<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, 1997
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 20 PAGES
EXHIBIT INDEX APPEARS ON PAGE 19
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JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
TABLE OF CONTENTS
Page No.
--------
Report of Independent Certified Public Accountants..............3
Financial Statements:
Statements of Net Assets Available for
Benefits, with Fund Information, as of
December 31, 1997 and 1996.................................4
Statements of Changes in Net Assets
Available for Benefits, with Fund Information,
for the years ended December 31, 1997 and 1996.............6
Notes to Financial Statements..............................8
Additional Information - Supplemental Schedules:
Schedule I - Schedule of Assets Held for
Investment as of December 31, 1997........................14
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, 1997 and 1996,
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
Schedule I 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. Schedule I 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.
As discussed in Note 3, on March 9, 1998 John Alden Financial Corporation
entered into an agreement for the sale of the Company to a wholly-owned
subsidiary of Fortis, Inc. which may result in the termination of the Plan.
These financial statements do not reflect any adjustments that may result from
the termination of the Plan.
/s/ Price Waterhouse LLP
- ------------------------
PRICE WATERHOUSE LLP
Miami, Florida
June 24, 1998
3
<PAGE> 4
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1997
<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 $14,219,026 $12,999,202 $ 677,392 $ 484,055 $ 58,377
Bonds 10,774,088 -- 10,774,088 -- --
Common stock 53,919,055 -- -- 51,403,677 2,515,378
Loans receivable from
participants 2,905,070 1,410,585 649,366 698,567 146,552
Accrued investment income 386,096 146,027 175,102 52,209 12,758
----------- ----------- ----------- ----------- -----------
Total assets available for
benefits 82,203,335 14,555,814 12,275,948 52,638,508 2,733,065
LIABILITIES
Unsettled trade payables 499,520 499,520 -- -- --
----------- ----------- ----------- ----------- -----------
Net assets available for
benefits $81,703,815 $14,056,294 $12,275,948 $52,638,508 $ 2,733,065
=========== =========== =========== =========== ===========
</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, 1996
<TABLE>
<CAPTION>
Fund Information
----------------------------------------------------
Money Fixed Company
Market Income Equity Stock
Total Fund Fund Fund Fund
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ASSETS
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.
5
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JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS,
WITH FUND INFORMATION
YEAR ENDED DECEMBER 31, 1997
<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:
Interest $ 1,816,098 $ 796,413 $ 828,286 $ 179,541 $ 11,858
Dividends 678,709 -- -- 624,533 54,176
Realized gains (losses) 12,755,936 12,601 35,592 12,747,949 (40,206)
Change in unrealized
appreciation/depreciation
in fair value of investments 1,396,078 8,268 208,836 383,464 795,510
------------ ------------ ------------ ------------ ------------
Total net investment
income 16,646,821 817,282 1,072,714 13,935,487 821,338
------------ ------------ ------------ ------------ ------------
Contributions:
Employee 5,737,025 417,377 1,104,563 3,859,978 355,107
Employer 2,355,591 839,150 326,053 1,071,788 118,600
------------ ------------ ------------ ------------ ------------
Total contributions 8,092,616 1,256,527 1,430,616 4,931,766 473,707
Interfund transfers, net -- (417,983) (187,048) 1,577,287 (972,256)
------------ ------------ ------------ ------------ ------------
Total inflows 24,739,437 1,655,826 2,316,282 20,444,540 322,789
------------ ------------ ------------ ------------ ------------
Withdrawals and
distributions (14,587,192) (3,305,758) (2,669,172) (8,200,895) (411,367)
Forfeiture (560,163) (83,123) (104,915) (318,512) (53,613)
Other outflows (9,520) (1,863) (1,990) (5,361) (306)
------------ ------------ ------------ ------------ ------------
Total outflows (15,156,875) (3,390,744) (2,776,077) (8,524,768) (465,286)
------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net
assets available for benefits 9,582,562 (1,734,918) (459,795) 11,919,772 (142,497)
------------ ------------ ------------ ------------ ------------
Net assets available for benefits:
Beginning of period 72,121,253 15,791,212 12,735,743 40,718,736 2,875,562
------------ ------------ ------------ ------------ ------------
End of period $81,703,815 $14,056,294 $12,275,948 $52,638,508 $ 2,733,065
============ ============ ============ ============ ============
</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, 1997
<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.
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.
8
<PAGE> 9
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 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.
9
<PAGE> 10
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, 1997, the number of employees participating in each fund was as
follows: Money Market Fund, 924; Fixed Income Fund, 1,109; Equity Fund, 1,655;
Company Stock Fund, 454.
At December 31, 1997, net assets available for benefits to participants who have
terminated employment with the Company aggregated $13,191,363. At December 31,
1997, net assets available for benefits relating to individuals who have elected
to withdraw from the Plan but have not yet been paid aggregated $2,982,502.
