UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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, 2007.
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
For the transition period from to
Commission file number 001-33363
| A. | Full title of the plan and the address of the plan, if different from that of the issuer named below: |
FCStone Group Employee Stock Ownership Plan
| B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
FCStone Group, Inc.
10330 NW Prairie View Road
Kansas City, Missouri 64153
(816) 891-7000
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Table of Contents
| Page | ||
| 1 | ||
Financial Statements: | ||
Statements of Net Assets Available for Benefits as of December 31, 2007 and 2006 | 2 | |
Statements of Changes in Net Assets Available for Benefits for the years ended December 31, 2007 and 2006 | 3 | |
| 4 | ||
Supplemental Schedules | ||
Schedule 1 – Form 5500, Schedule H, Part IV, Line 4i — Schedule of Assets (Held at End of Year) | 11 | |
Schedule 2 – Form 5500, Schedule H, Part IV, Line 4j — Schedule of Reportable Transactions | 13 | |
| Note: | All other schedules required by Section 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted because they are not applicable. |
Report of Independent Registered Public Accounting Firm
Participants and Administrators
FCStone Group Employee Stock Ownership Plan:
We have audited the accompanying statements of net assets available for benefits of FCStone Group Employee Stock Ownership Plan (the Plan) as of December 31, 2007 and 2006, 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits 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 the Plan’s 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 as of December 31, 2007 and 2006, and the changes in net assets available for benefits for the years then ended in conformity with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules: Schedule H, Part IV, Line 4 (i) — Schedule of Assets (Held at End of Year) as of December 31, 2007 and Schedule H, Part IV, Line 4 (j) — Schedule of Reportable Transactions for the year ended December 31, 2007, are presented for the purpose of additional analysis and are not a required part of the basic 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, as amended. The supplemental schedules are the responsibility of the Plan’s management. The supplemental schedules have been subjected to the auditing procedures applied in the audit 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/ KPMG LLP
June 30, 2008
Kansas City, Missouri
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
December 31, 2007 and 2006
Statements of Net Assets Available for Benefits
| Assets | 2007 | 2006 | ||||
Cash and cash equivalents | $ | — | $ | 5,006 | ||
Investments: | ||||||
FCStone Group, Inc. Common Stock Fund, fair value | 56,911,037 | 32,863,505 | ||||
General Fund, estimated fair value | 19,454,438 | — | ||||
Mutual funds, fair value | 8,261,725 | — | ||||
Total investments | 84,627,200 | 32,863,505 | ||||
Receivables: | ||||||
Employer’s cash contribution | 863,748 | — | ||||
Employer’s non-cash contribution of FCStone Group, Inc. common stock | — | 823,528 | ||||
Receivable from trustee for pending trades | 544,493 | — | ||||
Accrued interest and dividends | 5,341 | 582,708 | ||||
Total receivables | 1,413,582 | 1,406,236 | ||||
Net assets reflecting all investments at fair value | 86,040,782 | 34,274,747 | ||||
Adjustment from fair value to contract value for fully benefit-responsive investment contract | 19,214 | — | ||||
| 86,059,996 | 34,274,747 | |||||
Liabilities | ||||||
Payable to trustee for pending trades | 200,000 | — | ||||
Net assets available for benefits | $ | 85,859,996 | $ | 34,274,747 | ||
See accompanying notes to financial statements.
2
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Year ended December 31, 2007 and 2006
Statements of Changes in Net Assets Available for Benefits
| 2007 | 2006 | ||||
Additions to net assets attributed to: | |||||
Investment income: | |||||
Net appreciation in fair value of investments | $ | 51,963,635 | 26,784,921 | ||
Dividends and interest income | 366,992 | 587,724 | |||
Employer’s cash contribution | 885,129 | — | |||
Employer’s contribution of FCStone Group, Inc. common stock | — | 823,528 | |||
Total additions | 53,215,756 | 28,196,173 | |||
Deductions from net assets attributed to: | |||||
Benefits paid directly to participants | 1,630,507 | 60,681 | |||
Increase in net assets available for benefits | 51,585,249 | 28,135,492 | |||
Net assets available for benefits at beginning of year | 34,274,747 | 6,139,255 | |||
Net assets available for benefits at end of year | $ | 85,859,996 | 34,274,747 | ||
See accompanying notes to financial statements.
