Greenspring Fund,
Incorporated
ANNUAL REPORT
DECEMBER 31, 1995
This report is authorized for distribution only
to shareholders who have received a copy of
the official Prospectus of the Greenspring
Fund, Incorporated.
<PAGE>
January 1996
Dear Shareholders:
The year ended December 31, 1995 was a strong year
for the Greenspring Fund. Including the reinvestment of
all distributions, the Fund gained 18.8%, which greatly
exceeds the annual average return achieved by the Fund
since its inception on July 1, 1983. The principal force
behind this strength was the performance of the equity
securities in the Fund. The fixed income investments
provided strong, but less robust, results which is to be
expected in a year as buoyant in the equity markets as 1995.
When measured against the Greenspring Fund's goal of providing
steady performance for its shareholders by utilizing a low-risk,
total return approach to investing, 1995 was a success.
Throughout the year, various forces, both positive and
negative, influence the securities in investors' portfolios.
To be effective, a portfolio manager must constantly review,
analyze, and react to these forces in order to position the
portfolio appropriately. At the end of the year, the portfolio
manager has an opportunity to reflect on those elements that
affected the portfolio during the year. This process is beneficial
to the portfolio manager and, hopefully, the insights in this letter
will help our shareholders better understand the Greenspring Fund's
investment strategy.
In studying the positive influences on the Greenspring Fund's
performance during 1995, the first thing that becomes clear is that
most of the securities in the Fund performed very well. Only a handful
of securities had losses for the year, although several other investments
were disappointments to us because they did not produce returns that were
as strong as anticipated. The equities in the Fund had significantly better
performance than the fixed income investments. In retrospect, the Fund's
performance would have been stronger if the Fund's assets had been more
heavily weighted toward equities.
<PAGE>
The top performers in order of contribution were Loyola Capital,
Reliastar Financial (formerly USLICO Corp.), UNR Industries, and Brooklyn
Bancorp. With the exception of Brooklyn Bancorp, which was purchased in
early 1995, all these securities represent long term holdings of the
Greenspring Fund. Loyola Capital, in fact, is the oldest holding in the Fund,
with its original purchase dating back to October 1987. This past year was not
the only rewarding year for these investments, as the Fund has been the
beneficiary of strong performances from these stocks in prior years as well.
However, 1995 was the most profitable year for each of these securities. The
success of these long-term holdings shows that patience is a desirable trait
for value investors. An all-too-frequent error by investors is to sell holdings
because they have performed well, in the belief that "the money has already
been made." An investor who has discovered an undervalued, yet well-managed,
company should be careful not to be too rigid in setting price targets at
which he intends to sell. Instead, the investor should continually ensure
that the security fits his investment philosophy as time passes, but should
also be willing to be open-minded toward corporate developments that may
differ from original expectations, especially if these actions are undertaken
by a savvy, shareholder-oriented management team.
Another trait shared by the Fund's best performers last year is that they
all have been positively affected by actual, or soon-to-occur, capital
transactions. Loyola Capital was acquired by Crestar Financial in a
stock-for-stock merger on December 31, 1995. We continue to hold the shares
of Crestar received in this transaction, because we believe they will benefit
either from the continuing positive environment for bank stocks or the further
consolidation of the banking industry. Our Reliastar Financial holding resulted
from its January 1995 merger with USLICO, which the Fund had originally
purchased in 1993. This merger was also a stock-for-stock deal. Because
Reliastar's stock was undervalued at the time of the merger, the resulting
company is one we continue to hold. UNR Industries is essentially a liquidating
company. At the beginning of 1995, UNR's stock price was $6.375 per share.
During the year, UNR paid to its shareholders $2.55 per share in special and
regular dividends, and it closed the year at a price of $8.625. The company has
recently hired an investment banker to explore the possibility of selling the
company. It is likely, therefore, that this very successful investment will
cease to be a Greenspring Fund holding, should UNR be successful in its
search for a buyer. In the fall of 1995, Brooklyn Bancorp announced an
agreement to sell itself to Republic New York Corporation for $41.50 per
share in cash. The Fund had purchased these shares between February and May
of 1995 in the $31 per share range. We expect the transaction to close in
March of 1996, with the result being an annualized return of well over 30%
in this successful investment.
