SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
[FEE REQUIRED]
For fiscal year ended December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED]
For the transition period from to
Commission File Number 0-5562
HOME BENEFICIAL CORPORATION
(Exact name of registrant as specified in its charter)
VIRGINIA 54-0884714
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) Identification No.)
3901 West Broad Street, Richmond, Virginia 23230
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: 804-358-843l
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange
None on which registered
Securities registered pursuant to Section 12(g) of the Act:
CLASS B COMMON STOCK
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The Registrant's Class A Voting Common Stock is closely held and is not
publicly traded. The aggregate market value of Class B Non-Voting Common
Stock held by nonaffiliates of the Registrant was $171,045,986 as of March
10, 1995.
Number of shares outstanding of each of the Registrant's classes of common
stock as of March 10, 1995:
Class Shares
Class A Common Stock
$.3125 Par Value 8,476,576
Class B Common Stock
$.3125 Par Value 9,087,534
Documents Incorporated by Reference
Part I and Part II of this Form 10-K incorporate certain information by
reference from the Registrant's Annual Report to Stockholders for the year
ended December 31, 1994.
TABLE OF CONTENTS
PART I
PAGE
ITEM 1. Business .................................................... 3
ITEM 2. Properties .................................................. 8
ITEM 3. Legal Proceedings ........................................... 8
ITEM 4. Submission of Matters to a Vote of Security Holders ......... 8
PART II
ITEM 5. Market for the Registrants' Common Equity and
Related Stockholder Matters ................................. 9
ITEM 6. Selected Consolidated Financial Data ........................ 9
ITEM 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations ......................... 9
ITEM 8. Financial Statements and Supplementary Data ................. 9
ITEM 9. Changes in and Disagreements With Accountants on Accounting
and Financial Disclosures ................................... 9
PART III
ITEM 10. Directors and Executive Officers of the Registrant .......... 10
ITEM 11. Executive Compensation ...................................... 12
ITEM 12. Security Ownership of Certain Beneficial Owners
and Management .............................................. 16
ITEM 13. Certain Relationships and Related Transactions .............. 21
PART IV
ITEM 14. Exhibits, Financial Statement Schedules, and Reports
on Form 8-K ................................................. 22
SIGNATURES ........................................................... 30
PART I
ITEM 1. Business
HOME BENEFICIAL CORPORATION
Home Beneficial Corporation ("the Corporation") was incorporated in
Virginia on March 5, 1970, for the purpose of becoming a holding company
for Home Beneficial Life Insurance Company ("the Life Company"), which
originated in 1899. On December 31, 1970, pursuant to a Plan of
Reorganization proposed by the Board of Directors and approved by the
stockholders of the Life Company, the Corporation acquired all of the
issued and outstanding capital stock of the Life Company by merger of the
Life Company into a wholly-owned subsidiary of the Corporation, the name
of which was immediately changed to Home Beneficial Life Insurance
Company. At the present time, the Life Company, which is engaged in the
life and accident and health insurance business, is the major subsidiary
of the Corporation.
There was no material change in the nature of business done by the
Corporation during 1994.
BUSINESS OF THE LIFE COMPANY
The Life Company sells group life insurance and substantially all of
the forms of ordinary insurance, including universal life, whole life,
term, and annuities, together with accidental death and disability
riders. The Life Company's business is concentrated in six Mid-Atlantic
states and the District of Columbia, and its products are marketed
through its own sales force of approximately 1,150 full-time personnel
assigned to some 47 district offices located in principal cities and
towns. In addition to the agency force, there were some 236 supervisory,
administrative, clerical and other personnel employed in the home office.
The following table sets forth the geographic distribution of direct
business premiums received during 1994:
Premiums
Jurisdiction (In 000's)
Delaware $ 2,582
District of Columbia 2,971
Maryland 15,774
North Carolina 9,947
Tennessee 22,186
Virginia 40,246
West Virginia 1,190
The maximum amount of ordinary individual insurance presently retained by
the Life Company without reinsurance is $200,000 plus an additional
$75,000 coverage for accidental death. This maximum is scaled down
according to the age and physical classification of the insured. The
total amount of life insurance in force at December 31, 1994 reinsured by
the Life Company with other companies aggregated $97 million representing
less than 1% of the Life Company's life insurance in force on that date.
The Life Company participates in several group life insurance programs as
a reinsurer and also assumes reinsurance on a facultative (individual
risk) basis from two other life insurance companies. Life insurance
assumed relates principally to group life and represented approximately
17% of premium income and 55% of life insurance in force for 1994.
Claims incurred under these group life insurance programs approximate the
related premium income, and no significant assets or liabilities are
required in the balance sheet. A contingent liability exists on
insurance ceded to the reinsurer since the Life Company would be liable
in the event that the reinsurer is unable to meet obligations assumed by
it under the reinsurance agreement.
Accident and health insurance premiums accounted for less than 8% of
premium income for 1994. A significant proportion of the accident and
health premium is attributable to medical benefit coverage provided for
the Life Company's employees and their dependents under its Protection
and Retirement Plan. The Life Company offers no health insurance
coverage other than to its own employees. The Life Company writes
individual accident policies with death and dismemberment benefits.
These policies accounted for approximately 30% of total accident and
health premiums for 1994.
The Life Company, as a legal reserve company, is required by the various
laws of the states in which it is licensed to transact business to carry
as liabilities aggregate policy reserves which are considered adequate to
meet its obligations on insurance policies in force. Such required
reserves are considered statutory reserves because the methods and
assumptions used in their calculation are explicitly prescribed by the
laws of the various states. The liabilities shown herein for all
policies issued since 1948 are based on guidelines prescribed by the
American Institute of Certified Public Accountants and have been
calculated in accordance with generally accepted accounting principles.
Such liabilities are calculated by the use of assumptions as to mortality
rates, interest rates, withdrawal rates and expense rates in effect at
the time the gross premiums were calculated. Liabilities on paid-up
policies include a liability for future maintenance expenses which the
Life Company expects to incur. See Revenues, Benefits, Claims and
Expenses, Note 1 of the Notes to Consolidated Financial Statements, which
is incorporated herein by reference from pages 11 and 12 of the 1994
Annual Report to Stockholders, for additional information relating to the
Life Company's reserves.
The investment of the Life Company's funds and assets is determined by an
Investment Committee. Generally, investments made must meet requirements
established by the applicable investment statutes of the Commonwealth of
Virginia governing the nature and quality of investments which may be
made by life insurance companies.
The following table shows investments of the Life Company at December 31,
1994. Fixed maturities (bonds, notes and redeemable preferred stocks)
and equity securities (nonredeemable preferred and common stocks) are
stated at their estimated fair value; mortgage loans on real estate are
stated at cost adjusted where appropriate for amortization of premium or
discount; short-term investments are at cost; and policy loans are stated
at unpaid balances.
Asset Value
Amount Percent
(000's) of Total
Fixed Maturities:
Bonds and notes:
United States government and govern-
ment agencies and authorities $ 29,679 2.6%
States, municipalities and political
subdivisions 284,437 24.8
Foreign government 25,317 2.2
Public utilities 242,799 21.2
All other corporate 109,745 9.6
Total fixed maturities 691,977 60.4
Equity Securities $ 24,230 2.1
Mortgage loans 338,458 29.6
Policy loans 53,426 4.7
Short-term investments 31,880 2.8
Other 5,168 .4
$1,145,139 100.0%
There were no principal and interest payments past due on fixed
maturities at December 31, 1994.
