[ X ]
|
Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934
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For the Fiscal Year Ended December 31, 2009
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|
or
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|
[ ]
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Transition Report Pursuant to Section 15(d) of the Securities Exchange Act of
|
1934
|
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For the transition period from _______________ to _______________
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|
Commission File Number: 001-10607
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OLD REPUBLIC INTERNATIONAL CORPORATION EMPLOYEES | ||
SAVINGS AND STOCK OWNERSHIP PLAN, Registrant | ||
By: /s/ A. C. Zucaro | ||
A.C. Zucaro, Member of the | ||
Administration Committee | ||
Pages
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Report of Independent Registered Public Accounting Firm
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1
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Financial Statements:
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|
Statements of Net Assets Available for Benefits as of
|
|
December 31, 2009 and 2008
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2
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Statements of Changes in Net Assets Available for Benefits for the
|
|
years ended December 31, 2009 and 2008
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3
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Notes to Financial Statements
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4-13
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Supplemental Schedules:
|
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Schedule of Assets (Held at End of Year) at December 31, 2009
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14
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OLD REPUBLIC INTERNATIONAL CORPORATION
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|||||||||||||||||||||||
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
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|||||||||||||||||||||||
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
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|||||||||||||||||||||||
As of December 31, 2009 and 2008
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|||||||||||||||||||||||
2009
|
2008
|
||||||||||||||||||||||
Non-
|
Non-
|
||||||||||||||||||||||
Participant
|
Participant
|
Participant
|
Participant
|
||||||||||||||||||||
Directed
|
Directed
|
Unallocated
|
Combined
|
Directed
|
Directed
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Unallocated
|
Combined
|
||||||||||||||||
Account
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Account
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Account
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Account
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Account
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Account
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Account
|
Account
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||||||||||||||||
ASSETS
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|||||||||||||||||||||||
Investments, at fair value:
|
|||||||||||||||||||||||
Old Republic International Corporation:
|
|||||||||||||||||||||||
Common shares
|
$
|
2,794,399
|
$
|
100,144,084 |
$
|
52,145,712 |
$
|
155,084,195 |
$
|
2,598,627
|
$
|
114,636,560
|
$
|
65,422,622
|
$
|
182,657,809
|
|||||||
Common shares committed for
|
|||||||||||||||||||||||
release to participants
|
|||||||||||||||||||||||
(503,212 shares at $10.04 per share and 294,679 shares
|
|||||||||||||||||||||||
at $11.92 per share, respectively) |
-
|
5,052,248
|
(5,052,248)
|
-
|
-
|
3,512,574
|
(3,512,5714)
|
-
|
|||||||||||||||
Mutual funds
|
171,552,608
|
30,036
|
-
|
171,582,644
|
128,080,824
|
40,412
|
- |
128,121,236
|
|||||||||||||||
174,347,007 | 105,226,368 | 47,093,464 | 326,666,839 |
130,679,451
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118,189,546 |
61,910,048
|
310,779,045
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||||||||||||||||