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:
Years of Vested
Vesting Service Percentage
----------------- -----------------
Less than 2 0%
2-3 30%
3-4 60%
4 or more 100%
Participants are considered to have obtained one year of vesting service for
each full 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 charges by financial institutions.
10
<PAGE> 11
Distributions
A participant becomes entitled to their contributions, vested Company
contributions and all investment earnings in the event of retirement, death,
disability or termination of employment.
Plan Termination
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.
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.
11
<PAGE> 12
(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.
NOTE 3 - ANTICIPATED SALE OF THE COMPANY
On March 9, 1998, the Company entered into an agreement to merge with a
wholly-owned subsidiary of Fortis, Inc. ("Fortis"), a wholly-owned subsidiary of
Fortis Amev, Netherlands, and Fortis AG, Belgium, as a result of which, among
other things, the Company will become a wholly-owned subsidiary of Fortis and
each outstanding share of the Company's common stock will be converted into the
right to receive $22.50 in cash. Consummation of the merger is subject to
regulatory and stockholder approvals, as well as other customary terms and
conditions. It is anticipated that the merger will be consummated during 1998.
If the merger with Fortis is consummated, the Plan may be terminated.
NOTE 4 - INVESTMENT TRANSACTIONS
For the years ended December 31, 1997 and 1996, 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,
--------------------------------------
1997 1996
------------------ ------------------
<S> <C> <C>
Short-term investments $ 20,869 $ (59,135)
Bonds 244,428 (332,394)
Common stock 13,886,717 6,350,080
------------ -----------
$ 14,152,014 $ 5,958,551
============ ===========
</TABLE>
NOTE 5 - 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
1997 and 1996 by the Company. John Alden Asset Management Company ("JAAMCO"), an
indirectly wholly-owned subsidiary of the Company, was the investment manager of
the Plan during 1997 and 1996. JAAMCO managed the Plan's investments in
accordance with the
12
<PAGE> 13
investment guidelines set forth by the Trustees. JAAMCO received 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. On March 31, 1998, BT Alex Brown assumed management of the Plan's
investments. Fees paid to BT Alex Brown to manage the Plan's investments will be
paid by the Company.
13
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JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN SCHEDULE I
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1997
<TABLE>
<CAPTION>
NUMBER OF
SHARES OR FAIR
IDENTITY OF ISSUE, BORROWER, ETC. RATE MATURITY FACE AMOUNT COST VALUE
- --------------------------------------------- --------- ---------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Money Market Fund
- -----------------
Short-Term Investments:
Bankers Trust Pyramid Fund 5.700 N/A $ 1,781,387 $ 1,781,387 $ 1,781,387
U.S. Governments and Agency Obligations:
Federal Home Loan Banks 5.250 05/26/98 400,000 398,875 398,248
Federal Home Loan Mortgage Corporation 4.650 03/11/98 500,000 494,844 499,065
------------- ------------- -------------
Total U.S. Governments and Agency Obligations 900,000 893,719 897,313
------------- ------------- -------------
Commercial Paper:
American Bankers Insurance 5.840 01/06/98 500,000 494,809 494,809
Carpenter Technology Corporation 5.900 01/13/98 500,000 494,346 494,346
Circus Circus Enterprises 6.000 01/17/98 500,000 495,917 495,917
Conagra 5.700 01/02/98 500,000 493,667 493,667
Deutsche Bank 5.500 10/30/97 475,000 475,000 475,000
Houston Industry Incorporated 5.880 01/15/98 500,000 495,018 495,018
Illinois Power Company 5.850 01/20/98 500,000 493,906 493,906
Tyson Foods 5.850 01/08/98 500,000 495,938 495,938
------------- ------------- -------------
Total Commercial Paper 3,975,000 3,938,601 3,938,601
------------- ------------- -------------
Corporate Bonds and Debentures:
Commercial Credit Group Inc. 5.500 05/15/98 500,000 499,355 499,090
Gannet Corporation 5.250 03/01/98 200,000 199,200 199,758
General Electric Capital 5.750 11/10/98 500,000 499,200 498,125
General Motors Acceptance Corporation 5.375 01/09/98 500,000 498,450 499,980
