File No. 33- 11084 811-2188
As filed with the Securities and Exchange Commission on May 1, 1996
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]
Pre-Effective Amendment No. _____ [ ]
Post-Effective Amendment No. 2 [ X ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 [ X ]
Amendment No. 12
JEFFERSON-PILOT SEPARATE ACCOUNT A
(Exact Name of Registrant as Specified in Charter)
JEFFERSON-PILOT LIFE INSURANCE COMPANY
100 North Greene Street
Greensboro, North Carolina 27401
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code 1-800-458-4498
J. Gregory Poole
Jefferson-Pilot Life Insurance Company
100 North Greene Street
Greensboro, North Carolina 27401
(Name and Address of Agent for Service)
Copy to:
J. Gregory Poole
Jefferson-Pilot Life Insurance Company
100 North Greene Street
Greensboro, NC 27401
Approximate Date of Proposed Public Offering _______________________
It is proposed that this filing will become effective (check appropriate box)
[ x ] immediately upon filing pursuant to paragraph (b) of Rule 485
[ ] on (date) pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485
[ ] on (date) pursuant to paragraph (a) (1) of Rule 485
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
Registrant has registered an indefinite number or amount of securities under
the Securities Act of 1933 in connection with File No. 33-11084. Its Rule
24f-2 Notice for the fiscal year ended December 31, 1995 was filed on or about
February 29, 1996
<PAGE>
JP CAPITAL APPRECIATION FUND, INC.
Registration Statement on Form N1-A
CROSS REFERENCE SHEET
Pursuant to Rule 481 (a)
N-1A
Item No. Caption
PART A INFORMATION REQUIRED IN A PROSPECTUS
1. Cover Page Cover Page
2. Synopsis Not Applicable
3. Condensed Financial Information Condensed Financial
Information
4. General Description of Registrant General Description;
Investment
Objectives and Policies
5. Management of the Fund Who Manages The Funds
5A. Management's Discussion of Performance Not Applicable
6. Capital Stock and Other Securities Additional Information
7. Purchase of Securities Being Offered How to Purchase Shares
8. Redemption or Repurchase How to Redeem Shares
9. Pending Legal Proceedings Not Applicable
PART B INFORMATION REQUIRED IN A STATEMENT
OF ADDITIONAL INFORMATION
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and History General Information
<PAGE>
CROSS REFERENCE SHEET -- CONTINUED
N1-A
Item No. Caption
13. Investment Objectives and Policies Investment Objectives and
Policies
14. Management of the Registrant The Fund's Directors and
Officers
15. Control Persons and Principal
Holders of Securities General Information
16. Investment Advisory and Other Services The Investment Adviser
17. Brokerage Allocation and Other Practices Brokerage
18. Capital Stock and Other Securities Not Applicable
19. Purchase, Redemption and Pricing of
Securities Being Offered Purchase and Redemption
of Shares
20. Tax Status Not Applicable
21. Underwriters Not Applicable
22. Calculation of Performance Data Not Applicable
23. Financial Statements Financial Statements
PART C OTHER INFORMATION
Information required to be included in Part C is set forth under the
appropriate Item, so numbered, in Part C of this Registration Statement.
<PAGE>
JP FAMILY OF FUNDS
_____________________________________
PROSPECTUS
_____________________________________
May 1, 1996
JP Capital Appreciation Fund
JP Investment Grade Bond Fund
JP Capital Appreciation Fund, Inc. has as its primary objective long term
capital appreciation. A secondary objective is current income through the
receipt of interest or dividends.
JP Investment Grade Bond Fund, Inc. has as its primary objective the maximum
level of current income as is consistent with prudent risk. A secondary
objective is growth of income and capital.
This Prospectus sets forth concisely information about each of the above
mentioned companies that a prospective investor ought to know before investing.
Investors are advised to read and retain this Prospectus for future reference.
A Statement of Additional Information dated May 1, 1996 for each of the
above mentioned companies on file with the Securities and Exchange Commission
is, in its entirety, incorporated by reference in and made a part of this
Prospectus and is available without charge upon request of any of said
companies.
The shares offered by this prospectus are neither insured nor guaranteed by the
U.S. Government.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
Table of Contents
Selected Per Share Data and Ratios . . . . . . . . . . . . . . . . . . . . . .3
General Description. . . . . . . . . . . . . . . . . .. . . . . . . . . . . . 4
Investment Objectives and Policies . . . . . . . . . . . . . . . . . . . . . .4
How To Purchase Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
How to Determine Net Asset Value . . . . . . . . . . . . . . . . . . . . . . .6
Who Manages The Funds. . . . . . . . . . . . . . . . . . . . . . .. . . . . . 6
Dividends, Distributions and Taxes . . . . . . . . . . . . . . . . . . . . . .7
How To Redeem Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
<PAGE>
Condensed Financial Information
The following selected per share data and ratios of JP Capital Appreciation
Fund, Inc. and JP Investment Grade Bond Fund, Inc. (the "Funds") have been
audited by McGladrey & Pullen, LLP, Independent Certified Public Accountants,
as set forth in their opinion appearing in the Statement of Additional
Information for each of the Funds.
JP Investment Grade Bond Fund, Inc.
<TABLE>
<CAPTION>
Year Ended December 31
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per share operating
performance (for a share
outstanding throughout
the year)
Net asset value,
beginning of yea $ 10.08 $ 11.49 $ 11.19 $ 11.24 $ 10.61 $ 10.79 $ 10.56 $ 10.71 $ 11.56 $ 10.94
Income from investment
operations
Net investment
income 0.73 0.73 0.74 0.74 0.85 0.89 0.93 0.95 0.94 0.97
Net realized and
unrealized gain(loss)
on investments 1.19 (1.40) 0.36 ( 0.03) 0.62 ( 0.20) 0.31 (0.11) (0.66) 0.62
Total from investment
operations 1.92 ( .67) 1.10 0.71 1.47 0.69 1.24 0.84 0.28 1.59
Less distributions
Dividends from net
investment income (0.74) (0.71) (0.73) ( 0.76) ( 0.84) ( 0.87) (0.91) (0.94) (1.04) ( 0.99)
Distributions from
net realized gains - (0.03) (0.07) - - - (0.10) (0.05) (0.07) -
Total distributions (0.74) (0.74) (0.80) ( 0.76) ( 0.84) ( 0.87) (1.01) (0.99) (1.11) (0.99)
Net asset value,
end of year $ 11.26 $ 10.08 $ 11.49 $ 11.19 $ 11.24 $ 10.61 $ 10.79 $ 10.56 $ 10.71 $ 11.54
Total return
(without deduction
of sales load) 19.44% ( 5.92)% 10.10% 6.67% 14.61% 6.86% 12.12% 8.12% 2.77% 15.27%
Ratios/supplemental data:
Net assets, end of
year (000 omitted) $28,136 $25,278 $29,997 $23,622 $19,134 $15,300 $14,179 $12,926 $12,536 $13,095
Ratios to average net assets:
Expenses 0.70% 0.65% 0.59% 0.67% 0.72% 0.76% 0.76% 0.76% 0.73% 0.72%
Net investment
income 6.66% 6.80% 6.33% 6.65% 7.88% 8.49% 8.65% 8.88% 8.53% 9.26%
Portfolio turnover
rate 26.16% 28.93% 19.88% 18.05% 7.23% - 20.03% 4.92% 17.81% 13.50%
</TABLE>
JP Capital Appreciation Fund, Inc.
<TABLE>
<CAPTION>
Year Ended December 31
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per share operating
performance (for a
share outstanding
throughout the year)
Net asset value,
beginning of year $16.77 $18.19 $18.17 $17.69 $13.76 $15.08 $11.81 $11.26 $14.45 $13.92
Income from investment
operations
Net investment income 0.36 0.34 0.28 0.29 0.37 0.40 0.39 0.33 0.35 0.43
Net realized and
unrealized gain(loss)
on investments 4.45 (1.10) 1.26 0.75 3.91 (0.65) 3.29 0.47 (0.20) 1.47
Total from investment
operations 4.81 (0.76) 1.54 1.04 4.28 (0.25) 3.68 0.80 0.15 1.90
Less distributions
Dividends from net
investment income (0.36) (0.17) (0.27) (0.33) (0.35) (0.41) (0.41) (0.25) (0.46) (0.47)
Distributions from
net realized gains (2.26) (0.49) (1.25) (0.23) - (0.66) - - (2.88) (0.90)
Total distributions (2.62) (0.66) (1.52) (0.56) (0.35) (1.07) (0.41) (0.25) (3.34) (1.37)
Net asset value,
end of year $18.96 $16.77 $18.19 $18.17 $17.69 $13.76 $15.08 $11.81 $11.26 $14.45
Total return
(without deduction
of sales load) 33.39% (4.34)% 9.25% 6.16% 31.61% (1.39%) 31.67% 7.19% 0.21% 15.01%
Ratios/supplemental data:
Net assets, end
of year
(000 omitted) $71,601 $58,360 $56,625 $45,480 $37,319 $27,048 $23,203 $24,357 $25,177 24,222
Ratios to average
net assets:
Expenses 0.62% 0.58% 0.60% 0.63% 0.62% 0.63% 0.68% 0.68% 0.64% 0.65%
Net investment income 2.07% 2.03% 1.55% 1.68% 2.37% 2.90% 2.90% 2.84% 2.45% 2.98%
Portfolio turnover
rate 64.13% 126.70% 23.93% 48.72% 36.71% 31.75% 55.47% 76.62% 78.12% 69.41%
</TABLE>
<PAGE>
General Description
JP Investment Grade Bond Fund, Inc., formerly Jefferson-Pilot Income Fund, Inc.
("Bond Fund"), and JP Capital Appreciation Fund, Inc., formerly Jefferson-Pilot
Growth Fund, Inc. ("Capital Appreciation Fund"), are corporations both
organized under the laws of North Carolina on July 19, 1982. Each of the
companies is registered under the Investment Company Act of 1940 as an open-end
diversified investment company.
Investment Objectives and Policies.