With respect to the negative influences on the portfolio, as mentioned
earlier, there were not very many securities that lost money for the Fund. It is
very important to study what happened with these securities, however, as the
lessons learned can reduce the chances for losses in future investments. As
with the successes in the Fund last year, there are also similarities among
1995's disappointments. The two securities with losses of any significance
were both fixed income investments of what we would call the "workout"
variety, as opposed to traditional fixed income securities. Our investments
in both the WRT Energy and Kelley Oil and Gas bonds suffered due to their highly
<PAGE>
leveraged balance sheets and their reliance upon natural gas, the price of
which declined for a good part of the year to surprisingly low levels. The
resulting liquidity problems caused their security prices to decline
significantly. The presumed asset values supporting WRT Energy's bonds were
clearly too aggressive, and consequently we sold the securities. In the case
of Kelley Oil and Gas, however, the underlying assets of the company are of
substantial value. While a restructuring in the form of a whole or partial
sale of the company may be necessary, bondholders should be fully covered
by the assets of the company. The Fund purchased its Kelley bonds at
significant discounts to par value, and due to a strong recovery in the
prices of Kelley's securities so far in 1996, the Fund now has a profit
on the 13.5% Senior notes and only a very small loss in the 8.5% convertible
securities.
The lessons learned from the experiences with WRT Energy and Kelley
Oil and Gas revolve mainly around limiting downside risk. We were of the
opinion that natural gas prices would strengthen during 1995, an assumption
that turned out to be correct, but the rise occurred later in the year than
we expected. We underestimated the difficulties that would ensue if natural
gas prices declined, as they did for most of the year. Additionally,
particularly in the case of WRT Energy, we were not skeptical enough at the
time of our purchase of the asset values that were put forth by the Wall
Street community. The lack of adequate asset protection for WRT bondholders
resulted in the downside risk being far greater than we anticipated .
This realization caused us to sell the WRT Energy holdings, a sale that
proved timely as the securities have continued to drop in price after our
sale. Kelley Oil and Gas benefits from substantial asset values that helped
to cushion the downside during 1995, and will enable the company to formulate
a realistic and achievable recovery plan in 1996. We are confident that our
investment in the Kelley bonds will prove to be a very successful one,
although it caused us much concern during the latter part of 1995.
One last item that we would like to mention is that Morningstar, the
well-respected mutual fund research service, has once again shifted the
classification of the Greenspring Fund. While their competitors at Lipper
Analytical still list us as a "Growth and Income" fund, Morningstar now calls
us a "Balanced" fund. In the years that Morningstar has followed the
Greenspring Fund they have categorized us as Growth, Growth and Income,
Asset Allocation, and, now, Balanced. We realize that Greenspring Fund's
distinctive investment style can make it difficult for the mutual fund services
to categorize us. Although our investment approach is somewhat unique, our
objective is straightforward and has remained constant and unchanged since
our inception in 1983. Our goal for shareholders is to provide steady,
consistent performance over the long term by utilizing a total return,
low-risk approach that minimizes the volatility to which our shareholders'
assets are subjected. We believe we accomplished our objective during 1995,
and we are confident 1996 will prove to be another successful year for the
Greenspring Fund.
Respectfully,
Charles vK. Carlson
President
<PAGE>
GREENSPRING FUND, INCORPORATED
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
COMMON STOCKS (60.28%)
Shares Value
Banking (14.15%)
500 *Avondale Financial Corp. $ 7,250
11,000 Bell Bancorp, Inc. 393,250
100,000 *Brooklyn Bancorp, Inc. 4,075,000
35,000 Charter Financial, Inc. 378,438
25,000 Columbia Bancorp, Inc. 431,250
15,750 *DS Bancor, Inc. 401,625
30,000 Frankfort First Bancorp, Inc. 397,500
23,000 Home Financial Corp. 356,500
30,000 *Imperial Thrift & Loan 367,500
70,100 Loyola Capital Corp. 2,655,038
10,000 Mercantile Bankshares Corp. 278,750
26,000 *Springfield Institution for Savings 425,750
10,167,851
Consumer Products and Services (9.00%)
52,400 *American Safety Razor Company 412,650
60,100 *Craig Corp. 593,487
