<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[AHL LETTERHEAD]
1776 American Heritage Life Drive
Jacksonville, Florida 32224
Telephone 904/992-1776
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 30, 1998
NOTICE IS HEREBY GIVEN that the Annual Meeting of the Shareholders of
American Heritage Life Investment Corporation (the "Company") will be held in
the Auditorium of the American Heritage Life Building, on the First Floor, at
1776 American Heritage Life Drive, Jacksonville, Florida, on Thursday, April 30,
1998, at 9:00 A. M., Jacksonville time, for the following purposes:
1. To elect three (3) Class I Directors to serve until the Annual
Meeting of Shareholders in 2001;
2. To amend the Company's Amended and Restated Articles of
Incorporation to increase the number of authorized shares of
the Company's Common Stock, par value $1.00 per share, from
35,000,000 to 75,000,000; and
3. To transact such other business as may properly come before
the meeting or any adjournment thereof.
Only shareholders of record at the close of business on February 18,
1998, will be entitled to vote at the meeting or at any adjournment thereof.
Please sign the accompanying proxy and return it to the Company in the
return envelope enclosed for your use. If you attend the meeting in person, you
may revoke your proxy at such meeting and cast your vote in person.
A copy of the Company's annual report for the year ended December 31,
1997, which report contains consolidated financial statements and other
information of interest with respect to the Company and its subsidiaries, is
enclosed.
By order of the Board of Directors,
Christopher A. Verlander, Corporate Secretary
March , 1998
PLEASE DATE, SIGN AND MAIL THE ENCLOSED PROXY PROMPTLY. NO POSTAGE IS
REQUIRED IF MAILED IN THE UNITED STATES IN THE ACCOMPANYING ENVELOPE.
<PAGE> 3
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION
1776 AMERICAN HERITAGE LIFE DRIVE
JACKSONVILLE, FLORIDA 32224
(904) 992-1776
March , 1998
-----------------------------
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
by management of proxies for use at the 1998 Annual Meeting of Shareholders of
American Heritage Life Investment Corporation (the "Company") to be held on
April 30, 1998 and any adjournments thereof. It is expected that this Proxy
Statement and the enclosed form of proxy will be mailed to shareholders
commencing on or about March , 1998. If the enclosed form of proxy is executed
and returned, it will be voted at the meeting and, where no choice has been
specified thereon, will be voted for the election of the directors, and the
other matters contained thereon. A proxy may be revoked at any time to the
extent that it has not been exercised. A shareholder may revoke his or her proxy
by (a) writing the Secretary of the Company a letter of proxy revocation, (b)
executing a subsequently dated proxy, or (c) attending the shareholders' meeting
and voting his or her shares personally. The cost of preparing and assembling
the proxy materials and soliciting proxies will be borne by the Company. In
addition to the solicitation by mail, a number of regular employees of the
Company may solicit proxies in person or by telephone or other means of
communication. Brokers, dealers, banks and their nominees who hold shares for
the benefit of others will be asked to send proxy material to the beneficial
owners of the shares. The Company will reimburse them for their reasonable
expenses.
Only shareholders of record at the close of business on February 18,
1998 will be entitled to vote. On that date there were outstanding
shares of the Company's common stock, par value $1.00 per share, which stock is
the only class of outstanding voting securities of the Company (the "Shares").
On that date there were issued 431,084 shares of the Company's Class A
Non-Convertible Preferred Stock, par value $10.00 per share, to two wholly-owned
subsidiaries of the Company and accordingly were not entitled to vote. No shares
of its Class B Convertible Preferred Stock, par value $10.00 per share, are
outstanding. Each Share is entitled to one vote at the meeting. Robert D. Davis,
T. O'Neal Douglas and W. Ashley Verlander or any one of them have been
designated as proxies to vote the Shares solicited hereby. The Shares are not
subject to cumulative voting.
MATTERS TO BE CONSIDERED
The Company shareholders will consider and act upon proposals (i) to elect
three (3) Class I Directors to serve until the annual meeting of shareholders
in 2001 and until their respective successors are elected and qualified, (ii)
to amend the Company's Amended and Restated Articles of Incorporation to
increase the number of authorized Shares of the Company's Common Stock from
35,000,000 to 75,000,000, and (iii) to transact such other business as may
properly come before the meeting or any adjournment thereof.
ELECTION OF DIRECTORS
The directors of the Company are divided into three different classes
with each class being elected for a three-year term. Proxies are solicited for
the election of Class I of the directors to serve until the annual meeting of
shareholders in 2001 and until the successors of the members of that class are
elected and qualified. Class I includes Edward L. Baker, Robert D. Davis and
Christopher A. Verlander who are members of the present Board of the Company,
all of whom having been last elected to the Board at the 1995 Annual Meeting of
Shareholders. The enclosed proxy, unless otherwise specified, will be voted in
favor of the election of the above named directors for the period indicated. The
above named directors also serve as members of the Board of American Heritage
Life Insurance Company (the "Insurance Company"), a wholly-owned subsidiary of
the Company. Management believes the nominees will be able to serve; however, if
any one of them should be unable to serve; the proxies may be voted with
discretionary authority for a substitute designated by management and in the
absence of a substitute the size of the Board would be reduced.
1
<PAGE> 4
The bylaws of the Company provide that its Board consist of eight
directors as follows: three directors in Class I, two directors in Class II and
three directors in Class III, each of which classes is elected for a three year
term.