Georgia Power Company 5.500 04/01/98 500,000 497,490 499,545
Glatfeltter (P.H.) 5.875 03/01/98 350,000 349,738 349,934
IBM Corporation 5.670 01/28/98 500,000 500,000 499,965
International Lease Financial 5.920 01/15/98 500,000 499,550 500,010
Lehman Brothers Hldg Inc 5.750 02/15/98 650,000 649,520 649,851
Northwestern Bell 4.875 06/01/98 290,000 287,489 288,857
Pacific Gas & Electric Company 5.375 08/01/98 500,000 497,450 498,400
Salomon Brothers 5.900 06/15/98 300,000 299,850 299,784
Southern Bell Telephone 4.370 03/01/98 100,000 98,770 99,782
Wal Mart Stores Incorporated 5.500 03/01/98 500,000 499,138 499,515
West Pennsylvania Power Company 5.500 06/01/98 500,000 498,535 499,305
------------- ------------- -------------
Total Corporate Bonds and Debentures 6,390,000 6,373,735 6,381,901
------------- ------------- -------------
------------- ------------- -------------
Total Money Market Fund Investments $ 13,046,387 $ 12,987,442 $ 12,999,202
============= ============= =============
</TABLE>
14 Page 1 of 4
<PAGE> 15
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN SCHEDULE I
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1997
<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 $ 677,392 $ 677,392 $ 677,392
------------- ------------- --------------
U.S. Governments and Agency Obligations:
Federal Home Loan Banks 6.100 03/22/99 100,000 100,000 99,937
Federal Home Loan Banks 5.490 02/01/01 300,000 300,000 296,718
Federal Home Loan Mortgage Corporation 5.400 03/16/98 250,000 250,000 249,883
Federal Home Loan Mortgage Corporation 6.200 04/15/03 250,000 251,719 253,008
Federal Home Loan Mortgage Corporation 5.400 11/02/00 300,000 300,000 295,407
------------- ------------- --------------
Total U.S. Governments and Agency Obligations 1,200,000 1,201,719 1,194,953
------------- ------------- --------------
Foreign Government Obligation:
Quebec Providence Canada 7.500 07/15/02 100,000 99,765 104,613
Total U.S. & Foreign Governments and
------------- ------------- --------------
Agency Obligations 1,300,000 1,301,484 1,299,566
------------- ------------- --------------
Corporate Bonds and Debentures:
Discover Card Trust 8.000 10/15/98 100,000 99,424 101,000
Ahmanson H F 7.875 09/01/04 200,000 195,236 213,824
Alabama Power Co 6.750 02/01/03 200,000 197,750 201,790
Allegheny Generating 5.625 09/01/03 200,000 198,118 194,644
American General Corporation 6.250 03/15/03 100,000 97,483 99,168
Aon Corporation 6.300 01/15/04 165,000 146,289 164,333
Arkansas Power & Light Company 7.900 11/01/02 100,000 99,314 102,747
Associates Corporation North America 6.000 06/15/01 210,000 210,000 208,274
Associates Corporation North America 5.250 03/30/00 200,000 198,158 196,356
Bank Nova Scotia Halifax 6.875 05/01/03 100,000 99,911 101,928
Bank Of New York Incorporated 6.625 06/15/03 200,000 198,200 202,562
Bankamerica Corporation 6.200 02/15/06 300,000 298,653 294,120
Boeing Company 6.350 06/15/03 200,000 199,560 201,158
Carnival Cruise Lines Incorporated 6.150 10/01/03 200,000 175,816 197,684
Central Bancshares South Incorporated 7.000 05/01/03 200,000 196,168 203,618
Central Power & Light Company 7.000 02/01/01 100,000 94,655 100,815
Enhance Financial Services 6.750 03/01/03 300,000 289,341 300,759
First Chicago Corporation 6.875 06/15/03 200,000 197,222 205,016
First Colony Corporation 6.625 08/01/03 100,000 99,890 101,305
First Union Corporation 8.770 11/15/04 200,000 199,232 218,844
Georgia Power Company 6.350 08/01/03 100,000 98,700 100,078
Golden West Financial Corporation 6.000 10/01/03 200,000 176,454 195,794
Household Financial Corporation 7.250 05/15/06 300,000 299,970 312,855
Illinois Power Company 6.500 08/01/03 100,000 99,383 100,262
Indiana & Michigan Electric Company 7.000 05/01/98 100,000 91,238 100,065
Jersey Central Power & Light Company 6.375 05/01/03 100,000 98,795 99,707
Liberty National Bancorp 6.750 06/01/03 250,000 249,595 254,930
Lincoln National 7.250 05/15/05 300,000 298,458 311,478
Mid Penn Telephone 7.750 03/15/02 260,000 257,673 262,779
National City Bank Cleveland 6.500 05/01/03 200,000 191,384 200,656
Nationsbank Corp 8.125 06/15/02 100,000 99,750 107,024
New York State Electic & Gas Corporation 6.750 10/15/02 100,000 98,026 101,443
New York Telephone Company 4.250 01/01/00 100,000 67,227 96,646
Pacific Gas & Elec Company 8.750 01/01/01 200,000 199,500 213,550