The Life Company's mortgage portfolio consists of approximately 2400
conventional first mortgages on a wide range of residential and
commercial properties located primarily in those Mid-Atlantic states in
which the Life Company conducts its insurance business. At December 31,
1994 the aggregate carrying value of mortgage loans was $338,458,261,
broken down by category as follows:
Residential $168,476,605
Commercial 169,981,656
Commercial loans include loans on apartments, shopping centers, office
buildings and warehouses. Generally, commercial loans range from
$250,000 to $3,500,000 in principal amount. The Life Company also makes
some mortgage loans to churches. Every property is inspected by a staff
underwriter prior to the issuance of a loan commitment. On commercial
loans of more than $250,000, the property is inspected every two years
after the loan is closed as long as the balance exceeds $250,000.
The Life Company's mortgage lending business is heavily concentrated in
the states of Virginia and North Carolina. At December 31, 1994,
approximately 76% of the Life Company's mortgages, constituting approxi-
mately 74% of the total book value of the Life Company's mortgage port-
folio, were on residential or commercial properties located in the State
of Virginia. Additionally, at the same date approximately 14% of the
Life Company's mortgages, constituting approximately 12% of the total
book value of the Life Company's mortgage portfolio, were on properties
in North Carolina. The relatively high percentage of mortgage loans made
in these two states reflects the geographical concentration of the Life
Company's insurance business activities in the same two states. Although
the Life Company's mortgage loan portfolio is heavily concentrated in
Virginia and North Carolina, the economies of those states are
diversified, and the Life Company does not believe its mortgage loan
portfolio reflects undue risk from the large percentage of its loans
originated in those two states.
Although the economic downturn during 1990 and 1991 was characterized
by troubled real estate loans in the portfolios of many financial
institutions operating in the Life Company's market, the Life Company's
mortgage loan portfolio has not reflected the widely-publicized
experience of other financial institutions. The Life Company presently
holds two real estate parcels acquired through foreclosure with a
carrying value in the financial statements of $650,000. Mortgage loans
whose terms have been restructured over the past five years are
immaterial, and no mortgage loans were in foreclosure proceedings at
December 31, 1994. Except as indicated below, there were no mortgage
loans otherwise not performing in accordance with the contractual terms.
At December 31, 1994, the aging schedule for delinquent mortgage loans in
terms of past due days was as follows:
Past due days
30-60 60-90 Over 90 Total
Principal $5,547,6691 $1,863,551 $ -0- $7,411,220
Percent of total
mortgage loans 1.6% .6% - 2.2%
130-60 days past due includes a substantial amount of loan payments that
have been received by the Life Company's brokers after their December,
1994 cut-off reporting date to the Life Company. These amounts will be
included in their next remittance report.
The Life Company believes the quality of its loan portfolio is
attributable to its relatively stringent underwriting standards which
have been in force for many years. At the present time, and for a number
of years, the Life Company's lending policies have restricted mortgage
loans to a maximum loan to value ratio of 75%, based on the lower of cost
or appraisal, except for purchase money mortgages and insured or
guaranteed mortgages. The Life Company's policy is to place mortgage
loans on non-accrual status where any mortgage payment is 90 days or more
past due.
During the period 1986-1994, the Life Company experienced only five
foreclosures on real estate loans, one in each of the years 1986, 1989
and 1990, two in 1992 and none in 1993 and 1994. The total of the unpaid
principal balances of loans in these five foreclosures was $986,477. The
Life Company disposed of three properties acquired in foreclosure
proceedings prior to 1994 without loss. The Corporation does not provide
a provision for loan losses in its financial statements. Based upon the
de minimis loss experience of the mortgage loan portfolio over many years
and the continuing satisfactory performance of its portfolio, the
Corporation's management does not feel that a provision is required.
See Investment Operations, Note 2 of Notes to Consolidated Financial
Statements, which is incorporated herein by reference from pages 12, 13,
and 14 of the 1994 Annual Report to Stockholders, and Schedule I included
in Part IV elsewhere herein, for additional information concerning the
Corporation's consolidated investment portfolio.
The Life Company, in common with other insurance companies, is subject to
regulation and supervision in each of the states in which it does
business. Such regulation is primarily for the benefit of the policy-
holders of the Life Company rather than the stockholders. Although the
extent of such regulation varies from state to state, in general, the
insurance laws of the respective states delegate broad administrative
powers to supervisory agencies. These powers relate to the granting and
revocation of licenses to transact business, the licensing of agents, the
approval of the forms of policies used, reserve requirements, and the
type and concentration of investments permitted. In addition, the
supervisory agencies have power over the form and content of required
financial statements and reports, including requirements regarding
accounting practices to be employed in the presentation of such
statements and reports. Certain of the required accounting practices
vary from generally accepted accounting principles. See Notes 1 and 7 of
the Notes to Consolidated Financial Statements, which Notes are
incorporated herein by reference from pages 11, 12 and 17 of the 1994
Annual Report to Stockholders.
Several jurisdictions in which the Life Company does business including
its domiciliary state of Virginia, have enacted legislation providing for
specific regulation of the relationship between licensed insurers and
their holding companies and among affiliated members of a holding company
group. These statutes vary in substance from state to state, but
generally speaking, vest administrative control in the insurance
regulatory authority. Among the provisions found in these statutes are
provisions for the filing of registration statements by insurers which
are members of a holding company group, provisions that the holding
company will be subject to reporting requirements and to visitation by
the insurance regulatory authorities, standards as to transactions
between insurers and their holding companies or between members of a
holding company group, and control over the payment of extraordinary
dividends. See Stockholders' Equity and Restrictions, Note 7 of the
Notes to Consolidated Financial Statements, which is incorporated herein
by reference from page 17 of the 1994 Annual Report to Stockholders for
additional information concerning transactions between the Life Company
and its affiliates.
The life insurance business is intensely competitive and the Life
Company competes with many other companies, both stock and mutual, in the
states in which it is licensed. The American Council of Life Insurance
in its "1994 Fact Book", estimates that of the 1,886 life insurance
companies doing business in the United States at mid-year 1993, 1,777
were stock companies.
According to figures reported in the September 1994 issue of Best's
Review, Life/Health Edition, calculated on a statutory accounting basis,
the Life Company ranks in the top 11% of all life insurance companies in
the United States based on total admitted assets as of December 31, 1993.
No material portion of the business of the Life Company is dependent
upon a single customer or a very few customers. The group life insurance
sold by the Life Company consists largely of reinsurance participations
described on page 4.
The Corporation's only industry segment is the business of the Life
Company, and its operations have contributed over 98% of the total
consolidated revenues and income before income taxes for each of the past
three years.
Neither the Corporation nor any of its subsidiaries engage in material
operations outside of the United States, or derives material business
from customers outside the United States.
ITEM 2. Properties
The principal office of the Corporation is located at 3901 West Broad
Street, Richmond, Virginia 23230, which also serves as the home office
premises of the Life Company. The home office building, which contains
approximately 110,000 square feet of office space, was originally
completed in 1950 with a 30,000 square foot addition completed in 1990.
The building is used solely for company purposes.