Investments, at cost:
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|||||||||||||||||||||||
Collective Trusts:
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|||||||||||||||||||||||
Short-term Investment Fund,
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|||||||||||||||||||||||
Cash & CD's
|
-
|
-
|
1,743,647
|
1,743,647
|
-
|
-
|
797,760
|
797,760
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|||||||||||||||
Total investments
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174,347,007 |
105,226,368
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48,837,111
|
328,410,486
|
130,679,451
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118,189,546
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62,707,808
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311,576,805
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|||||||||||||||
Contributions receivable from employers
|
-
|
-
|
1,858,061
|
1,858,061
|
-
|
-
|
2,631,059
|
2,631,059
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|||||||||||||||
Contributions receivable from employees
|
76,918 |
-
|
-
|
76,918
|
490,183
|
-
|
-
|
490,183
|
|||||||||||||||
Funds in course of settlement
|
4,849
|
-
|
-
|
4,849
|
14,688
|
-
|
-
|
14,688
|
|||||||||||||||
Total assets
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$
|
174,428,774
|
$
|
105,226,368
|
$
|
50,695,172
|
$
|
330,350,314
|
$
|
131,184,322
|
$
|
118,189,546
|
$
|
65,338,867
|
$
|
314,712,735
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|||||||
LIABILITIES
|
|||||||||||||||||||||||
Notes payable
|
$
|
-
|
$
|
-
|
$
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46,650,000
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$
|
46,650,000
|
$
|
-
|
$
|
-
|
$
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50,000,000
|
$
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50,000,000
|
|||||||
Unpaid anti-discrimination refunds
|
50,210
|
-
|
-
|
50,210
|
3,758
|
-
|
-
|
3,758
|
|||||||||||||||
Unpaid interest
|
-
|
-
|
-
|
-
|
-
|
-
|
75,156
|
75,156
|
|||||||||||||||
Unpaid administrative expenses
|
-
|
21,000
|
-
|
21,000
|
-
|
40,000
|
-
|
40,000
|
|||||||||||||||
Total liabilities
|
50,210
|
21,000
|
46,650,000
|
46,721,210
|
3,758
|
40,000
|
50,075,156
|
50,118,914
|
|||||||||||||||
NET ASSETS AVAILABLE FOR BENEFITS
|
174,378,564
|
105,205,368
|
4,045,172
|
283,629,104
|
131,180,564
|
118,149,546
|
15,263,711
|
264,593,821
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|||||||||||||||
Total liabilities and net assets
|
|||||||||||||||||||||||
available for benefits
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$
|
174,428,774
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$
|
105,226,368
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$
|
50,695,172
|
$
|
330,350,314
|
$
|
131,184,322
|
$
|
118,189,546
|
$
|
65,338,867
|
$
|
314,712,735
|
OLD REPUBLIC INTERNATIONAL CORPORATION
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|||||||||||||||||||||||
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
|
|||||||||||||||||||||||
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
|
|||||||||||||||||||||||
As of December 31, 2009 and 2008
|
|||||||||||||||||||||||
2009
|
2008
|
||||||||||||||||||||||
Non-
|
Non-
|
||||||||||||||||||||||
Participant
|
Participant
|
Participant
|
Participant
|
||||||||||||||||||||
Directed
|
Directed
|
Unallocated
|
Combined
|
Directed
|
Directed
|
Unallocated
|
Combined
|
||||||||||||||||
Account
|
Account
|
Account
|
Account
|
Account
|
Account
|
Account
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Account
|
||||||||||||||||
Additions:
|
|||||||||||||||||||||||
Employer contributions
|
$
|
-
|
$
|
-
|
$
|
1,858,061
|
$
|
1,858,061
|
$
|
-
|
$
|
1,473
|
$
|
2,631,059
|
$
|
2,632,532
|
|||||||
Common shares committed for release
|
|||||||||||||||||||||||
to participants
|
|||||||||||||||||||||||
(503,212 shares at $10.04 per share and 294,679 shares at $11.92 per share, respectively)
|
-
|
5,052,248
|
-
|
5,052,248
|
-
|
3,512,574 | - |
3,512,574
|
|||||||||||||||
Employee contributions
|
18,169,984
|
-
|
-
|
18,169,984
|
19,002,768
|
-
|
-
|
19,002,768
|
|||||||||||||||
