<PAGE> 1
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UNITED STATES
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
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
------------------ --------------
Commission File Number : 1-11396
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
JOHN ALDEN FINANCIAL CORPORATION
7300 Corporate Center Drive
Miami, Florida 33126-1223
Page 1 of 21 pages
Exhibit Index appears on page 20
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<PAGE> 2
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Report of Independent Certified Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Financial Statements:
Statements of Net Assets Available for
Benefits, with Fund Information, as of
December 31, 1996 and 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Statements of Changes in Net Assets
Available for Benefits, with Fund Information,
for the years ended December 31, 1996 and 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Additional Information - Supplemental Schedules:
Schedule I - Schedule of Assets Held for
Investment as of December 31, 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Schedule II - Schedule of Investments
Acquired and Disposed of during the year
ended December 31, 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
</TABLE>
Schedules other than those listed above have been omitted since they are not
applicable or the required information is shown in the Financial Statements or
related notes.
2
<PAGE> 3
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Salary and Benefits Committee and Participants
of the John Alden Employee Savings Incentive 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 John Alden Employee Savings Incentive Plan at December 31, 1996
and 1995, and the changes in net assets available for benefits for the years
then ended, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the plan's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards 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 performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
Schedules I and II is presented for purposes of additional analysis and is not
a required part of the basic financial statements but is additional information
required by ERISA. The Fund Information in the statements of net assets
available for benefits and the statements of changes in net assets available
for benefits is presented for purposes of additional analysis rather than to
present the net assets available for benefits and changes in net assets
available for benefits of each fund. Schedules I and II and the Fund
Information 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/ PRICE WATERHOUSE LLP
- ------------------------------
PRICE WATERHOUSE LLP
Miami, Florida
June 24, 1997
3
<PAGE> 4
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Fund Information
----------------------------------------------------------------
Money Fixed Company
Market Income Equity Stock
Total Fund Fund Fund Fund
----------- ----------- ------------ ---------------- ------------
ASSETS
- -------
<S> <C> <C> <C> <C> <C>
Investments at fair value:
Short-term investments $ 16,760,413 $ 14,163,700 $ 152,661 $ 2,407,717 $ 36,335
Bonds 11,699,888 -- 11,699,888 -- --
Common stock 40,173,882 -- -- 37,476,767 2,697,115
Loans receivable from
participants 3,027,318 1,433,422 689,222 780,157 124,517
Accrued investment income 459,752 194,090 193,972 54,095 17,595
------------ ------------ ------------ ------------ -----------
Net assets available
for benefits $ 72,121,253 $ 15,791,212 $ 12,735,743 $ 40,718,736 $ 2,875,562
============ ============ ============ ============ ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 5
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1995
<TABLE>
<CAPTION>
Fund Information
-------------------------------------------------------------------
Money Fixed Company
Market Income Equity Stock
Total Fund Fund Fund Fund
------------ ------------- ------------- ---------------- ------------
ASSETS
- -------
<S> <C> <C> <C> <C> <C>
Investments at fair value:
Short-term investments $15,268,678 $13,459,761 $ 218,318 $ 1,541,186 $ 49,413
Bonds 12,169,743 -- 12,169,743 -- --
Common stock 32,890,412 -- -- 29,542,438 3,347,974
Loans receivable from
participants 3,076,858 1,425,966 709,125 844,118 97,649
Accrued investment income 368,015 121,444 193,558 35,113 17,900
----------- ----------- ----------- ----------- ----------
Net assets available
for benefits $63,773,706 $15,007,171 $13,290,744 $31,962,855 $3,512,936
=========== =========== =========== =========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 6
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS,