The Life Company presently leases space for 54 district and detached
offices in Delaware, Maryland, the District of Columbia, West Virginia,
Virginia, Tennessee and North Carolina. The termination dates on these
leases range from 1995 to 2003; all of the longer term leases being for
district office purposes. The maximum annual rent paid under any lease
is $28,775. The annualized rent under all leases in effect on December
31, 1994 was approximately $760,000.
ITEM 3. Legal Proceedings
As of the date of this report, neither the Corporation nor any of its
subsidiaries was a party to any material pending legal proceedings.
ITEM 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of the Corporation's security holders
during the fourth quarter of its fiscal year ended December 31, 1994.
PART II
ITEM 5. Market for the Registrant's Common Equity and Related
Stockholder Matters
Incorporated herein by reference from the 1994 Annual Report to
Stockholders, page 21.
ITEM 6. Selected Consolidated Financial Data
Incorporated herein by reference from the 1994 Annual Report to
Stockholders, page 22.
ITEM 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Incorporated herein by reference from the 1994 Annual Report to
Stockholders, pages 19 and 20.
ITEM 8. Financial Statements and Supplementary Data
Consolidated financial statements of the Corporation at December 31, 1994
and 1993 and for each of the three years in the period ended December 31,
1994 and the auditor's report thereon and the Corporation's unaudited
quarterly financial data for the two year period ended December 31, 1994
are incorporated herein by reference from the 1994 Annual Report to
Stockholders, pages 6 through 18 and 21.
ITEM 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosures
None.
PART III
ITEM 10. Directors and Executive Officers of the Registrant
(a) and (b) The following table gives the name and age of each of the
directors (all of whom, except C. M. Glenn, Jr., L. W. Richardson, and
Dianne N. Collins are executive officers of the Corporation and the Life
Company) and their positions and offices with the Corporation and the
Life Company and the dates first elected to those positions with the
Corporation.
Position and Offices with the Corporation
and the Life Company and Date Elected to
Name Age Corporation Officer Position
Dianne N. Collins 49 Director of the Life Company and the
Corporation and Community Volunteer
H. D. Garnett 52 Vice President (since 1979), Controller
(since 1974) and a director of the
Corporation and the Life Company
C. M. Glenn, Jr. 78 Retired Vice President-Treasurer and a
director of the Corporation and the
Life Company
W. G. Hancock 44 Counsel (since 1984) and a director of
the Corporation and the Life Company
G. T. Richardson 42 Vice President (since 1983) and a director
of the Corporation and the Life Company
L. W. Richardson 75 Retired Vice President and a director of
the Corporation and the Life Company
J. M. Wiltshire, Jr. 69 Vice President (since 1972), Counsel
(since 1982), Secretary (since 1994)
and a director of the Corporation
and the Life Company
R. W. Wiltshire 73 Chairman of the Board (since 1983) and a
director of the Corporation and the Life
Company
R. W. Wiltshire, Jr. 49 President (since 1988), Chief Executive
Officer (since 1992) and a director of
the Corporation and the Life Company
W. B. Wiltshire 46 Vice President (since 1983) and a director
of the Corporation and the Life Company
Mrs. Collins was first elected to the Board of Directors of the
Corporation on February 15, 1994, Messrs. Garnett, Hancock, G. T.
Richardson, and W. B. Wiltshire were first elected to the Board in 1983,
and Messrs. R. W. Wiltshire, Jr. and J. M. Wiltshire, Jr. were first
elected to the Board in 1976 and 1971, respectively, all to fill then
existing vacancies on the Board. The remaining persons named in the
foregoing table have served as directors of the Corporation since its
organization in 1970.
All of the above persons serve one year terms as both executive officers
and directors, or in the case of Messrs. Glenn and Richardson and Mrs.
Collins, as directors only, which expire April 4, 1995. There are no
executive officers of the Corporation who are not directors.
(c) Not applicable.
(d) C. M. Glenn, Jr. is the uncle of W. G. Hancock. L. W. Richardson is
the father of G. T. Richardson and the first cousin of R. W. Wiltshire.
R. W. Wiltshire is the father of R. W. Wiltshire, Jr. and W. B. Wiltshire
and the first cousin of J. M. Wiltshire, Jr.
(e)(1) Except as set forth below, each of the persons named in (a) and
(b) above has been principally employed by the Corporation and the Life
Company in the present position for more than the past five years.
Dianne N. Collins has been a Trustee of the 1984 Voting Trust described
in Item 12 below since January 4, 1994 and a volunteer in the Richmond,
Virginia community for more than the past five years. C. M. Glenn, Jr.
and L. W. Richardson retired at the end of 1986 and 1987, respectively,
each having served in the office shown for more than five years
immediately prior to his retirement. W. G. Hancock has been a partner of
the law firm of Mays & Valentine, Richmond, Virginia since 1981
specializing in real estate and mortgage lending, insurance company
regulation and general business matters. He was designated as Counsel to
the Corporation and the Life Company effective June 13, 1984. J. M.
Wiltshire, Jr. was elected to the additional office of Secretary of the
Corporation and Life Company effective January 18, 1994. Effective April
7, 1992, R. W. Wiltshire, Jr. was elected Chief Executive Officer of the
Life Company and the Corporation to succeed R. W. Wiltshire who had
served in that office for more than five years immediately prior thereto.
Prior to his election as Chief Executive Officer, R. W. Wiltshire, Jr.
was responsible for the general management of the operations of the
Corporation and the Life Company. R. W. Wiltshire retired as an employee
and salaried officer of the Corporation and the Life Company effective
September 6, 1993.
(e)(2) Not applicable.
(f) Not applicable.
(g) Not applicable.
(h) The Corporation's directors and executive officers are required to
file reports with the Securities and Exchange Commission (the
"Commission") concerning their initial ownership of shares of the
Corporation's Class A and Class B Common Stock and any subsequent changes
in that ownership, and the Corporation traditionally has assisted its
directors and executive officers in the filing of these reports. In
making these reports, the Corporation has relied on written
representations of its directors and executive officers and copies of the
reports that they have filed with the Commission. The Corporation
believes that these filing requirements were satisfied in 1994.
ITEM 11. Executive Compensation
(a) and (b) Summary Compensation Table
The following Summary Compensation Table sets forth certain information
concerning cash compensation paid to or contributed for the benefit of
the five individuals named below for services rendered to the Corporation
and its subsidiaries as executive officers during each of the three years
in the period ended December 31, 1994.
SUMMARY COMPENSATION TABLE
Name and Principal Annual All Other
Position (1) Year Compensation-Salary (2) Compensation(3)
R. W. Wiltshire, Jr. 1994 $139,312 $4,179
President and Chief 1993 118,512 3,555
Executive Officer(4) 1992 108,528 2,171
J. M. Wiltshire, Jr. 1994 132,134 3,964
Vice President, 1993 125,434 3,763
Secretary and 1992 121,201 2,424
Counsel
H. D. Garnett 1994 119,122 3,574
Vice President and 1993 112,422 3,373
Controller 1992 107,937 2,159
W. B. Wiltshire 1994 117,294 3,519
Vice President 1993 105,403 3,162
1992 99,986 2,000
G. T. Richardson 1994 117,074 3,512
Vice President 1993 105,174 --
1992 98,991 1,980
(1) Offices shown are of both the Corporation and the Life Company.
(2) The amounts shown include employee contributions to the Thrift Plan.