Interfund transfers
|
1,949,268
|
(1,949,268)
|
-
|
-
|
3,194,197
|
(3,194,197)
|
-
|
-
|
|||||||||||||||
Interest income
|
4,177
|
6,399
|
2,264
|
12,840
|
26,523
|
1,650
|
-
|
28,173
|
|||||||||||||||
Dividend income
|
3,140,831
|
6,620,757
|
3,581,877
|
13,343,465
|
5,435,378
|
6,416,927
|
933,041
|
12,785,346
|
|||||||||||||||
Net appreciation (depreciation) in fair value of investments
|
30,706,206
|
(18,537,033) |
(9,764,336)
|
2,404,837 |
(66,267,675)
|
(33,730,807)
|
15,422,622 | (84,575,860) | |||||||||||||||
53,970,466
|
(8,806,897)
|
(4,322,134)
|
40,841,435
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(38,608,809)
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(26,992,380)
|
18,986,722
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(46,614,467)
|
||||||||||||||||
Deductions:
|
|||||||||||||||||||||||
Termination and withdrawal benefits
|
10,596,361 |
4,065,818
|
-
|
14,662,179
|
19,271,800
|
7,947,992
|
-
|
27,219,792
|
|||||||||||||||
Common shares committed for release
|
|||||||||||||||||||||||
to participants
|
|||||||||||||||||||||||
(503,212 shares at $10.04 and 294,679 shares at $11.92 per share, respectively)
|
-
|
-
|
5,052,248
|
5,052,248
|
-
|
-
|
3,512,574
|
3,512,574
|
|||||||||||||||
Interest expense
|
-
|
-
|
1,843,592
|
1,843,592
|
-
|
-
|
210,437
|
210,437
|
|||||||||||||||
Anti-discrimination refunds
|
50,210
|
-
|
-
|
50,210
|
3,758
|
-
|
-
|
3,758
|
|||||||||||||||
Administrative expenses
|
125,895
|
71,463
|
565
|
197,923
|
164,530
|
49,222
|
-
|
213,752
|
|||||||||||||||
10,772,466
|
4,137,281
|
6,896,405
|
21,806,152
|
19,440,088
|
7,997,214
|
3,723,011
|
31,160,313
|
||||||||||||||||
NET ADDITIONS (DEDUCTIONS)
|
43,198,000
|
(12,944,178)
|
(11,218,539)
|
19,035,283
|
(58,048,897)
|
(34,989,594)
|
15,263,711
|
(77,774,780)
|
|||||||||||||||
Transfer from merged-in plan
|
-
|
-
|
-
|
-
|
5,500,785
|
-
|
-
|
5,500,785
|
|||||||||||||||
Net assets available for plan benefits,
|
|||||||||||||||||||||||
beginning of year
|
131,180,564
|
118,149,546
|
15,263,711
|
264,593,821
|
183,728,676
|
153,139,140
|
-
|
336,867,816
|
|||||||||||||||
NET ASSETS AVAILABLE FOR PLAN
|
|||||||||||||||||||||||
BENEFITS, END OF YEAR
|
$
|
174,378,564
|
$
|
105,205,368
|
$
|
4,045,172
|
$
|
283,629,104
|
$
|
131,180,564
|
$
|
118,149,546
|
$
|
15,263,711
|
$
|
264,593,821
|
|
C.
|
Contributions
|
·
|
the participant completes 1,000 or more hours of service during the year and
|
·
|
the participant is employed by one of the Companies on December 31 of that year, died or became fully disabled during the year, or retired during the year after attaining age 65.
|
1.00% 30% 40% 65% 100% 140%
|
1.01 to 2.00% 28% 38% 63% 98% 138%
|
2.01 to 3.00% 26% 36% 61% 96% 136%
|
3.01 to 4.00% 24% 34% 59% 94% 134%
|
4.01 to 5.00% 22% 32% 57% 92% 132%
|
5.01 to 6.00% 20% 30% 55% 90% 130%
|
6.01 to 15.00% None None None None None
|
C.
|
Contributions, Continued
|
·
|
Prior to December 31, 2008, no contribution could be made if the Corporation’s consolidated annual net profit before extraordinary items and taxes was less than $2,500,000. Effective as of December 31, 2008, the Plan was amended to allow the Corporation’s Board of Directors to waive such minimum profit requirement. For plan years 2009 and 2008, the Corporation’s Board of Directors elected to waive the Plan’s minimum profit requirements and declared matching contributions of $1,858,061 and $2,350,351, respectively. In addition, in 2008, the Corporation’s Board of Directors also approved an additional discretionary contribution of $280,708. The approval of these amounts was necessary to enable the Plan to meet its debt service requirements for 2009 and 2008. For financial statement purposes, the discretionary contribution is included with the employer matching contribution.
|
·
|
No contribution shall be made by any Employer for any fiscal year which exceeds the maximum amount currently deductible by that Employer under section 404 of the Code.
|
·
|
No contribution shall be made by any Employer for any fiscal year which would cause its total contribution to exceed the amount of its annual net profit before taxes and its accumulated earnings.
|
D.
|
Employee Account
|
E.
