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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 11-K
(Mark One)
| /X/ |
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2002
OR
| / / | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number: 000-30898
| A. | Full title of the plan and the address of the plan, if different from that of the issuer named below: |
All*AmerUs Savings and Retirement Plan
| B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
AmerUs Group Co.
699 Walnut Street
Des Moines, IA 50309-3948
Table of Contents
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
All*AmerUs Savings and Retirement Plan
Years Ended December 31, 2002 and 2001
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All*AmerUs Savings and Retirement Plan
Financial Statements and Supplemental Schedule
Years Ended December 31, 2002 and 2001
Contents
| Report of Independent Auditors | 1 | |||
| Audited Financial Statements | ||||
| Statements of Net Assets Available for Benefits | 2 | |||
| Statements of Changes in Net Assets Available for Benefits | 3 | |||
| Notes to Financial Statements | 4 | |||
| Supplemental Schedule | ||||
| Schedule H, Line 4(i) — Schedule of Assets (Held at End of Year) | 11 |
Table of Contents
 |
o | Ernst & Young LLP 801 Grand Avenue Suite 3400 Des Moines, IA 50309 |
o | Phone: (515) 243-2727 www.ey.com |
Report of Independent Auditors
The Board of Trustees
All*AmerUs Savings and Retirement Plan
We have audited the accompanying statements of net assets available for benefits of All*AmerUs Savings and Retirement Plan as of December 31, 2002 and 2001, and the related statements of changes in net assets available for benefits for the years then ended. 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 in accordance with auditing standards generally accepted in the United States. Those standards 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. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2002 and 2001, and the changes in its net assets available for plan benefits for the years then ended in conformity with accounting principles generally accepted in the United States.
Our audits were made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2002, is presented for the purposes of additional analysis and is not a required part of the 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. This supplemental schedule is the responsibility of the Plan’s management. This supplemental schedule has been subjected to the auditing procedures applied in our audit of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.
 |
June 13, 2003
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All*AmerUs Savings and Retirement Plan
Statements of Net Assets Available for Benefits
| December 31 | ||||||||
| 2002 | 2001 | |||||||
Assets |
||||||||
Investments |
$ | 83,215,723 | $ | 90,735,411 | ||||
Employer contributions receivable |
2,934,468 | 2,172,921 | ||||||
Net assets available for benefits |
$ | 86,150,191 | $ | 92,908,332 | ||||
See accompanying notes.
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All*AmerUs Savings and Retirement Plan
Statements of Changes in Net Assets Available for Benefits
| Year Ended December 31 | ||||||||||
| 2002 | 2001 | |||||||||
Additions: |
||||||||||
Investment income (loss): |
||||||||||
Interest and dividends |
$ | 1,605,980 | $ | 1,455,714 | ||||||
Net unrealized and realized losses on investments |
(12,640,582 | ) | (4,658,485 | ) | ||||||
| (11,034,602 | ) | (3,202,771 | ) | |||||||
Contributions: |
||||||||||
Employer |
8,326,734 | 4,417,328 | ||||||||
Employees |
4,321,670 | 3,982,601 | ||||||||
| 12,648,404 | 8,399,929 | |||||||||
Transfer of net assets from other plans |
388,957 | 129,882 | ||||||||
Transfer of net assets resulting from plan merger |
— | 19,587,533 | ||||||||
Total additions |
2,002,759 | 24,914,573 | ||||||||
Deductions — benefits paid to participants |
(8,760,900 | ) | (7,366,961 | ) | ||||||
Net additions (deductions) |
(6,758,141 | ) | 17,547,612 | |||||||
Net assets available for benefits at beginning of year |
92,908,332 | 75,360,720 | ||||||||
Net assets available for benefits at end of year |
$ | 86,150,191 | $ | 92,908,332 | ||||||
See accompanying notes.
3
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All*AmerUs Savings and Retirement Plan
Notes to Financial Statements
December 31, 2002
1. Description of Plan
The following description of the All*AmerUs Savings and Retirement Plan (the
Plan) provides only general information. Participants should refer to the plan
agreement for a more complete description of the Plan’s provisions.
General
The Plan is a contributory defined contribution plan covering all employees of
AmerUs Group Co., (the Company or AmerUs). The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 (ERISA).
Effective October 1, 2001, the Indianapolis Life Insurance Company Salary
Reduction Plan and the Bankers Life Insurance Company of New York Profit-Sharing
and Salary-Deferral Plan (the Indianapolis Life plans) merged into the Plan.