Bond Fund. The Bond Fund's primary investment objective is the maximum level of
current income as is consistent with prudent risk. A secondary objective is
growth of income and capital. The Bond Fund proposes to achieve these
objectives by investing primarily in fixed income securities rated A or better
by Standard & Poor's Corporation ("S&P") or Moody's Investors Service, Inc.
("Moody's"). Fixed income securities will include debt securities and
preferred stocks, some of which may have a call on common stock by means of
conversion privilege or attached warrants. When the incremental investment
yield available on corporate securities is small compared to that available on
U. S. Treasury securities, the Bond Fund may invest substantially in U. S.
Treasury securities. The Bond Fund may also hold cash or invest in short-term
securities and may purchase U. S. Government obligations with a simultaneous
agreement by the seller to repurchase the securities at the original price
plus accrued interest; provided that not more than 10% of the Fund's net assets
may be invested in such repurchase agreements that mature in more than seven
days. Repurchase agreements involve certain risks in the event of a default
by the other party.
The percentage of assets invested in different types of securities will vary
from time to time depending upon the judgment of the management as to general
market and economic conditions, fiscal and monetary policy and trends in
interest rates and yields.
The Bond Fund's investments (other than cash and U. S. Government securities)
are diversified among the securities issued by different companies and
governments to the extent that no more than 5% of its total assets may be
invested in securities issued by any one issuer. In addition, management
generally selects investments for the Bond Fund from among many different
industries and may invest up to 25% of the Bond Fund's assets in a single
industry. The investment restrictions (page 1, Statement of Additional
Information) include: limitations on borrowing money; no more than 10% of
assets may be invested in securities with a limited trading market; and no
more than 5% of assets may be invested in companies having a record of less
than three years of continuous operation. These restrictions, and the
investment objectives and policies described above, as well as most of the
additional restrictions described in the Statement of Additional Information,
cannot be changed without shareholder approval. While the Bond Fund does not
intend to place emphasis upon short-term trading profits, it will sell
securities held short term to take advantage of special opportunities which
might arise. Accordingly, the Bond Fund has historically had a portfolio
turnover rate of less than 50%. The Bond Fund's portfolio turnover rates are
shown in its respective table under the caption "Condensed Financial
Information".
<PAGE>
The Bond Fund's investments are subject to market fluctuations and risks
inherent in all securities. There is no assurance that the Bond Fund's stated
objectives will be realized.
Capital Appreciation Fund. The Capital Appreciation Fund's primary investment
objective is long-term capital appreciation. Current income through the
receipt of interest or dividends from investments is only a secondary
objective. The Capital Appreciation Fund proposes to achieve these objectives
by investing substantially all its assets in common stocks of companies
recognized as leaders in their respective industries with proven and capable
management and that are providing significant products and services to their
customers. The Capital Appreciation Fund's investments will be made
predominantly in securities listed on registered securities exchanges, but it
may purchase securities traded in the over-the-counter market.
Investments may be made in other equity securities, including rights, warrants,
preferred stock and those debt securities convertible into or carrying rights,
warrants, or options to purchase common stock or to participate in earnings.
The Capital Appreciation Fund may also hold cash or invest in short-term
securities and may purchase U. S. government obligations with a simultaneous
agreement by the seller to repurchase the securities at the original price plus
accrued interest; provided that not more than 10% of the Capital Appreciation
Fund's net assets may be invested in such repurchase agreements that mature in
more than seven days. Repurchase agreements involve certain risks in the event
of a default by the other party.
The percentage of assets invested in different types of securities will vary
from time to time depending upon the judgment of the management as to general
market and economic conditions, fiscal and monetary policy and trends in
interest rates and yields.
The Capital Appreciation Fund's investments (other than cash and U. S.
Government securities) are diversified among the securities issued by
different companies and governments to the extent that no more than 5% of its
total assets may be invested in securities issued by any one issuer. In
addition, management generally selects investments for the Fund from among
many different industries and may invest up to 25% of the Capital Appreciation
Fund's assets in a single industry. The investment restrictions (page 1,
Statement of Additional Information) include: limitations on borrowing money;
no more than 10% of assets may be invested in securities with a limited trading
market; and no more than 5% of assets may be invested in companies having a
record of less than three years of continuous operation. These restrictions,
and the investment objectives and policies described above, as well as most of
the additional restrictions described in the Statement of Additional
Information, cannot be changed without shareholder approval. While the Capital
Appreciation Fund invests for long-term growth of capital and does not intend
to place emphasis upon short-term trading profits, it will sell securities held
short term to take advantage of special opportunities which might arise.
Accordingly, the Capital Appreciation Fund has historically had a portfolio
turnover rate of less than 100%. Generally, the Capital Appreciation Fund's
expenses will increase in relative proportion to an increase in its portfolio
turnover rate and may result in taxes on realized capital gains to be borne by
the Fund or its shareholders. See "Dividends, Distributions, and Taxes" in
this prospectus. The Capital Appreciation Fund's portfolio turnover rates are
shown in its respective table under the caption "Condensed Financial
Information".
<PAGE>
The Capital Appreciation Fund's investments are subject to market fluctuations
and risks inherent in all securities. There is no assurance that the Capital
Appreciation Fund's stated objectives will be realized.
How To Purchase Shares
Purchases of the Fund's shares are currently restricted to the separate accounts
that are sponsored by the insurance subsidiaries of Jefferson-Pilot Corporation
and any of their affiliates and to pension plans for employees of said
companies and their affiliates. Shares are offered at the net asset value per
share, which is calculated as described below. The offering price so
determined becomes effective at the New York Stock Exchange closing time.
Orders received prior to that time are confirmed at the offering price
effective at that time, provided the order is received by the Fund prior to its
close of business.
How To Determine Net Asset Value. Net asset value per share is computed by each
Fund as of the close of each day on which the New York Stock Exchange is open
(4:00 p.m. New York time) and on any other day in which there is a sufficient
degree of trading in the Fund's portfolio securities to materially affect net
asset value. Net asset value is determined by dividing the value of the Fund's
securities, plus any cash and other assets (including dividends accrued but not
collected) less all liabilities (including accrued expenses), by the number of
shares outstanding.
<PAGE>
The Capital Appreciation and Bond Funds each adhere to the following
practices. A security listed or traded on an exchange is valued at its last
sale price on that exchange where it is principally traded or, if there were
no sales on that exchange, the last quoted sale on other exchanges or on the
National Association of Securities Dealers Automated Quotation System
("NASDAQ"). Lacking any sales the security is valued at the mean of the last
bid and ask prices reported on the exchange where the security is principally
traded. All other securities for which over-the-counter market quotations are
readily available are valued at their last sale price on NASDAQ or at the mean
of the last bid and ask prices as of the close of trading. Fixed income
securities are valued by using market quotations, or independent pricing
services which use prices provided by market makers or estimates of market
values obtained from yield data relating to similar classes of instruments or
securities. Certain short-term debt securities are valued at amortized cost.
Other securities, including restricted securities, and other assets are valued
at fair value as determined in good faith and under authority by the Board of
Directors.
Who Manages The Funds
The Board of Directors of each Fund is responsible for the overall supervision
of the conduct of the Fund's business. Each Fund's investment adviser is JP
Investment Management Company ("JP Management"), P.O. Box 21008, Greensboro,
North Carolina 27420, a North Carolina corporation organized on January 13,
1970. JP Management is a wholly-owned subsidiary of Jefferson-Pilot
Corporation, an insurance holding company. JP Management has served as an
investment adviser to the Funds since their inception in 1982; to Jefferson-
Pilot Capital Appreciation Fund, Inc., formerly JP Growth Fund, Inc., since
that company's inception in 1970; and to Jefferson-Pilot Investment Grade Bond
Fund, Inc., formerly JP Income Fund, Inc., since that company's inception in
1978.
In addition to providing investment advice, JP Management or persons
employed by or associated with JP Management are, subject to the authority of
the Board of Directors, responsible for the overall management of the Funds'
business affairs.
As compensation for its services, JP Management receives from each Fund a fee
at an annual rate of one half of 1% of the Fund's average net asset value.
The fee is payable monthly, on the basis of the Fund's average net asset
value during the monthly period computed in the manner used in determining
the public offering price of Fund shares. The ratio of the management fee
to average net assets for the year ended December 31, 1995 was 0.5%. For
the same period, the Capital Appreciation Fund's total operating expenses
were .62% of average net assets, and the Bond Fund's total operating
expenses were .70% of average net assets.
<PAGE>
JP Management has also agreed to serve as each Fund's stock transfer agent,
dividend paying agent and to provide shareholder accounting, bookkeeping,
pricing and related services to each Fund. Each Fund has agreed to reimburse
JP Management for expenses incurred by JP Management in providing these
services, including an amount intended to reimburse JP Management for that
portion of its general and administrative expenses allocable to such services.
Under service agreements between each Fund, JP Management, Jefferson-Pilot Life
Insurance Company and Jefferson-Pilot Investments, Inc. ("Companies"), the
Companies have agreed to furnish such personnel, services and facilities as may
be reasonably needed by JP Management in connection with its performance as
investment adviser and under the Agency Agreement, and JP Management has agreed
to reimburse the Companies for their expenses in this regard.
Dividends, Distributions and Taxes
The Capital Appreciation Fund's policy is to pay dividends from net
investment income semi-annually in February and August. The Bond Fund's
policy is to pay dividends from net investment income quarterly in February,
May, August and November. In addition, if the Capital Appreciation or Bond
Fund has not paid out 98% of its net investment income by the end of the
calendar year, its policy is to pay a dividend near the end of the calendar
year which will, when added to the dividends previously paid in the year,
equal or exceed 98% of its net investment income for the year. Each December
the Capital Appreciation and Bond Funds make a distribution of the capital
gains, if any, each realized during the 12-month period ended the preceding
October 31. Unless the investor requests that payments be made in cash,
dividends and distributions will be reinvested in additional Fund shares at
net asset value as of the record date.
