LITIGATION Release No. 16156 / May 20, 1999

Securities and Exchange Commission v. Ramon R. Obod, U.S. District Court for the District of Columbia (1:99CV01220) (LFO)

SEC SUES PARTNER IN PHILADELPHIA-BASED LAW FIRM FOR INSIDER TRADING IN TRANSPORT HOLDINGS, INC. SECURITIES

The Securities and Exchange Commission ("Commission") filed a Complaint today against Ramon R. Obod in the United States District Court for the District of Columbia charging him with insider trading in the securities of Texas insurer Transport Holdings, Inc. ("Transport") before the September, 26, 1996 public announcement that Transport would be acquired by Indiana-based insurer Conseco, Inc. ("Conseco"). Obod, a partner in a Philadelphia-based law firm, who was at the time the head of his firm's Corporate Department, settled the case without admitting or denying the Commission's allegations. He consented to the entry of an order enjoining him from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, requiring him to disgorge $11,460.62, representing his trading profits and prejudgment interest, and to pay a $9,449.92 civil penalty.

The Commission's Complaint alleges the following:

• Obod was outside counsel to and board member of American Travellers Corporation, a Pennsylvania long-term care insurer that had agreed to be acquired by Conseco in August, 1996.

• Shortly after American Travellers' agreement was announced, Obod learned that a significant shareholder of Transport had called American Travellers President to seek an introduction to Conseco's CEO in order to discuss a potential merger with Transport. Obod advised American Travellers CEO with regard to that introduction.

• Conseco's acquisition discussions with Transport progressed rapidly. By September 20 Conseco had made an initial offer to acquire Transport, and the parties had agreed upon the principal terms of the transaction.

• On Saturday, September 21, 1996, Conseco's CEO called American Travellers President, thanked him for the introduction, and told him in confidence that Conseco was going to acquire Transport.

• American Travellers' President immediately called Obod at home. He told Obod in confidence of his conversation with Conseco's CEO, and instructed Obod not to allow the negotiations with Transport to delay the completion of proxy materials for the Conseco/American Travellers acquisition.

• The following Monday, September 23, 1996, Obod purchased 500 shares of Transport's stock.

• On September 26, 1996, Conseco announced it would acquire Transport in stock for stock transaction valuing Transport at $70 per share, a premium of approximately $19 3/8 per share. Obod sold his Transport stock after the announcement for a profit of approximately $9,499.92.