3
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (1) | Plan Description |
The FCStone Group Employee Stock Ownership Plan (the Plan) is a defined contribution plan administered by Associated Benefits Corporation (Plan Administrator). The following description of the Plan provides only general information. Participants should refer to the Plan document for a more complete description of the Plan’s provisions.
| (a) | General |
The Plan, adopted on June 1, 2005, is a defined contribution plan available to all full-time employees of FCStone Group, Inc. (the Company or Plan Sponsor) who have attained age 21 and completed four months of service. The Plan enables employees to become beneficial owners of the common stock of FCStone Group, Inc. (Company Stock). Effective in June 2007, the Company transitioned to a new trustee of the Plan, Wells Fargo Bank N.A (Trustee). Prior to the transition, Marshall & Ilsley Trust Company N.A. served as trustee. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
In March 2007, the Company completed its initial public offering (IPO) of common stock in which a total of 8,797,500 shares of Company Stock were sold at an IPO price of $16.00 per share. Subsequent to the IPO, the Company redeemed 313,545 shares of Company Stock held by the plan. Proceeds from the redemption, totaling $4,665,550 were re-invested into a cash equivalent money market fund. Realized gains of $3,968,783, from the redemption, have been included in the net appreciation in fair value of investments on the Statement of Changes in Net Assets Available for Benefits.
| (b) | Amendments |
In July 2007, the Plan was amended to allow participants the ability to diversify their holdings in the Plan by electing to sell shares of Company Stock held by each participant and re-invest those proceeds in other investments offered by the Plan. This amendment was adopted in response to changes in applicable tax law requiring plans to permit greater investment diversification. As a result of the amendment, all Plan participants can diversify their Company Stock holdings daily. As of the date participants could diversify the holding of Company Stock, the Plan held 1,247,848 shares of Company Stock which had appreciated in fair value by approximately $25,380,000 in 2007.
| (c) | Contributions |
The Plan is funded by Company contributions. The Company’s matching contributions are equal to 50% of the first 8% of base compensation that a participant contributes to any eligible 401(k) plan of the Company, subject to certain limitations contained in the Internal Revenue Code of 1986, as amended. The Company may also elect to make discretionary contributions to the Plan as determined by the Company. Discretionary contributions are allocated to individual accounts based on the participants annual compensation as a percentage of total eligible participant compensation. There were no discretionary contributions made by the Company in the 2007 and 2006 plan years. Participants must be employed on the last day of the year to be eligible to receive Company contributions, which may be remitted in the form of either cash or Company Stock. Contributions of Company Stock are recorded at fair value on the date contributed. Contributions by participants are not permitted.
| 4 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (d) | Participant Accounts |
Individual accounts are maintained for each Plan participant. Each participant’s account is credited with Company contributions and an allocation of investment income. Allocations are based on participant earnings or account balances, as defined in the Plan document. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account. Effective July 2007, participants are allowed to direct the investment of cash contributions among various investment options offered by the Plan, which can be changed daily. Contributions, of Company Stock can subsequently be diversified into any other investment option offered by the Plan.
| (e) | Vesting |
Participants become vested in the Company contributions and earnings thereon in accordance with the following schedule:
| Vested percentage | |||
Years of service: | |||
Less than 2 years | None | ||
2 years but less than 3 years | 20 | % | |
3 years but less than 4 years | 40 | ||
4 years but less than 5 years | 60 | ||
5 years or more | 100 |
The remaining unvested account balance becomes fully vested in the event of death, disability, or attainment of age 65, if still employed at such date.
| (f) | Forfeitures |
Any participant who terminates employment will forfeit the non-vested portion of their account balance. A forfeiture will occur at the earlier of the date the participant has received a distribution from the Plan or after five consecutive one year breaks in service. The balance of such forfeitures will be applied to reduce the Company’s matching contributions made to the Plan. In 2007 the Company’s matching contribution was reduced by $21,381, as a result of such forfeitures. There were no forfeitures in 2006.
| (g) | Participant Loans |
The Plan does not allow loans to participants.
| (h) | Payment of Benefits |
The benefit to which a participant is entitled is provided from the vested portion of a participant’s account balance. Upon termination of service, if a participant’s vested account balance does not exceed $1,000, the vested value is distributed in the form of a lump-sum payment. If the vested account balance exceeds $1,000, the participant may request a lump-sum
| 5 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
payment or may elect to defer distribution, as set forth in the Plan. On termination of service due to death or disability, a participant may elect to receive either a lump sum amount equal to the value of the participants vested interest in his or her account, or periodic installments over a period not to exceed five years unless a longer distribution period is requested in writing by the participant.
| (i) | Voting Rights |
Each participant has the right to direct the Trustee with respect to the voting of all shares of Company Stock, vested or non-vested, which are included in their participant account balance. The Trustee, at the direction of the Plan Administrator, will vote all Company Stock to the extent participant voting directions are not provided.
| (j) | Stock splits |
In February 2007, the Company issued a three-for-one stock split effected in the form of a stock dividend to stockholders of record at the close of business on February 26, 2007. Additionally, in July 2007 the Company’s Board of Directors approved a three-for-two stock split effected in the form of a stock dividend to stockholders of record at the close of business on September 27, 2007. The shares held by the Plan reflect these stock splits retrospectively.
| (k) | Transfers |
Any participant who has reached the age of 55 and has 10 years of participation in the Plan has the option of making a transfer of a certain percentage of their Plan account into another qualified plan of the participating employer or to another eligible retirement plan. At the inception of the Plan, eligible participants were able to elect to make a one-time irrevocable transfer of eligible funds from another qualified retirement plan into the Plan. Participants are immediately vested in their transfer contributions and actual earnings thereon.