Each Fund qualified in 1995 and plans to qualify in 1996 for the special
tax treatment afforded a "regulated investment company" under Subchapter M of
the Internal Revenue Code (the "Code"). In any fiscal year in which the Fund
so qualifies and distributes at least 90% of its taxable net income, the Fund
(but not shareholders) will be relieved of federal income tax on the income
distributed. Dividends (i.e., distributions of any net investment income and
any net realized short-term capital gains) are taxable to shareholders as
ordinary income, whether received in cash or additional shares. Distributions
of long-term capital gains (i.e., the excess of any net long-term capital gains
over net short-term capital losses), if any, are taxable as long- term capital
gains whether received in cash or shares without regard to how long a
shareholder has held his shares. Gain or loss realized on a redemption by a
shareholder will be treated as a capital gain or loss unless the shares are
not capital assets in the shareholder's hands.
The foregoing is a general summary of the applicable provisions of the Code
and Treasury Regulations presently in effect. Dividends and distributions
also may be subject to state or local taxes. Investors should consult their
tax advisors for specific information.
How To Redeem Shares
Shareholders may redeem shares at the per share net asset value next determined
after receipt of certificates endorsed by all parties (or trustees) in whose
name the certificates are issued, and in proper form for transfer, with
signatures guaranteed, at the office of JP Management. If no certificates
have been issued to the shareholder, redemption may be accomplished by signed
written request, the signature(s) of which JP Management may require be
guaranteed. A redemption request should identify the account by number and
should be signed by all parties (or trustees) in whose name the account is
registered in the exact manner in which the account is registered.
<PAGE>
A check for payment for shares redeemed will be issued as early as possible,
but not later than seven days after JP Management's receipt of the certificates
or the written redemption request. Redemption of shares may be suspended or
payment postponed at times (a) when the New York Stock Exchange is closed
other than weekends and holidays, (b) when trading on said Exchange is
restricted, (c) when an emergency exists as a result of which disposal
by the Fund of securities owned by it is not reasonably practicable or it is
not reasonable for the Fund fairly to determine the value of its net assets,
or during any other period when the Securities and Exchange Commission, by
order, so permits; provided that applicable rules and regulations of the
Securities and Exchange Commission shall govern as to whether the conditions
prescribed in (b) or (c) exist.
Neither Fund nor Investor Services makes a charge for redemption. Other
broker-dealers may charge for handling redemption transactions but such
charge can be avoided by requesting redemption by the Funds directly or through
the Investor Services.
The shareholder may, within thirty days of a redemption of shares of either
Fund, reinvest the proceeds in shares of that Fund or the other Fund at net
asset value without a sales charge. This privilege is permitted only once to
each shareholder per year.
Due to the high cost of maintaining accounts, each Fund reserves the right to
redeem any account which has been in existence for at least one year and which
has a balance of less than $250. A shareholder will be notified in writing of
either Fund's intention to redeem and given 60 days to make additional share
purchases before the redemption is processed.
Additional Information
The Capital Appreciation and Bond Funds each has authorized capital stock of
10,000,000 shares of $1.00 par value. Each share entitles the holder to
participate equally in dividends and distributions declared by the Fund and
in its remaining net assets on liquidation after satisfaction of outstanding
liabilities. Fund shares are fully paid and nonassessable when issued; have
no preemptive or conversion rights; are transferable without restriction; and
are redeemable at net asset value.
On matters submitted for a shareholder vote, each shareholder is entitled to
one vote for each share owned. Shares have cumulative voting rights which
means that in all elections of directors each shareholder has the right to
cast a number of votes equal to the number of shares owned multiplied by the
number of directors to be elected and each shareholder may cast the whole
number among two or more candidates. Fractional shares have proportionally
the same rights as do full shares.
In the opinion of the staff of the Securities and Exchange Commission, the
use of this combined prospectus may make each Fund liable for any misstatement
or omission in this prospectus regardless of the Fund to which it pertains.
<PAGE>
JP FAMILY OF FUNDS
Investment Adviser and Transfer Agent
JP Investment Management Company
100 North Greene Street
Greensboro, North Carolina 27401
Custodian
Investors Fiduciary Trust Company
127 West Tenth Street
Kansas City, Missouri 64105
Certified Public Accountants
McGladrey & Pullen, L.L.P.
555 Fifth Avenue - 8th Floor
New York, New York 10017-2416
Direct Inquiries To:
JP Investment Management Company
Post Office Box 22086
Greensboro, North Carolina 27420
<PAGE>
JP Capital Appreciation Fund, Inc.
100 North Greene Street
Greensboro, North Carolina 27401
Telephone 1-800-458-4498
Statement of Additional Information
May 1, 1996
Page
Table of Investment Objectives and Policies . . . . . . B-1
Contents Investment Restrictions. . . . . . . . . . . . B-1
The Investment Adviser . . . . . . . . . . . . B-3
Brokerage. . . . . . . . . . . . . . . . . . . B-4
Purchase and Redemption of Shares. . . . . . . B-5
The Fund's Directors and Officers . . . B-5
General Information. . . . . . . . . . . . . . B-7
Financial Statements . . . . . . . . . . . . . B-8
________________________________________________________________________
This Statement of Additional Information is not a prospectus but supplements
and should be read in conjunction with the current Prospectus dated May 1, 1996
of JP Capital Appreciation Fund, Inc. ("Fund"). A copy of the Prospectus may
be obtained by contacting the Fund at the address or telephone number shown
above.
Investment Objectives and Policies
The Fund's investment objectives and how it hopes to achieve those objectives
are described on page one of the Prospectus. There can be no assurance that
these objectives will be achieved. The objectives may not be changed without
the approval of a majority of the Fund's shareholders. A majority means: the
lesser of (i) a majority of the Fund's outstanding voting securities, or (ii)
67 percent of the shares present at a shareholder's meeting at which more than
50 percent of the outstanding shares are present or represented by proxy.
Investment Restrictions
In addition to, or amplification of, the investment restrictions set forth
in the Prospectus, the Fund may not:
1. Issue senior securities.
2. Purchase securities on margin or sell short, except it may obtain
such short-term credits as are necessary for the clearance of
transactions.
3. Write, purchase or sell puts, calls or combinations thereof.
4. Borrow money except that, as a temporary measure for extraordinary
or emergency purposes and not for investment purposes, the Fund
may borrow up to 5% of the value of its total assets.
5. Act as an underwriter of securities of other issuers, except that
the Fund may invest up to 10% of the value of its net assets (at
time of investment) in portfolio securities which the Fund might
not be free to sell to the public without registration of such
securities under the Securities Act of 1933.
<PAGE>
It may be difficult for the Fund to sell restricted securities at prices
representing their fair market value except pursuant to an effective
registration statement under the Securities Act of 1933. If registration of
restricted securities is necessary, a considerable period of time may elapse
between the decision to sell and the effective date of the registration
statement. During that time the price of securities to be sold may be affected
by adverse market conditions.
In purchasing restricted securities, the Fund will endeavor to have the issuer
agree to register the securities on request and pay the registration expenses.
The Fund may be obliged, however, to bear all or part of these expenses.
The Fund's Board of Directors will value restricted securities in good faith
in determining the net asset value of Fund shares. The valuations will be
made on an individual basis in light of the particular circumstances affecting
each restricted security, including market value (if any), the period of time
the restrictions are in force, and other relevant factors. The Fund has not
for the past 12 months owned any restricted securities and has no present
intention of acquiring such securities.
6. Purchase or sell real estate or interests in real estate, nor interest in
real estate investment trusts or real estate limited partnerships (however,
the Fund may purchase interests in real estate in investment trusts whose
securities are registered under the Securities Act of 1933 and readily
marketable).
7. Engage in the purchase and sale of commodities or commodity contracts.
8. Make loans, except to the extent that either of the following is deemed to
constitute a loan: (a) purchases of a portion of an issue of a debt security
distributed to the public; or (b) investments in "repurchase agreements".
9. Purchase the securities (except U.S. Government securities) of any one
issuer if immediately after and as a result of such purchase (a) the value of
the holdings of the Fund in the securities of such issuer exceeds 5% of the
value of the Fund's total assets, or (b) the Fund owns more than 10% of the
outstanding voting securities of any one class of securities of such issuer.
10. Purchase the securities of open-end investment companies. The Fund may
purchase the securities of other investment companies provided that (a)
immediately after such purchase the Fund and companies controlled by the Fund,
or other investment companies having the same investment adviser as the Fund,
do not own more than 10% of the investment company whose securities are being
purchased; (b) the Fund cannot invest more than 10% of its total assets in the
securities of other investment companies; and (c) such purchases are made in
the open market where no commission or profit to a sponsor or dealer results
other than the customary broker's commission. The restrictions of the
preceding sentence do not apply in connection with a merger, consolidation, or
plan of reorganization.
11. Mortgage, pledge, hypothecate, or in any manner transfer, as security for
indebtedness, any securities owned or held by the Fund.
12. Participate on a joint or joint and several basis in any trading account
in securities or effect a short sale of any security, except in connection with
an underwriting in which it is a participant in the circumstances specified in
Paragraph 5.
<PAGE>
13. Purchase or retain the securities of any issuer if those officers and
directors of the Fund, its adviser or underwriter owning individually more
than 0.5% of the securities of such issuer together own more than 5% of the
securities of such issuer.
14. Invest in companies for the purpose of exercising control or management.
15. Invest in foreign securities other than securities issued by Canadian
companies.
16. Invest in interests of oil, gas, or other mineral exploration or
development programs.
The investment restrictions in Paragraphs 1 through 13 above and on page one of
the Prospectus are fundamental policies and may not be changed without the
approval of a majority of the Fund's shareholders. The policies mentioned in
Paragraphs 14-16 above are not fundamental and may be changed without
shareholder approval.
While the Fund will not purchase illiquid, including restricted, securities
if such purchase would cause its then total investment in such securities to
exceed 10% of the value of its net assets, the Fund could through the decrease
in values of its other securities, for example, at sometime own illiquid,
including restricted, securities having a value in excess of 10% of the value
of its net assets. In that event, the Fund will promptly take such action as
its Board of Directors deems appropriate to assure the continued liquidity of
the Fund.
The Investment Adviser
The Fund's investment adviser, JP Investment Management Company ("JP
Management"), like Investor Services, is a wholly-owned subsidiary of
Jefferson-Pilot Corporation, an insurance holding company. E.J. Yelton,
John C. Ingram, W. Hardee Mills, and J. Gregory Poole are officers and/or
directors of the Fund and of JP Management. Their positions with the Fund
and/or JP Management are (with the Fund position shown first) President,
Treasurer and Director/President and Director; Director/Senior Vice President,
Treasurer and Director; Vice President/Vice President; and Secretary/Secretary,
respectively.
