prime Rate on the notes
with the banks.
The carrying amounts of the notes payable approximates their fair value.
10
<PAGE>
SUPPLEMENTAL SCHEDULES
11
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS & STOCK OWNERSHIP PLAN
FORM 5500-ANNUAL RETURN/REPORT OF EMPLOYEE BENEFIT PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1999
--------------------------------------------------------------
<TABLE>
(c)
DESCRIPTION OF INVESTMENT INCLUDING MATURITY DATE,
RATE OF INTEREST, COLLATERAL, PAR OR MATURITY VALUE
---------------------------------------------------
(b) RATE OF SHARES, PAR, (e)
IDENTITY OF ISSUE, BORROWER, MATURITY INTEREST OR MATURITY (d) CURRENT
(a) LESSOR, OR SIMILAR PARTY DATE DIVIDENDS COLLATERAL VALUE COST VALUE
----------------------------------------- --------------------------------------------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
COLLECTIVE TRUSTS:
SHORT-TERM INVESTMENT FUND N/A VARIABLE N/A 258,567 sh $258,567
------------
MUTUAL FUNDS:
FIDELITY FUND N/A VARIABLE N/A 224,196 sh 9,552,978
FIDELITY EQUITY-INCOME FUND N/A VARIABLE N/A 182,836 sh 9,778,048
FIDELLITY INVESTMENT GRADE BOND FUND N/A VARIABLE N/A 41,377 sh 285,090
FIDELITY INTERMEDIATE TERM BOND FUND N/A VARIABLE N/A 95,819 sh 935,194
FIDELITY CAPITAL & INCOME FUND N/A VARIABLE N/A 26,209 sh 243,478
FIDELITY VALUE FUND N/A VARIABLE N/A 140,048 sh 6,135,495
FIDELITY CASH RESERVES N/A VARIABLE N/A 2,112,312 sh 2,112,312
SPARTAN MARKET INDEX FUND N/A VARIABLE N/A 72,223 sh 7,286,565
FIDELITY AGGRESSIVE GROWTH FUND N/A VARIABLE N/A 59,752 sh 3,563,033
FIDELITY DIVERSIFIED INTERNATIONAL FUND N/A VARIABLE N/A 170,842 sh 4,376,964
FIDELITY DIVIDEND GROWTH FUND N/A VARIABLE N/A 561,292 sh 16,271,861
FIDELITY MID-CAP STOCK FUND N/A VARIABLE N/A 111,709 sh 2,443,066
FIDELITY SHORT-TERM BOND FUND N/A VARIABLE N/A 2,607,266 sh 22,161,759
------------
85,145,843
------------
EMPLOYER SECURITIES:
OLD REPUBLIC INTERNATIONAL CORP.:
COMMON STOCK N/A N/A N/A 7,349,384 sh $40,329,340 100,135,364
=========== ------------
PLAN TOTAL $185,539,773
============
</TABLE>
12
<PAGE>
OLD REPUBLIC INTERNATIONAL CORPORATION
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
FORM 5500-ANNUAL RETURN/REPORT OF EMPLOYEE BENEFIT PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
--------------------------------------------------------------
<TABLE>
Dividend/ Face Value
Interest Date of of Amount of Net
Identity of Party or Investment Involved Rate Maturity Transaction Investment Transaction Cost Gain (Loss)
---------------------------------------- ---- -------- ----------- ---------- ----------- ---- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases of Investments
------------------------
Old Republic International
Corporation Common Stock
(799,118 shares) N/A N/A Various N/A $15,042,426 $15,042,426
Sales of Investments
--------------------
Old Republic International
Corporation Common Stock
(552,286 shares) N/A N/A Various N/A $ 9,350,468 $ 2,750,321 $ 6,600,147
</TABLE>
Notes:
-----
This schedule lists all non-participant directed transactions or series of
transactions which aggregate in excess of 5% of the Fund assets at the beginning
of the current year, as required by the Department of Labor.
13