Pacific Gas & Elec Company 6.250 03/01/04 200,000 200,000 200,392
Pacific Telephone & Telegraph Company 6.500 07/01/03 100,000 100,000 99,355
Paine Webber Group Incorporated 7.000 03/01/00 100,000 99,725 101,102
Penney J C & Company 6.125 11/15/03 300,000 294,114 296,829
Progressive Corp 6.600 01/15/04 96,000 94,110 96,892
Public Service Electric & Gas Company 6.750 03/01/06 200,000 197,542 204,070
Salomon Brothers Incorporated 6.875 12/15/03 100,000 100,000 102,108
Santander Financial 6.800 07/15/05 300,000 297,408 302,736
Society National Bank 6.750 06/15/03 100,000 94,150 101,773
Southern California Edison Company 5.625 10/01/02 200,000 199,092 195,790
State Street Boston Corporation 5.950 09/15/03 200,000 169,764 196,468
Travelers Incorporated 7.750 06/15/99 100,000 100,000 102,165
Travelers Incorporated 6.125 06/15/00 200,000 198,380 199,950
Union Pacific Railroad Company 6.000 09/01/03 295,000 263,435 284,823
Wachovia Corporation 6.375 04/15/03 100,000 88,149 100,728
Zeneca 6.300 06/15/03 300,000 288,255 300,369
United Postal Savings 9.000 07/26/99 500,000 497,594 521,760
-------------- ------------- --------------
Total Corporate Bonds and Debentures 9,376,000 9,098,291 9,474,522
-------------- ------------- --------------
Total Fixed Income Fund Investments $ 11,353,392 $ 11,077,167 $ 11,451,480
============== ============= ==============
</TABLE>
15 Page 2 of 4
<PAGE> 16
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN SCHEDULE I
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1997
<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 484,055 $ 484,055 $ 484,055
Common Stock
- ------------
Abbott Laboratories 27,000 1,762,560 1,768,500
Allied Signal 20,000 211,646 776,260
Boeing Company 20,000 881,560 978,760
Bristol-Meyers Squibb 19,000 1,470,159 1,797,875
CPC International 14,000 1,174,884 1,512,000
Campbell Soup 47,000 1,380,361 2,731,875
Carnival Cruise Lines Incorporated 23,000 896,912 1,273,625
Chase Manhattan Corporation 10,000 370,860 1,095,000
Cisco Systems 33,000 1,444,428 1,839,750
Coca Cola Company 35,000 1,576,791 2,334,080
Disney Walt Company 17,500 980,488 1,732,500
DuPont E I De Nemours & Company 26,000 1,032,166 1,561,638
Ford Motors Company Delaware 20,000 467,347 971,260
GAP Incorporated 43,500 1,044,693 1,541,553
General Electric Company 27,000 1,730,185 1,981,125
Gillette Company 26,000 1,382,110 2,611,388
Harley Davidson Incorporated 18,000 157,858 490,500
Hershey Foods 14,000 460,375 867,132
Home Depot Incorporated 45,000 1,434,783 2,649,375
Intel Corporation 34,400 2,549,939 2,416,600
Johnson & Johnson 20,600 508,263 1,357,025
Merck & Company 19,500 1,387,398 2,067,000
Microsoft Corporation 16,000 2,012,699 2,068,000
Oracle Corporation 35,000 946,272 780,955
Pepsico Incorporated 23,000 800,303 833,750
Pfizer Incorporated 33,000 1,806,860 2,460,579
Philip Morris Companies Incorporated 25,000 1,068,186 1,131,250
Procter & Gamble 32,000 2,251,839 2,554,016
Schering-Plough Corporation 34,500 1,625,993 2,143,313
Travelers Incorporated 22,500 906,515 1,212,188
Tricon Global Restaurants Incorporated 3,100 88,636 90,095
Wal Mart Stores Incorporated 45,000 1,179,568 1,774,710
-------------- --------------
Total Common Stock 36,992,637 51,403,677
-------------- --------------
Total Equity Fund Investments $ 37,476,692 $ 51,887,732
============== ==============
</TABLE>
16 Page 3 of 4
<PAGE> 17
JOHN ALDEN EMPLOYEE SAVINGS INCENTIVE PLAN SCHEDULE I
ADDITIONAL INFORMATION - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1997
<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 58,377 $ 58,377 $ 58,377
Common Stock
- ------------
John Alden Financial Corporation 103,195 2,456,369 2,515,378
-------------- --------------
-------------- --------------
Total Company Stock Fund Investments $ 2,514,746 $ 2,573,755
============== ==============
</TABLE>
17 Page 4 of 4
<PAGE> 18
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, 1998 By: /s/ Scott L. Stanton
--------------------
Scott L. Stanton
Trustee
18
<PAGE> 19
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C> <C>
23.1 Consent of Independent Certified Public Accountants 20
</TABLE>
19
<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, 1998 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, 1997.
/s/ Price Waterhouse LLP
- ------------------------
PRICE WATERHOUSE LLP
Miami, Florida
June 24, 1998
20