JP Management's services are provided under an Investment Advisory Agreement
with the Fund dated November 12, 1982. Under the terms of the agreement, JP
Management provides personnel, including executive officers for the Fund, and
compensates the Fund's directors who are affiliated with JP Management or its
affiliated companies. JP Management also furnishes, or causes to be furnished,
at its own expense office space, facilities and necessary executive and other
personnel for conducting the Fund's affairs and pays all expenses incurred by
it or the Fund in connection with the administration of the investment affairs
of the Fund.
The Fund pay all other corporate expenses incurred in its operations, including
its taxes (if any), brokerage commissions on portfolio transactions, expenses
relating to the issue, transfer, redemption and pricing of shares, disbursement
of dividends and other distributions, custodian fees, auditing and legal
expenses, compensation of unaffiliated directors, and expenses in connection
with meetings of directors and shareholders.
<PAGE>
As compensation for its services, JP Management receives from the Fund a fee
at an annual rate of 1/2 of 1% of the Fund's average net asset value. The fee
is payable monthly, on the basis of the Fund's average daily net asset value
during the monthly period computed in the manner used in determining the public
offering price of Fund shares (see "How To Determine Net Asset Value" in the
prospectus).
If, in any fiscal year, the total of the fund's ordinary business expenses
(including the investment advisory fee but excluding taxes, portfolio brokerage
commissions and interest) exceed 1% of the Fund's average daily net asset value
JP Management pays the excess. The payment of the investment advisory fee at
the end of any month is reduced or postponed so that at the end of any month
there is not any accrued but unpaid liability under this expense limitation.
The Fund's ordinary business expenses did not, during fiscal years 1993, 1994
or 1995 exceed 1% of its average daily net asset value.
The amount of JP Management's advisory fee for fiscal year 1993 was
$252,703, for fiscal 1994 was $291,744, and for fiscal year 1995 was
$325,646.
JP Management has also agreed in an Agency Agreement dated November 12,
1982 to serve as the Fund's stock transfer agent, dividend paying agent and to
provide shareholder accounting, bookkeeping pricing and related services to the
Fund. The Fund has agreed to reimburse JP Management for expenses incurred
by JP Management in providing these services, including an amount intended to
reimburse JP Management for that portion of its general administrative expenses
allocable to such services.
The amount paid to JP Management by the Fund under the Agency
Agreement for fiscal year 1993 was $9,365, for fiscal year 1994 was $18,294,
and for fiscal year 1995 was $18,200.
Under a Service Agreement between the Fund, JP Management, Jefferson-
Pilot Life Insurance Company and Jefferson-Pilot Investments, Inc.
("Companies"), which agreement is dated January 25, 1984, the Companies have
agreed to furnish such personnel, services and facilities as may be reasonably
needed by JP Management in connection with its performance under the
Investment Advisory Agreement and Agency Agreement, and JP Management
has agreed to compensate the Companies for their services in this regard.
Because of the arrangements under the Service Agreement, the Companies might
be deemed to be investment advisers of the Fund, and the Service Agreement an
investment advisory contract, for purposes of the Investment Company Act of
1940. However, the Companies have been advised by counsel that they are not
by reason of such arrangements investment advisers under that Act.
For the years ended December 31, 1993, 1994 and 1995 the aggregate
amount paid by JP Management to the Companies under this Service Agreement
and similar service agreements between JP Management, the Companies and
other mutual funds managed by JP Management was $352,095, $444,313, and
$347,048, respectively.
The Investment Advisory Agreement and the Service Agreement may,
independently of each other, continue in force from year to year if the
continuance of each such agreement is approved at least annually by the Fund's
Board of Directors, including the specific approval with respect to the
continuance of each such agreement of a majority of the Directors who are not
parties to the particular agreement or interested persons (as the term is
defined in the Investment Company Act of 1940) of any such party, cast in
person at a meeting called for the purpose of voting on approval of the
particular agreement.
<PAGE>
The Investment Advisory Agreement and the Service Agreement may each be
terminated at any time without the payment of any penalty on 60 days' notice to
the other parties either by a vote of the Fund's Board of Directors or by a
vote of the majority of the Fund's shareholders. The Investment Advisory
Agreement and the Service Agreement will automatically terminate in the event
of their assignment.
The Investment Advisory Agreement may be terminated by JP Management on
90 days' written notice to the Fund. The Service Agreement may be terminated
on 90 days' written notice to the Fund and the other parties by JP Management
or any of the Companies.
The Fund's name has been adopted with the permission of Jefferson-Pilot
Corporation and its continued use is subject to the right of Jefferson-Pilot
Corporation to withdraw this permission at any time. If the permission is
withdrawn, but JP Management proposes to continue as the Fund's investment
adviser, the Investment Advisory Agreement will be submitted to Fund
shareholders for approval.
Brokerage
Transactions on stock exchanges and other agency transactions involve the
payment by the Fund of negotiated brokerage commissions. Such commissions
vary among different brokers. Also, a particular broker may charge different
commissions according to such factors as the difficulty and size of the
transaction. There is generally no stated commission in the case of securities
traded in the over-the-counter markets, or for fixed income securities (which
currently includes most of the Fund's portfolio transactions), but the price
paid by the Fund usually includes an undisclosed dealer commission or mark-up.
In underwritten offerings, the price paid by the Fund includes a disclosed,
fixed commission or discount retained by the underwriter or dealer.
JP Management, which places all orders for the purchase and sale of securities
for the Fund, has no formula for the allocation of brokerage business in the
purchase and sale of securities for the Fund. Purchase and sale orders are
placed with the primary objective of obtaining the best execution. Subject
to the foregoing, orders are placed with broker-dealer firms giving
consideration to the quality, quantity and nature of the firms' professional
services which include execution, clearance procedures, and statistical data
and research information to the Fund and JP Management. In pursuing this
objective, JP Management may purchase securities in the over-the-counter
market, utilizing the services of principal market makers unless better
execution can be obtained elsewhere, and may purchase securities listed on an
exchange from non-exchange members in transactions off the exchange. Although
any statistical, research or other information and services provided by broker-
dealers may be useful to JP Management, its dollar value is indeterminable and
its availability does not serve to materially reduce JP Management's normal
research activities or expenses. Any such information, which includes such
matters as general economic and security market reviews, industry and company
reviews, evaluations of securities and recommendations as to the purchase and
sale of securities, must still be analyzed and reviewed by JP Management's
personnel. JP Management may, in recognition of the value of brokerage or
research services provided by the broker, pay such broker a brokerage
commission in excess of that which another broker might have charged for
effecting the same transaction. JP Management will not, however, effect a
transaction at such higher commission unless it determines in good faith that
the amount of the higher commission is reasonable in relation to the value
to the Fund of the brokerage and research services being provided.
<PAGE>
Statistical research or other information or services received by
JP Management from broker-dealers may be used by JP Management in servicing
various of its clients (including the Fund), although not all these services
are necessarily useful and of value in servicing the Fund. The total amount
of brokerage commission on purchase and sale transactions in fiscal year 1993
was $63,883, in fiscal year 1994 was $215,951, and in fiscal year 1995 was
$170,452, one hundred percent of which was paid to brokers furnishing
statistical data research information to JP Management.
Purchase and Redemption of Shares
Reference is made to the information in the Prospectus under "How to Purchase
Shares" and "How to Redeem Shares" which describes the manner in which the
net asset value of the shares of the fund is computed at the close of trading
on each day the New York Stock Exchange is open for trading, and on any other
day in which there is a sufficient degree of trading in the Fund's portfolio
securities to materially affect net asset value, and how the offering price is
determined based on such net asset value. It also sets forth specific
directions for the redemption of shares at net asset value. The Fund's shares
are not valued on New Year's Day, President's Day, Good Friday, Memorial Day,
July 4, Labor Day, Thanksgiving Day or Christmas Day, as the New York Stock
Exchange closes on those days.
The Fund's Directors and Officers
The following list of the Fund's directors and executive officers, all of
whom are also directors and/or officers of Jefferson-Pilot Capital
Appreciation Fund, Inc., JP Investment Grade Bond Fund, Inc., and Jefferson-
Pilot Investment Grade Bond Fund, Inc., includes information as to their
principal occupations during the past five years and their principal
affiliations.
Name, Address & Position with Fund Principal Occupation
During Past 5 years
E. J. Yelton* Senior Vice President -
Director, President and Treasurer Investments, Jefferson-Pilot
100 North Greene Street Corporation and Executive
Greensboro, North Carolina Vice President - Investments,
Jefferson-Pilot Life
Insurance Company since
October 1993; prior
thereto, President and
CEO, ING North America
Investment Centre/Member of
ING Group; Director,
Jefferson-Pilot Investor Services;
President and Director,
JP Management
<PAGE>
John C. Ingram* Senior Vice President,
Director Jefferson-Pilot Life Insurance
100 North Greene Street Company since November 1988 and
Greensboro, North Carolina prior thereto, Vice President;
Senior Vice President, Treasurer
and Director, JP Management
Richard Wolcott McEnally Professor of Investment
401 Brookside Drive Banking, University of North
Chapel Hill, North Carolina Carolina at Chapel Hill
William Edward Moran Senior Vice President,
Director Connors Investor Services, Inc
5206 Barnfield Road since January 1995; prior thereto,
Greensboro, North Carolian Chancellor, University of North
Carolina at Greensboro
J. Lee Lloyd Managing Director, Lloyd
Director & Company since April, 1991;
16 Irving Park Lane prior thereto, Vice
Greensboro, North Carolina President, Goldman, Sachs & Co.
J. Gregory Poole Assistant Secretary,
Secretary Jefferson-Pilot Corporation,
100 North Greene Street since January 1994; Associate
Greensboro, North Carolina Counsel and Assistant Secretary,
Jefferson-Pilot Life Insurance
Company since February 1994;
Attorney and Assistant Secretary,
January 1994; and prior thereto,
Attorney
Messrs. Yelton and Ingram are interested persons (as that term is defined in
the Investment Company Act of 1940, as amended) of the Fund.