(3) All of the amounts shown reflect matching contributions by the
Corporation and the Life Company to the Thrift Plan. The Thrift Plan is
a defined contribution plan available to substantially all salaried
employees. Participants may make thrift contributions to the plan in any
whole percentage of 2-14% of their compensation, and the Corporation and
the Life Company will make a matching contribution to the plan in an
amount equal to three-fourths of the first 4% of each eligible employee's
compensation so contributed for the year. All matching amounts shown for
each executive officer are fully vested. Benefits under the Thrift Plan
are payable at death, retirement or other termination of employment (or
at January of the calendar year of age 70 1/2, if earlier).
(4) Effective April 7, 1992, R. W. Wiltshire, Jr. was elected Chief
Executive Officer of the Corporation and the Life Company.
(c) Not applicable
(d) Not applicable
(e) Not applicable
(f) Pension and Postretirement Medical Benefits Plans
The Corporation's Retirement Plan, a defined benefit pension plan,
covers substantially all employees of the Corporation and the Life
Company with the requisite length of service, which was reduced from six
months to two months of service commencing January 1, 1995. The Plan
provides a retirement annuity, payable by the Life Company as the insurer
under the Plan, to each employee who is credited with five years of
service, who attains his normal retirement age (which is age 65 or, if
the employee becomes a participant at or after age 60, his fifth
anniversary of becoming a participant) while employed by the Corporation
or the Life Company, or who is totally and permanently disabled while an
employee. The retirement annuity is earned in the form of a single life
annuity for the life of the employee, commencing at the employee's normal
retirement age, and is equal to the sum of retirement annuity credits
earned by the employee for each calendar year he is credited with a year
of service. Retirement annuity benefits under the plan can be paid as
early as age 55 if the employee retires with at least ten years of
service (or at disability retirement, if earlier) and must be paid
starting in January of the calendar year the employee reaches age 70 1/2,
even though he has not then retired. The annuity is payable monthly and
is subject to actuarial reduction in the event the employee commences to
receive his retirement annuity prior to his normal retirement age (other
than as a result of disability retirement) or receives his retirement
annuity in a joint and survivor rather than a single life annuity form of
payment. A survivor annuity benefit is provided to the employee's spouse
in certain cases if the employee dies before his retirement annuity
payments begin.
The annual annuity credit for years after 1988 is equal to 2% of the
first $10,000 of the employee's compensation for the year, plus 2.5% of
the employee's compensation for the year in excess of $10,000. Once an
employee is credited with 35 years of service, whether before or after
1989, the annual annuity credit after 1988 becomes 2.5% of the employee's
compensation for the year. Prior to 1989, several different benefit
formulas were applied, and employees who were participants before 1989
will retain their annuity credits as determined through December 31, 1988
based on those earlier formulas. Covered compensation for purposes of
the Plan is aggregate cash compensation up to $150,000 per year for years
after 1993 ($200,000 per year for 1992 and 1993), as adjusted from time
to time under the Internal Revenue Code of 1986, as amended, which in the
case of each executive officer is identical to the amount shown as salary
in the Summary Compensation Table appearing in Item 11(a) and (b).
The estimated annual benefits payable under the Plan for each of the
individuals listed in the Summary Compensation Table are as follows: R.
W. Wiltshire, Jr. - $85,790, J. M. Wiltshire, Jr. - $44,552, , H. D.
Garnett - $71,137, W. B. Wiltshire - $83,372, and G. T. Richardson -
$92,032. The benefits as shown are estimated on the basis that the
persons named will continue to receive, until the end of the calendar
year in which they reach age 65 or, if already age 65, until the end of
the current calendar year, salaries at the same rates in effect during
1994 and will then retire and elect a single life rather than a joint and
survivor annuity form of payment.
Amounts payable under the Plan are not subject to deduction for social
security benefits under the Federal Social Security Act.
In addition to the Corporation's defined benefit pension plan, the
Corporation has a postretirement medical benefits plan consisting of
defined benefit medical coverage for pre-1993 retirees and defined
contribution medical coverage for post-1992 retirees who were active
employees on December 31, 1992. The pre-1993 retiree program covers all
employees who had retired under the Corporation's pension plan as of
December 31, 1992. The post-1992 retiree program covers all full time
active employees as of December 31, 1992 who retire under the
Corporation's pension plan thereafter. Employees who joined the
Corporation after December 31, 1992 are not eligible for participation in
either program under the postretirement medical benefits plan.
The pre-1993 retiree program reimburses its participants for actual
covered costs subject to specified deductibles and coinsurance. The pre-
1993 retiree program is contributory and participant contribution
requirements may be increased from time to time and benefits may be
modified or terminated by the Corporation. The post-1992 retiree program
is noncontributory and reimburses its participants for the cost of health
insurance and other health care coverage premiums up to a maximum benefit
amount (stated in terms of health care spending credits) determined in
accordance with the plan based on years of service as of December 31,
1992. The unused maximum benefit amount, initially determined as of
December 31, 1992, is increased thereafter only for interest from January
1, 1993 until it is fully expended.
All current salaried executive officers of the Corporation, upon their
retirement, will be covered under the post-1992 retiree program. The
spending account credit balances determined as of December 31, 1994
(without interest to be credited thereafter) for each of them are as
follows: R. W. Wiltshire, Jr. - $28,058, J. M. Wiltshire, Jr. - $30,796,
H. D. Garnett - $26,005, W. B. Wiltshire - $28,743 and G. T. Richardson
-$26,005.
The Corporation is self insured with respect to benefits under the
postretirement medical benefits plan.
(g) Compensation of Directors
All directors of the Corporation (other than Messrs. Glenn, L. W.
Richardson, R. W. Wiltshire, Hancock and Mrs. Collins) are salaried
executive officers. Messrs. Glenn, L. W. Richardson and R. W. Wiltshire
have retired as salaried executive officers of the Corporation and the
Life Company. Upon his retirement on December 31, 1986 after more than
48 years of service, Mr. Glenn was asked to serve at the pleasure of the
Board of Directors as a Consultant to the Corporation and its
subsidiaries for which he receives $30,000 per year in addition to his
normal retirement benefit of $26,495 under the Corporation's Retirement
Plan. Under the terms of the contract, Mr. Glenn has agreed to perform
such services of a consulting and advisory nature as may be requested of
him from time to time by the Chairman of the Board of the Corporation.
Messrs. Richardson and Wiltshire retired on December 31, 1987, and
September 6, 1993, respectively, and in consideration of their past
services to the Corporation and the Life Company over a continuous period
of more than 42 years in the case of Mr. Richardson and 47 years in the
case of Mr. Wiltshire, the Corporation agreed to pay Mr. Richardson
$30,000 per year and Mr. Wiltshire $90,000 per year in addition to their
respective pension benefits of $34,109 and $55,002 under the Retirement
Plan. The Corporation's agreements with each of Messrs. Glenn,
Richardson and Wiltshire provide that they will not compete with the
Corporation or its subsidiaries, directly or indirectly, on a full time
or a part time or on a consulting or advisory basis. Messrs. Glenn and
Richardson also are participants in the pre-1993 retiree program under
the Corporation's postretirement medical benefits plan. Mr. Wiltshire is
a participant in the post-1992 retiree program under the plan and has a
spending account credit balance as of December 31, 1994, after
reimbursement to him of premiums paid subsequent to his retirement, of
$42,591. (See "Pension and Postretirement Medical Benefits Plan" in Item
11(f)). Mr. Hancock is a partner in the law firm of Mays & Valentine.