WITH FUND INFORMATION
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
Fund Information
---------------------------------------------------------------
Money Fixed Company
Market Income Equity Stock
Total Fund Fund Fund Fund
------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Net investment income (loss):
Interest $ 1,925,377 $ 779,303 $ 866,673 $ 263,339 $ 16,062
Dividends 640,835 -- -- 574,795 66,040
Realized gains (losses) 98,078 57,160 (18,196) 137,648 (78,534)
Change in unrealized
appreciation/depreciation
in fair value of investments 5,860,473 (19,565) (332,394) 6,499,466 (287,034)
------------ ------------ ------------ ------------ -----------
Total net investment
income (loss) 8,524,763 816,898 516,083 7,475,248 (283,466)
------------ ------------ ------------ ------------ -----------
Contributions:
Employee 5,878,798 966,722 1,164,247 3,256,784 491,045
Employer 2,372,243 407,497 456,998 1,309,820 197,928
------------ ------------ ------------ ------------ ------------
Total contributions 8,251,041 1,374,219 1,621,245 4,566,604 688,973
Interfund transfers, net -- 556,147 (841,376) 935,668 (650,439)
Other inflows 12,261 2,567 2,404 6,906 384
------------ ------------ ------------ ------------ ------------
Total inflows 16,788,065 2,749,831 1,298,356 12,984,426 (244,548)
------------ ------------ ------------ ------------ -----------
Withdrawals and distributions (8,440,518) (1,965,790) (1,853,357) (4,228,545) (392,826)
----------- ----------- ----------- ----------- -----------
Total outflows (8,440,518) (1,965,790) (1,853,357) (4,228,545) (392,826)
----------- ----------- ----------- ----------- -----------
Net increase (decrease) in net
assets available for benefits 8,347,547 784,041 (555,001) 8,755,881 (637,374)
------------ ------------ ----------- ------------ -----------
Net assets available for
benefits:
Beginning of period 63,773,706 15,007,171 13,290,744 31,962,855 3,512,936
------------ ------------ ------------ ------------ -----------
End of period $ 72,121,253 $ 15,791,212 $ 12,735,743 $ 40,718,736 $ 2,875,562
============ ============ ============ ============ ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE> 7
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS,
WITH FUND INFORMATION
YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
Fund Information
---------------------------------------------------------------
Money Fixed Company
Market Income Equity Stock
Total Fund Fund Fund Fund
------------- ------------ ------------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Net investment income (loss):
Interest $ 1,932,411 $ 830,132 $ 839,302 $ 241,093 $ 21,884
Dividends 529,809 -- -- 468,947 60,862
Realized gains (losses) 1,359,012 41,889 8,314 1,313,188 (4,379)
Change in unrealized
appreciation/depreciation
in fair value of investments 5,789,488 24,703 1,106,832 5,309,089 (651,136)
----------- ----------- ----------- ----------- ------------
Total net investment
income (loss) 9,610,720 896,724 1,954,448 7,332,317 (572,769)
----------- ----------- ----------- ----------- ------------
Contributions:
Employee 6,384,024 1,145,271 1,382,377 3,165,667 690,709
Employer 2,569,605 422,862 508,955 1,337,645 300,143
----------- ----------- ----------- ----------- -----------
Total contributions 8,953,629 1,568,133 1,891,332 4,503,312 990,852
Interfund transfers, net -- (225,741) (453,047) 127,761 551,027
Other inflows 10,398 1,454 3,034 5,133 777
----------- ----------- ----------- ----------- -----------
Total inflows 18,574,747 2,240,570 3,395,767 11,968,523 969,887
----------- ----------- ----------- ----------- -----------
Withdrawals and distributions (5,475,872) (1,675,202) (1,047,618) (2,589,338) (163,714)
----------- ----------- ------------ ------------ ------------
Total outflows (5,475,872) (1,675,202) (1,047,618) (2,589,338) (163,714)
----------- ----------- ----------- ----------- -----------
Net increase in net
assets available for benefits 13,098,875 565,368 2,348,149 9,379,185 806,173
----------- ----------- ----------- ----------- -----------
Net assets available for
benefits:
Beginning of period 50,674,831 14,441,803 10,942,595 22,583,670 2,706,763
----------- ----------- ----------- ----------- -----------
End of period $63,773,706 $15,007,171 $13,290,744 $31,962,855 $3,512,936
=========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE> 8
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - THE PLAN
The following description of the John Alden Employee Savings Incentive Plan
(the "Plan") provides general information. Participants should refer to the
Plan agreement for a more complete description of the Plan's provisions.