The following officers of the Fund also serve as officers and/or directors
of JP Management and Investor Services: E. J. Yelton, President and Treasurer
of the Fund, is President and a Director of JP Management and a Director of
Investor Services; W. Hardee Mills, Jr., Vice President of the Fund, is Vice
President of JP Management; and J. Gregory Poole, Secretary of the Fund, is
Secretary of Investor Services and JP Management. Each director of the Fund
also services as director for 3 other funds in the Jefferson-Pilot Investment
Management Fund Complex. Messrs. Yelton, Poole and Mills hold positions with
the other companies in the Jefferson-Pilot Investment Management Fund Complex
similar to the positions held with the Fund. The other companies within the
Fund Complex have the same investment adviser as does the Fund.
The table on the following page provides information regarding the
compensation each nominee for director was paid by the Fund and the Fund
Complex for the year ended December 31, 1995.
<PAGE>
COMPENSATION TABLE
Pension Estimate Total
Retirement Annual Compensation
Aggregate Benefits Accrued Benefits from Fund and
Name of Person, Compensation as Part of upon 3 other funds
Position from Fund Fund Expenses Retirement in Complex
John C. Ingram
Director $ 0 $ 0 $ 0 $ 0
J. Lee Lloyd
Director 1,220 0 0 4,880
Richard W. McEnally
Director 1,220 0 0 4,880
William E. Moran
Director 1,220 0 0 4,880
E. J. Yelton
Director, President,
Treasurer 0 0 0 4,880
The Board of Directors met five times during the year.
During the year ended December 31, 1995, director not employed by the
Fund or its affiliates received a $100 director's fee for each meeting
attended, amounting to an aggregate of $500. In addition, each of the
non-affiliated directors receives a fee of $720 per year, payable in equal
monthly installments.
General Information
As of April 12, 1996 Jefferson-Pilot Life Insurance Company owned
beneficially 15,000 share or less than 1% of the Fund's outstanding shares.
That company owns of record all of the Fund's outstanding shares; the shares
not owned beneficially are owned for that company's separate account. The
beneficial owner of those shares are the owners of variable annuity contracts
issued by the company's separate account. Jefferson-Pilot Life Insurance
Company, like JP Investment Management Company, is a wholly-owned
subsidiary of Jefferson-Pilot Corporation, Greensboro, North Carolina.
Investors Fiduciary Trust Co., 127 W. 10th Street, 12th Floor, Kansas City, MO
64105, acting as custodian, has custody of all the Fund's securities and cash.
That company attends to the collection of principal and income, and payment
for and collection of proceeds of securities bought and sold by the Fund.
The Fund's independent accountants are McGladrey & Pullen, LLP, 555 Fifth
Avenue, 8th Floor, New York, New York 10017-2416, who audit and report on
the Fund's annual financial statements, review certain regulatory reports,
prepare the Fund's income tax returns, and perform other professional
accounting, auditing, tax and advisory services when engaged to do so by
the Fund. The selection of independent accountants will be submitted
annually to the Fund's shareholders for approval. Shareholders will receive
annual audited financial statements and semi-annual unaudited financial
statements.
<PAGE>
Statement of Assets and Liabilities
December 31, 1995
Assets
Investment in securities at value (cost $57,777,456) $ 72,620,683
Cash 234,191
Receivables:
Capital shares sold 73,582
Dividends 101,730
Total Assets 73,030,186
Liabilities
Payables:
Securities purchased 1,354,110
Accrued expenses 74,577
Total Liabilities 1,428,687
Net Assets
Net Assets, equivalent to $18.96 per share on
3,776,774 shares of capital stock outstanding (Note 2) $ 71,601,499
See Notes to Financial Statements.
<PAGE>
Statement of Operations
Year Ended December 31, 1995
Investment Income:
Interest $ 263,977
Dividends 1,469,132
Total income 1,733,109
Expenses:
Investment Adviser's fee (Note 3) 325,646
Custodian and Transfer Agent fees 26,499
Directors' fees 3,660
Professional fees 25,800
Shareholder accounting services (Note 3) 18,200
Other 2,197
Total expenses 402,002
Less expenses offset (Note 5) (18,225)
Net expenses 383,777
Investment income _ net 1,349,332
Realized and Unrealized Gain on Investments:
Net realized gain on investments 4,429,313
Unrealized appreciation of investments for the year 12,830,999
Net gain on investments 17,260,312
Net increase in net assets from operations $18,609,644
See Notes to Financial Statements.
<PAGE>
Statements of Changes in Net Assets
Years Ended December 31, 1995 and 1994
1995 1994
Increase in Net Assets from:
Operations:
Investment income _ net $ 1,349,332 $ 1,187,225
Net realized gain on investments 4,429,313 7,856,540
Unrealized appreciation (depreciation)
for the year 12,830,999 ( 11,642,733)
Net increase (decrease) in net assets
from operations 18,609,644 ( 2,598,968)
Dividends paid to shareholders from:
Investment income _ net ( 1,318,791) ( 574,936)
Net realized gain on investments ( 7,845,335) ( 1,564,793)
Capital share transactions (Note 2) 3,796,147 6,473,023
Total increase 13,241,665 1,734,326
Net Assets
Beginning of year 58,359,834 56,625,508
End of year (including undistributed net
investment income of $693,205 and
$662,664, respectively) $71,601,499 $58,359,834
See Notes to Financial Statements.
<PAGE>
Statement of Investments
December 31, 1995
Number of Shares
Common Stocks _ 87.34% or Principal Amount Value
Aerospace/Defense _ 1.79%
Lockheed-Martin Corporation 9,300 $ 734,700
Loral Corporation 16,000 566,000
Auto & Truck _ .17%
Honda Motor Company, Ltd. 3,000 126,000
Banks _ 4.04%
Bank of New York Company, Inc. 19,400 945,750
Chase Manhattan Corporation 10,000 606,250
Citicorp 20,600 1,385,350
Biotechnology _ 1.61%
Amgen, Inc. 19,800 1,173,150*
Broadcasting _ 2.32%
Capital Cities/ABC, Inc. 11,600 1,431,150
US West Media Group, Inc. 13,400 254,600*
Chemicals _ Major _3.76%
Dow Chemical Company 10,400 731,900
Monsanto Company 16,300 1,996,750
Computer Software _ 1.39%
Informix Corporation 10,000 300,000*
Silicon Graphics Computer System 13,800 379,500*
Sybase, Inc. 9,200 328,900*
Conglomerates _ .92%
AlliedSignal, Inc. 14,000 665,000
Drugs _ 5.90%
Lilly (Eli) & Company 10,090 567,562
Merck & Company, Inc. 9,000 591,750
Mylan Laboratories, Inc. 29,400 690,900
Pharmacia-Upjohn, Inc. 27,000 1,046,250
Schering-Plough Corporation 25,400 1,390,650
Electric Equipment _ Major _ 3.51%
General Electric Company 25,000 1,800,000
Kuhlman Corporation 60,000 750,000
Electronics _ Instrument _ 2.42%
General Instrument Corporation 14,000 327,250*
3Com Corporation 15,000 699,375*
Varian Associates, Inc. 15,300 730,575
Electronics _ Semi _ 1.64%
LSI Logic Corporation 11,800 386,450*
Texas Instruments, Inc. 15,600 807,300
<PAGE>
Entertainment _ .91%
Disney, (Walt) & Company 11,200 660,800
Financial Services _ .48%
Money Store, Inc. 22,500 348,750
Foods _ 1.98%
Sara Lee Corporation 45,000 1,434,375
Footwear _ 1.34%
Nike, Inc. 14,000 974,750
Hospital _ Management _ 3.04%
Columbia/HCA Healthcare Corporation 16,600 842,450
Medaphis Corporation 21,000 777,000*
Vencor, Inc. 18,000 585,000*
Hospital _ Supplies _ 2.69%
Baxter International, Inc. 10,000 418,750
Guidant Corporation 8,916 376,701
Johnson & Johnson 13,500 1,155,938
Information Processing _ 2.02%
Equifax, Inc. 68,600 1,466,325
Insurance _ Multi-Line _ 4.31%
Aflac, Inc. 17,600 763,400
Allstate Corporation 20,500 843,063
American General Corporation 12,200 425,475
CIGNA Corporation 10,600 1,094,450
Insurance _ Property & Casualty _ .82%
Prudential Reinsurance Holdings, Inc. 25,500 596,063
Machinery _ Agricultural _ .48%
Varity Corporation 9,300 345,262*
Merchandising _ Department _ 1.57%
Dayton Hudson Corporation 6,400 480,000
Federated Department Stores, Inc. 24,000 660,000*
Merchandising _ Drugs _ 1.01%
Eckerd Corporation 16,500 736,312*
Merchandising _ Special _ 2.17%
Borders Group, Inc. 43,500 804,750*
Circuit City Stores, Inc. 28,000 773,500
Miscellaneous Consumer Cyclical _ .46%
Kelly Services, Inc. 12,000 333,000
Miscellaneous Financial _ 4.77%
Countrywide Credit Industries, Inc. 68,000 1,479,000
Dean Witter, Discover & Company 11,000 517,000
Federal Home Loan Mortgage Corporation 8,000 668,000
First USA, Inc. 18,000 798,750
Natural Gas _ Diversified _ .65%
Questar Corporation 14,000 469,000
Oils _ Integrated Domestic _ 5.40%
Amoco Corporation 15,600 1,121,250
Atlantic Richfield Company 13,600 1,506,200
Enron Oil & Gas Company 29,500 708,000
Phillips Petroleum Company 17,200 586,950
<PAGE>
Oils _ Integrated International _ 3.91%
Mobil Corporation 12,100 1,355,200
Royal Dutch Petroleum Company 10,500 1,481,812
Oil Services _ .66%
Oceaneering International, Inc. 37,000 476,375*
Paper & Forest Products _ .30%
Sonoco Products Company 8,400 220,500
Railroads _ .88%
CSX Corporation 14,000 638,750
Telecommunications _ 1.27%
DSC Communications Corporation 25,000 921,875*
Textile _ Apparel _ 1.08%
Intimate Brands, Inc. 20,200 303,000
Ross Stores, Inc. 25,000 478,125
Tobacco _ 1.74%
Philip Morris Companies, Inc. 14,000 1,267,000
Transportation _ Miscellaneous _ .45%
Federal Express Corporation 4,400 325,050*
Utilities _ Communications _ 6.34%
Bell Atlantic Corporation 6,300 421,312
BellSouth Corporation 12,600 548,100
Century Telephone Enterprises, Inc. 14,000 444,500
Frontier Corporation 43,000 1,290,000
SBC Communications, Inc. 6,400 368,000
Sprint Corporation 26,500 1,056,688
US West Communications Group, Inc. 13,400 479,050
Utilities _ Electric _ 7.14%
American Electric Power Company, Inc. 11,550 467,775
CMS Energy Corporation 16,200 483,975
Carolina Power & Light Company 6,700 231,150
CINergy Corporation 22,800 698,250
Consolidated Edison Company of New York, Inc. 9,900 316,800
Dominion Resources, Inc. 7,650 315,563
Entergy Corporation 19,800 579,150
FPL Group, Inc. 13,600 630,700
Illinova Corporation 15,900 477,000
Northeast Utilities 14,500 353,438
PECO Energy Company 8,300 250,037
Public Service Enterprise Group, Inc. 12,550 384,344
Total Common Stocks (Cost _ $48,612,918+) 63,426,845
Preferred Stocks _ 1.93%
Tobacco _ 1.93%
RJR Nabisco Holdings, Inc. Pfd. C. 220,000 1,402,500
Total Preferred Stocks (Cost _ $1,373,200+) 1,402,500
<PAGE>
Short-Term Securities _ 10.73%
Chevron Oil Finance Company, 1/08/96 $ 250,000 249,686
du Pont (E.I.) de Nemours & Company,
1/10/96 2,500,000 2,495,972
Ford Motor Credit Company, 1/10/96 1,700,000 1,697,280
General Electric Capital Corporation,
1/02/96 1,750,000 1,749,436
IBM Credit Corporation, 1/04/96 1,600,000 1,598,964
Total Short-Term Securities (Cost _ $7,791,338+) 7,791,338
Total Investments (Cost _ $57,777,456+) $72,620,683
*Non-income producing.