Certain information concerning the directors of the Company, including
their principal occupations for the past five or more years, is set forth below:
<TABLE>
<CAPTION>
CLASS AND
ANNUAL
BENEFICIALLY OWNED MEETING
PRINCIPAL AT JANUARY 31, 1998(1) DATE AT WHICH TERM
OCCUPATION -------------------------- FIRST BECAME AS DIRECTOR
DIRECTORS OR EMPLOYMENT SHARES PERCENTAGE DIRECTOR AGE WILL EXPIRE
--------- ------------- ------------- ---------- -------------- --- -----------
<S> <C> <C> <C> <C> <C> <C>
Edward L. Chairman of the Board, 16,626 .06 April 28, 1994 62 Class I
Baker Florida Rock Industries, Inc., 1998
Jacksonville, Florida (Con-
struction Products Company)
Robert D. Davis Chairman of the Board of 27,444(2) .10 Oct. 7, 1968 66 Class I
D.D.I., Inc., Jacksonville, 1998
Florida (Investments)
Christopher A. Vice Chairman and 120,760(4) .44 July 30, 1987 50 Class I
Verlander (2) Corporate Secretary of the 1998
Company and the Insurance
Company since August, 1997;
President and Chief Operating
Officer of the Company
1996-1997; President of
the Insurance Company
1994-1997; Executive Vice
President of the Company
1990-1996; Corporate
Secretary 1985-1994 of the
Company and the Insurance
Company; Executive Vice
President of the Insurance
Company 1990-1994
A. Dano Davis Chairman of the Board 116,062(2) .41 June 25, 1993 52 Class II
and Principal Executive 1999
Officer, Winn-Dixie Stores, Inc.,
Jacksonville, Florida
(Retail Grocery Chain)
T. O'Neal Chairman of the Board 260,844(5) .95 July 30, 1987 62 Class II
Douglas since 1994, Chief 1999
Executive Officer since
1990, President 1990-April,
1996 of the Company;
Chairman of the Board
since 1994, Chief Executive
Officer since 1990 and
President 1986-1994
of the Insurance Company
H. Corbin Day Chairman of the Board of 149,380(6) .54 June 25, 1993 60 Class III
Jemison Investment Co., Inc., 2000
Birmingham, Alabama
(Investment Banking Firm)
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
CLASS AND
ANNUAL
BENEFICIALLY OWNED MEETING
PRINCIPAL AT JANUARY 31, 1998(1) DATE AT WHICH TERM
OCCUPATION -------------------------- FIRST BECAME AS DIRECTOR
DIRECTORS OR EMPLOYMENT SHARES PERCENTAGE DIRECTOR AGE WILL EXPIRE
--------- ------------- -------------- ---------- ------------ --- -----------
<S> <C> <C> <C> <C> <C> <C>
Radford D. Chairman of the Board, 29,562 .11 Feb. 9, 1989 64 Class III
Lovett Commodores Point 2000
Terminal Corp.,
Jacksonville, Florida
(Marine Terminal)
W. Ashley Retired Chairman of the 320,830(7) 1.16 Oct. 7, 1968 78 Class III
Verlander (3) Board, President and Chief 2000
Executive Officer of the
Company and the Insurance
Company
All Directors of the Company and
Executive Officers of the Company and
its subsidiaries as a group (16 persons) 1,213,846(2)(8) 4.37
</TABLE>
- ------------------
(1) Share amounts reflect a two-for-one stock split in the form of a stock
dividend payable March 4, 1998 to shareholders of record February 18,
1998.
(2) In addition, Robert D. Davis and A. Dano Davis, who are first cousins,
are directors and officers of D.D.I., Inc. and Estuary Corporation.
Trusts, of which Robert D. Davis and A. Dano Davis are sole or
co--trustees, and, of certain trusts, beneficiaries, Estuary
Corporation, FND, Ltd., ADSONS, Inc. and ADFAM Partners, Ltd., are
shareholders of D.D.I., Inc. Trusts, of which A. Dano Davis is sole or
co-trustee, and, of certain trusts, beneficiary, are the principal
shareholders of Estuary Corporation. D.D.I., Inc. and Estuary
Corporation are limited partners of AHLI, Ltd., a limited partnership,
and D.D.I., Inc. and Estuary Corporation are the members of a limited
liability corporation, the sole general partner of AHLI, Ltd. Robert D.
Davis is an officer and manager and A. Dano Davis is a manager of the
limited liability corporation for which they have shared voting and
dispositive powers.
A. Dano Davis is a director and officer of James E. Davis
Family--WD Charities, Inc. a private charitable foundation. Estuary
Corporation is the sole general partner of FND, Ltd. and Robert D.
Davis and A. Dano Davis share voting and dispositive power for shares
held by FND, Ltd. Robert D. Davis is sole trustee and beneficiary of
his revocable trust and sole trustee of three additional trusts, all of
which are limited partners of ADFAM Partners, Ltd. and his revocable
trust is a 50 percent shareholder of a corporation, which is one of two
general partners of ADFAM Partners, Ltd. Robert D. Davis has authority
to replace the current trustee of a Trust which is also a general
partner of ADFAM Partners, Ltd. Robert D. Davis is a director and
officer of ADSONS, Inc., which is wholly owned by ADFAM Partners, Ltd.
A. Dano Davis disclaims any beneficial interest in the shareholdings of
James E. Davis Family--WD Charities, Inc.
At January 31, 1998, these entities held the following Shares:
<TABLE>
<CAPTION>
PERCENTAGE OF
NAMED ENTITY NO. OF SHARES OUTSTANDING SHARES
- ------------ ------------- ------------------
<S> <C> <C>
AHLI, Ltd. 10,797,178 38.53%
D.D.I., Inc. 264,800* .09%
FND, Ltd. 76,798 .27%
ADFAM Partners, Ltd. 47,696 .17%
James E. Davis Family--
WD Charities, Inc. 39,998 .14%
</TABLE>
The shares reported for DDI represent the equivalent shares of
common stock which would be received upon the settlement of 100,000
purchase contracts held by DDI. Such contracts which are required to be
settled on August 16, 2000, may be settled earlier at the option of the
holder.
3
<PAGE> 6
A. Dano Davis is co-trustee for trusts for the benefit of his
sister and his sister's children which hold an aggregate of 116,756
Shares. A. Dano Davis disclaims any beneficial interest in the
shareholdings of such trusts. Also, A. Dano Davis is co-trustee for
trusts for the benefit of him and his children which hold an aggregate
of 38,246 Shares. A. Dano Davis' wife is personal representative and a
beneficiary of her mother's estate which holds 9,750 shares.
Principally through a limited partnership, the Davis Family holds
42.25% of the Shares. For information concerning Shares held by certain
members of the Davis family and their associates, see "Principal
Shareholders."
(3) Christopher A. Verlander is the son of W. Ashley Verlander.
(4) Includes 19,486 Shares which are subject to presently exercisable
options.
(5) Includes 72,706 Shares which are subject to presently exercisable
options.
(6) Includes 94,494 Shares held by Jemison Investment Co., Inc. of which
Mr. Day has shared voting and dispositive power.
(7) Includes 53,330 Shares owned by the wife of Mr. Verlander as to which
beneficial ownership is disclaimed.
(8) Includes 148,254 Shares which are subject to presently exercisable
options.
DIRECTORS OF THE INSURANCE COMPANY
The Company, as sole shareholder of the Insurance Company, intends to
elect the following persons to the Board of Directors of the Insurance Company
at its annual shareholder meeting also to be held on April 30, 1998, all of whom
are presently members of the Board thereof. The term of office for that Board is
for one year and until the 1999 annual meeting.
<TABLE>
<S> <C>
F. Duane Ackerman Robert D. Davis
President and Chief Executive Officer, Chairman of the Board
BellSouth Corporation D.D.I., Inc.
Atlanta, Georgia Jacksonville, Florida
(Telecommunications) (Investments)
Edward L. Baker H. Corbin Day
Chairman of the Board Chairman of the Board
Florida Rock Industries, Inc. Jemison Investment Co., Inc.
Jacksonville, Florida Birmingham, Alabama
(Construction Products Company) (Investment Banking Firm)
I. Jon Brumley T. O'Neal Douglas
Chairman of the Board and Chairman of the Board and
Chief Executive Officer, Chief Executive Officer of the Company
Mesa, Inc. and the Insurance Company
Fort Worth, Texas
(Oil and Gas Production Company)
Langdon S. Flowers
John Ellis "Jeb" Bush* Retired Chairman of the Board
President, Codina Group, Inc. Flowers Industries, Inc.
Coral Gables, Florida (Real Estate) Thomasville, Georgia
(Food Manufacturing and Distribution)
Alvin R. "Pete" Carpenter
President and Chief Executive Officer, Radford D. Lovett
CSX Transportation, Inc. Chairman of the Board
Jacksonville, Florida Commodores Point Terminal Corp.