Eligibility
Employees are eligible to participate the first of the month coinciding with, or
next following, their hire date. Full-time employees and part-time employees who
are scheduled to work fewer than 20 hours per week are eligible if the employee
has earned 1,000 hours of service during (a) the one-year period which commences
on his date of employment, or (b) any Plan year subsequent to the employee’s
date of employment. Any individual who was eligible to participate in one of the
Indianapolis Life plans as of September 30, 2001 and who is an employee on
October 1, 2001 are also eligible employees.
Contributions
Participants may contribute up to 50% of annual base salary, overtime pay,
short-term disability plan payments, and bonuses (W-2 compensation), but
excluding sign-on bonuses, long-term incentives, moving expenses, severance
payments, flexible benefit credits taken in cash, car allowances, fitness
reimbursements, and exam awards. In addition, participants may contribute
flexible benefit credits to the Plan as pretax contributions. Contributions of
flexible benefit credits shall be made at the time and in the manner specified
in the flexible benefit plan. The amount contributed per year shall not exceed
$11,000 in 2002 and $10,500 in 2001. The annual contribution to all retirement
benefit plans shall not exceed the lesser of $30,000 or 25% of the participant’s
compensation.
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All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
1. Description of Plan (continued)
In addition to the above general plan provisions, special provisions of the Plan
applicable in connection with the merger of the Indianapolis Life plans provides
that an individual who was an eligible participant in one of the Indianapolis
Life plans was eligible for profit sharing contributions, salary deferral
contributions, and matching contributions during the period from October 1, 2001
to December 31, 2001 in accordance with the terms of the Indianapolis Life
plans.
The Company contributes 125% of the participant’s contribution up to the first
4% of pay contributed, which is called the “company match.” The Company also
contributes 4% of compensation as of the end of the Plan year, which is called a
“core contribution.” The Company’s “core contribution” is made as a combination
of cash and Company stock, with the cash portion being contributed to the Money
Purchase Pension component of the Plan and the stock portion being contributed
to the Employee Stock Ownership (ESOP) component of the Plan. Each business unit
within the Company could elect a “profit sharing contribution” to be allocated
among participants employed by the business unit.
Participant Accounts
Each participant’s account is credited with the participant’s contribution, the
Company’s contribution, and an allocation of Plan net earnings. Allocations of
net earnings are based on account balances, as defined. Forfeited balances of
terminated participants’ nonvested accounts are used to reduce future Company
contributions. The benefit to which a participant is entitled is the vested
benefit that could be provided from the participant’s account.
Vesting
A participant’s interest in pre-tax employee contributions and rollover
contributions is fully vested and nonforfeitable at all times. After one year of
service, the participant is fully vested in the portion of the participant’s
account attributable to employer matching contributions. After five years of
service, the participant is fully vested in the core contribution, profit
sharing contributions, and any interim benefit supplement, however some
employees (generally those that have been merged into the plan) are subject to
different vesting schedules. In addition, any participant whose position is
eliminated during the period from September 1, 2001 to December 31, 2003 shall
have a fully vested interest in their account balance upon their termination of
employment provided that during the period beginning January 1, 2003 and ending
December 31, 2003 this
5
All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
1. Description of Plan (continued)
provision will not apply if the employee terminates employment prior to the
termination date established by AmerUs.
Payment of Benefits
On termination of service, a participant may elect to receive a lump-sum amount
equal to the value of the participant’s account; regular installments paid
monthly, quarterly, or annually over a period designated or dollar amount
specified by the participant, not to exceed the participant’s life expectancy; a
joint and 50% survivor annuity for the lives of the participant and spouse,
which is purchased from a life insurance company with the proceeds from the
participant’s account; or a participant may elect to rollover the value of the
account into another company’s plan or into an established individual retirement
account.
Investment Options
Participants may direct contributions in 1% increments among 16 core investment
options, including 14 mutual funds offered by American Century Services
Corporation, investments through American Century Personal Choice Retirement
Account (PCRA) or common stock of AmerUs. Participants are limited to 50% of
their vested account balance (minimum of $1,000) in the American Century
Personal Choice Retirement Account or common stock of AmerUs.
Ultra Investors Fund - funds invested in stocks of larger companies with a
long-term capital growth potential.