| (l) | Administrative Expenses |
Administrative expenses of the Plan are paid by the Company.
| (2) | Summary of Significant Accounting Policies and Related Matters |
| (a) | Basis of Accounting |
The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles.
| (b) | Use of Estimates |
The preparation of financial statements in conformity with U.S. generally accepted accounting principles, requires Plan management to make estimates and assumptions that affect the reported amounts of net assets available for benefits and changes therein and disclose contingent assets and liabilities. Actual results could differ from those estimates.
| 6 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (c) | Risks and Uncertainties |
The Plan invests in investments that are exposed to various risks such as interest rate, market, and credit risks. Due to the level of risk associated with certain investments, it is at least reasonably possible that changes in the fair values of investments will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the statement of net assets available for benefits.
The Plan’s exposure to a concentration of credit risk is limited by the diversification of investments across the participant-directed fund elections. Additionally, the investments within each participant-directed fund election are further diversified into varied financial instruments, with the exception of investments in Company Stock. Investment decisions are made, and the resulting risks are borne, exclusively by the Plan participant who made such decisions.
| (d) | Investment Valuation and Income Recognition |
Investment options under the Plan include the Company Stock Fund, various mutual funds, and the General Fund (Trust). Shares of the Company Stock Fund are based upon the fair value of the underlying investments, which include Company Stock and cash equivalents. Fair value of the mutual funds is based on quoted market prices from national securities exchanges. As of December 31, 2006, a date prior to the IPO, the estimated fair value of the Company Stock was determined by an independent appraised value.
The Trust is a stabilized fixed income portfolio managed by the Trustee. The objective of the Trust is to produce stable returns that are usually higher than traditional money market investments. The Trust usually experiences little or no fluctuation in principal value as it is invested predominately in direct obligations of the US Government and US Government Agencies. The underlying investments in the Trust, including a stable value fund, are stated at estimated fair value based upon quoted market prices, if available, or dealer quotes as of the pricing date. Investment contracts held by the Trust are presented at fair value. The value of these investments as determined using the contract value would result in an increase of $19,214.
Management fees and operating expenses charged to the Plan for investment in mutual funds are deducted from income earned on a daily basis and are not separately reflected. Consequently, management fees and operating expenses are reflected as a reduction of investment return for such investments.
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.
| 7 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (e) | Payment of Benefits |
Benefit payments to participants are recorded upon distribution.
| (f) | Accounting Pronouncements |
In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“FAS 157”). FAS 157 defines fair value and establishes a framework for measuring fair value. FAS 157 applies to other pronouncements that require or permit fair value, however, it does not require any new fair value measurements. FAS 157 is effective for fiscal years beginning after November 15, 2007. The Plan does not expect the provisions of FAS 157 to have a material effect on the Plan’s financial statements.
On January 1, 2007, the Plan adopted FASB Interpretations (FIN) No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires evaluation of tax positions taken or expected to be taken to determine whether the tax positions will “more likely than not” be sustained by the applicable tax authority. The adoption of FIN 48 did not have an impact on the Plan’s financial statements.
The provisions of the FASB Staff Position entitled, FSP AAG INV-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans (the “FSP”) became effective for plan years ending after December 15, 2006. This FSP requires that investment contracts held by a defined contribution plan be reported at fair value. The Plan’s investment in the Trust holds investment contracts that are deemed to be fully benefit-responsive as of December 31, 2007. Although the FSP requires these investment Contracts to be reported at fair value, contract value is the relevant measurement attribute because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. As required by the FSP, the Statements of Net Assets Available for Benefits presents the fair value of the Trust as well the amount necessary to adjust this fair value to contract value. The adoption of this FSP did not have a significant impact on the Plan’s net assets available for plan benefits as of December 31, 2007. As permitted by the FSP, the Statements of Changes in Net Assets Available for Benefits is prepared on a contract value basis.
| 8 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (3) | Company Stock Fund |
During 2007, the Plan began to offer the Company Stock Fund as an investment option, which is a unitized fund, holding cash and Company Stock. The Fund has a cash reserve in order to provide the liquidity necessary to process daily Company Stock transactions by the close of market each business day. The cash reserve generally represents between one and five percent of the total Fund value, and varies depending upon account activity. The reserve may consist of cash or cash equivalents. As of December 31, 2007, the cash reserve totaled $1,044,058.
| (4) | Investments |
The following table presents investments held by the Plan at December 31, 2007 and 2006 that represent five percent or more of the Plan’s net assets.
| 2007 | 2006 | ||||||
FCStone Group, Inc. Common Stock Fund: | |||||||
FCStone Group, Inc. Common Stock | $ | 56,911,037 | $ | 32,863,505 | |||
General Fund | 19,454,438 | — | (a) | ||||
| (a) | The investment was not available as an investing option during the plan year ended December 31, 2006. |
The Trust seeks to outperform money market funds in a normal yield curve environment and attempts to maintain a stable unit value of $10.00. Valuation occurs daily and dividends are declared daily and paid monthly. This investment is reported at contract value in the financial statements, which represents contributions made to the account, plus earnings on the underlying investment, less participant withdrawals and administrative expenses. Recording such investments at contract value rather than fair value, to the extent that they are fully-benefit responsive, is in accordance with the FSP discussed in note 2.