(Transportation) Jacksonville, Florida
(Marine Terminal)
A. Dano Davis
Chairman of the Board Clarence V. McKee
and Principal Executive Officer Chairman of the Board,
Winn-Dixie Stores, Inc. Chief Executive Officer
Jacksonville, Florida and President
(Retail Grocery Chain) McKee Communications, Inc.
Tampa, Florida
(Communications)
</TABLE>
4
<PAGE> 7
<TABLE>
<S> <C>
C. Richard Morehead Jay Stein
President and Chief Operating Officer Chairman of the Board and Chief
of the Company and the Insurance Company Executive Officer
Stein Mart, Inc.
Jacksonville, Florida
Patricia G. Moran (Retail Department Store Chain)
President and Chief Executive Officer,
JM Family Enterprises, Inc. Rolf H. Towe
Deerfield Beach, Florida Senior Partner
(Automotive Distributor) The Clipper Group, L.P.
New York, New York
Herbert H. Peyton (Investments)
President
Gate Petroleum Company Christopher A. Verlander
Jacksonville, Florida Vice Chairman and Corporate Secretary
(Petroleum Products Retailing) of the Company and the Insurance
Company
Frederick H. Schultz
Private Investor W. Ashley Verlander
Jacksonville, Florida; Retired Chairman of the Board of the
Former Vice Chairman of the Company and the Insurance Company
Board of Governors of the
Federal Reserve System
Washington, D.C.
* on temporary leave-of-absence
</TABLE>
CORPORATE GOVERNANCE
The Company's Board of Directors had four regular quarterly meetings
and one special meeting during 1997. The Company's Executive Committee,
consisting of Robert D. Davis, W. Ashley Verlander, T. O'Neal Douglas, Edward L.
Baker, Radford D. Lovett and Christopher A. Verlander, had seven regular monthly
meetings during 1997 and one special meeting in March; omitting regular meetings
for the months in which the Company's quarterly board meetings were held. The
Finance and Investment Committee, which consists of the same members as the
Executive Committee except for Mr. Baker, had seven meetings in 1997. The
Executive, and Finance and Investment Committees have been delegated broad
authority to act on behalf of the Board of Directors on an interim basis between
board meetings. The compensation paid all senior officers of the Company and its
subsidiaries is determined by the Compensation Committee consisting of Robert D.
Davis, Radford D. Lovett and H. Corbin Day. This committee met four times during
1997. The Company's Audit Committee met three times during 1997 with the
Company's independent auditors and certain officers of the Company and its
subsidiaries. During these meetings, the nature and scope of the services
performed on behalf of the Company by the independent auditors and the results
of their auditing activities were considered and discussed, and the committee
received reports from the Insurance Company's internal auditor. This committee
currently consists of Radford D. Lovett, Edward L. Baker and Robert D. Davis.
All of the directors attended at least 75% of the meetings of the Board of
Directors and of the committees of the Board of which they were members, except
for Mr. Edward L. Baker who was absent from one Board meeting, one Audit
Committee meeting and three meetings of the Executive Committee. The Company
does not have a directors nominating committee.
5
<PAGE> 8
EXECUTIVE COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT
EXECUTIVE COMPENSATION
Shown below is information concerning the annual and long-term
compensation for services in the capacities to the Company and its subsidiaries
for the years ended December 31, 1997, 1996 and 1995, of those persons who were
at December 31, 1997, (i) the Chief Executive Officer and (ii) the other four
most highly compensated executive officers of the Company (the "Named
Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------
ANNUAL COMPENSATION AWARDS (3) PAYOUTS
------------------------------- --------------------- -------
NAME OTHER
AND ANNUAL RESTRICTED LTIP ALL OTHER
PRINCIPAL INCENTIVE COMPEN- STOCK OPTIONS/ PAY- COMPEN-
POSITION YEAR SALARY AWARD (3) SATION AWARDS (4) SARS(#)(7) OUTS (5) SATION
- ----------------------------- ---- ------ --------- ------ ---------- ---------- -------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
T. O'Neal Douglas 1997 $500,000 $248,500 $5,762 $124,236 19,814 $84,117 $31,743(6)
Chairman of the Board and 1996 471,955 237,500 -- 118,755 27,536 93,443 31,351
Chief Executive Officer(1)(2) 1995 456,900 142,553 -- 71,279 18,902 63,647 29,284
Christopher A. Verlander 1997 242,190 96,295 598 48,132 7,678 32,114 22,688(6)
Vice Chairman and Corporate 1996 231,382 93,150 -- 46,568 10,800 33,958 21,334
Secretary and Director(1)(2) 1995 217,875 54,382 -- 27,198 7,210 12,629 21,637
C. Richard Morehead 1997 229,102 104,370 482 52,200 8,322 17,647 22,945(6)
President and Chief 1996 198,013 79,716 -- 33,889 7,856 18,649 21,646
Operating Officer (1)(2); 1995 191,625 52,945 -- 14,937 3,964 12,629 24,257
Director (2)
John K. Anderson Jr 1997 218,077 77,056 4,851 32,760 5,222 -- 26,530(6)
Executive Vice-President,
Treasurer and Chief
Financial Officer (1)(2)
David A. Bird 1997 155,524 66,304 112 28,188 4,494 11,142 20,715(6)
Executive Vice-President 1996 126,287 47,750 -- 15,881 3,684 9,807 19,894
and Chief Marketing 1995 120,750 27,042 -- 9,425 2,498 -- 19,980
Officer (1)(2)
</TABLE>
- ------------------------------
(1) Of the Company.
(2) Of the Insurance Company.
(3) Represents awards and amounts earned in specified year but granted or
paid in the following year.
(4) Represents market value of Shares on date of grant. Number of Shares
and market value of all restricted stock owned by the Named Officers at
December 31, 1997 were as follows: Mr. Douglas 26,760 Shares, $481,680;
Mr. Verlander 10,096 Shares, $181,728; Mr. Morehead 6,180 Shares,
$111,240 and Mr. Bird 3,238 Shares, $58,284. Shares and market values
at December 31, 1997 do not include awards earned in 1997 but granted
in 1998. Shares are restated to reflect the stock split in February,
1998 (see footnote (7)).
(5) Represents cash award and market value of Shares on date of grant made
during specified year.
(6) Includes (a) Contributions to the Employees' Profit Sharing Retirement
Program of American Heritage Life Insurance Company (Mr. Douglas
$16,000, Mr. Verlander $16,000, Mr. Morehead $16,000, Mr. Anderson
$16,000 and Mr. Bird $16,000), (b) Premiums on group life and accident
and health policies (Mr. Douglas $14,476, Mr. Verlander $6,553,
Mr. Morehead $6,180, Mr. Anderson $7,785 and Mr. Bird $4,220), (c)
Contributions to the Stock Investment Plan (Mr. Douglas $1,267,
Mr. Verlander $135, Mr. Morehead $765, Mr. Anderson $2,745 and Mr. Bird
$495.)