Vista Investors Fund - funds invested primarily in stocks of small to
medium-sized companies with long-term capital growth potential. This fund was
frozen and made unavailable for new contributions effective January 1, 1999.
International Growth Fund - funds invested in companies of all sizes located in
foreign countries.
Value Fund - funds invested primarily in equity securities of well-established
companies that are believed to be undervalued at time of purchase.
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All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
1. Description of Plan (continued)
Strategic Allocation: Aggressive Fund— funds invested in a diversified
portfolio of stocks, bonds, and money market securities. The fund’s targeted mix
of assets is 75% stocks, 20% bonds, and 5% money market securities.
Strategic Allocation: Moderate Fund— funds invested in a diversified portfolio
of stocks, bonds, and money market securities. The fund’s targeted mix of assets
is 60% stocks, 30% bonds, and 10% money market securities.
Strategic Allocation: Conservative Fund— funds invested in a diversified
portfolio of stocks, bonds, and money market securities. The fund’s targeted mix
of assets is 40% stocks, 45% bonds, and 15% money market securities.
Stable Asset Fund - funds invested exclusively in a diversified pool of high
quality fixed income securities.
Income & Growth Fund - funds invested in large U.S. companies whose stocks appear undervalued.
J.P. Morgan U.S. Small Company Opportunities Fund - funds invested primarily in the common stocks of small U.S. companies
whose market capitalization are greater than $150 million and less than $1.25 billion when purchased.
Diversified Bond Fund - funds invested in high and medium grade, non-money
market debt securities. They are payable in U.S. or foreign currencies,
including corporate bonds and notes, government securities, and securities
backed by mortgages or other assets.
Real Estate Fund - funds invested exclusively in stocks of companies in the real
estate sector.
Barclays Global Investors S&P 500 Stock Fund - funds invested in stocks of
larger companies with market capitalization of $10 billion or more providing a
blend of long-term growth potential and securities believed to be undervalued at
time of purchase.
Royce Low-Priced Stock Fund - funds invested primarily in small companies that
are believed to be undervalued at time of purchase.
7
All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
1. Description of Plan (continued)
Common Stock of AmerUs - funds invested in common stock of AmerUs. For reporting
purposes, AmerUs stock represents both common stock held under the AmerUs stock
core investment fund and stock held under the ESOP component of the Plan.
Charles Schwab & Co. Inc. (Schwab) Personal Choice Retirement Account - funds allow the individual participant to purchase
the mutual funds, stocks, and bonds offered through Schwab.
Participant Loans
Participants may borrow from their fund accounts. Maximum allowable borrowings
are 50% of the participant’s vested account balance, not to exceed $50,000. The
minimum borrowing is $1,000. The loans bear interest at rates established by the
AmerUs Benefit and Pension Committee. Interest rates ranged from 4.25% to 9.5%
at December 31, 2002 and from 5.00% to 9.5% at December 31, 2001.
Plan Termination
Although it has not expressed any intent 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 100% vested in their accounts.
Administrative Expenses
The Company pays all expenses of the Plan, with the exception of loan
origination fees, which are charged directly to the participant’s account.
2. Significant Accounting Policies
Investment Valuation and Income Recognition
Investments in mutual funds and common stock of AmerUs is reported at fair
value, based upon the latest quoted market price. Participant loans are valued
at their unpaid principal balance, representing estimated fair value.