The amount of legal fees paid to that firm by the Corporation and its
subsidiaries and affiliates in 1994, including amounts for legal services
provided by Mr. Hancock, did not exceed 5% of the firm's gross revenues
for its last fiscal year. No director of the Corporation receives any
additional compensation in the form of directors' fees or otherwise for
attendance at meetings of the Board or committees thereof, or other
services performed solely in his or her capacity as a director.
(h) Employment Contracts and Termination of Employment and Change-in-
Control Arrangements
(1) Not applicable
(2) Not applicable
(i) Not applicable
(j) Board of Director Interlocks and Insider Participation
The Corporation has no formal compensation committee, and all final
decisions as to executive officer compensation are made by the entire
Board of Directors. All members of the Board of Directors, except Mrs.
Collins, are present or retired officers of the Corporation. Messrs. R.
W. Wiltshire, Jr., J. M. Wiltshire, Jr., Garnett, W. B. Wiltshire, and
G. T. Richardson are salaried executive officers of the Corporation. R.
W. Wiltshire has retired as an employee of the Corporation and now serves
as an unsalaried executive officer in the capacity of Chairman of the
Board. Messrs. Glenn and L. W. Richardson are retired executive officers
of the Corporation. Mr. Hancock is an unsalaried executive officer of
the Corporation and a partner in the law firm of Mays & Valentine which
is general counsel to the Corporation.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management
(a) and (b) As of March 10, 1995, 5,401,024 shares of Class A Common
Stock of the Corporation, constituting 63.7% of the 8,476,576 shares then
outstanding, were held by trustees under a voting trust agreement dated
as of May 1, 1984, which, by virtue of a voting trust extension agreement
dated as of May 1, 1987, continues in force until May 11, 1997 (1984
Voting Trust). The Voting Trustees, each of whom is a director of the
Corporation and the Life Company are R. W. Wiltshire, L. W. Richardson,
R. W. Wiltshire, Jr., G. T. Richardson, and Dianne N. Collins (as the
current successor to M. D. Nunnally, Jr. one of the original Voting
Trustees, who died several years ago) (together, the Trustees). Their
mailing address is 3901 West Broad Street, Richmond, Virginia 23230. The
Trustees are given exclusive voting power of the Class A Common Stock
subject to the 1984 Voting Trust, but must vote or execute consents in
accordance with the instructions of the holders of voting trust
certificates with respect to any action submitted to a vote of the
holders of Class A Common Stock as to which a majority of the Trustees
then in office favor an affirmative vote, where such action, if
approved by the holders of Class A Common Stock in accordance with and to
the extent required by law and the Corporation's Articles of
Incorporation, would result in: (a) the increase or decrease of the
authorized number of shares of Class A Common Stock; (b) an exchange,
reclassification, or cancellation of all or part of the shares of Class
A Common Stock; (c) an exchange, or right of exchange, of all or any part
of the shares of another class into the shares of Class A Common Stock;
(d) any change that may be adverse to the designations, preferences,
limitations, voting rights or relative to other rights of any nature of
the shares of Class A Common Stock; (e) any change of the shares of Class
A Common Stock into a different number of shares of the same class or
into the same or a different number of shares, either with or without par
value, of other classes of stock; (f) the creation of a new class of
stock, or change of a class with subordinate and inferior rights into a
class having rights and preferences prior and superior to shares of Class
A Common Stock, or any increase of the rights and preferences of any
class having rights and preferences prior or superior to shares of Class
A Common Stock; (g) any limitation or denial of preemptive rights of
shares of Class A Common Stock; (h) the sale, lease, exchange, mortgage,
pledge or other disposition of all, or substantially all, the property
and assets of the Corporation; (i) the merger or consolidation of the
Corporation with or into any other corporation, or of any other
corporation with or into the Corporation; or (j) the dissolution of the
Corporation. If a majority of the Trustees shall oppose any such matter,
the Trustees need not solicit, obtain or follow directions from the
holders of the voting trust certificates, and such majority of Trustees
opposing any such proposal are authorized and empowered to vote all the
shares of Class A Common Stock held by the Trustees under the 1984 Voting
Trust against such proposal. A majority vote of the Trustees controls
actions to be taken by them; they may vote in person or by proxy to
another Trustee with or without direction how to vote. They may vote for
themselves as directors and officers of the Corporation and fix their
compensation provided it be commensurate with the duties and
responsibilities of the office or position held. They may name successor
trustees in event of death, resignation, removal from the Commonwealth of
Virginia or incapacity of any Trustee. They receive no compensation for
their services as Trustees. In the event that by virtue of a stock
dividend, stock split, reclassification of stock or subscription, the
Trustees receive further Class A Common Stock, it is to be held by them
subject to all of the provisions of the 1984 Voting Trust. In the event
that as a result of any merger, consolidation, sale of assets or
property, exchange or other cause, the shares of Class A Common Stock of
the Corporation held by the Trustees should be converted into and become
shares of another corporation, the 1984 Voting Trust shall be terminated
automatically unless the amount of voting stock in such other corporation
received as a result of the conversion would thereafter represent more
than one-third of the issued and outstanding voting stock of such other
corporation if it has no class of stock registered under the Securities
Exchange Act of 1934, or more than one-twentieth of the issued and
outstanding voting stock of such other corporation if it has a class of
stock so registered, in either of which cases the 1984 Voting Trust shall
continue in force according to its terms.
Class B Common Stock, which has no vote on most matters, is publicly
traded in the over-the-counter market and is not subject to the 1984
Voting Trust.
Due to the substantial number of shares of Class A Common Stock held
subject to the 1984 Voting Trust, the Trustees individually and
collectively may be deemed to be "control persons" of the Corporation
under rules and regulations of the Securities and Exchange Commission.
As of March 10, 1995, the Trustees under the 1984 Voting Trust
beneficially owned, directly or indirectly, voting trust certificates
evidencing an aggregate of 827,646 shares of Class A Common Stock subject
thereto, as well as another 270,673 shares of Class A Common Stock that
are not subject to the 1984 Voting Trust.
The following table shows as of March 10, 1995, the beneficial owner-
ship of all Class A and Class B Common Stock by each director of the
Corporation, and the beneficial ownership of the Corporation's Class A
Common Stock by any other person or entity known to the Corporation to
own more than 5% of the outstanding shares of such class. The
Corporation has no executive officers who are not directors. The amounts
shown for Class A Common Stock include beneficial ownership evidenced by
voting trust certificates of the 1984 Voting Trust, but exclude Class A
shares held by the Trustees thereunder.