(7) Number of shares have been restated to reflect a two-for-one stock
split in the form of a stock dividend payable March 4, 1998 to
shareholders of record February 18, 1998.
6
<PAGE> 9
OPTION/SHAREHOLDER APPRECIATION RIGHTS GRANTS TABLE
Shown below is information for the year ended December 31, 1997, with
respect to option/shareholder appreciation rights ("SARs") grants to purchase
the Shares granted to the Named Officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR(1)
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF STOCK
PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (5)
----------------------------------------------- -----------------------
% OF TOTAL
NUMBER OF OPTIONS
SECURITIES GRANTED TO
UNDERLYING EMPLOYEES EXERCISE EXPIRA-
OPTIONS IN FISCAL PRICE/ TION
NAME GRANTED (2) YEAR SHARE(2) DATE 0%(6) 5% 10%
- ------------------------ ----------- ---------- -------- ---- ----- -- ---
<S> <C> <C> <C> <C> <C> <C> <C>
T. O'Neal Douglas 27,356(1)(3) 5% $11.44 1/07 $0
T. O'Neal Douglas 100,000(4) 18 17.50 8/07 0
Christopher A. Verlander 10,800(1)(3) 2 11.44 1/07 0
Christopher A. Verlander 70,000(4) 12 17.50 8/07 0
C. Richard Morehead 7,846(1)(3) 1 11.44 1/07 0
C. Richard Morehead 70,000(4) 12 17.50 8/07 0
John K. Anderson, Jr 50,000(4) 9 17.50 8/07 0
David A. Bird 3,684(1)(3) 1 11.44 1/07 0
David A. Bird 50,000(4) 9 17.50 8/07 0
</TABLE>
(1) Represents grants made in 1997 which were earned in 1996.
(2) Amounts restated to reflect a two-for-one stock split in the form of a
stock dividend payable March 4, 1998 to shareholders of record
February 18, 1998.
(3) Options become exercisable at a cumulative annual rate of 33%
commencing in 1997.
(4) Options become exercisable at a rate of 20% per year commencing in
1998, contingent upon achieving specified annual increases in the
earnings from operations of the Company.
(5) The dollar amounts under these columns are the result of calculations
at 0% and at the 5% and 10% rates set by the Securities and Exchange
Commission and therefore are not intended to forecast possible future
appreciation, if any, of the Company's stock price. The Company did not
use an alternative formula for a grant date valuation, as the Company
is not aware of any formula which will determine with reasonable
accuracy a present value based on future unknown or volatile factors.
(6) No gain to the optionees is possible without an increase in stock price
appreciation, which will benefit all shareholders commensurately. A
zero percent gain in stock price appreciation will result in zero
dollars for the optionee.
OPTION EXERCISES AND YEAR-END VALUE TABLE
Shown below with respect to the Named Officers is the aggregate
options exercised for the year ended December 31, 1997, the values realized and
the number of unexercised options and the value of the unexercised options
appreciation value at December 31, 1997.
AGGREGATE OPTION EXERCISES IN 1997 AND DECEMBER 31, 1997 OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
NUMBER 12/31/97(1) 12/31/97
OF SHARES
ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(1) REALIZED UNEXERCISABLE UNEXERCISABLE
- ------------------------ -------------- -------- -------------- ---------------
<S> <C> <C> <C> <C>
T. O'Neal Douglas 18,346 $484,313 72,706/176,036 $590,444/641,007
Christopher A. Verlander 12,462 366,000 19,486/101,930 159,054/286,815
C. Richard Morehead 10,752 285,000 14,528/94,874 117,899/235,990
John K. Anderson -- -- --/50,000 --/25,000
David A. Bird -- -- 2,822/56,348 22,977/69,041
</TABLE>
- ------------------
(1) Amounts restated to reflect a two-for-one stock split in the form of a
stock dividend payable March 4, 1998 to shareholders of record February
18, 1998.
7
<PAGE> 10
LONG-TERM INCENTIVE PLAN AWARDS TABLE
The restricted stock awards to Named Officers are listed in the
"Executive Compensation--Summary Compensation Table" on page 6. The performance
unit feature of the Long-Term Incentive Plan provides the participating employee
the opportunity to earn cash and Shares if corporate performance meets
predetermined three-year financial goals.
The plan awards are earned over a three-year period. The performance
unit grants outlined below, if earned, would be paid in early fiscal year 2000
for results in the 1997-99 performance period.
LONG-TERM INCENTIVE PLAN--AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
ESTIMATED FUTURE PAYOUTS
AMOUNT OF UNDER NON-STOCK PRICE BASED PLANS
PERFORMANCE PERFORMANCE -----------------------------------------
UNITS PERIOD THRESHOLD TARGET MAXIMUM
NAME GRANTED COVERED ($) ($) ($)
- ------------------------ ----------- ---------- --------- ------ -------
<S> <C> <C> <C> <C> <C>
T. O'Neal Douglas $124,250 1997-99
Christopher A. Verlander 48,147 1997-99
C. Richard Morehead 52,185 1997-99
John K. Anderson, Jr. 32,749 1997-99
David A. Bird 28,179 1997-99
</TABLE>
ANNUAL INCENTIVE COMPENSATION PLAN
The Company has an Amended and Restated Annual Incentive Compensation
Plan (the "Annual Incentive Plan") to provide additional compensation to all
officers of the Company and its subsidiaries. This Plan provides annual
incentive compensation based upon the participating employee's performance in
relation to predetermined performance goals established by the Company's
Compensation Committee. Individual target incentive award opportunities are
established based upon the impact the various eligible positions are deemed to
have in the Company or its subsidiaries. If the predetermined financial
performance goals are exactly met, the award for a participating employee would
be equal to the amount assigned to such employee at the beginning of the
particular fiscal year. Actual awards for any fiscal year may range from 0% to
150% of the targeted award opportunities, depending upon how actual performance
during the fiscal year compares to such predetermined performance goals.
Performance goals for each fiscal year ended are based upon the growth
in operating earnings of the Company or the growth in operating earnings and the
growth in premium and equivalent revenues of a particular business unit of the
Insurance Company in which the participating employee is involved. Payments of
annual incentive awards are made within 30 days after the date on which the
Company's independent certified public accountants have issued their opinion on
the Company's financial statements for the fiscal year to which the incentive
awards relate and after it has been determined that statutory earnings are
sufficient to pay dividends to stockholders.
The Company paid in 1998, aggregate annual incentive awards in the
amount of $1,164,652 with respect to 1997 performance. For information
concerning awards to Named Officers pursuant to the Annual Incentive Plan
reference is made to "Executive Compensation--Summary Compensation Table."
LONG-TERM INCENTIVE PLAN
The Company has an Amended and Restated Long-Term Incentive Plan (the
"Long-Term Incentive Plan") which provides for the grant to certain officers of
the Company and its subsidiaries of (1) stock options, (2) restricted stock and
(3) performance units (as described below).
The stock option feature of the Long-Term Incentive Plan provides to
senior officers the grant of options to purchase Shares at their fair market
value on the date of grant. The right to exercise these stock options will
commence one year after grant and will vest at the rate of one-third per year on
a cumulative basis thereafter. These options have a term of up to ten years.