18,300 First Brands Corporation 871,537
5,300 Genesee Corporation Class B 233,200
8,600 Hasbro, Inc. 266,600
50,500 Premark International, Inc. 2,556,562
79,000 *The Scotts Company 1,530,625
6,464,661
Defense (1.21%)
11,000 Lockheed Martin Corp. 869,000
869,000
Environmental Services (2.20%)
121,100 Alliance Global Environmental Fund, Inc. 1,226,138
12,000 Browning-Ferris Industries 354,000
1,580,138
Industrial Services (0.55%)
121,800 General Physics Corp. 395,850
395,850
<PAGE>
GREENSPRING FUND, INCORPORATED
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
COMMON STOCKS (CON'T)
Shares Value
Insurance (6.27%)
75,000 PartnerRe Holdings, Ltd. $ 2,062,500
51,208 Reliastar Financial Corp. 2,272,355
4,100 *Transport Holdings, Inc. 167,075
4,501,930
Manufacturing (10.41%)
387,100 *Griffon Corporation 3,483,900
216,300 UNR Industries, Inc. 1,865,588
110,000 *U.S. Industries, Inc. 2,021,250
10,000 *Varitronic Systems 107,500
7,478,238
Media (2.94%)
111,000 *US West Media Group 2,109,000
2,109,000
Natural Resources (2.96%)
232,600 *Castle Energy Corp. 2,075,234
4,300 *Norex America, Inc. 53,750
2,128,984
Real Estate (10.57%)
179,200 *EQK Realty Investors 1 268,800
327,000 Mark Centers Trust 3,719,625
277,045 The Town and Country Trust 3,601,585
7,590,010
Companies in Liquidation (0.02%)
4,700 *Aerospace Creditors Liquidating Trust 16,156
16,156
Total Common Stocks (Cost $36,043,932) 43,301,818
<PAGE>
GREENSPRING FUND, INCORPORATED
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
PREFERRED STOCKS (2.98%)
Shares or
Principal
Amount Value
14,500 Illinois Power Company,
Adj. Rate Pfd., Series A $ 634,375
60,000 Manville Corporation,
Preference Stock, Series B 1,507,500
Total Preferred Stocks
(Cost $1,774,120) 2,141,875
BONDS (34.11%)
Convertible Bonds (7.43%)
$ 1,615,000 Alexander Haagen Properties, Inc.,
7.50%, 1/15/01 1,359,964
2,045,000 Bell Sports Corp., 4.25%, 11/15/00 1,431,925
600,000 Hasbro, Inc., 6.00%, 11/15/98 658,500
1,149,000 Kelley Oil & Gas Partners Ltd.,
8.50%, 4/1/00 643,440
500,000 Liberty Properties Limited Partnership,
8.00%, 7/1/01 517,813
750,000 Pacific Physicians Services,
5.50%, 12/15/03 725,625
Total Convertible Bonds 5,337,267
Non-Convertible Bonds (22.64%)
1,500,000 B.F. Saul Real Estate Investment
Trust, 11.625%, 4/1/02 1,545,000
705,308 Carson Pirie Scott & Co.,
13.00%, 4/1/05 708,212
2,800,000 Hills Department Stores,
10.25%, 9/30/03 2,555,000
314,000 IMO Industries, 12.25%, 8/15/97 316,355
513,000 Kelley Oil & Gas, 13.50%, 6/15/99 420,019
1,904,000 Tyco Toys, Inc., 10.125%, 8/15/02 1,720,740
1,840,000 UNC, Inc., 9.125%, 7/15/03 1,798,026
1,000,000 Unisys Corp., 9.75%,9/15/96 978,438
1,000,000 U.S. Treasury, 7.125%, 9/30/99 1,060,469
3,200,000 Walter Industries, Inc. Series B
Sr. Notes, 12.19%, 3/15/00 3,240,889
1,752,000 Zapata Corp., 10.25%, 3/15/97 1,767,330
164,000 Zapata Corp., 10.875%, 5/1/01 154,775
Total Non-Convertible Bonds 16,265,253
<PAGE>
GREENSPRING FUND, INCORPORATED
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
BONDS (34.11%) (CON'T)
Principal
Amount Value
Bonds in Reorganization (4.04%)
$ 706,000 El Paso Electric 1st Mortgage,
9.95%, 5/1/04 $ 769,540
500,000 El Paso Electric 1st Mortgage,
6.75%, 5/1/98 519,375
500,000 El Paso Electric 1st Mortgage,
9.00%, 11/1/04 536,875
1,010,000 El Paso Electric 1st Mortgage,
8.50%, 4/1/07 1,080,069
Total Bonds in Reorganization 2,905,859
Total Bonds (Cost $24,318,995) 24,508,379
SHORT-TERM INVESTMENTS (2.15%)
Rodney Square Money Market Fund 1,542,952
Total Short-Term Investments
(Cost $1,542,952) 1,542,952
Total Investments in Securities (99.52%)
(Cost $ 63,679,999) 71,495,024
Other Assets Less Liabilities (.48%) 344,071
Total Net Assets (100.00%) $ 71,839,095
*Non-income producing securities
<PAGE>
GREENSPRING FUND, INCORPORATED
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
ASSETS
Investments, at market value
(cost, $63,679,999) $ 71,495,024
Interest receivable 564,930
Dividends receivable 245,014
Receivable for Fund shares sold 163,997
Receivable for securities sold 98,417
Purchased interest 38,368
Prepaid expense 701
Total Assets 72,606,451
LIABILITIES
Payable for securities purchased 495,985
Payable to bank 173,615
Accrued expenses 45,528
Due to investment advisor 44,801
Payable for Fund shares repurchased 7,427
Total Liabilities 767,356
NET ASSETS
Capital stock, $.01 par value; authorized
30,000,000 shares; outstanding, 4,774,378 $ 71,839,095
NET ASSETS CONSIST OF:
Capital stock at par value $ 47,744
Paid in capital 64,353,353
Undistributed net investment income 109,378
Accumulated net realized losses (486,405)
Net unrealized appreciation on investments 7,815,025
Net Assets $ 71,839,095
NET ASSET VALUE PER SHARE $ 15.05
The accompanying notes are an integral part of these financial statements.