General
The Plan, originally effective on October 10, 1980 and amended effective
January 1, 1993, is a defined contribution savings plan, subject to the
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") and
is exempt from federal and state income taxes. The Plan covers substantially
all of the employees of John Alden Financial Corporation and its subsidiaries
("JAFCO" or the "Company"). Prior to January 1, 1995, employees became
eligible to participate in the Plan on any January 1 or July 1 following one
year of service. Effective January 1, 1995, the Plan was amended to eliminate
the one year of service requirement. Effective December 1, 1995, the one year
of service requirement was reinstated.
Certain members of management of the Company are named as Trustees of the Plan
by the Board of Directors of the Company. The Plan is administered by a
committee (the "Committee") appointed by the Board of Directors of the Company.
As provided by the Plan, the Committee has appointed Bankers Trust Company of
New York ("Bankers Trust"), an outside firm, as custodian for the Plan. Plan
investments and employee and employer contributions are held in a custodial
account established under the Custodial Agreement with Bankers Trust.
Tax Status
The Plan has received a determination letter indicating the Plan's design meets
the requirements for tax exempt status under Section 401(k) of the Internal
Revenue Code ("IRC"). As a result of certain amendments to the Plan adopted in
1993, the Plan filed for an updated determination letter covering the amended
Plan's tax status.
In April 1995, the Plan received a determination letter indicating the design
of the Plan, as amended in 1993, is qualified under Section 401(k) of the IRC,
subject to the implementation of certain agreed-upon amendments, which have
been adopted. The Plan sponsor believes the Plan, as currently designed and
operated, is in compliance with the applicable requirements of the IRC.
Contributions
A participant may elect to contribute from 1% to 14% of pre-tax or after-tax
compensation, subject to certain dollar amount limits, through payroll
deductions. The contributions of certain highly compensated employees are
limited to 6% of pre-tax compensation and by Internal Revenue Service
8
<PAGE> 9
annual limitations. For pre-tax contributions, the employee's taxable income
is reduced by the amount contributed as provided under Section 401(k) of the
IRC.
The Plan provides for minimum Company contributions equal to 50% of the first
6% of the contributions made by participating employees with at least one year
of service. Supplemental annual Company matching contributions may be made at
the discretion of the Company based on the Company's profits.
A participant may elect to suspend contributions at any time. Suspension of
employee contributions, however, will result in suspension of employer
contributions during that period. A participant may resume contributions on
the first day of the following calendar quarter.
The Plan is a tax-deferred plan under federal law, and is subject to a
non-discriminatory test. If the test is not met, a portion of the
contributions and related earnings made by higher paid employees will not be
tax deferred and will be considered taxable income to such employees.
Participant Accounts
Each participant's account is credited with the participant's contributions,
Company contributions and allocations of (a) Plan earnings, based on
participant account balances, and (b) forfeitures of terminated participants'
nonvested funds, based on the participant's contributions to the Plan. Each
participant is entitled to vested benefits in the amount of the participant's
vested account balance.
Investment Options
Participants may invest contributions and transfer account balances among four
investment funds, as follows:
1. Money Market Fund - invested primarily in money market instruments with
maturities of less than one year.
2. Fixed Income Fund - invested in fixed-rate securities and short term
investments.
3. Equity Fund - invested in equities such as common stock and short term
investments.
4. Company Stock Fund - invested primarily in common stock of John Alden
Financial Corporation.
Participants may elect to invest contributions in a single fund, or may elect
to split the contributions, in multiples of 25%, among any of the four funds.
At December 31, 1996, the number of employees participating in each fund was as
follows: Money Market Fund, 1,201; Fixed Income Fund, 1,404; Equity Fund,
1,968; Company Stock Fund, 641.
At December 31, 1996, net assets available for benefits to participants who
have terminated employment with the Company aggregated $7,523,847. At December
31, 1996, net assets available for benefits relating to individuals who have
elected to withdraw from the Plan but have not yet been paid aggregated
$1,291,156.
9
<PAGE> 10
Vesting
Plan participants are 100% vested in the employee contribution amounts. Plan
participants become vested in the employer contributions according to the
following vesting schedule:
<TABLE>
<CAPTION>
Years of Vested
Vesting Service Percentage
--------------- ----------
<S> <C>
Less than 2 0%
2-3 30%
3-4 60%
4 or more 100%
</TABLE>
Participants are considered to have completed one year of vesting service for
each 12 month period of employment following the date of hire.