Although the stock options will terminate with the termination of employment, if
such termination is the result of retirement, disability or death, or is
involuntary, the Compensation Committee may extend the right to exercise
8
<PAGE> 11
such option to such retired or disabled employee or his or her guardian and, in
the case of death, to the personal representative of such employee.
The granting of such options is dependent upon the Company's
performance for the prior fiscal year. During 1997, options to purchase 70,424
Shares (restated for the two-for-one stock split) were granted relative to 1996
performance.
The restricted stock feature of the Long-Term Incentive Plan provides
for the grant of Shares of restricted stock to a participating employee. The
number of Shares of restricted stock available to be issued in the name of each
participating employee is determined at the beginning of each fiscal year by the
Compensation Committee based on the prior year's operating results. Such Shares
are held by the Company in the name of the participating employee, who has the
right to vote and to receive dividends paid on all such Shares.
The number of Shares issued to each participating employee is based
upon achieving a target award level established for such employee and the market
price of the Shares at the time the grant is made. During the period of
restriction such Shares may not be sold, transferred or pledged. Such Shares are
subject to forfeiture to the Company, in whole or in part, if the participating
employee does not remain in the Company's employ for three years after the date
of grant. The Compensation Committee, at is sole discretion, may waive such
forfeiture provisions, in whole or in part, in the event that termination of
employment occurs as a result of retirement, death or disability, or is
involuntary. Upon vesting, all restrictions as to transferability will terminate
and all Shares held in the name of a participating officer will thereafter be
freely transferable except to the extent limited by federal securities laws.
The granting of such awards is dependent upon the Company's performance
for the prior fiscal year. During 1997, 34,432 Shares (restated for the
two-for-one stock split) were granted relative to 1996 performance.
The performance units feature of the Long-Term Incentive Plan provides
to a participating employee the opportunity to earn cash and Shares if corporate
performance meets predetermined three-year financial goals. A target award is
established for each participating employee, and payments ranging from 0% to
150% of the targeted award may result, depending upon actual performance over
the following three-year period.
At the end of each performance period, the Compensation Committee will
determine the value of performance units based on actual Company performance as
compared with the predetermined financial goals. When the value of an award is
determined, half of the award will be paid in cash and half will be paid in
Shares based on the market value of a Share at payment date.
If a participating employee's employment is terminated for any reason
during the performance period, he or she shall automatically forfeit all rights
to receive payment for any outstanding performance units. The Compensation
Committee may, however, determine to prorate the amounts payable as awards of
performance units, in whole or in part, in the event that the termination of a
participating employee occurs as a result of retirement, death or disability.
The performance unit feature of the Long-Term Incentive Plan is based
upon three-year performance periods, the first of which commenced on January 1,
1992. During 1997 the Company made aggregate awards pursuant to the performance
unit feature of the Long-Term Incentive Plan of 11,734 Shares (restated for the
two-for-one stock split) and $154,021 for the three year period ended December
31, 1996.
For information concerning awards to Named Officers pursuant to the
Long-Term Incentive Plan see "Executive Compensation--Summary Compensation
Table."
MANAGEMENT SECURITY PLAN
The Company has a Management Security Plan, which essentially is a
deferred compensation plan, which provided at December 31, 1997, benefits for 28
key employees of the Company and its subsidiaries.
This plan provides in the event a senior officer participant dies prior
to age 65 that his or her beneficiary will receive 100% of such participant's
monthly salary, as set forth in the plan, for a
9
<PAGE> 12
period of 12 months and, thereafter, 50% of that monthly salary until such time
as such participant would have reached age 65, provided, however, that such 50%
payments are for a minimum of nine years in the event of the participant's death
between the ages of 55 and 65. For senior officers with an agreed upon later
retirement age, his or her beneficiary will receive a pre-determined amount for
120 months. For all other participants in the plan who die prior to age 65, his
or her beneficiary will receive two-thirds of such participant's monthly salary,
as set forth in the plan, for a period of 12 months and, thereafter, one-third
of that monthly salary until such time as such participant would have reached
age 65 provided, however, that such one-third payment will be made for at least
nine years regardless of the age at the death of such participant.
This plan also provides a retirement benefit which is based on a
participant's age at entry into the plan and salary, as set forth in the plan. A
portion of this retirement benefit will be paid to a participant's beneficiary
if the participant dies after retirement at age 65. For senior officers, the
remainder will be paid in monthly installments for the greater of ten years or
the lifetime of the participant if such participant has ten or more years of
service with the Company at the time of his/her retirement from the Company.
Alternatively, for senior officers who are not employees of the Company at
retirement and for all other participants such payments will be made over a
ten-year period beginning at retirement age whether the participant is alive or
dead. This plan has certain provisions for early retirement and vesting prior to
age 65.
The annual retirement benefit, upon reaching age 65 or an agreed to
later age, payable for life but not less than ten years under this plan for
Messrs. Douglas, Verlander, Morehead, Anderson and Bird would be $487,968,
$237,804, $197,760, $122,532, and $148,560, respectively.
STOCK INVESTMENT PLAN
The Company has a Stock Investment Plan authorizing the purchase in the
open market on behalf of participating employees and directors of up to an
aggregate of 400,000 Shares. The payment for the Shares is accomplished by a
payroll deduction plan established by participating employers, which are
subsidiaries of the Company. Each employer contributes the following percentages
of each of its respective participating employees' total monthly payroll
deductions: (a) 25% of amounts of from $5 through $25, (b) 20% of amounts in
excess of $25 through $50, and (c) 15% of amounts in excess of $50 through
$1,500. Directors of the Company or its subsidiaries may elect to participate in
this plan. A participating director may have deductions made from such
director's fees. The Company pays all commissions and related expenses of this
plan. During the year ended December 31, 1997, the Company's participating
subsidiaries contributed pursuant to this plan an aggregate of $77,953 and
$4,928 on behalf of participating employees and two directors of the Company,
respectively. The two directors were Mr. Baker and Mr. Day for which the Company
made a contribution of $2,558 and $2,370, respectively.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the following
report and the information included under the "Shareholder Return Performance
Presentation" including the performance graph which follows shall not be deemed
to be incorporated by reference into any such filings.
The Company adopted an Annual Incentive Plan and a Long-Term Incentive
Plan for the fiscal year beginning January 1, 1992. These important
performance-oriented plans were developed after working with compensation
consultants. They provided a perspective on the types of programs successfully
used by other high-performing companies, and the Compensation Committee of the
Company's Board of Directors (the "Compensation Committee") worked closely with
them to design a program that it believes is right for the Company.
As a starting point, the Compensation Committee established a simple
and straightforward management compensation philosophy/strategy which guided the
design of the program. The strategy included the following seven points, or
statements of policy:
10
<PAGE> 13
Compensation Elements Relative to Competitive Market. The Company needs
to attract and retain quality officers, yet control fixed costs. Therefore, the
Company has provided competitive total cash compensation opportunities
consisting of: (1) base salary targeted at 90% of the competitive market, and
(2) above competitive incentive opportunities for attaining high targeted
Company performance results.