The General Fund’s (Trust) one-year total return was 4.74% for 2007. The thirty-day effective yield, also known as the crediting interest rate, was 4.84% at December 31, 2007. Both the one-year total return and the thirty-day effective yield are net of the annual trustee fee of 0.25%. The crediting interest rate is calculated on a daily basis. There are no reserves against contract value for credit risk of the contract issuer or otherwise.
The existence of certain conditions can limit the Trust’s ability to transact at contract value with the issuers of its investment contracts. Specifically, any event outside the normal operation of the Trust that causes a withdrawal from an investment contract may result in a negative market value adjustment with respect to such withdrawal. Examples of such events include, but are not limited to, partial or complete legal termination of the Trust or a unit holder, tax disqualification of the Trust or a unit holder, and certain Trust amendments if issuers’ consent is not obtained. As of December 31, 2007, the occurrence of an event outside the normal operation of the Trust that would cause a withdrawal from an investment contract is not considered to be probable. To the extent a unit holder suffers a tax disqualification or legal termination event, under normal circumstances it is anticipated that liquid assets would be available to satisfy the redemption of such unit holder’s interest in the Trust without the need to access investment contracts.
During 2007, the Plan’s investments appreciated in value, including gains and losses on investments bought and sold during the year, as shown below:
FCStone Group, Inc. common stock | 51,177,154 | ||
Mutual Funds | 786,481 | ||
Net appreciation in fair value of investments | $ | 51,963,635 | |
| 9 | (Continued) |
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Notes to Financial Statements
December 31, 2007 and 2006
| (5) | Exempt Party-In-Interest Transactions |
At December 31, 2007 and 2006, the Plan held 1,213,708 and 2,097,671 shares of common stock of FCStone Group, Inc., the sponsoring employer, respectively, with a cost basis of $3,264,094 and $4,710,311. In conjunction with the IPO, the Company redeemed 313,545 shares of Company Stock held by the plan. Proceeds from the redemption, totaling $4,665,550 were re-invested into a cash equivalent money market fund, and subsequently reallocated by Plan participants.
During the year ended December 31, 2007, the Plan did not record any dividend income from Company Stock. During the year ended December 31, 2006, the Plan recorded dividend income, from Company Stock, of $582,686 which was received on January 3, 2007.
| (6) | Plan Termination |
Although it has not expressed any intention to do so, the Company has the right under the Plan to discontinue its contributions at any time and terminate the Plan subject to the provisions set forth in ERISA. In the event of Plan termination, participants will become fully vested in their accounts.
| (7) | Federal Income Tax Status |
The Plan has not filed for a determination letter from the Internal Revenue Service that the Plan and its related Trust are designed in accordance with applicable regulations of the Internal Revenue Code (IRC). However, the Plan Administrator believes that the Plan is currently designed and operated in compliance with the applicable requirements of the IRC and the Plan and related trust are tax-exempt. Therefore, no provision for income taxes has been included in the Plan’s financial statements.
| (8) | Subsequent Event |
Effective January 1, 2008, the Plan was amended to define compensation in accordance with Section 415 of the Internal Revenue Code and to adopt certain provisions of the Pension Protection Act in regards to the rights of designated beneficiaries.