|
Company Account
|
·
|
the plan participant has reached age 65, or
|
·
|
termination is caused by death, or
|
·
|
termination is caused by total and permanent disability which renders the employee incapable of performing satisfactory service for the Companies.
|
·
|
in one lump sum, or
|
·
|
in a direct rollover to an eligible retirement plan specified by the participant, or
|
·
|
in substantially equal annual or more frequent installments paid over a reasonable period of time not to exceed the life expectancy of the participant or the joint life expectancy of the participant and his/her spouse or designated beneficiary.
|
F.
|
Unallocated Account
|
G.
|
Common Shares Committed to be Allocated to Participants
|
H.
|
Voting Rights
|
2009
|
2008
|
||
Old Republic International Corporation Common Stock:
|
|||
Allocated and participant directed accounts (278,327 and 218,006 shares, respectively)
|
$ 2,794,399
|
$ 2,598,627
|
|
Allocated and non-participant directed accounts (9,974,510 and 9,617,161 shares, respectively)
|
100,144,084
|
114,636,560
|
|
Committed to be allocated to participant accounts (503,212 and 294,679 shares, respectively)
|
5,052,248
|
3,512,574
|
|
Not allocated to participant accounts (4,690,584 and 5,193,796 shares, respectively)
|
47,093,464
|
61,910,048
|
|
|
|
||
Total held by the Plan (15,446,633 and 15,323,642 shares, respectively)
|
155,084,195
|
182,657,809
|
Fidelity Cash Reserves Fund
|
23,327,186
|
21,357,001
|
|
|
Net appreciation in the fair value of investments is broken down as follows for the years ended December 31:
|
|
|
2009
|
2008
|
||
Old Republic International Corporation Common Stock
|
$ (28,798,257)
|
$ (18,548,872)
|
|
Mutual funds
|
31,203,094
|
(66,026,988)
|
|
|
$ 2,404,837
|
$ (84,575,860)
|
Assets at Fair Value as of December 31, 2009
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||
Mutual funds:
|
||||||||||||
Balanced funds
|
$
|
33,729,540
|
$
|
-
|
$
|
-
|
$
|
33,729,540
|
||||
Equity funds
|
66,785,150
|
-
|
-
|
66,785,150
|
||||||||
Fixed Income funds
|
50,921,688
|
-
|
-
|
50,921,688
|
||||||||
Growth fund
|
4,791,191
|
-
|
-
|
4,791,191
|
||||||||
Index funds
|
15,355,075
|
-
|
-
|
15,355,075
|
||||||||
Total mutual funds
|
171,582,644
|
-
|
-
|
171,582,644
|
||||||||
Company Common stocks
|
155,084,195
|
-
|
-
|
155,084,195
|
||||||||
Other short-term
|
1,743,647
|
-
|
-
|
1,743,647
|
||||||||
Total assets at fair value
|
$
|
328,410,486
|
$
|
-
|
$
|
-
|
$
|
328,410,486
|
Assets at Fair Value as of December 31, 2008
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||
Mutual funds:
|
||||||||||||
Balanced funds
|
$
|
24,032,947
|
$
|
-
|
$
|
-
|
$
|
24,032,947
|
||||
Equity funds
|
45,774,679
|
-
|
-
|
45,774,679
|
||||||||
Fixed Income funds
|
44,087,238
|
-
|
-
|
44,087,238
|
||||||||
Growth fund
|
3,266,505
|
-
|
-
|
3,266,505
|
||||||||
Index funds
|
10,959,867
|
-
|
-
|
10,959,867
|
||||||||
Total mutual funds
|
128,121,236
|
-
|
-
|
128,121,236
|
||||||||
Company Common stocks
|
182,657,809
|
-
|
-
|
182,657,809
|
||||||||
Other short-term
|
797,760
|
-
|
-
|
797,760
|
||||||||
Total assets at fair value
|
$
|
311,576,805
|
$
|
-
|
$
|
-
|
$
|
311,576,805
|
Participating
|
|||||||||||
Subsidiary
|
|||||||||||
Total
|
Corporation
|
Companies
|
|||||||||
2010
|
$
|
3,600,000
|
$
|
2,160,000
|
$
|
1,440,000
|
|||||
2011
|
19,590,000
|
2,370,000
|
17,220,000
|
||||||||
2012
|
2,580,000
|
2,580,000
|
|||||||||
2013
|
2,790,000
|
2,790,000
|
|||||||||
2014
|
3,060,000
|
3,060,000
|
|||||||||
Thereafter
|
15,030,000
|
15,030,000
|
|||||||||
Total
|
$
|
46,650,000
|
$
|
27,990,000
|
$
|
18,660,000
|
|
Old Republic International Corporation and participating subsidiaries are parties in interest. The Plan’s Non-Participant Directed Account (Company Account) and Unallocated Account are made up of the Corporation’s common stock as noted in Note 3. Also, office personnel, space and equipment are furnished by the Companies at no charge to the Plan.