+Aggregate cost for Federal income tax purposes is the same.
See Notes to Financial Statements.
Notes to Financial Statements
Note 1. Significant Accounting Policies:
JP Capital Appreciation Fund, Inc. is an open-end management investment company
registered under the Investment Company Act of 1940. The Fund's primary
investment objective is long-term capital appreciation. The Fund seeks to
achieve this objective by investing substantially all of its assets in common
stocks of companies recognized as leaders in their respective industries,
however, other types of securities may be purchased depending upon the
judgement of management. The following is a summary of significant accounting
policies followed in the preparation of its financial statements:
Valuation of Securities _ Investments are stated at value based on the closing
prices reported on national securities exchanges on the last business day of
the year, or for over-the-counter securities, at the last bid price, except
that short-term securities are stated at amortized cost which approximates
value.
Federal Income Taxes _ It is the Fund's policy to comply with the requirements
of the Internal Revenue Code applicable to "regulated investment companies" and
to distribute all of its taxable income to its shareholders. Therefore, no
provision for Federal income tax is required.
Use of Estimates _ The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increases and decreases in net assets
from operations during the reporting period. Actual results could differ from
those estimates.
General _ Securities transactions are accounted for on the trade date. Dividend
income and distributions to shareholders are recorded on the ex-dividend date.
Interest income is accrued as earned.
<PAGE>
Note 2. Capital Stock:
At December 31, 1995, 10,000,000 shares of capital stock ($1.00 par value) were
authorized and capital paid-in amounted to $51,638,775. Transactions in capital
stock were as follows:
Year Ended Year Ended
December 31, 1995 December 31, 1994
Shares Amount Shares Amount
Sold 425,888 $ 7,340,776 547,769 $ 9,476,781
Issued on reinvestment
of dividends 620,704 9,124,856 120,270 2,129,830
Redeemed (749,300) ( 12,669,485) (301,292) ( 5,133,588)
Net increase 297,292 $ 3,796,147 366,747 $ 6,473,023
Note 3. Investment Advisory Fee and other Transactions with Affiliates:
JP Investment Management Company received investment advisory fees of $325,646
during the year ended December 31, 1995. This fee is computed at the annual
rate of 0.5% of the Fund's average daily net asset value. If the Fund's
expenses, excluding interest and taxes, exceed 1% of the average daily net
asset value, the Investment Adviser will pay the excess. No such reimbursement
was required during the year.
Expenses include $18,200 of fees paid to JP Investment Management Company under
an Agency Agreement to provide shareholder accounting services.
Note 4. Investment Transactions:
Purchases and sales of investment securities, excluding short-term securities,
were $38,620,653 and $44,365,481, respectively.
Realized gains and losses are reported on an identified cost basis. Accumulated
undistributed net realized gain at December 31, 1995 was $4,426,292.
At December 31, 1995, the aggregate gross unrealized appreciation and
depreciation of portfolio securities was as follows:
Unrealized appreciation $15,175,922
Unrealized depreciation ( 332,695)
Net unrealized appreciation $14,843,227
Note 5. Expense Offset Arrangement:
The Fund has an arrangement with its custodian and transfer agent whereby
credits earned on cash balances maintained at the custodian are used to offset
custody and transfer agent charges. These credits amounted to $18,225 for the
year ended December 31, 1995.
<PAGE>
Note 6. Selected Financial Information:
Years Ended December 31,
1995 1994 1993 1992 1991
Per share operating performance
(for a share outstanding throughout the year)
Net asset value,
beginning of year $16.77 $18.19 $18.17 $17.69 $13.76
Income from investment
operations:
Net investment income .36 .34 .28 .29 .37
Net realized and unrealized
gain (loss) on investments 4.45 ( 1.10) 1.26 .75 3.91
Total from investment
operations 4.81 ( .76) 1.54 1.04 4.28
Less distributions:
Dividends from net
investment income ( .36) ( .17) ( .27) ( .33) ( .35)
Distributions from net
realized gains ( 2.26) ( .49) ( 1.25) ( .23) _
Total distributions ( 2.62) ( .66) ( 1.52) ( .56) ( .35)
Net asset value,
end of year $18.96 $16.77 $18.19 $18.17 $17.69
Total return 33.39% ( 4.34)% 9.25% 6.16% 31.61%
Ratios/supplemental data:
Net assets, end of year
(000 omitted) $71,601 $58,360 $56,625 $45,480 $37,319
Ratios to average net assets:
Expenses .62% .58% .60% .63% .62%
Net investment income 2.07 2.03 1.55 1.68 2.37
Portfolio turnover rate 64.13 126.70 23.93 48.72 36.71
<PAGE>
Independent Auditor's Report
To the Board of Directors and Shareholders
JP Capital Appreciation Fund, Inc.
We have audited the accompanying statement of assets and liabilities and the
statement of investments of JP Capital Appreciation Fund, Inc. as of December
31, 1995, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period
then ended, and the selected financial information for each of the five years
in the period then ended. These financial statements and selected financial
information are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and selected financial
information based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and selected
financial information are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of December 31, 1995, by correspondence with the custodian and brokers.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and selected financial information
referred to above present fairly, in all material respects, the financial
position of JP Capital Appreciation Fund, Inc. as of December 31, 1995, the
results of its operations, the changes in its net assets, and the selected
financial information for the periods indicated, in conformity with generally
accepted accounting principles.
/S/ McGladrey & Pullen, LLP
New York, New York
January 11, 1996
<PAGE>
PART C
OTHER INFORMATION
Page in
Statement of
Item 24. Financial Statements and Exhibits Additional Information
(a) Financial Statements.
Included in the Statement of Additional Information:
Statement of Assets and Liabilities
at December 31, 1995 B-8
Statement of Operations for the Year
ended December 31, 1995 B-9
Statement of Changes in Net Assets for
the Years Ended December 31, 1995 and
1994 B-10
Notes to Financial Statements B-11
Statement of Investments at December 31,
1995 B-14
Report of Certified Public Accountants B-19
Filed as part of Part C of Registration Statement:
None
All other financial statements are omitted because
they are not applicable or the required information
is shown in the financial statements or the notes thereto.
(b) Exhibits.
1 Articles of Incorporation (incorporated by reference to
Exhibit 1 of Form N-1).
2 By-Laws (incorporated by reference to Post-Effective
Amendment No. 13 to the Registrant's Form N-1A).
3 None.
4 Copy of security (incorporated by reference Pre-Effective
Amendment No. 1 to the Registrant's Form N-1).
5 Investment Advisory Agreement (incorporated by reference to
Post-Effective Amendment No. 1 to the Registrant's Form N-1).
6 None.
<PAGE>
7 None.
8 Custody Agreement (incorporated by reference to Post-Effective
Amendment No. 14 to the Registrant's Form N-1A).
9 (a) Service Agreement (incorporated by reference to Post-Effective
Amendment No. 2 to the Registrant's Form N-1).
9 (c) Agency Agreement (incorporated by reference to Pre-Effective
Amendment No. 1 to the Registrant's Form N-1).
10 Not Applicable.
11 Consent of Certified Public Accountants.
12 Not Applicable.
13 None.
14 None.
15 None.
16 Not Applicable.
Item 25. Persons Controlled By or Under Common Control With Registrant
Jefferson-Pilot Life Insurance Company, incorporated under the
insurance laws of the State of North Carolina, owns of record
4,128,244 shares of Registrant's common stock, which represents
100% of Registrant's outstanding voting securities as of
April 12, 1996. Jefferson-Pilot Life Insurance Company owns
beneficially 15,000 of such shares; the balance of the shares
owned by the company is owned by a separate account of the
company as described in the Prospectus making up Part A of
this Amendment.
Jefferson-Pilot Corporation, a North Carolina corporation, owns
(a) all the outstanding voting securities of Jefferson-Pilot Life
Insurance Company; and (b) all of the outstanding voting securities
of JP Investment Management Company, a North Carolina corporation,
Registrant's investment adviser.