Withdrawals
Withdrawals from participant accounts including any earnings thereon are
permitted, but are limited to once every 12 months. Certain withdrawals from
participant accounts are allowed for financial hardship only (in accordance
with IRS regulations). Basic or additional contributions will be suspended for
a one year period following a hardship withdrawal.
Loans
The Plan allows participants to borrow the lesser of a) 50% of their total
vested balance in all investment funds or b) $50,000, after reduction of the
excess of certain outstanding loan balances, if any. Such loans are to be
repaid through payroll deductions over a term not to exceed ten years and may
be prepaid at the participant's option. These loans bear interest at a rate
based on the then prevailing rates charged by financial institutions.
Distributions
A participant's account becomes payable upon retirement, death, disability or
termination of employment. During early 1997, the Company restructured its
operations and announced that it would reduce its workforce by approximately
725 employees. Although the Company cannot predict the impact of this
reduction on the Plan, the Plan may experience an increase in the level of
distributions and a decrease in the net assets available for benefits during
1997.
Plan Termination
Although it has not expressed any interest to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate
the Plan subject to the provisions of ERISA. In the event of plan termination,
participants will become fully vested in their participant accounts.
10
<PAGE> 11
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accounting records of the Plan are maintained on the accrual basis and
include management estimates and assumptions that affect the recorded amounts.
Valuation of Investments
Investments are stated at fair value. Investment transactions are accounted
for on a trade date basis. Gain or loss on the sale of investments is computed
on the average cost method. Investments with initial maturities of less than
one year are considered to be short term.
The fair market value of each fund's investments are determined as follows:
(1) Money Market Fund - Short-term investments are valued at cost, which
approximates market value. U.S. Government and agency obligations,
commercial paper and corporate bonds are carried at market prices as
of the valuation date.
(2) Fixed Income Fund - U.S. Government securities and other fixed
income securities are valued at fair value based on quoted market
prices or current market yields for investments with similar
characteristics such as maturity, coupon rate and credit quality, as
determined by an independent source. Short-term investments are
valued at cost, which approximates market value.
(3) Equity Fund - Securities traded on national securities exchanges are
valued at the last reported sales price as of the valuation date;
securities traded in the over-the-counter market and listed
securities for which no sales were reported on the valuation date
are valued at the last reported bid price. Short-term investments
are valued at cost, which approximates market value.
(4) Company Stock Fund - JAFCO common stock is valued at the last
reported sales price as reported on the New York Stock Exchange on
the valuation date. Short-term investments are valued at cost, which
approximates market value.
Loans
Loans are disbursed from participants' fund balances on a pro-rata basis. Loan
repayments are allocated to participants' fund balances based upon the
individual's investment fund election at the time of repayment. Loans
receivable and interest earned on loan balances are allocated to funds on a
pro-rata basis using relative loan repayment and disbursement activity during
the respective period.
11
<PAGE> 12
NOTE 3 - INVESTMENT TRANSACTIONS
For the years ended December 31, 1996 and 1995, the Plan's investments
(including realized gains and losses on investments sold during the year)
appreciated (depreciated) in value as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
---------------------------------------
1996 1995
---------------- -----------------
<S> <C> <C>
Short-term investments $ (59,135) $ 71,351
Bonds (332,394) 1,106,832
Common stock 6,350,080 5,970,317
----------- -----------
$ 5,958,551 $ 7,148,500
=========== ===========
</TABLE>
NOTE 4 - ADMINISTRATION OF PLAN ASSETS
The Plan's assets are held by Bankers Trust, the custodian for the Plan.
Bankers Trust also performs other administrative services for which fees were
paid in 1996 and 1995 by the Company. John Alden Asset Management Company
("JAAMCO"), an indirectly wholly-owned subsidiary of the Company, is the
investment manager of the Plan. JAAMCO manages the Plan's investments in
accordance with the investment guidelines set forth by the Trustees. JAAMCO
receives no fees for these services. Certain administrative functions are
performed by officers or employees of the Company. No such officer or employee
receives compensation from the Plan.