|
|
Through November 21, 2008, Inter Capital Corporation of Chicago, an affiliate, was the Plan’s Trustee to whom trustee fees ($36,000 per annum) were paid by the Plan. On November 21, 2008, four members of the Corporation’s management were appointed as the Trustees of the Plan.
|
|
Fidelity Investments Institutional Services Company, Inc. (Fidelity Investments), a subsidiary of FMR Corporation, is the Plan’s custodian, record keeper and provider of educational information to plan participants. All mutual funds are managed by subsidiaries of FMR Corporation, which make FMR Corporation a party in interest. Fees paid by the Plan to Fidelity Investments for custodianship, transaction and maintenance were $118,993 and $110,206 during 2009 and 2008, respectively.
|
OLD REPUBLIC INTERNATIONAL CORPORATION
|
||||||||||||||||
EMPLOYEES SAVINGS AND STOCK OWNERSHIP PLAN
|
||||||||||||||||
FORM 5500-ANNUAL RETURN/REPORT OF EMPLOYEE BENEFIT PLAN
|
||||||||||||||||
SCHEDULE H, LINE 4i-SCHEDULE OF ASSETS (HELD AT END OF YEAR)
|
||||||||||||||||
DECEMBER 31, 2009
|
||||||||||||||||
EIN: 36-2678171 PLAN NUMBER-003
|
||||||||||||||||
(c)
|
||||||||||||||||
DESCRIPTION OF INVESTMENT INCLUDING MATURITY DATE,
|
||||||||||||||||
RATE OF INTEREST, COLLATERAL, SHARES, PAR OR MATURITY VALUE
|
||||||||||||||||
SHARES,
|
||||||||||||||||
(b)
|
RATE OF
|
PAR, OR
|
(e)
|
|||||||||||||
(a) |
IDENTITY OF ISSUE, BORROWER,
|
MATURITY
|
INTEREST
|
MATURITY
|
(d)
|
CURRENT
|
||||||||||
*
|
LESSOR, OR SIMILAR PARTY
|
DATE
|
DIVIDENDS
|
COLLATERAL
|
VALUE
|
COST
|
VALUE
|
|||||||||
MUTUAL FUNDS:
|
||||||||||||||||
FIDELITY FUND
|
N/A
|
VARIABLE
|
N/A
|
351,051
|
sh
|
#
|
$
|
9,948,787
|
||||||||
FIDELITY EQUITY-INCOME FUND
|
N/A
|
VARIABLE
|
N/A
|
302,061
|
sh
|
#
|
11,822,665
|
|||||||||
FIDELITY INVESTMENT GRADE BOND FUND
|
N/A
|
VARIABLE
|
N/A
|
637,862
|
sh
|
#
|
4,490,550
|
|||||||||
FIDELITY INTERMEDIATE TERM BOND FUND
|
N/A
|
VARIABLE
|
N/A
|
511,945
|
sh
|
#
|
5,196,246
|
|||||||||
FIDELITY CAPITAL & INCOME FUND
|
N/A
|
VARIABLE
|
N/A
|
611,042
|
sh
|
#
|
5,267,183
|
|||||||||
FIDELITY VALUE FUND
|
N/A
|
VARIABLE
|
N/A
|
224,090
|
sh
|
#
|
12,759,700
|
|||||||||
FIDELITY CASH RESERVES
|
N/A
|
VARIABLE
|
N/A
|
23,327,186
|
sh
|
A
|
23,327,186
|
|||||||||