8
All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
2. Significant Accounting Policies (continued)
The marketable securities in the PCRA, which include common stocks, mutual
funds, bonds and a money market fund, are reported at fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
3. Investments
Participants have no investment direction authority over that portion the AmerUs
common stock related to the non-vested ESOP Company core contributions. A
summary of the significant components of the changes in the ESOP portion of the
AmerUs common stock is as follows:
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| Year Ended December 31 | ||||||||
| 2002 | 2001 | |||||||
AmerUs Group Co. common stock, beginning of year |
$ | 8,114,345 | $ | 7,941,442 | ||||
Dividend income |
116,836 | 90,099 | ||||||
Net unrealized and realized (losses) gains on investments |
(1,912,466 | ) | 178,380 | |||||
Employer contributions |
946,409 | 1,299,242 | ||||||
Benefits paid to participants |
(1,400,326 | ) | (1,351,842 | ) | ||||
Net transfers to (from) other investments |
2,465,085 | (42,976 | ) | |||||
AmerUs Group Co. common stock, end of year |
$ | 8,329,883 | $ | 8,114,345 | ||||
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All*AmerUs Savings and Retirement Plan
Notes to Financial Statements (continued)
3. Investments (continued)
The fair values of individual investments that represent 5% or more of the
Plan’s net assets are as follows:
| December 31 | ||||||||
| 2002 | 2001 | |||||||
Ultra Investors Fund |
$ | 8,994,498 | $ | 12,035,208 | ||||
International Growth Fund |
4,479,373 | 5,762,814 | ||||||
Value Fund |
8,908,075 | 10,594,934 | ||||||
Strategic Allocation: Moderate Fund |
3,599,748 | 3,942,996 | ||||||
Stable Asset Fund |
20,394,276 | 19,736,425 | ||||||
Income & Growth Fund |
10,628,945 | 12,679,938 | ||||||
Common stock of AmerUs Group Co. |
11,182,327 | 11,365,391 | ||||||
During the years ended December 31, 2002 and 2001, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) depreciated in fair value as follows:
| December 31 | ||||||||
| 2002 | 2001 | |||||||
Mutual funds |
$ | (10,000,396 | ) | $ | (4,923,186 | ) | ||
Common stock |
(2,640,186 | ) | 264,701 | |||||
| $ | (12,640,582 | ) | $ | (4,658,485 | ) | |||
4. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service dated February 1, 2001, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the Code) and, therefore, the related trust is exempt from taxation. Subsequent to this issuance of the determination letter, the Plan was amended. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan, as amended, is qualified and the related trust is tax exempt. The plan sponsor has indicated that it will take the necessary steps, if any, to maintain the Plan’s qualified status.
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Supplemental Schedule
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All*AmerUs Savings and Retirement Plan Schedule H, Line 4(i) — Schedule of Assets December 31, 2002
EIN — 42-1458424
(Held at End of Year)
| Description of Investment, | ||||||||||||||
| Identity of Issue, Borrower, | Including Maturity Date, Rate | Current | ||||||||||||
| Lessor or Similar Party | of Interest, Par or Maturity Value | Cost | Value | |||||||||||
Participant Directed: |
||||||||||||||
American Century Funds*: |
||||||||||||||
Ultra Investors Fund |
424,669 shares | $ | 8,994,498 | |||||||||||
Vista Investors Fund |
87,220 shares | 765,794 | ||||||||||||
International Growth Fund |
702,220 shares | 4,479,373 | ||||||||||||
Value Fund |
1,497,156 shares | 8,908,075 | ||||||||||||
Strategic Allocation: Aggressive
Fund |
494,543 shares | 2,719,988 | ||||||||||||
Strategic Allocation: Moderate Fund |
685,666 shares | 3,599,748 | ||||||||||||
Strategic Allocation: Conservative
Fund |
162,429 shares | 787,780 | ||||||||||||
Stable Asset Fund |
20,394,276 shares | 20,394,276 | ||||||||||||
Income & Growth Fund |
488,912 shares | 10,628,945 | ||||||||||||
J.P. Morgan U.S. Small Company
Opportunities Fund |
161,473 shares | 1,136,770 | ||||||||||||
Diversified Bond Fund |
344,645 shares | 3,594,178 | ||||||||||||
Real Estate Fund |
9,915 shares | 152,884 | ||||||||||||
Barclays Global Investors S&P 500
Stock Fund |
8,923 shares | 952,153 | ||||||||||||
Royce Fund Low-Priced Stock |
14,713 shares | 143,451 | ||||||||||||
| 67,257,913 | ||||||||||||||
Common Stock: |
||||||||||||||
AmerUs Group Co.* — Core
Investment Fund |
100,225 shares | 2,852,444 | ||||||||||||
Personal Choice Retirement Account |
2,193,754 | |||||||||||||
Participant loans receivable |
Loans to participants, 4.25% to 9.5% | |||||||||||||
| due through 2017 | 2,581,729 | |||||||||||||
Nonparticipant directed: |
||||||||||||||
Common stock: |
||||||||||||||
AmerUs Group Co.* — ESOP |
293,279 shares | 7,224,730 | 8,329,883 | |||||||||||
Total investments |
$ | 83,215,723 | ||||||||||||
| * | Indicates party in interest to the Plan. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereto duly authorized.
| All#AmerUs Savings and Retirement Plan (Name of Plan) |
|||||
| Date: June 27, 2003 | By | /s/ Douglas K. Owens Douglas K. Owens Vice President - Compensation & Benefits |