12
<PAGE> 13
ADDITIONAL INFORMATION - SUPPLEMENTAL SCHEDULES
13
<PAGE> 14
SCHEDULE I
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
NUMBER OF
SHARES OR FAIR
IDENTITY OF ISSUE, BORROWER, ETC. RATE MATURITY FACE AMOUNT COST VALUE
- -------------------------------------------------- --------- ----------- --------------- ---------- ---------
Money Market Fund
<S> <C> <C> <C> <C> <C>
Short-Term Investments:
Bankers Trust Pyramid Fund 5.790 N/A $ 1,345,431 $ 1,345,431 $ 1,345,431
U.S. Governments and Agency Obligations:
Federal Farm Credit Banks Cons 5.120 03/03/97 657,143 654,268 657,038
Federal Farm Credit Banks Cons Systemwide 5.760 11/19/97 500,000 500,000 501,400
Federal Home Loan Banks 5.350 03/14/97 1,000,000 1,000,000 999,530
Student Loan Marketing Association 5.620 06/30/97 500,000 500,000 500,340
-------------- --------------- ---------------
Total U.S. Governments and Agency Obligations 2,657,143 2,654,268 2,658,308
-------------- --------------- ---------------
Commercial Paper:
American Brands 5.560 01/10/97 550,000 531,822 531,822
AmGen Incorporated 6.990 02/05/97 100,000 100,000 100,084
Central Illinois Public Service 5.875 05/01/97 500,000 500,000 498,895
Cincinnati Gas & Electric Company 5.875 07/01/97 450,000 450,000 450,051
Circus Circus Enterprises 5.570 01/07/97 500,000 493,115 493,115
Crown Cork & Seal 5.600 01/15/97 500,000 496,889 496,889
Delmarva Power & Light Company 6.375 09/01/97 255,000 255,000 255,046
Detroit Edison 5.410 05/01/97 500,000 498,160 498,875
Disney Walt Company 5.560 03/03/97 500,000 479,459 479,459
Ford Motors Credit Corporation 5.625 03/03/97 265,000 265,000 264,740
General Motors Acceptance Corporation 5.050 02/11/97 500,000 498,395 499,640
Hilton Hotels 6.000 01/02/97 500,000 498,667 498,667
Houston Industry Incorporated 5.570 01/02/97 500,000 496,828 496,828
Illinois Power Company 5.550 01/08/97 500,000 492,523 492,523
International Lease Finance Corporation 5.500 04/01/97 200,000 200,000 199,822
Key Bank of New York 5.260 02/14/97 500,000 499,662 499,960
Lockheed Martin 5.480 01/02/97 500,000 496,727 496,727
New York Telephone Company 4.625 10/01/97 100,000 99,048 99,042
Orix CAC 6.000 02/14/97 500,000 496,167 496,167
Pennsylvania Power & Light Energy Trust 5.570 01/07/97 500,000 496,751 496,751
Public Service Company Colorado 5.520 01/03/97 500,000 497,087 497,087
Quaker Oats Company 5.510 01/13/97 500,000 494,873 494,873
Source One Mortgage 5.720 01/27/97 250,000 248,173 248,173
Tambrands Incorporated 4.650 01/21/97 500,000 496,653 499,808
Total Commercial Paper -------------- --------------- ---------------
Corporate Bonds and Debentures: 10,170,000 10,080,999 10,085,044
-------------- --------------- ---------------
Northern State Power Company Minnesota 5.875 10/01/97 75,000 74,759 74,917
-------------- --------------- ---------------
Total Money Market Fund Investments $ 14,247,574 $ 14,155,457 $ 14,163,700
============== =============== ===============
</TABLE>
Page 1 of 4
14
<PAGE> 15
SCHEDULE I
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Number of
Shares or Fair
Identity of Issue, Borrower, etc. Rate Maturity Face Amount Cost Value
- ------------------------------------ ---------- ------------ ------------ ------------- ---------
<S> <C> <C> <C> <C> <C>
Fixed Income Fund
- -----------------
Short-Term Investments:
Bankers Trust Pyramid Fund 5.790 N/A
$ 152,661 $ 152,661 $ 152,661
------------ -------------- --------------
U.S. Governments and Agency