Forms of Incentive Compensation: Both annual and long-term incentive
compensation opportunities are available for all Company officers.
Incentive Compensation--Annual/Long-Term Orientation: The relative
weight of annual versus long-term incentive compensation reflects the time
orientation associated with each organization level. This orientation tends to
be longer-term for executive officers and shorter-term for other officers.
Incentive Compensation--Performance Measurement: Bottom-line
profitability is the Company's key measure of success. The magnitude of award
distributions under both the annual and long-term incentive plans is primarily
tied to this measure.
Annual Incentive Compensation--Corporate/Business Unit Emphasis: The
Company recognizes the different impact that various officers have on corporate
and business unit performance. Therefore, annual incentive compensation is
weighted in favor of corporate performance for corporate officers and business
unit performance for business unit officers.
Annual Incentive Compensation--Individual Performance Emphasis: The
financial success of the Company requires the achievement of some goals which
are non-financial in nature. These goals are reinforced by basing a part of the
annual incentive compensation on management discretion.
Long-Term Incentive Compensation--Equity Building: The Company believes
that officers should have a "stake" in the Company's long-term success.
Therefore, long-term incentive compensation is heavily weighted towards
equity-building components.
This strategy formed the basis for the plans adopted. These plans have
now been in place for the past five years. The Compensation Committee believes
the plans have worked extremely well in serving the best interests of the
shareholders by rewarding key executives for a job well done. Consequently, the
Compensation Committee has endorsed their continued use for fiscal 1997 without
change.
As pertaining to the Chief Executive Officer (the "CEO"), the Committee
established his base salary at $500,000 for fiscal 1997 after consideration of
competitive salary levels for comparably qualified and experienced CEO's at
companies similar in size to that of the Company and engaged in the same or
similar businesses. Under the adopted annual incentive plan a percent of his
salary is funded based upon a predetermined increase in the Company's operating
income. The Company believes the following operating earnings growth goals of:
(1) threshold (6%), (2) target (10%), and (3) superior (16%) represented a very
challenging range of goals in light of both the Company's strong fiscal 1995
operating income results and the difficult economy. The Compensation Committee
was therefore pleased with the resultant % increase in operating earnings
for 1997 and to pay the formula-based annual incentive amount of $ , which
appears in the "Executive Compensation--Summary Compensation Table" in the
incentive award column.
Under the Long-Term Incentive Plan, the granting of stock options and
restricted Shares is dependent upon meeting predetermined performance goals. For
fiscal 1996 these goals were:
- The Insurance Company's statutory earnings were sufficient to
pay the Company's declared dividends to shareholders, and
- The Insurance Company's GAAP operating earnings were equal to
or greater than the threshold performance levels established
for that year.
These criteria were met. Accordingly, stock options and restricted
Shares were granted in fiscal 1997 to the CEO in accordance with the adopted
compensation strategy. The assumption is that the present value of a restricted
Share is its market value at time of grant and that three option Shares are
approximately equal to one restricted Share. This relationship was reflected in
the granting of stock options and restricted Shares to the CEO, as well as to
all other senior officers.
The Long-Term Incentive Plan also provides for the granting of
performance units to the CEO. Their unit value, if any, is based upon future
performance over a three-year period. The Company performance criteria upon
which the value of the performance units granted in 1997 will be based is that
of annualized growth in operating earnings for the period 1997-1999.
11
<PAGE> 14
A minimum of at least a 6% annualized growth in operating earnings is
required before the performance units will have any value. The Company's 1997
growth in operating earnings of % was above this threshold level and, if
maintained over the next two years, will result in a payout under this
performance-oriented feature of the Long-Term Incentive Plan.
As pertains to the other Named Officers, as well as other senior
management, the compensation program consists of a base salary, annual incentive
compensation and long-term incentive compensation composed of stock options,
restricted stock and performance units. Base salary range midpoints are fixed at
levels approximately 10% below the competitive amounts paid to senior managers
with comparable qualifications, experience and responsibility at companies
similar in size to that of the Company and engaged in the same or similar
businesses as the Company. The annual and long-term incentive compensation is
more highly leveraged and closely tied to the Company's success in achieving
significant financial performance goals.
In the early part of each fiscal year, the Compensation Committee
reviews with the CEO and approves any modification it deems appropriate in the
annual salary plan for the Company's senior executives (other than for the CEO).
This salary plan was developed with the assistance of an independent
compensation consultant and is based on industry, peer group and national
surveys concerning salary competitiveness. Performance judgments as to past and
expected future contributions of each individual senior executive are provided
by the CEO. Salary adjustments within the appropriate salary ranges are
recommended by the CEO. The Compensation Committee reviews the recommendations
of the CEO and fixes the base salary for each of the Named Officers and other
senior management position holders.
The objectives of the Annual and Long-Term Incentive Plans are to
motivate key employees to continue their efforts to improve the success and
growth of the Company and to encourage the high performing employees to remain
with the Company and to be rewarded for their performance.
As pertains to the Annual Incentive Plan for 1997, the Compensation
Committee reviewed and approved the recommendations of the CEO as pertaining to
the individual performance portion of the funded awards. In fixing the grant of
stock options, restricted stock and performance unit awards to each individual
in the senior management group, including the Named Officers other than the CEO,
the Compensation Committee reviewed with the CEO the recommended individual
awards. In doing so, the Long-Term Incentive Plan calls for taking into account
the respective scope of accountability, strategic and operational goals,
contributions of each individual in the senior management group, and the
Company-wide performance requirements for the granting of stock options and
restricted stock awards. The latter, having been met for the fiscal year 1997,
will result in stock option grants and restricted stock awards being made during
1998.
Summary descriptions of the Annual Incentive and Long-Term Incentive
Plans have been previously provided in the subsections under this section of
this Proxy Statement describing executive compensation.
The foregoing report has been furnished by the Compensation Committee
of the Company consisting of the following individuals: Robert D. Davis, Radford
D. Lovett and H. Corbin Day.
DIRECTORS COMPENSATION
Except for T. O'Neal Douglas and Christopher A. Verlander, who received
no fees as directors or committee members of the Company, a director receives a
fee of $1,000 for each director's meeting he attends and a quarterly retainer of
$2,500. A member of the Board of Directors receives a fee of $500 for each
meeting of a committee he attends. Directors may elect payment in Shares by
participation in the Company's Stock Investment Plan or to defer the payment of
these fees according to an established plan under which the deferred amounts are
paid with interest in later years.
12
<PAGE> 15
SHAREHOLDER RETURN PERFORMANCE PRESENTATION
Set forth below is a line graph comparing the five-year cumulative
total shareholder return on the Shares against the cumulative total return of
the Standard and Poor's Composite--500 Stock Index and a Peer Group for the
period commencing January 1, 1993 (closing price December 31, 1992) and ending
December 31, 1997.
COMPARISON OF FIVE YEAR CUMULATIVE RETURN (1) AMONG THE COMPANY, S&P 500 AND
PEER GROUP
[GRAPH]
(1) Assumes a reinvestment of dividends and a $100 initial investment on
January 1, 1993 in the Company, S&P 500, and the Peer Group.