| 10 |
Schedule 1
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Form 5500, Schedule H, Part IV, Line 4i – Schedule of Assets (Held at End of Year)
December 31, 2007
(a) | (b) Identity of issue, borrower, lessor, or similar party | (c) Description of investment including maturity date, rate of interest, collateral, par, or maturity | (e) Current value | ||||
| * | FCStone Group, Inc. Company Stock Fund: | $ | |||||
| * | FCStone Group, Inc. Common Stock | 1,213,708 shares of company stock | 55,866,979 | ||||
| * | Wells Fargo Short Term Investment Fund G | Money Market | 1,044,058 | ||||
Total Common Stock Fund | 56,911,037 | ||||||
| General Fund | |||||||
Cash & Money Market Funds | |||||||
| * | Wells Fargo Short Term Investment Fund G | Money market fund | 777,561 | ||||
Pooled Common and Collective Funds | |||||||
| * | Wells Fargo Stable Return Fund G | Stable value fund | 5,459,426 | ||||
United States Government Obligations | |||||||
GOVT NATL MTG ASSN POOL #510835 | DTD 02/01/05 5.500 02/15/2035 | 451,378 | |||||
GOVT NATL MTG ASSN GTD REMIC | DTD 05/01/03 3.80031 01/16/2032 | 32,770 | |||||
GOVT NATL MTG ASSN POOL #403456 | DTD 11/01/03 5.000 11/15/2033 | 223,315 | |||||
GOVT NATL MTG ASSN POOL #495357 | DTD 06/01/02 6.250 07/15/2022 | 229,931 | |||||
GOVT NATL MTG ASSN POOL #603671 | DTD 05/01/03 5.000 05/15/2033 | 136,001 | |||||
GOVT NATL MTG ASSN POOL #616201 | DTD 01/01/04 6.000 01/15/2034 | 390,400 | |||||
GOVT NATL MTG ASSN POOL #616478 | DTD 06/01/04 5.500 06/15/2034 | 459,608 | |||||
GOVT NATL MTG ASSN POOL #781690 | DTD 12/01/03 6.000 12/15/2033 | 380,430 | |||||
GOVT NATL MTG ASSN REMIC | DTD 02/01/03 3.1296 04/16/2016 | 132,565 | |||||
| 2,436,398 | |||||||
Farmers Home Mortgage Administration | |||||||
FMHA #03072430454055 (7130-9007-354) | 4.725% DUE 12-2-2017 | 368 | |||||
FMHA #10014263841866 (6010-9007-271) | DTD 12/29/03 6.050 06/13/2015 | 40,534 | |||||
FMHA #1317305344458 (6010-9785-31) | DTD 12/29/03 6.150 01/01/2010 | 28,073 | |||||
FMHA #15026308549763 (6010-5835-225) | DTD 12/29/03 5.400 05/01/2018 | 43,969 | |||||
FMHA #15033305501345 (6010-5835-228) | DTD 12/29/03 5.400 05/01/2018 | 33,406 | |||||
FMHA #15033306509625 | DTD 12/29/03 4.775 08/01/2017 | 23,290 | |||||
FMHA #15034306761349 | DTD 01/12/04 4.675 08/01/2017 | 30,346 | |||||
FMHA #15034307507925 (6010-5835-222) | DTD 12/29/03 4.300 05/01/2010 | 6,375 | |||||
FMHA #15034307507925 (6010-5835-223) | DTD 12/29/03 5.400 05/01/2018 | 45,146 | |||||
FMHA #15038315648303 (6010-5835-227) | DTD 12/29/03 4.000 05/01/2008 | 1,207 | |||||
FMHA #15054317847975 (6010-9785-38) | DTD 12/29/03 5.800 04/01/2012 | 13,773 | |||||
FMHA #15068316486392 (6010-5835-185) | DTD 12/29/03 5.300 07/01/2016 | 29,834 | |||||
FMHA #15072351755050 (6010-5835-216) | DTD 12/29/03 5.350 04/21/2018 | 12,087 | |||||
FMHA #1524280401417 (6010-5835-129) | DTD 12/29/03 6.625 02/01/2015 | 25,055 | |||||
FMHA #1533351344140 (6010-5835-146) | DTD 12/29/03 6.625 04/01/2015 | 48,741 | |||||
FMHA #1534312563723 (6010-5835-245) | DTD 12/29/03 5.400 02/01/2016 | 17,516 | |||||
FMHA #1535317383043 (6010-5835-244) | DTD 12/29/03 4.775 06/01/2018 | 10,744 | |||||
FMHA #1552307627140 (6010-5835-141) | DTD 12/29/03 6.625 03/01/2015 | 21,155 | |||||
FMHA #1584305742021 (6010-9785-45) | DTD 12/29/03 3.625 01/01/2014 | 13,293 | |||||
FMHA #1585308403022 (6010-5125-25) | DTD 01/12/04 4.200 12/31/2009 | 32,583 | |||||
FMHA #2089405889241 (6010-9007-212) | DTD 12/29/03 6.750 10/22/2014 | 15,968 | |||||
FMHA #230150010392102(6010-1236-232) | DTD 12/29/03 8.025 07/21/2009 | 13,950 | |||||
FMHA #28034587621369 (6010-9007-320) | DTD 12/29/03 6.285 01/16/2017 | 35,233 | |||||