Obligations:
Federal Farm Credit Banks Cons 7.950 04/01/02 150,000 149,719 150,633
Federal Home Loan Banks 6.100 03/22/99 100,000 100,000 99,656
Federal Home Loan Banks 5.490 02/01/01 300,000 300,000 291,048
Federal Home Loan Mortgage 5.400 03/16/98 250,000 250,000 248,868
Corporation
Federal Home Loan Mortgage 6.200 04/15/03 250,000 251,719 246,523
Corporation
Federal Home Loan Mortgage 5.400 11/02/00 300,000 300,000 290,532
Corporation
U.S. Treasury Notes 5.750 10/31/97 500,000 517,422 500,704
------------ -------------- --------------
Total U.S. Governments and
Agency Obligations 1,850,000 1,868,860 1,827,964
------------ -------------- --------------
Foreign Government Obligation:
Quebec Providence Canada 7.500 07/15/02 100,000 99,765 103,040
Total U.S, & Foreign Governments ------------ -------------- --------------
and Agency Obligations 1,950,000 1,968,625 1,931,004
------------ -------------- --------------
Corporate Bonds and Debentures:
Discover Card Trust 8.000 10/15/98 100,000 99,424 102,781
Ahmanson H F 7.875 09/01/04 200,000 195,236 208,498
Alabama Power Co 6.750 02/01/03 200,000 197,750 198,616
Allegheny Generating 5.625 09/01/03 200,000 198,118 185,330
American General Corporation 6.250 03/15/03 100,000 97,483 95,922
Aon Corporation 6.300 01/15/04 165,000 146,289 158,037
Arkansas Power & Light Company 7.900 11/01/02 100,000 99,314 102,445
Associates Corporation North 6.000 06/15/01 210,000 210,000 203,853
America
Associates Corporation North 5.250 03/30/00 200,000 198,158 193,094
America
Bank N S Halifax 6.875 05/01/03 100,000 99,911 100,265
Bank Of New York Incorporated 6.625 06/15/03 200,000 198,200 197,708
Bankamerica Corporation 6.200 02/15/06 300,000 298,653 283,005
Bankers Trust N Y Corporation 8.000 03/15/97 500,000 462,690 501,925
Boeing Company 6.350 06/15/03 200,000 199,560 196,816
Carnival Cruise Lines 6.150 10/01/03 200,000 175,816 189,202
Incorporated
Central Bancshares South 7.000 05/01/03 200,000 196,168 196,264
Incorporated
Central Power & Light Company 7.000 02/01/01 100,000 94,655 100,634
First Chicago Corporation 6.875 06/15/03 200,000 197,222 200,174
First Colony Corporation 6.625 08/01/03 100,000 99,890 99,303
First Union Corporation 8.770 11/15/04 200,000 199,232 215,980
General Telephone Company 7.500 03/01/02 100,000 97,902 101,625
Wisconsin
Georgia Power Company 6.350 08/01/03 100,000 98,700 97,143
Golden West Financial 6.000 10/01/03 200,000 176,454 190,334
Corporation
Household Financial Corporation 7.250 05/15/06 300,000 299,970 303,366
Illinois Power Company 6.500 08/01/03 100,000 99,383 96,521
Indiana & Michigan Electric 7.000 05/01/98 100,000 91,238 100,392
Company
Jersey Central Power & Light 6.375 05/01/03 100,000 98,795 96,888
Company
Liberty National Bancorp 6.750 06/01/03 250,000 249,595 244,010
Lincoln National 7.250 05/15/05 300,000 298,458 301,413
Mid Penn Telephone 7.750 03/15/02 270,000 267,584 273,440
National City Bank Cleveland 6.500 05/01/03 200,000 191,384 193,730
Nationsbank Corp 8.125 06/15/02 100,000 99,750 106,165
New York State Electic & Gas 6.750 10/15/02 100,000 98,026 98,677
Corporation
New York Telephone Company 4.250 01/01/00 100,000 67,227 93,703
Pacific Gas & Elec Company 8.750 01/01/01 200,000 199,500 215,090
Pacific Gas & Elec Company 6.250 03/01/04 200,000 200,000 191,838
Pacific Telephone & Telegraph 6.500 07/01/03 100,000 100,000 97,063
Company
Paine Webber Group Incorporated 7.000 03/01/00 100,000 99,725 100,687