(2) The members of the peer group are Protective Life Corporation and
Liberty Corporation. The returns of each company have been weighted
according to their respective stock market capitalization for purposes
of arriving at a peer group average.
(3) In October 1993 the Company completed a public offering. The Company
sold 1,872,045 Shares and certain selling shareholders sold an
additional 980,300 Shares for a total number of Shares sold of
2,852,345. The price of the Company's Shares since the offering has
been impacted as a result of this offering.
OTHER TRANSACTIONS AND RELATIONSHIPS
The Insurance Company is the carrier of the group health, accident and
sickness and life insurance of Winn-Dixie Stores, Inc. ("Winn-Dixie") of which
A. Dano Davis, Robert D. Davis and Radford D. Lovett, directors of the Company,
are also directors. Affiliates of A. Dano Davis and Robert D. Davis are
principal shareholders of the Company and Winn-Dixie. During 1997, the Insurance
Company received premiums of $4,457,475 for such group insurance. The Insurance
Company also received a net premium of $11,168,855 from Winn-Dixie to fund a
deferred compensation plan for certain senior officers and other key management
personnel of Winn-Dixie. In addition, the Insurance Company carries life
insurance policies on the lives of certain members of the Davis family and on
employees of a corporation owned by them. During 1997, the Insurance Company
received $283,414 in net premiums with respect to this insurance.
T. O'Neal Douglas, Chairman of the Board, President and Chief Executive
Officer of the Company, is also a director of Physician Sales & Service, Inc.;
A. Dano Davis, a director of the Company, is also Chairman of the Board of
Directors of Winn-Dixie; and a director of First Union Corporation; Robert D.
Davis, a director of the Company, is also a director of Winn-Dixie; Radford D.
Lovett, a director of the Company, is also a director of Winn-Dixie, First Union
Corporation, Florida Rock Industries, Inc. and FRP Properties, Inc.; Edward L.
Baker, a director of the Company, is also Chairman of the Board of Directors of
Florida Rock Industries, FRP Properties, Inc., a director of Flowers Industries,
Inc. and Regency Realty; H. Corbin Day, a director of the Company, is also a
director of Blount International, Inc., all of which corporations have
securities registered pursuant to
13
<PAGE> 16
Section 12 of the Securities Exchange Act of 1934 or subject to the requirements
of Section 15(d) of that Act. In addition, T. O'Neal Douglas, Chairman of the
Board, President and Chief Executive Officer of the Company, is a director of
the Barnett Bank of Jacksonville, N.A., a subsidiary of Barnett Banks, Inc.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers to file with the Securities and
Exchange Commission ("SEC") and the New York Stock Exchange initial reports of
ownership and reports of changes in ownership of the Shares. Executive officers
and directors are required by SEC regulation to furnish the Company with copies
of all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended December 31, 1997, all
Section 16(a) filing requirements applicable to its executive officers and
directors were complied with, except Mr. Robert D. Davis made a gift in December
1997 which was not reported until February 9, 1998. The effect of such gift was
a 384-share reduction in his indirect holdings.
TO AMEND THE COMPANY'S AMENDED AND RESTATED
ARTICLES OF INCORPORATION
PROPOSED AMENDMENT TO INCREASE AUTHORIZED COMMON STOCK
The Board of Directors has determined that it would be in the best
interest of the Company to amend Article V A.1. of the Company's Amended and
Restated Articles of Incorporation to increase the authorized number of shares
of the Company's common stock, par value $1.00 per share (the "Shares") from
35,000,000 to 75,000,000. As of February 18, 1998, there were issued and
outstanding Shares. At that date an additional Shares were
reserved for issuance pursuant to employee benefit plans and upon conversion of
the Company's convertible securities.
While the Board of Directors may from time to time authorize the
issuance of Shares from the currently authorized, but unissued Shares, there are
no past, present or proposed negotiations, understandings, plans or commitments
for the issuance of Shares from the Shares to be authorized by the proposed
increase of authorized Shares, nor are there any plans, arrangements, or
negotiations, which call for the issuance of any of the currently authorized
common stock, except Shares reserved for issuance described above.
The Board of Directors believes that it is in the best interests of the
Company to authorize additional Shares to be available for issuance, without
further shareholder action, for possible future financings, stock dividends,
stock distributions, employee stock plans, dividend reinvestment and common
stock purchase plans, or other corporate purposes. In the opinion of the Board
of Directors, additional authorized Shares will provide the Company greater
flexibility in planning for the Company's future development.
The increase to 75,000,000 Shares of authorized common stock must be
accomplished by amending Article V A.1. of the Amended and Restated Articles of
Incorporation of the Company, so that Article V A., as amended will read as
follows:
ARTICLE V - CAPITAL STOCK
"A. The maximum number of shares of stock which this
corporation is authorized to have outstanding at any one time
is:
1. 75,000,000 shares of common stock, par value $1.00
per share;
2. 500,000 shares of non-convertible preferred stock,
par value of $10.00 per share; and
3. 500,000 shares of convertible preferred stock, par
value of $10.00 per share."
The amount of shares of the two classes of preferred stock will remain
unchanged.
14
<PAGE> 17
The favorable vote of the holders of a majority of the outstanding
Shares represented in person or by proxy at the Annual Meeting and voting for or
against the proposal is required for approval of this proposal. Under Florida
law, abstentions and broker non-votes will have no effect.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
PROPOSED AMENDMENT TO ARTICLE V A.1.
PRINCIPAL SHAREHOLDERS
A beneficial owner of a security includes any person who directly or
indirectly has or shares voting power and/or investment power with respect to
such security. Voting power is the power to vote or direct the voting of
securities and investment power is the power to dispose of or direct the
disposition of securities.
The following table sets forth as of January 31, 1998, that group of
persons known to management owning of record or beneficially, more than 5% of
the Shares:
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE OF
OWNER SHARES(3) OWNERSHIP
- ----- ---------- -------------
<S> <C> <C>
AHLI, Ltd. (1)............................................. 10,797,178 38.53%
Other Davis Family Shareholdings (2)....................... 1,039,688 3.72%
---------- ---------
P.O. Box 19366; Jacksonville, Florida 32245-9366......... 11,836,866 42.25%
========== =========
</TABLE>
(1) A limited partnership of which D.D.I., Inc. and Estuary Corporation are
(a) limited partners and (b) members of a limited liability corporation
which is the sole general partner. Robert D. Davis is an officer and
manager and A. Dano Davis is a manager of the sole general partner, and
they have shared voting and dispositive powers for the Shares owned by
the limited partnership.
D.D.I., Inc. is wholly owned directly or indirectly by certain members
of the Davis family. Robert D. Davis, a director of the Company, and
his cousins, A. Dano Davis, a director of the Company and T. Wayne
Davis and Charles P. Stephens, son-in-law of M. Austin Davis, deceased
uncle of Robert D. Davis and A. Dano Davis, have shared voting and
dispositive powers for that corporation.