Directors
Amount
Title of Beneficially Percent of
Name of Director Class Owned(1) Class(2)
Dianne N. Collins Class A 13,536(3)(4)(5) *
Class B 7,264(4) *
H. D. Garnett Class A - -
Class B 2,600 (6) *
C. M. Glenn, Jr. Class A 327,826 (5)(7)(8)(9) 3.87
Class B 80,711 (7)(8)(9) *
W. G. Hancock Class A 89,560 (9)(10)(11) 1.06
Class B 4 *
G. T. Richardson Class A 52,784 (3)(5) *
Class B 10,274 *
L. W. Richardson Class A 262,161 (3)(5)(9)(12) 3.09
Class B 89,179 (9)(12) *
J. M. Wiltshire, Jr. Class A - -
Class B 6,000 *
R. W. Wiltshire Class A 741,492 (3)(5)(9)(13) 8.75
Class B 47,920 (13) *
R. W. Wiltshire, Jr. Class A 28,346 (3)(5)(13) *
Class B 41,443 (9)(13) *
W. B. Wiltshire Class A 28,186 (5)(13) *
Class B 30,550 (9)(13) *
5% Class A Stockholders
(Other Than Directors and Trustees)
Amount
Name and Address of Beneficially Percent of
5% Class A Stockholder Owned (1) Class
Dixie Company 2,561,336 (5)(14) 30.22
Richmond, Virginia
Doris G. Hancock 449,574 (8)(15) 5.30
Richmond, Virginia
Estate of Mary Morton Parsons 1,174,427 (5)(16) 13.85
Richmond, Virginia
George L. Richardson 599,680 (5) 7.07
Richmond, Virginia
(1) Beneficial ownership has been determined in accordance with Rule 13d-
3 under the Securities Exchange Act of 1934.
(2) Where an asterisk is shown, the percentage is less than 1%.
(3) 5,401,024 shares of Class A Common Stock constituting 63.7% of the
8,476,576 shares outstanding are held by R. W. Wiltshire, L. W.
Richardson, R. W. Wiltshire, Jr., G. T. Richardson and Dianne N.
Collins, as Trustees under the 1984 Voting Trust.
(4) All of the voting trust certificates for Class A shares and the Class
B shares are held of record by Dixie Company and may be acquired by
Mrs. Collins pursuant to her power to revoke an inter vivos trust.
Such voting trust certificates are also included in the table for
Dixie Company.
(5) Some portion or all of the Class A shares shown for each of the
indicated directors or stockholders are subject to the 1984 Voting
Trust, and their beneficial ownership as to those shares is evidenced
by voting trust certificates that have been issued to them
thereunder. The number of Class A shares deposited in the 1984
Voting Trust by each of them is as follows: Dianne N. Collins -
13,536; C. M. Glenn, Jr. - 150,164; G. T. Richardson - 22,510; L. W.
Richardson - 250,708; R. W. Wiltshire - 539,016; R. W. Wiltshire, Jr.
- 1,876; W. B. Wiltshire - 1,728; Dixie Company - 2,423,800; Estate
of Mary Morton Parsons - 1,174,427; and George L. Richardson -
404,600.
(6) All of the Class B shares shown for Mr. Garnett are owned jointly
with his wife.
(7) Includes 165,520 shares of Class A (of which 90,000 shares are
evidenced by voting trust certificates of the 1984 Voting Trust) and
23,280 shares of Class B Common Stock held in trust by Crestar Bank
as trustee for the benefit of Mr. Glenn during his lifetime, with
remainder to his issue.
(8) Includes 80,822 shares of Class A and, in the case of Mr. Glenn,
3,644 shares of Class B Common Stock, held by Mr. Glenn and his
sister, Doris G. Hancock, and another sister, as trustees under the
will of Hazel C. Glenn for the benefit of his daughter.
(9) Includes an aggregate of 7,560 shares of Class A (of which 2,696
shares are evidenced by voting trust certificates of the 1984 Voting
Trust) and 12,750 shares of Class B Common Stock held by directors as
trustees or custodians for the benefit of children (that are not
described in other footnotes to this table), or by their wives, and
with respect to which beneficial ownership is or will be disclaimed
by individual directors in ownership reports filed with the
Securities and Exchange Commission.
(10) The ownership shown for Mr. Hancock excludes 188,800 shares of Class
A Common Stock held in trust by Crestar Bank for the benefit of his
mother, Doris G. Hancock, with remainder to Mrs. Hancock's issue, in
which Mr. Hancock has a vested one-third beneficial interest subject
to partial divestment upon any further children of Mrs. Hancock.
(11) Includes 2,400 shares of Class A Common Stock held by Mr. Hancock and
his brother and sister as trustees under inter vivos trusts created
by their mother for the benefit of her six grandchildren, three of
whom are children of Mr. Hancock.
(12) Includes 25,538 shares of Class A Common Stock evidenced by voting
trust certificates of the 1984 Voting Trust and 36,912 shares of
Class B Common Stock held by Mr. Richardson, as trustee with sole
voting and shared investment power, for the benefit of a member of
his immediate family.
(13) 141,804 shares of Class A Common Stock, voting trust certificates for
94,976 shares of Class A Common Stock subject to the 1984 Voting
Trust and 660 shares of Class B Common Stock are held by the Estate
of Essie Lee Wiltshire for the life of R. W. Wiltshire with a vested
remainder interest in the children of R. W. Wiltshire. R. W.
Wiltshire is the sole executor of the Estate of Essie Lee Wiltshire.
During the life of R. W. Wiltshire the income from the foregoing
shares is paid to the children of R. W. Wiltshire. In addition, R.
W. Wiltshire has a life estate in voting trust certificates
evidencing 403,264 shares of Class A Common Stock subject to the 1984
Voting Trust and 47,260 shares of Class B Common Stock, with
remainder to the children of R. W. Wiltshire. R. W. Wiltshire, Jr.
and W. B. Wiltshire have vested one-fourth beneficial interests in
all the foregoing shares, subject to partial divestment upon any
further children of R. W. Wiltshire. The ownership shown includes
such shares for R. W. Wiltshire and excludes all such shares for R.
W. Wiltshire, Jr. and W. B. Wiltshire. Both R. W. Wiltshire, Jr. and
W. B. Wiltshire also have the same vested one-fourth remainder
interests subject to partial divestment in another 140,836 shares of
Class B Common Stock in which various children and grandchildren of
R. W. Wiltshire residing in other households have an interest for his
life. The ownership shown for R. W. Wiltshire, R. W. Wiltshire, Jr.
and W. B. Wiltshire does not reflect any of such shares, except in
the case of R. W. Wiltshire, Jr. for 26,445 shares held by him as
custodian for his minor children and another 8,764 shares held for
his own benefit and in the case of W. B. Wiltshire for 17,630 shares
held by him as custodian for his minor children and another 8,764
shares held for his own benefit.
(14) Dixie Company is the nominee of Jefferson National Bank which holds
137,536 Class A shares and voting trust certificates for another
2,423,800 Class A shares in a number of fiduciary accounts that it
administers (including voting trust certificates for 13,536 Class A
shares previously reported in the table for Mrs. Collins).
(15) Includes 188,800 shares of Class A Common Stock held in trust by
Crestar Bank as trustee for the benefit of Mrs. Hancock during her
lifetime with remainder to her issue. Also includes 18,205 Class A
shares held by Mrs. Hancock's husband.
(16) Clinton Webb and NationsBank of Virginia, N.A. are the co-executors
of the Estate of Mary Morton Parsons.
As of March 10, 1995, executive officers and directors of the
Corporation as a group beneficially owned 1,543,891 shares or 18.2% of
the Class A (including beneficial ownership evidenced by voting trust
certificates of, but exclusive of shares held by the Trustees under, the
1984 Voting Trust) and 315,945 shares or 3.5% of the Class B Common Stock
of the Corporation, respectively.