FMHA #2851587961927 (7130-9007-296) | DTD 12/29/03 6.775 06/22/2015 | 19,207 | |||||
FMHA #320100507363588 (6010-3231-31) | DTD 12/29/03 2.250 01/15/2030 | 20,346 | |||||
FMHA #320100507920389 (7130-3231-23) | DTD 12/29/03 2.250 01/15/2030 | 12,392 | |||||
FMHA #32035470555511 (7130-3231-17) | DTD 12/29/03 5.400 03/01/2017 | 44,735 | |||||
FMHA #32063505745528 (7130-3846-1) | DTD 12/29/03 4.975 01/01/2012 | 7,749 | |||||
FMHA #32082507112481 (7130-3231-19) | DTD 12/29/03 6.375 12/15/2016 | 12,834 | |||||
FMHA #37035161570118 (7130-6309-231) | DTD 12/29/03 4.960 08/20/2012 | 42,215 | |||||
FMHA #370500013386540 (7130-6309-227 | DTD 12/29/03 6.300 04/10/2017 | 49,910 | |||||
FMHA #3705005356977401 (6010-6309228 | DTD 12/29/03 5.490 11/01/2014 | 23,495 | |||||
FMHA #37050166363204 (6010-6309-239) | DTD 12/29/03 4.165 11/05/2009 | 30,499 | |||||
FMHA #37059198647552 (6010-6309-236) | DTD 12/29/03 5.245 04/05/2017 | 17,922 | |||||
FMHA #3761051601506 (6010-2072-1) | DTD 12/29/03 6.400 06/01/2008 | 8,389 | |||||
FMHA #410360310742125 (6010-3872-2) | DTD 12/29/03 5.000 06/19/2015 | 182,825 | |||||
FMHA #4734504606358 (7130-3943-1) | DTD 12/29/03 2.500 04/15/2017 | 7,262 | |||||
FMHA #4865449593043 (7130-9007-251) | 5.725% DUE 2-14-2015 | 16,112 | |||||
FMHA #5074249457928 (7130-9007-355) | DTD 12/29/03 4.725 01/08/2018 | 67,285 | |||||
FMHA #51010467063361 (6010-9007-159) | DTD 12/29/03 6.625 10/09/2013 | 12,064 | |||||
FMHA #580050391995796 (6010-4728-6) | DTD 02/17/04 5.3750 01/01/2012 | 46,668 | |||||
FMHA #58006391414612 | DTD 12/29/03 5.625 10/01/2012 | 22,083 | |||||
FMHA #58006394462032 (6010-7951-45) | DTD 12/29/03 4.200 02/18/2010 | 17,784 | |||||
FMHA #58006394787724 (6010-7951-47) | DTD 12/29/03 4.670 05/01/2013 | 13,209 | |||||
FMHA #580140391790299 (7130-3032-2) | DTD 12/29/03 4.725 05/01/2018 | 166,763 | |||||
FMHA #58018394402948 | DTD 01/12/04 3.675 06/15/2010 | 7,577 | |||||
FMHA #580230391443553 (6010-5946-3) | DTD 12/29/03 6.325 05/01/2012 | 49,816 | |||||
FMHA #580360390711420 (6010-4728-24) | DTD 12/29/03 4.750 04/25/2018 | 245,741 | |||||
FMHA #5805391950029 (6010-5572-115) | DTD 12/29/03 5.770 07/25/2017 | 43,201 | |||||
FMHA #580690391127741 (7130-5772-30) | DTD 12/29/03 6.000 03/31/2012 | 87,368 | |||||
FMHA #5820391787330 (6010-5572-103) | DTD 12/29/03 5.875 04/20/2017 | 38,738 | |||||
FMHA #5831398709150 | DTD 01/12/04 4.795 06/20/2018 | 52,500 | |||||
FMHA #5836396180318 (6010-5572-114) | DTD 12/29/03 5.850 08/25/2017 | 59,045 | |||||
FMHA #5838390769507 (6010-5572-29) | DTD 12/29/03 5.475 11/19/2014 | 43,670 | |||||
FMHA #5850395742076 (6010-5572-107) | DTD 12/29/03 6.415 06/25/2017 | 29,697 | |||||
FMHA #5859391235272 (6010-5572-45) | DTD 12/29/03 5.375 05/25/2015 | 73,006 | |||||
FMHA #59005520445370 | DTD 01/12/04 4.150 12/15/2017 | 41,169 | |||||
FMHA# 2054405864598 (7130-9007-307) | DTD 12/29/03 6.625 09/09/2017 | 16,909 | |||||
FMHA# 310240516648540 (6010-2571-48) | DTD 12/29/03 6.225 10/01/2016 | 35,938 | |||||
| 2,208,769 | |||||||
11
Schedule 1 continued
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Form 5500, Schedule H, Part IV, Line 4i – Schedule of Assets (Held at End of Year)
December 31, 2007
Small Business Administration Loans: | |||||||
SBA – PVT MULTIPLE LOANS | PRIV PLCMT 5.105 09/20/2019 | 296,826 | |||||
SBA #5307954006 (6010-3735-1) | DTD 12/29/03 6.000 04/08/2017 | 6,794 | |||||
SBA #5313474000 (6010-3745-1) | DTD 12/29/03 5.875 06/03/2009 | 3,658 | |||||
SBA 4 LOAN 6.225 | DTD 11/01/06 6.225 04/15/2021 | 190,788 | |||||
SBA GP #4843153005 (7130-7460-1) | DTD 12/29/03 6.225 06/01/2012 | 11,695 | |||||
SBA GP# 1190364003 (6010-5554-2) | DTD 12/29/03 3.000 11/12/2017 | 64,454 | |||||