Estuary Corporation is principally owned by trusts for the benefit of
A. Dano Davis, his mother, his sister, his children and his sister's
children. As to Estuary Corporation, A. Dano Davis and Robert D. Davis
share voting and dispositive power.
(2) Includes Shares held directly or indirectly by trusts for the benefit
of various members of the Davis family, by Davis family members,
individually, or by entities which such family members control. Robert
D. Davis and A. Dano Davis have sole or shared voting and dispositive
power for 737,550 of such Shares.
(3) Number of Shares reflect a two-for-one stock split in the form of a
stock dividend payable March 4, 1998 to shareholders of record February
18, 1998.
ACCOUNTANTS
Ernst and Young LLP ("E&Y"), the Company's auditors, has completed its
examination of the Company's financial statements for the year ended December
31, 1997; and it is expected that representatives of E&Y will attend the Annual
Meeting and be available to respond to appropriate questions and make
appropriate comments concerning the Company.
Neither E&Y nor any of its associates has any relationship with the
Company or any of its subsidiaries except in its capacity as auditors. The
Company has not selected auditors to examine its financial statements for its
fiscal year ending December 31, 1998. It is the policy of the Company to delay
this selection until later in its fiscal year.
15
<PAGE> 18
GENERAL
The Company will bear the costs of solicitation of proxies. In addition
to the use of the mails, proxies, may be solicited by personal interview,
telephone and telegram by directors and officers and other employees of the
Company, and no additional compensation will be paid to such individuals.
Arrangements may also be made with the stock transfer agent and with brokerage
houses and other custodians, nominees and fiduciaries who are record holders of
Shares for the forwarding of solicitation material to the beneficial owners of
the Shares. The Company will, upon the request of such entities, pay their
reasonable expenses for completing the mailing of such material to such
beneficial owners.
Consistent with state law and under the Company's Articles of
Incorporation and By-laws, a majority of the Shares entitled to vote on
particular matters for which proxies are being solicited, present in person or
represented by a proxy, constitutes a quorum as to such matter.
The three nominees for election as directors at the Company's Annual
Meeting of Shareholders who receive the greatest number of votes properly cast
for the election of directors shall be elected directors. A majority of the
votes properly cast on the matter is necessary to approve any other matter which
comes before the Annual Meeting, except where law or the Company's Articles of
Incorporation or By-laws require otherwise.
The Company will count the total number of votes cast "for" approval of
proposals, other than the election of directors, for purposes of determining
whether sufficient affirmative votes have been cast. The Company will count
Shares represented by proxies that withhold authority to vote for a nominee for
election as a director or that reflect abstentions and "broker non-votes" (i.e.,
Shares represented at the annual meeting held by brokers or nominees as to which
(i) instructions have not been received from the beneficial owners or persons
entitled to vote and (ii) the broker or nominee does not have the discretionary
voting power on a particular matter) only as Shares that are present and
entitled to vote on the matter for purposes of determining the presence of a
quorum, but neither abstentions nor broker non-votes will have any effect on the
outcome of voting on the matter.
The Company's Annual Report to Shareholders for the fiscal year ended
December 31, 1997, which contains financial statements and other information, is
mailed herewith to shareholders, but is not to be regarded as proxy soliciting
material.
The Company is not aware of any matter which may be presented for
action at the meeting, or at any adjournment thereof, other than the matters set
forth herein. However, should any other matter requiring a vote of the
shareholders arise, it is intended proxies in the accompanying form will be
voted in respect thereof in accordance with the best judgment of the person or
persons voting the proxies, discretionary authority to do so being included in
the proxy in the interest of the Company.
Shareholders are urged to specify choices, date, sign and return the
accompanying proxy in the enclosed envelope to which no postage need be affixed
if mailed in the United States. Prompt response is helpful and your cooperation
will be appreciated.
SHAREHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
The deadline for the receipt of shareholder proposals for inclusion in
the Company's 1999 Proxy Statement and form of proxy and presentation at the
1999 Annual Meeting of Shareholders is November , 1998. Such proposals should
be sent to the Corporate Secretary of the Company at 1776 American Heritage Life
Drive, Jacksonville, Florida 32224.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION MAY BE OBTAINED, WITHOUT CHARGE, BY ANY
SHAREHOLDER UPON WRITTEN REQUEST TO THE CORPORATE SECRETARY, AMERICAN HERITAGE
LIFE INVESTMENT CORPORATION, 1776 AMERICAN HERITAGE LIFE DRIVE, JACKSONVILLE,
FLORIDA 32224. EXHIBITS TO THE FORM 10-K WILL NOT BE SUPPLIED UNLESS
SPECIFICALLY REQUESTED, FOR WHICH THERE MAY BE A REASONABLE CHARGE.
16
<PAGE> 19
APPENDIX
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
Should any other matter requiring a vote of the Shareholders arise, the
proxies named on the reverse side hereof are authorized to vote the same in
accordance with their best judgement in the interest of the Company.
Please sign exactly as name appears
below. When shares are held by joint
tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If
a corporation, please sign full
corporate name by president or other
authorized officer. If a partnership,
please sign in partnership name by
authorized person.
--------------------------------------
SIGNATURE
--------------------------------------
SIGNATURE IF HELD JOINTLY
Dated 1998
------------------------,
PLEASE MARK, SIGN AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION
PROXY
Solicited by the Board of Directors of American Heritage
Life Investment Corporation
I (we) hereby appoint T. O'Neal Douglas, Robert D. Davis and W. Ashley
Verlander and each of them as proxies with power of substitution, to represent
me (us) and to vote all of my (our) shares in American Heritage Life Investment
Corporation on all matters which may come before the 1998 Annual Meeting of the
Shareholders to be held on Thursday, the 30th day of April, 1998, at 9:00 a.m.,
Jacksonville time, in the auditorium in the American Heritage Life Building, on
the First Floor, at 1776 American Heritage Life Drive, Jacksonville, Florida,
and at any adjournment thereof.
The proxies shall vote these shares as specified below or, where no choice
is specified shall vote the shares FOR the following proposals:
<TABLE>
<CAPTION>
THE BOARD OF DIRECTORS RECOMMEND A VOTE "FOR" THE FOLLOWING PROPOSALS:
- ------------------------------------------------------------------------------------------------------------------------------------
1. To elect three (3) Class I Directors to serve until the Annual Meeting of Shareholders in 2001:
<S> <C>
[ ] FOR nominees named below [ ] WITHHOLD AUTHORITY to vote for nominees
Class III Director: Edward L. Baker (INSTRUCTION: TO WITHHOLD AUTHORITY to vote for nominee
Robert D. Davis write that nominee's name on the space provided below.)
Christopher A. Verlander
----------------------------------
2. To amend the Company's Amended and Restated Articles of Incorporation to increase the number of authorized shares of the
Company's Common Stock, par value $1.00 per share, from 35,000,000 to 75,000,000.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or at
any adjournment thereof.
</TABLE>
PLEASE SIGN AND DATE ON REVERSE SIDE AND RETURN PROMPTLY
(CONTINUED, AND TO BE SIGNED ON OTHER SIDE)