(c) The Corporation has no knowledge of any contractual arrangement which
may at a subsequent date result in a change of control of the
Corporation, except that the 1984 Voting Trust is scheduled to expire on
May 11, 1997. Upon its expiration, the shares of Class A Common Stock of
the Corporation now held by the Trustees under the 1984 Voting Trust will
be held by persons presently holding voting trust certificates
representing those shares.
ITEM 13. Certain Relationships and Related Transactions
(a) Not applicable.
(b) W. G. Hancock is a partner in the law firm of Mays & Valentine which
provided legal services as general counsel to the Corporation and its
subsidiaries and affiliates during 1994, and is expected to serve in the
same capacity in 1995. The amount of legal fees paid to that firm by the
Corporation and its subsidiaries and affiliates for 1994 did not exceed
5% of the firm's gross revenues for its last full fiscal year.
(c) Not applicable.
(d) Not applicable.
Part IV
ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) 1. and 2. Financial Statements and Financial Statement Schedules
The financial statements and financial statement schedules listed in
the accompanying Index to Financial Statements and Financial
Statement Schedules on page 23 are filed as part of this annual
report.
3. Exhibits
The exhibits listed in the accompanying Index to Exhibits are filed
as part of this annual report.
(b) Reports on Form 8-K
None
HOME BENEFICIAL CORPORATION
Index to Financial Statements
and Financial Statement Schedules
(Item 14(a))
Annual
Form Report to
10-K Stockholders
Consolidated Financial Statements:
Report of Ernst & Young LLP, Independent Auditors 18
Consolidated Balance Sheet at December 31, 1994 and 1993 6-7
Consolidated Statement of Income for each of the three
years in the period ended December 31, 1994 8
Consolidated Statement of Retained Earnings for each of
the three years in the period ended December 31, 1994 9
Consolidated Statement of Cash Flows for each of the
three years in the period ended December 31, 1994 10
Notes to Consolidated Financial Statements 11-17
Supplementary information--
Quarterly financial information (unaudited) 21
Financial Statement Schedules:
I - Summary of investments - other than investments
in related parties at December 31, 1994
(Consolidated) 25
II - Condensed Financial Information of Registrant
(Parent Company):
Balance Sheet at December 31, 1994 and 1993 26
Statement of Income for each of the three years
in the period ended December 31, 1994 27
Statement of Cash Flows for each of the three
years in the period ended December 31, 1994 28
IV - Reinsurance for each of the three years in the
period ended December 31, 1994 (Consolidated) 29
All other schedules are omitted since the required information is not
present, or is not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the financial
statements and notes thereto.
The consolidated financial statements and supplementary information listed in
the above index, which are included in the Annual Report to Stockholders for
Home Beneficial Corporation for the year ended December 31, 1994, are
incorporated herein by reference.
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report(Form 10-K)
of Home Beneficial Corporation of our report dated February 10, 1995,
included in the 1994 Annual Report to Stockholders of Home Beneficial
Corporation.
Our audits also included the financial statement schedules of Home Beneficial
Corporation listed in Item 14(a). These schedules are the responsibility of
the Corporation's management. Our responsibility is to express an opinion
based on our audits. In our opinion, the financial statement schedules
referred to above, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.
ERNST & YOUNG LLP
Richmond, Virginia
February 10, 1995
Schedule I
HOME BENEFICIAL CORPORATION
(CONSOLIDATED)
SUMMARY OF INVESTMENTS - OTHER THAN INVESTMENTS IN RELATED PARTIES
At December 31, 1994
Column A Column B Column C Column D
Amount at
which shown in
Type of Investment Cost Value balance sheet
Fixed maturities securities available-for-sale:
Bonds and notes:
United States Government
and government agencies
and authorities $ 28,659,884 $ 29,678,807 $ 29,678,807
States, municipalities
& political subdivisions 302,051,360 284,436,727 284,436,727
Foreign governments 26,343,642 25,317,338 25,317,338
Public utilities 250,900,747 241,829,335 241,829,335
All other corporate 109,350,262 109,745,273 109,745,273
Redeemable preferred stocks 1,000,000 969,375 969,375
Total 718,305,895 $691,976,855 691,976,855
Equity securities available-for-sale:
Common stocks:
Public utilities 1,715,043 $ 3,552,394 3,552,394
Banks, trust and insurance
companies 668,900 5,239,702 5,239,702
Industrial, miscellaneous
and other 6,662,725 14,771,313 14,771,313
Nonredeemable preferred
stocks 681,477 666,440 666,440
Total equity securities 9,728,145 $24,229,849 24,229,849
Mortgage loans on real estate 338,458,261 338,458,261
Policy loans 53,425,676 53,425,676
Other long-term investments 6,167,002 6,167,002
Short-term investments 32,459,616 32,459,616
Total investments $1,158,544,595 $1,146,717,259
Schedule II
HOME BENEFICIAL CORPORATION
(PARENT COMPANY)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT
BALANCE SHEET
December 31, 1994 and 1993
1994 1993
ASSETS
Cash and cash equivalents $ 1,015,332 $ 1,580,496
Investment in subsidiaries, at equity 460,497,094 466,132,836
Other assets 5,370,053 5,628,327
$466,882,479 $473,341,659
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities $ 112,545 $ 79,267
Stockholders' equity (*)
Capital stock:
Class A Common Stock, voting, $.3125 par
value 12,800,000 shares authorized;
8,476,576 issued at December 31, 1994
and December 31, 1993 2,648,930 2,648,930
Class B Common Stock, non-voting,
$.3125 par value, 19,200,000 shares
authorized; 9,087,534 issued at
December 31, 1994 and 9,462,482
issued at December 31, 1993 2,839,854 2,957,025
Total capital stock 5,488,784 5,605,955
Unrealized (losses) gains on available-
for-sale securities of subsidiaries
less deferred income taxes (6,652,336) 14,258,342
Retained earnings 467,933,486 453,398,095
Total stockholders' equity 466,769,934 473,262,392
$466,882,479 $473,341,659
(*) See Notes 6 and 7 to Consolidated Financial Statements
Schedule II
HOME BENEFICIAL CORPORATION
(PARENT COMPANY)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT
STATEMENT OF INCOME
Years Ended December 31, 1994, 1993 and 1992
1994 1993 1992
Revenues:
Dividends from subsidiaries $22,304,000 $29,216,000 $14,944,000
Other investment income 971,392 1,005,362 944,528
Total Revenues 23,275,392 30,221,362 15,888,528
Expenses:
Operating and administrative 821,074 915,949 877,593
Income before income taxes and
equity in undistributed income
of subsidiaries 22,454,318 29,305,413 15,010,935
Income taxes - current 75,000 50,000 25,000
Income before equity in
undistributed income of
subsidiaries 22,379,318 29,255,413 14,985,935
Equity in undistributed income