Penney J C & Company 6.125 11/15/03 300,000 294,114 288,114
Progressive Corp 6.600 01/15/04 96,000 94,110 93,780
Public Service Company Colorado 5.875 07/01/97 100,000 88,334 99,931
Public Service Electric & Gas 6.750 03/01/06 200,000 197,542 195,688
Company
Rochester Gas & Electric 8.000 08/15/99 98,000 98,000 98,540
Corporation
Salomon Brothers Incorporated 6.875 12/15/03 100,000 100,000 97,528
Santander Financial 6.800 07/15/05 300,000 297,408 292,962
Society National Bank 6.750 06/15/03 100,000 94,150 98,300
Southern California Edison 5.625 10/01/02 200,000 199,092 190,244
Company
State Street Boston Corporation 5.950 09/15/03 200,000 169,764 189,192
Travelers Incorporated 7.750 06/15/99 100,000 100,000 102,617
Travelers Incorporated 6.125 06/15/00 200,000 198,380 195,628
Union Pacific Railroad Company 6.000 09/01/03 295,000 263,435 277,150
Wachovia Corporation 6.375 04/15/03 100,000 88,149 98,344
Zeneca 6.300 06/15/03 300,000 288,255 291,399
United Postal Savings 9.000 07/26/99 500,000 497,593 527,530
------------ -------------- --------------
Total Corporate Bonds and
Debentures 9,884,000 9,565,786 9,768,884
------------ -------------- --------------
Total Fixed Income Fund
Investments $11,986,661 $ 11,687,072 $ 11,852,549
============ ============== ==============
</TABLE>
Page 2 of 4
15
<PAGE> 16
SCHEDULE I
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
NUMBER OF
SHARES OR FAIR
IDENTITY OF ISSUE, BORROWER, ETC. RATE MATURITY FACE AMOUNT COST VALUE
- ---------------------------------- ------ -------- ------------ -------- ----------
<S> <C> <C> <C> <C> <C>
Equity Fund
- -----------
Short-Term Investments:
Bankers Trust Pyramid Fund 5.790 N/A
$ 1,909,607 $ 1,909,607 $ 1,909,607
Commercial Paper:
Houston Industry Incorporated 5.670 01/02/97 500,000 498,110 498,110
Total Short Term Investments ----------------- -------------------- --------------------
and Commercial Paper 2,409,607 2,407,717 2,407,717
----------------- -------------------- --------------------
Common Stock
- ------------
Allergan Incorporated 13,100 303,480 466,687
Allied Signal 15,400 325,935 1,031,800
American Express Company 4,800 128,669 271,200
Amsouth Bancorp 11,000 371,514 532,125
Armstrong World Industries
Incorporated 8,100 302,781 562,950
Atlantic Southeast Airlines 19,500 595,725 426,563
Bell South Corporation 24,000 672,564 972,000
Boeing Company 4,000 197,200 426,000
Brunswick Corporation 21,900 302,375 525,600
Campbell Soup 18,000 840,906 1,444,500
Chase Manhattan Corporation 17,000 630,462 1,519,375
Coca Cola Company 16,800 327,270 884,100
Disney Walt Company 9,300 308,995 648,675
Dow Chemical 12,500 894,375 979,688
DuPont E I De Nemours & Company 11,600 813,884 1,091,850
Fluor Corporation 16,500 781,116 1,035,375
Ford Motors Company Delaware 15,600 300,565 503,100
Gillette Company 18,000 606,120 1,399,500
Harley Davidson Incorporated 39,000 684,050 1,833,000
Hershey Foods 26,000 854,981 1,137,500
Home Depot Incorporated 21,000 841,638 1,052,625
Johnson & Johnson 18,600 375,953 925,350
Liz Claiborne Incorporated 9,000 194,625 347,625
MCI Communications Corporation 19,400 299,873 634,147
Merck & Company 15,000 850,125 1,194,375
Motorola Incorporated 15,000 247,331 918,750
National Semiconductor 31,000 624,712 759,500
Nationsbank Corporation 12,700 629,285 1,241,425
Outback Steakhouse Incorporated 38,000 1,014,980 1,016,500
Philips NV ADR's 30,000 354,000 1,200,000
Reliastar Financial Corporation 15,000 458,250 866,250