Separate financial statements are filed for the Registrant. All of
Jefferson-Pilot Corporation's subsidiaries' financial statements are
included in Jefferson-Pilot Corporation's consolidated financial
statements.
<PAGE>
The following is a list of corporations controlled by
Jefferson-Pilot Corporation:
Percent of
Voting Securities
State of Owned by Jefferson-
Name Incorporation Pilot Corporation
Jefferson-Pilot Life North Carolina 100%
Insurance Company
JP Investment Management North Carolina 100%
Company
Jefferson-Pilot Investor North Carolina 100%
Services, Inc.
Jefferson - Pilot North Carolina 100%
Communications Company
Alexander Hamilton Life
Insurance Company of America Michigan 100%
Omitted from the list are subsidiaries of Jefferson-Pilot Corporation
and the other companies listed which, considered in the aggregate as
a single subsidiary, would not constitute a significant subsidiary.
Because none of the companies listed is a subsidiary of Registrant,
only the financial statements of Registrant are filed.
Item 26. Number of Holders of Securities
The following table indicates the number of record
holders of the Registrant's shares as of April 12, 1996:
(1) (2)
Number of Record
Title of Class Holders
Common Stock, Par Value
$1.00 per share 1
Item 27. Indemnification
The Jefferson-Pilot Corporation, pursuant to resolution of its Board
of Directors, agrees to indemnify the officers and directors of the
Registrant and Jefferson-Pilot Investor Services, Inc. against any
liability to the extent permitted by law. That resolution reads as
follows:
1. The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending,
or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, including all appeals, by reason
of the fact that he/she is or was a director, officer, or employee
of the Corporation, or is or was serving at the request of the
Corporation as a director, trustee, officer, employee, or agent of
another Corporation, partnership, joint venture, trust, or other
enterprise, or as a committee member, trustee or administrator under
an employee benefit plan (all such persons hereinafter sometimes
referred to as "employee"), against expenses (including attorneys'
<PAGE>
fees), judgments, decrees, fines, penalties, and amounts paid in
settlement actually and reasonably incurred by such employee in
connection with such action, suit or proceeding, except that no
indemnification shall be made in respect of any liability or
litigation expense which such employee may incur on account of that
employee's activities which were at the time taken known or believed
by that employee to be clearly in conflict with the best interests
of the Corporation. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a
presumption that the employee knew or believed the activities were
clearly in conflict with the best interests of the Corporation.
2. Any indemnification under Section 1 (unless ordered by a court)
shall be made by the Corporation only as authorized in the specific
case upon a determination that indemnification of the employee is
proper in the circumstances because the employee did not know or
believe, at the time, that the activities were clearly in conflict
with the best interests of the Corporation. Such determination shall
be made (a) by a majority vote of directors acting at a meeting at
which a quorum is present, or (b) if such quorum is not obtainable
(or even of obtainable), and a majority of directors so direct, by
independent legal counsel (compensated by the Corporation) in a
written opinion, or (c) by the affirmative vote of the holders of a
majority of the shares entitled to vote in the election of directors.
3. Expenses of each employee indemnified hereunder incurred in
defending a civil, criminal, administrative, or investigative action,
suit, or proceeding (including all appeals), or threat thereof, may
be paid by the Corporation in advance of the final disposition of
such action, suit or proceeding as authorized by the Board of
Directors, upon receipt of an undertaking by or on behalf of the
employee, to repay such amount unless it shall ultimately be
determined that the employee is entitled to be indemnified by
the Corporation.
4. The indemnification provided by the Resolution shall not be
deemed exclusive of any other rights to which those seeking
indemnification may be entitled as a matter of law, any agreement,
vote of shareholders, any insurance purchased by the Corporation,
or otherwise, both as to action in the employee's official capacity
and as to action in another capacity while holding such office, and
shall continue as to any employee who has ceased to be director,
officer, or employee and shall inure to the benefit of the heirs,
executors, and administrators of such an employee.
5. The Corporation may purchase and maintain insurance on behalf
of any employee who is or was a director, officer, or employee of
the Corporation, or is or was serving at the request of the
Corporation as a director, trustee, officer, or employee of another
corporation, partnership, joint venture, trust, or other enterprise
against any liability asserted against the employee and incurred
by the employee in any such capacity, or arising out of the
employee's status as such, whether or not the Corporation would have
the power to indemnify the employee against such liability under the
provisions of this Resolution or of the North Carolina Business
Corporation Act.
<PAGE>
The North Carolina law applicable to indemnification of directors
and officers reads as follows:
Part 5. Indemnification
55-8-50 POLICY STATEMENT AND DEFINITIONS (a) It is the public policy of
this State to enable corporations organized under this Chapter to attract
and maintain responsible, qualified directors, officers, employees and agents,
and, to that end, to permit corporations organized under this Chapter to
allocate the risk of personal liability of directors, officers, employees and
agents through indemnification and insurance as authorized in this Part.
(b) Definitions in this Part:
(1) "Corporation" includes any domestic or foreign predecessor entity of
a corporation in a merger or other transaction in which the predecessor's
existence ceased upon consummation of the transaction.
(2) "Director" means an individual who is or was a director of a
corporation or an individual who, while a director of a corporation, is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership,
joint venture, trust, employee benefit plan, or other enterprise. A director
is considered to be serving an employee benefit plan at the corporation's
request if his duties to the corporation also impose duties on, or otherwise
involve services by, him to the plan or to participants in or beneficiaries
of the plan. "Director" includes, unless the context requires otherwise, the
estate of personal representatives of a director.
(3) "Expenses" means expenses of every kind incurred in defending a
proceeding, including counsel fees.
(4) "Liability" means the obligation to pay a judgment, settlement,
penalty, fine including an excise tax assessed with respect to an employee
benefit plan, or reasonable expenses incurred with respect to a proceeding.
(5) "Official capacity" means (i) when used with respect to a director,
the office of director in a corporation: and (ii) when used with respect to
an individual other than a director, as contemplated in G.S. 55-8-56 the
office in a corporation held by the officer or the employment or agency
relationship undertaken by the employee or agent on behalf of the corporation.
"Official capacity" does not include service for any other foreign or domestic
corporation or any partnership, joint venture, trust, employee benefit plan,
or other enterprise.
(6) "Party" includes an individual who was, is, or is threatened to be
made a named defendant or respondent in a proceeding.
(7) "Proceeding" means by threatened, pending, or completed action, suit or
proceeding, whether civil, criminal, administrative, or investigative and
whether formal or informal.
55-8-51 AUTHORITY TO INDEMNIFY (a) Except as provided in subsection (d),
a corporation may indemnify an individual made a party to a proceeding because
he is or was a director against liability incurred in the proceeding if:
(1) He conducted himself in good faith; and
<PAGE>
(2) He reasonably believed (i) in the case of conduct in his official
capacity with the corporation, that his conduct was in its best interests;
and (ii) in all other cases, that his conduct was at least not opposed to
its best interests; and
(3) In the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for a
purpose he reasonably believed to be in the interests of the participants
in and beneficiaries of the plan is conduct that satisfies the requirement
of subsection (a)(2)(ii).
(c) The termination of a proceeding by judgment, order, settlement,
conviction, or upon a plea of no contest or its equivalent is not, of
itself, determinative that the director did not meet the standard of
conduct described in this section.
(d) A corporation may not indemnify a director under this section:
(1) In connection with a proceeding by or in the right of the corporation
in which the director was adjudged liable to the corporation; or
(2) In connection with any other proceeding charging improper personal
benefit to him, whether or not involving action in his official capacity,
in which he was adjudged liable on the basis that personal benefit was
improperly received by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation that is concluded without
a final adjudication on the issue of liability is limited to reasonable
expenses incurred in connection with the proceeding.
(f) The authorization, approval or favorable recommendations by the
board of directors of a corporation of indemnification, as permitted by this
section, shall not be deemed an act or corporate transaction in which a
director has a conflict of interest, and no such indemnification shall be void
or voidable on such ground.
55-8-52 MANDATORY INDEMNIFICATION Unless limited by its articles of
incorporation, a corporation shall indemnify a director who was wholly
successful, on the merits or otherwise, in the defense of any proceeding to
which he was a party because he is or was a director of the corporation
against reasonable expenses incurred by him in connection with the proceeding.
55-8-53 ADVANCE FOR EXPENSES Expenses incurred by a director in defending
a proceeding may be paid by the corporation in advance of the final disposition
of such proceeding as authorized by the board of directors in the specific case
or as authorized or required under any provision in the articles of incorpora-
tion or bylaws or by any applicable resolution or contract upon receipt of an
undertaking by or on behalf of the director to repay such amount unless it
shall ultimately be determined that he is entitled to be indemnified by the
corporation against such expenses.
55-8-54 COURT-ORDERED INDEMNIFICATION Unless a corporation's articles of
incorporation provide otherwise, a director of the corporation who is a party
to a proceeding may apply for indemnification to the court conducting the
proceeding or to another court of competent jurisdiction. On receipt of an
application, the court after giving any notice the court considers necessary
may order indemnification if it determines.
(1) The director is entitled to mandatory indemnification under G.S. 55-8-52
in which case the court shall also order the corporation to pay the director's
reasonable expenses incurred to obtain court-ordered indemnification, or
<PAGE>
(2) The director is fairly and reasonably entitled to indemnification in
view of all the relevant circumstances, whether or not he met the standard
of conduct set forth in G.S. 55-8-51 or was adjudged liable as described
in G.S. 55-8-51(d), but if he was adjudged so liable his indemnification is
limited to reasonable expenses incurred.
55-8-55 DETERMINATION AND AUTHORIZATION OF INDEMNIFICATION - (a)
A corporation may not indemnify a director under G.S. 55-8-51 unless
authorized in the specific case after a determination has been made that
indemnification of the director is permissible in the circumstances because
he has met the standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a quorum consisting of
directors not at the time parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision (1), by majority vote
of a committee duly designated by the board of directors (in which designation
directors who are parties may participate), consisting solely of two or more
directors not at the time parties to the proceeding;
(3) By special legal counsel (i) selected by the board of directors or
its committee in the manner prescribed in subdivision (1) or (2): or (ii)
if a quorum of the board of directors cannot be obtained under subdivision
(1) and a committee cannot be designated under subdivision (2), selected
by majority vote of the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted under the control
of directors who are at the time parties to the proceeding may not be voted
on the determination.