SPARTAN MARKET INDEX FUND
|
N/A
|
VARIABLE
|
N/A
|
173,149
|
sh
|
#
|
13,318,646
|
|||||||||
FIDELITY AGGRESSIVE GROWTH FUND
|
N/A
|
VARIABLE
|
N/A
|
294,480
|
sh
|
#
|
4,791,191
|
|||||||||
FIDELITY DIVERSIFIED INTERNATIONAL FUND
|
N/A
|
VARIABLE
|
N/A
|
554,910
|
sh
|
#
|
15,537,490
|
|||||||||
FIDELITY DIVIDEND GROWTH FUND
|
N/A
|
VARIABLE
|
N/A
|
622,111
|
sh
|
#
|
14,725,372
|
|||||||||
FIDELITY SMALL CAP INDEPENDENCE FUND
|
N/A
|
VARIABLE
|
N/A
|
145,014
|
sh
|
#
|
2,018,597
|
|||||||||
FIDELITY MID-CAP STOCK FUND
|
N/A
|
VARIABLE
|
N/A
|
423,626
|
sh
|
#
|
9,921,326
|
|||||||||
FIDELITY FREEDOM INCOME FUND
|
N/A
|
VARIABLE
|
N/A
|
63,384
|
sh
|
#
|
680,749
|
|||||||||
FIDELITY FREEDOM 2000 FUND
|
N/A
|
VARIABLE
|
N/A
|
55,539
|
sh
|
#
|
630,370
|
|||||||||
FIDELITY FREEDOM 2010 FUND
|
N/A
|
VARIABLE
|
N/A
|
561,258
|
sh
|
#
|
7,021,332
|
|||||||||
FIDELITY FREEDOM 2020 FUND
|
N/A
|
VARIABLE
|
N/A
|
760,435
|
sh
|
#
|
9,543,462
|
|||||||||
FIDELITY FREEDOM 2030 FUND
|
N/A
|
VARIABLE
|
N/A
|
310,109
|
sh
|
#
|
3,842,249
|
|||||||||
SPARTAN EXTENDED MARKET INDEX FUND
|
N/A
|
VARIABLE
|
N/A
|
26,144
|
sh
|
#
|
794,779
|
|||||||||
SPARTAN INTERNATIONAL INDEX FUND
|
N/A
|
VARIABLE
|
N/A
|
37,120
|
sh
|
#
|
1,241,650
|
|||||||||
FIDELITY SHORT-TERM BOND FUND
|
N/A
|
VARIABLE
|
N/A
|
1,521,122
|
sh
|
#
|
12,640,523
|
|||||||||
FIDELITY FREEDOM 2040 FUND | N/A | VARIABLE | N/A | 277,187 | sh | # | 1,984,657 | |||||||||
FIDELITY FREEDOM 2050 FUND
|
N/A
|
VARIABLE
|
N/A
|
9,333
|
sh
|
#
|
77,934
|
|||||||||
171,582,644
|
||||||||||||||||
EMPLOYER SECURITIES:
|
||||||||||||||||
OLD REPUBLIC INTERNATIONAL CORPORATION COMMON STOCK:
|
||||||||||||||||
PARTICIPANT DIRECTED
|
N/A
|
N/A
|
N/A
|
278,327
|
sh
|
$
|
3,495,602
|
2,794,399
|
||||||||
NON-PARTICIPANT DIRECTED
|
N/A
|
N/A
|
N/A
|
10,477,722
|
sh
|
88,778,081
|
105,196,332
|
|||||||||
UNALLOCATED
|
N/A
|
N/A
|
N/A
|
4,690,584
|
sh
|
42,731,213
|
47,093,464
|
|||||||||
TOTAL
|
15,446,633
|
sh
|
$
|
135,004,896
|
155,084,195
|
|||||||||||
COLLECTIVE TRUST: | ||||||||||||||||
THE NORTHERN TRUST COMPANY-
|
||||||||||||||||
SHORT-TERM INVESTMENT FUND, CASH & CD,s
|
N/A
|
N/A
|
N/A
|
1,743,647
|
sh
|
1,743,647
|
1,743,647
|
|||||||||
TOTAL INVESTMENTS HELD
|
$
|
328,410,486
|