of subsidiaries 13,816,658 13,359,040 2,047,551
Net income $36,195,976 $42,614,453 $17,033,486
Schedule II
HOME BENEFICIAL CORPORATION
(PARENT COMPANY)
CONDENSED FINANCIAL INFORMATION OF REGISTRANT
STATEMENT OF CASH FLOWS
Years Ended December 31, 1994, 1993 and 1992
Increase (Decrease) in Cash and Cash Equivalents (*)
1994 1993 1992
Operating Activities:
Net income $ 36,195,976 $ 42,614,453 $ 17,033,486
Adjustments to reconcile net
income to net cash provided
from operating activities:
Undistributed net income
of subsidiaries (13,816,658) (13,359,040) (2,047,551)
Dividends paid by subsidiary
declared prior year - - 3,584,000
Other 333,274 92,878 13,801
Net cash provided by
operating activities 22,712,592 29,348,291 18,583,736
Investing activities:
Additional investment
in subsidiary (1,500,000) - -
Net cash used in
investing activities (1,500,000) - -
Financing activities:
Purchase of Common Stock (7,675,184) (14,142,511) (4,252,500)
Cash dividends to stockholders (14,102,572) (14,014,459) (14,152,261)
Net cash used in financing
activities (21,777,756) (28,156,970) (18,404,761)
(Decrease) Increase in cash and
cash equivalents (565,164) 1,191,321 178,975
Cash and cash equivalents,
beginning of year 1,580,496 389,175 210,200
Cash and cash equivalents,
end of year $ 1,015,332 $ 1,580,496 $ 389,175
(*) Short-term investments, which consist of investments with maturities of
30 days or less, are considered cash equivalents
Schedule IV
HOME BENEFICIAL CORPORATION
(CONSOLIDATED)
REINSURANCE
Years Ended December 31, 1994, 1993 and 1992
Column A Column B Column C Column D Column E Column F
% of
Ceded Assumed amount
Gross to other from other Net assumed
amount companies companies amount to net
1994:
Life insurance
in force $4,641,841,621 $ 96,625,275 $5,678,611,343 $10,223,827,689 55.5%
Premiums:
Life insurance $88,367,544 $468,895 $19,057,921 $106,956,570 17.8%
Accident and
health insurance 8,371,165 - 743,687 9,114,852 8.2
Total premiums $96,738,709 $468,895 $19,801,608 $116,071,422 17.1%
1993:
Life insurance
in force $4,622,917,075 $101,565,145 $5,467,245,347 $9,988,597,277 54.7%
Premiums:
Life insurance $88,754,881 $452,023 $18,788,760 $107,091,618 17.5%
Accident and
health insurance 8,482,576 2,916 797,843 9,277,503 8.6
Total premiums $97,237,457 $454,939 $19,586,603 $116,369,121 16.8%
1992:
Life insurance
in force $4,640,207,175 $ 99,371,137 $5,250,622,272 $9,791,458,310 53.6%
Premiums:
Life insurance $88,409,010 $383,224 $19,624,622 $107,650,408 18.2%
Accident and
health insurance 9,284,564 2,713 1,014,008 10,295,859 9.8
Total premiums $97,693,574 $385,937 $20,638,630 $117,946,267 17.5%
SIGNATURES
Pursuant to the requirements of Section 12 or 15(d) of the Securities
Exchange Act of 1934 the Registrant has duly caused this Annual Report to be
signed on its behalf by the undersigned, thereunto duly authorized.
HOME BENEFICIAL CORPORATION
Registrant
By: H. D. Garnett
Vice President and Controller, 3/21/95
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Annual Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
R. W. Wiltshire
Chairman of the Board and Director, 3/21/95
C. M. Glenn, Jr.
Retired Vice President, Treasurer and Director, 3/21/95
L. W. Richardson
Retired Vice President and Director, 3/21/95
R. W. Wiltshire, Jr.
President, Chief Executive Officer and Director, 3/21/95
J. M. Wiltshire, Jr.
Vice President, Counsel, Secretary and Director, 3/21/95
W. B. Wiltshire
Vice President and Director, 3/21/95
H. D. Garnett
Vice President, Controller and Director, 3/21/95
G. T. Richardson
Vice President and Director, 3/21/95
W. G. Hancock
Counsel and Director, 3/21/95
Dianne N. Collins
Director, 3/21/95
HOME BENEFICIAL CORPORATION
Index to Exhibits
(Items 14(c))
Sequential
Page
Number
EXHIBITS
2 - Plan of acquisition, reorganization, arrangement, liquidation or
succession - Not applicable -
3(i) - Restated Articles of Incorporation (incorporated herein by
reference from December 31, 1993 Form 10-K -
(ii)- Bylaws incorporated herein by reference from December 31, 1992
Form 10-K -
4 - Instruments defining the rights of security holders, including
indentures - See Article III of the Restated Articles of Incorporation
incorporated herein by reference from December 31, 1993 Form 10-K -
9 - Voting Trust Agreement dated May 1, 1984, effective May 31, 1984, and
Voting Trust Extension Agreement dated May 1, 1987, effective May 11,
1987 incorporated herein by reference from December 31, 1992 Form 10-K -
10 - Material Contracts - Consulting and compensation agreements with C. M.
Glenn, Jr. and L. W. Richardson who are present Directors of the
Corporation incorporated herein by reference from December 31, 1992
Form 10-K. Supplemental Compensation Agreement with R. W. Wiltshire,
Chairman of the Board of Directors of the Corporation incorporated
herein by reference from September 30, 1993 Form 10-Q -
11 - Statement reference computation of per share earnings - Not applicable -
12 - Statement reference computation of ratios - Not applicable -
13 - Annual Report to Security Holders
With the exception of the information incorporated by reference into
Items 1, 5, 6, 7 and 8 of this Form 10-K, the 1994 Annual Report to
Stockholders is not deemed filed as part of this report 32-54
16 - Letter reference change in certifying accountant - Not applicable -
18 - Letter reference change in accounting principles - Not applicable -
21 - Subsidiaries of the Registrant incorporated herein by reference from
December 31, 1989 Form 10-K -
22 - Published report regarding matters submitted to vote of security holders
- Not applicable -
23 - Consents of experts and counsel
24
24 - Power of Attorney - Not applicable -
27 - Financial Data Schedule
55
28 - Information from reports furnished to state insurance regulatory
authorities - Not applicable -
99 - Additional exhibits - Not applicable -
EXHIBIT 27 - FINANCIAL DATA SCHEDULE
ARTICLE 7 of Regulation S-X
Type Ex-27
Description Article 27 FDS for 10-K
Article 7
Period - Type 12 mons
Fiscal year-end Dec 31 1994
Period-end Dec 31 1994
Debt held for sale 691,976,855
Debt carrying value 0
Debt market value 0
Equities 24,229,849
Mortgage 338,458,261
Real estate 0
Total invest 1,146,717,259
Cash 1,726,812
Recover reinsure 0
Deferred acquisition 96,246,153
Total assets 1,288,826,060
Policy losses 660,081,842
Unearned premiums 25,658,167
Policy other 11,004,362
Policyholder funds 65,821,085
Notes payable 0
Preferred mandatory 0
Preferred 0
Common 5,488,784
Other SE 461,281,150
Total liability & Equity 1,288,826,060
Premiums 116,071,422
Investment income 84,902,022
Investment gains (42,592)
Other income 0
Benefits 91,098,014
Underwriting amortization 13,221,175
Underwriting - Other 41,015,687
Income - Pretax 55,595,576
Income tax 19,400,000
Income - Continuing 36,195,976
Discontinued 0
Extraordinary 0
Changes 0
Net income 36,195,976
EPS - Primary 2.04
EPS - Diluted 2.04
Reserve Open 0
Provision - Current 0
Provision - Prior 0
Payments - Current 0
Payments - Prior 0
Reserve Close 0