(c) Authorization of indemnification and evaluation as to reasonableness
of expenses shall be made in the same manner as the determination that
indemnification is permissible, except that if the determination is made
by special legal counsel, authorization of indemnification and evaluation
as to reasonableness of expenses shall be made by those entitled under
subsection (b)(3) to select counsel.
55-8-56 INDEMNIFICATION OF OFFICERS, EMPLOYEES, AND AGENTS
Unless a corporation's articles of incorporation provide otherwise:
(1) An officer of the corporation is entitled to mandatory
indemnification under G.S. 55-8-52, and is entitled to apply for
court-ordered indemnification under G.S. 55-8-54, in each case to the
same extent as a director:
(2) The corporation may indemnify and advance expenses under this
Part to an officer, employee, or agent of the corporation to the same
extent as to a director; and
(3) A corporation may also indemnify and advance expenses to an officer,
employee, or agent who is not a director to the extent, consistent with
public policy, that may be provided by its articles of incorporation, bylaws,
general or specific action of its board of directors, or contract.
<PAGE>
55-8-57 ADDITIONAL INDEMNIFICATION AND INSURANCE (a) In addition to
and separate and apart from the indemnification provided for in G.S. 55-8-51,
55-8-52, 55-8-54, 55-8-55 and 55-8-56, a corporation may in its articles of
incorporation or bylaws or by contract or resolution indemnify or agree to
indemnify any one or more of its "directors, officers, employees, or agents
against liability and expenses in any proceeding (including without limitation
a proceeding brought by or on behalf of the corporation itself) arising out of
their status as such or their activities in any of the foregoing capacities;
provided, however, that a corporation may not indemnify or agree to indemnify a
person against liability or expenses he may incur on account of his activities
which were at the time taken known or believed by him to be clearly in conflict
with the best interests of the corporation. A corporation may likewise and to
the same extent indemnify or agree to indemnify any person who, at the request
of the corporation, is or was serving as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation, partnership,
joint venture, trust or other enterprise or as a trustee or administrator under
an employee benefit plan. Any provision in any articles of incorporation,
bylaw, contract, or resolution permitted under this section may include
provisions for recovery from the corporation of reasonable costs, expenses,
and attorneys' fees in connection with the enforcement of rights to
indemnification granted therein and may further include provisions
establishing reasonable procedures for determining and enforcing the rights
granted therein.
(b) The authorization, adoption, approval, or favorable recommendation by
the board of directors of a public corporation of any provision in any articles
of incorporation, bylaw, contract or resolution, as permitted in this section,
shall not be deemed an act or corporate transaction in which a director has a
conflict of interest, and no such articles of incorporation or bylaw provision
or contract or resolution shall be void or voidable on such grounds. The
authorization, adoption, approval, or favorable recommendation by the board of
directors of a nonpublic corporation of any provision in any articles of
incorporation, bylaw, contract or resolution, as permitted in this section,
which occurred prior to July 1, 1990, shall not be deemed an act or corporate
transaction in which a director has a conflict of interest, and no such
articles of incorporation, bylaw provision, contract or resolution shall be
void or voidable on such grounds. Except as permitted in G.S. 55-8-31, no
such bylaw, contract, or resolution not adopted, authorized, approved or
ratified by shareholders shall be effective as to claims made or liabilities
asserted against any director prior to its adoption, authorization, or approval
by the board of directors.
(c) A corporation may purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee, or agent of the
corporation, or who, while a director, officer, employee, or agent of the
corporation, is or was serving at the request of the corporation as a director,
officer, partner , trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust, employee benefit plan, or other
enterprise, against liability asserted against or incurred by him in that
capacity or arising from his status as a director, officer, employee, or agent,
whether or not the corporation would have the power to indemnify him against
the same liability under any provision of this act. (Last amended by
Ch. 1024.L.'89. eff. 7-1-90.)
55-8-58 APPLICATION OF PART (a) If articles of incorporation limit
indemnification or advance for expenses, indemnification and advance for
expenses are valid only to the extent consistent with the articles.
(b) This Part does not limit a corporation's power to pay or reimburse
expenses incurred by a director in connection with his appearance as a witness
in a proceeding at a time when he has not been made a named defendant or
respondent to the proceeding.
(c) This Part shall not affect rights or liabilities arising out of
acts or omissions occurring before the effective date of this act.
<PAGE>
Item 28. Business and Other Connections of Investment Adviser
Connections of officers and directors of the investment adviser
with the Registrant appear under "The Investment Adviser" on
page B-3 of the Statement of Additional Information making up a
portion of this Amendment. Any other business, profession,
vocation or employment of a substantial nature of each officer and
director of the investment adviser during the last two years is
shown below.
Name of Director Other Business and
or Officer Nature of Connection
Emery Jay Yelton Senior Vice President-Investments,
President & Director Jefferson-Pilot Corporation and Executive
Vice President-Investments, Jefferson-Pilot
Life Insurance Company since October 1993
John Carter Ingram Senior Vice President, Jefferson-Pilot
Senior Vice President, Life Insurance Company
Treasurer & Director
Kenneth Charles Mlekush Senior Vice President, Jefferson-Pilot
Director Corporation and Executive Vice President-
Individual, Jefferson-Pilot Life Insurance
Company since January 1993; prior thereto,
President & CEO of Southland Life Insurance
Company
Wardell Hardee Mills, Jr. Vice President, Jefferson-Pilot Life Insurance
Vice President Company since February 1994
Jonathan Gregory Poole Associate Counsel & Assistant Secretary,
Secretary Jefferson-Pilot Life Insurance Company since
February 1994
Peggy King Collins Manager, Securities Administration,
Assistant Treasurer Jefferson-Pilot Life Insurance Company
Robert Emmet Whalen Second Vice President-Securities,
Assistant Treasurer Jefferson-Pilot Life Insurance Company
since February 1994
JP Investment Management Company, the investment adviser, also
serves as investment adviser to Jefferson-Pilot Capital
Appreciation Fund, Inc., Jefferson-Pilot Investment Grade Bond
Fund, Inc., and Investment Grade Bond Fund, Inc.
Item 29. Principal Underwriters
Not Applicable
<PAGE>
Item 30. Location of Accounts and Records
The accounts and records of the Registrant are located, in whole or
in part, at the office of the Registrant and the following locations:
Name Address
Investors Fiduciary Trust 127 West 10th Street
Company Kansas City, Missouri 64105
JP Investment Management 100 North Greene Street
Company Greensboro, North Carolina 27401
Item 31. Management Services
None
Item 32. Undertakings
Not Applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1993 and the Investment
Company Act of 1940, the Registrant certifies that it meets all of the
requirements for effectiveness of this Amendment to Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused
this Amendment to Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Greensboro, and
State of North Carolina, on the 30th day of April, 1996.
JP CAPITAL APPRECIATION FUND, INC.
By /s/ E. Jay Yelton
Director, President and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
Director, President and
Treasurer (Chief Executive
Officer, Principal Accounting
/s/ E.J. Yelton Officer and Principal
Financial Officer) April 30, 1996
/s/ John C. Ingram Director April 30, 1996
/s/ J. Lee Lloyd Director April 30, 1996
/s/ Richard W. McEnally Director April 30, 1996
/s/ William E. Moran Director April 30, 1996
/s/ J. Gregory Poole Secretary April 30, 1996
<PAGE>
EXHIBIT INDEX
11 Consent of Certified Public Accountants
27 Financial Data Schedule
<PAGE>
EXHIBIT 11
CONSENT OF CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the use of our report dated January 11, 1996 on
the financial statement of JP Capital Appreciation Fund, Inc. referred
to therein in this Registration Statement and to the reference to our
firm in the Statement of Additional Information under the caption
"General Information."
/s/ McGladrey & Pullen LLP
McGladrey & Pullen, LLP
Certified Public Accountants
New York, New York
April 30, 1996
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
ANNUAL REPROT OF THE JP CAPITAL APPRECIATION FUND, INC., DATED AS OF
DECEMBER 31, 1995 AND FROM FORM N-SAR FOR THE PERIOD ENDING DECEMBER 31,
1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 57,777,456
<INVESTMENTS-AT-VALUE> 72,620,683
<RECEIVABLES> 175,312
<ASSETS-OTHER> 234,191
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 73,030,186
<PAYABLE-FOR-SECURITIES> 1,354,110
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 74,577
<TOTAL-LIABILITIES> 1,428,687
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 51,638,775
<SHARES-COMMON-STOCK> 3,776,774
<SHARES-COMMON-PRIOR> 3,479,482
<ACCUMULATED-NII-CURRENT> 693,205
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 4,426,293
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 14,843,227
<NET-ASSETS> 71,601,499
<DIVIDEND-INCOME> 1,469,132
<INTEREST-INCOME> 263,977
<OTHER-INCOME> 0
<EXPENSES-NET> 383,777
<NET-INVESTMENT-INCOME> 1,349,342
<REALIZED-GAINS-CURRENT> 4,429,313
<APPREC-INCREASE-CURRENT> 12,830,999
<NET-CHANGE-FROM-OPS> 18,609,644
<EQUALIZATION> 0
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<DISTRIBUTIONS-OF-GAINS> 7,845,335
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 425,888
<NUMBER-OF-SHARES-REDEEMED> 749,300
<SHARES-REINVESTED> 620,704
<NET-CHANGE-IN-ASSETS> 13,241,665
<ACCUMULATED-NII-PRIOR> 662,664
<ACCUMULATED-GAINS-PRIOR> 7,842,314
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<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 325,646
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 65,073,514
<PER-SHARE-NAV-BEGIN> 16.77
<PER-SHARE-NII> .36
<PER-SHARE-GAIN-APPREC> 4.45
<PER-SHARE-DIVIDEND> 2.62
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 18.96
<EXPENSE-RATIO> .62
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