SBA GP# 1833294000 (7130-7616-26) | DTD 12/29/03 4.350 08/07/2013 | 41,883 | |||||
SBA GP# 1966744008 (6010-5772-2) | DTD 12/29/03 5.600 04/17/2013 | 36,967 | |||||
SBA GP# 2843183004 (7130-1539-32) | DTD 12/29/03 6.250 09/23/2008 | 2,193 | |||||
SBA GP# 3121714007 (6010-5905-2) | DTD 12/29/03 3.000 05/11/2017 | 46,563 | |||||
SBA GP# 3178964002 (6010-9007-274) | DTD 02/17/04 5.725 07/17/2015 | 36,856 | |||||
SBA GP# 3800194008 (6010-2430-9) | DTD 12/29/03 5.360 06/29/2010 | 29,584 | |||||
SBA GP# 4626814002 (6010-5772-31) | DTD 11/06/07 5.325 07/23/2016 | 8,610 | |||||
SBA GP# 4901354001 (6010-5572-122) | DTD 12/29/03 4.875 04/15/2012 | 28,274 | |||||
SBA GP# 5109214006 (7130-3267-25) | DTD 12/29/03 2.500 03/08/2027 | 10,414 | |||||
SBA GP# 5177064000 (6010-3270-15) | DTD 12/29/03 5.975 03/21/2022 | 60,881 | |||||
SBA GP# 5781894009 (6010-0966-10) | DTD 01/12/04 5.355 10/31/2037 | 37,111 | |||||
SBA GP# 6011534004 (6010-1071-2) | DTD 12/29/03 5.375 03/10/2018 | 76,495 | |||||
SBA GP# 6111694003 (7130-7895-14) | DTD 12/29/03 4.800 02/28/2018 | 7,555 | |||||
SBA GP# 6178644004 (6010-3965-1) | DTD 12/29/03 4.375 03/15/2013 | 27,140 | |||||
SBA GP# 6607043004 (7130-2211-1667) | DTD 12/29/03 5.875 05/16/2019 | 5,731 | |||||
SBA GP# 9152963005 (6010-9819-2) | DTD 12/29/03 3.000 04/25/2016 | 17,443 | |||||
SBA GP# 9234363006 (6010-5636-10) | DTD 12/29/03 3.000 09/09/2016 | 33,729 | |||||
SBA GP# 9745933002 (6010-1670-38) | DTD 12/29/03 7.090 02/01/2013 | 38,443 | |||||
SBA GP#2271064003 (6010-9007-115) | DTD 01/12/04 6.270 05/20/2014 | 30,112 | |||||
SBA GP#2721466006 CERT C35421 – DR | DTD 11/02/07 6.000 03/23/2032 | 185,181 | |||||
SBA GP#2951414005 (6010-5772-9) | DTD 02/17/04 6.650 05/25/2009 | 16,610 | |||||
SBA LO | 144A PRIV PLCMT 5.495 09/15/2028 | 85,198 | |||||
SBA SERIES 6.0975 | 144A PRIV PLCMT 03/01/2026 | 133,407 | |||||
SMALL BUSINESS ADMIN | DTD 02/22/06 5.408 02/10/2016 | 232,547 | |||||
SMALL BUSINESS ADMIN | DTD 11/06/06 6.2690 02/23/2021 | 568,689 | |||||
SMALL BUSINESS ADMIN | DTD 08/25/04 4.754 08/10/2014 | 462,736 | |||||
SMALL BUSINESS ADMIN | DTD 09/28/05 4.941 09/10/2015 | 283,443 | |||||
SMALL BUSINESS ADMIN GTD DEV PARTN | DTD 12/12/90 8.950 12/01/2010 | 513 | |||||
SMALL BUSINESS ADMIN GTD DEV PARTN | DTD 09/13/89 9.050 09/01/2009 | 221 | |||||
SMALL BUSINESS ADMIN GTD PARTN CTFS | DTD 03/26/03 4.628 03/10/2013 | 212,485 | |||||
SMALL BUSINESS ADMIN GTD PARTN CTFS | DTD 08/27/03 5.136 08/10/2013 | 416,261 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 09/13/06 5.540 09/01/2026 | 448,353 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 12/12/07 5.290 12/01/2027 | 408,594 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 11/14/07 5.510 11/01/2027 | 413,153 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 03/15/06 5.570 03/01/2026 | 760,927 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 08/23/06 5.681 08/01/2016 | 401,616 | |||||
SMALL BUSINESS ADMINISTRATION | DTD 08/22/07 5.788 08/10/2017 | 681,100 | |||||
| 6,861,233 | |||||||
United States Government Agency Obligations | |||||||
U S DEPT HSG & URBAN DEV GOVT GTD | DTD 06/30/04 4.570 08/01/2010 | 547,700 | |||||
US DEPT HSG & URBAN DEV | DTD 09/14/06 4.990 08/01/2010 | 281,808 | |||||
USDA – PVT | PRIV PLCMNT 5.025 04/19/2019 | 15,857 | |||||
USDA D | 144A PRIV PLCMT 5.981 03/03/2035 | 77,608 | |||||
USDA FIXED RATE USDA | PRIV PLCMT 6.005 04/30/2026 | 226,513 | |||||
USDA PVT LOAN COLSON SERVICES CORP | PRIV PLCMNT 5.175 12/18/2016 | 66,562 | |||||
USDA SERIES D #74 | PRIV PLCMT 6.125 11/22/2019 | 105,701 | |||||
USDA – PVT | PRIV PLCMNT 5.000 08/24/2025 | 110,612 | |||||
FSA – PVT | DTD 04/25/03 4.825 05/01/2013 | 17,126 | |||||
| 1,449,487 | |||||||
Other | |||||||