Rubbermaid Incorporated 28,000 705,672 633,500
Sherwin Williams Company 9,000 224,829 504,000
Sysco Corporation 32,000 876,494 1,044,000
Torchmark Corporation 13,700 637,694 691,850
Toys R Us Incorporation 32,000 893,600 956,000
Wal Mart Stores Incorporation 36,000 861,235 819,000
Washington Mutual Incorporation 27,000 627,750 1,169,451
Wendy's International 47,000 889,475 963,500
Worldcom, Incorporated 62,000 650,613 1,615,906
Xerox 23,400 948,090 1,231,425
-------------------- --------------------
Total Common Stock 23,449,191 37,476,767
-------------------- --------------------
Total Equity Fund Investments $ 25,856,908 $ 39,884,484
==================== ====================
</TABLE>
Page 3 of 4
16
<PAGE> 17
SCHEDULE I
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Number of
Shares or Fair
Identity of Issue, Borrower, etc. Rate Maturity Face Amount Cost Value
- ------------------------------------------ ------------- --------- ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
Company Stock Fund
- ------------------
Short-Term Investments:
Bankers Trust Pyramid Fund 5.790 N/A 36,335 $ 36,335 $ 36,335
Common Stock
- ------------
John Alden Financial Corporation 145,790 3,433,616 2,697,115
---------------- ----------------
Total Equity Fund Investments $ 3,469,951 $ 2,733,450
================ ================
</TABLE>
Page 4 of 4
17
<PAGE> 18
SCHEDULE II
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
ADDITIONAL INFORMATION - SCHEDULE OF INVESTMENTS ACQUIRED AND
DISPOSED OF DURING THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
NUMBER OF
SHARES OR
IDENTITY OF ISSUE, BORROWER, ETC. RATE MATURITY FACE AMOUNT COST PROCEEDS
- -------------------------------------------------- ------- ----------- --------------- ----------- ---------------
<S> <C> <C> <C> <C> <C>
Money Market Fund
- -----------------
Bonds
-----
Cox Enterprises 5.27 04/02/$6 $ 495,828 $ 495,828 $ 495,828
Tyson Foods Incoporated 5.45 07/10/96 268,079 268,079 268,079
Illinois Power Company 5.50 07/12/96 495,340 495,340 495,340
American Bankers Insurance 5.60 07/12/96 498,911 498,911 498,911
Source One Mortgage 5.60 07/03/96 497,278 497,278 497,278
Pennsylvania Power & Light Company 5.60 07/10/96 498,444 498,444 498,444
--------------- --------------- --------------
Money Market Fund Total 2,753,880 2,753,880 2,753,880
--------------- --------------- --------------
Fixed Income Fund
- -----------------
None
----
Equity Fund
- -----------
None
----
--------------- --------------- --------------
Total $ 2,753,880 $ 2,753,880 $ 2,753,880
=============== =============== ==============
</TABLE>
18
<PAGE> 19
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee stock
purchase plan) have duly caused this annual report to be signed on its behalf
by the undersigned hereunto duly authorized.
JOHN ALDEN EMPLOYEE SAVINGS
INCENTIVE PLAN
Dated: June 30, 1997 By: /s/ Scott L. Stanton
--------------------------------
Scott L. Stanton
Trustee
19
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C> <C>
23.1 Consent of Independent Certified Public Accountants 21
</TABLE>
20
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-56656) of John Alden Financial Corporation of our
report dated June 24, 1997 appearing on page 3 of the Annual Report of the John
Alden Employee Savings Incentive Plan on Form 11-K for the year ended December
31, 1996.
/s/ PRICE WATERHOUSE LLP
- ------------------------------
PRICE WATERHOUSE LLP
Miami, Florida
June 24, 1997
21