ARAB REP EGYPT | DTD 09/27/05 4.450 09/15/2015 | 261,564 | |||||
| 19,454,438 | |||||||
Mutual funds | |||||||
American Growth Fund (R5) | Mutual fund | 1,170,858 | |||||
Vanguard Intermediate Term Fund | Mutual fund | 404,192 | |||||
Vanguard Target Retirement 2020 | Mutual fund | 158,798 | |||||
Vanguard Target Retirement 2030 | Mutual fund | 21,715 | |||||
Vanguard Target Retirement 2040 | Mutual fund | 928 | |||||
Vanguard Target Retirement 2050 | Mutual fund | 95 | |||||
Vanguard Target Retirement 2010 | Mutual fund | 1,806,015 | |||||
Columbia Acorn Fund – Class Z | Mutual fund | 338,665 | |||||
Dodge & Cox Stock Fund | Mutual fund | 766,418 | |||||
Julius Baer International Equity Fund II | Mutual fund | 1,993,328 | |||||
Vanguard Institutional Index Fund | Mutual fund | 378,735 | |||||
Vanguard Target Retirement Fund | Mutual fund | 100,182 | |||||
Vanguard Target Retirement 2005 Fund | Mutual fund | 338,948 | |||||
Vanguard Target Retirement 2015 | Mutual fund | 456,857 | |||||
Vanguard Target Retirement 2025 | Mutual fund | 92,867 | |||||
Vanguard Target Retirement 2035 | Mutual fund | 95 | |||||
Vanguard Target Retirement 2045 | Mutual fund | 96 | |||||
Vanguard Value Index Fund | Mutual fund | 232,933 | |||||
| 8,261,725 | |||||||
| $ | 84,627,200 | ||||||
| * | Known to be a party-in-interest. |
Cost is not required for participant directed accounts
See accompanying Report of Independent Registered Public Accounting Firm.
12
Schedule 2
FCSTONE GROUP EMPLOYEE STOCK OWNERSHIP PLAN
Administered by Associated Benefits Corporation
Form 5500, Schedule H, Part IV, Line 4j – Schedule of Reportable Transactions
Year ended December 31, 2007
(a) Party involved | (b) Description of asset | (c) Purchase price at cost | (d) Selling price | (e) Lease rental | (f) Expense incurred with transaction | (g) Cost of asset | (h) Current value on transaction date | (i) Net gain or (loss) | ||||||||||
* | FC Stone Group, Inc. | FC Stone Group, Inc. common stock | — | 4,665,550 | — | — | 696,767 | 4,665,550 | 3,968,783 | |||||||||
Goldman Sachs | Goldman Sachs Financial Square Money Market Fund | 5,292,276 | — | — | — | 5,292,276 | 5,292,276 | — | ||||||||||
Goldman Sachs | Goldman Sachs Financial Square Money Market Fund | — | 5,297,282 | — | — | 5,297,282 | 5,297,282 | — |
| * | Known to be a party-in-interest. |
See accompanying Report of Independent Registered Public Accounting Firm.
13
SIGNATURES
The Plan. 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 hereunto duly authorized.
| FCStone Group Employee Stock Ownership Plan | ||||
| (Name of Plan) | ||||
| Date: June 30, 2008 | /s/ William J. Dunaway | |||
| William J. Dunaway | ||||
| Chief Financial Officer | ||||
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors of FCStone Group, Inc.
The Administrator of the FCStone Group Employee Stock Ownership Plan:
We consent to the incorporation by reference in the registration statement (No. 333–125889) on Form S-8 of FCStone Group, Inc. of our report dated June 30, 2008, with respect to the statements of net assets available for benefits of the FCStone Group Employee Stock Ownership Plan as of December 31, 2007 and 2006, the related statements of changes in net assets available for benefits for the years then ended and the related supplemental schedules: Schedule H, Part IV, Line 4(i) — Schedule of Assets (Held at End of Year) as of December 31, 2007 and Schedule H, Part IV, Line 4(j) — Schedule of Reportable Transactions for the year ended December 31, 2007, which report appears in the December 31, 2007 annual report on Form 11-K of the FCStone Group Employee Stock Ownership Plan.
/s/ KPMG LLP
Kansas City, Missouri
June 30, 2008