<PAGE>
GREENSPRING FUND, INCORPORATED
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1995
INVESTMENT INCOME
Interest $ 2,718,489
Dividend 1,210,291
Other Income 13,564
Total Income $ 3,942,344
Expenses
Investment advisory fee 494,166
Salary and benefits 47,362
Transfer agent fees 35,720
Registration fees 25,920
Administrative 21,347
Professional fees 20,247
Custodian fees 19,984
Miscellaneous 8,985
Reports to shareholders 7,074
Filing fees 5,634
Directors fees 3,900
Fidelity bond 2,797
Total Expenses 693,136
NET INVESTMENT INCOME 3,249,208
REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS
Net realized loss on investments (127,537)
Net change in unrealized appreciation of
investments 7,706,761
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS 7,579,224
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 10,828,432
The accompanying notes are an integral part of these financial statements.
<PAGE>
GREENSPRING FUND, INCORPORATED
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
<TABLE>
<CAPTION>
INCREASE IN NET ASSETS
1995 1994
<S> <C> <C>
OPERATIONS:
Net investment income $ 3,249,208 $ 1,617,431
Net realized gain/(loss) from investments ( 127,537) 1,875,611
Net change in unrealized appreciation
of investments 7,706,761 ( 2,612,163)
Net increase in net assets resulting from
operations 10,828,432 880,879
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income ( 3,139,831) ( 1,608,002)
Net realized gain on investments ( 289,108) ( 1,596,443)
Distributions in excess of net realized gains ( 358,868) ( 0)
Net decrease in net assets from
distributions to shareholders ( 3,787,807) ( 3,204,445)
CAPITAL STOCK TRANSACTIONS:
Sale of 1,664,602 and 1,915,202 shares 24,026,990 27,073,305
Distributions reinvested of 232,278
and 230,591 shares 3,419,563 3,092,760
Redeemed 881,936 and 526,899 shares ( 12,970,297) ( 7,405,137)
Increase in net assets from capital
stock transactions 14,476,256 22,760,928
TOTAL INCREASE IN NET ASSETS 21,516,881 20,437,362
NET ASSETS AT BEGINNING OF YEAR 50,322,214 29,884,852
NET ASSETS AT END OF YEAR $ 71,839,095 $ 50,322,214
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
GREENSPRING FUND, INCORPORATED
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
Note 1 - Significant Accounting Policies
Greenspring Fund, Incorporated ("the Fund") is a diversified open-end
management investment company registered under the Investment Company
Act of 1940, as amended.
Investment transactions and related investment income - Investment
transactions are recorded on the trade date. Dividend income is recorded
on the ex-dividend date and interest income is recorded on the accrual
basis. Dividends determined to be a return of capital are recorded as a
reduction of the cost basis of the security. Realized gains and losses
from investment transactions and unrealized appreciation and depreciation
of investments are reported on an identified cost basis.
Valuation of investments - Securities listed on a national securities
exchange or the NASDAQ National Market are valued at the last reported sale
price on the exchange of major listing as of the close of the regular
session of the New York Stock Exchange (currently 4:00 P.M. Eastern time).
Securities which are traded principally in the over-the-counter market,
listed securities for which no sale was reported on the day of valuation,
listed securities for which the last reported sale price is not in the
context of the highest closing bid price and the lowest closing offering
price, and listed securities whose primary market is believed by the
Advisor to be over-the-counter are valued at the mean of the closing bid
and asked prices obtained from sources that the Advisor deems appropriate.
Short-term investments are valued at amortized cost which approximates
fair market value. The value of securities that mature, or have an
announced call, within 60 days will be amortized on a straightline basis
from the market value one day preceding the beginning of the amortization
period.
Securities for which market quotations are not readily available are
valued at fair market value as determined in good faith by the Advisor
as directed by the Board of Directors.
Income Taxes - It is the policy of the Fund to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies.
Accordingly, the Fund intends to distribute substantially all of its
taxable income. Therefore, no federal income tax provision is required.
Dividends and distributions to stockholders - The Fund records dividends
and distributions to stockholders on the ex-dividend date.
Redemption of capital stock - A stockholder may request redemption of
some or all of his shares on any day that the New York Stock Exchange is
open for business. The redemption price per share is the net asset value
per share as of the close of business on the day that redemption request
is received by the Fund. Payment for shares will be made within seven days
after receipt of the redemption request.
<PAGE>
GREENSPRING FUND, INCORPORATED
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
Note 2 - Dividends and Distributions of 1995 Taxable Earnings
It is the Fund's policy to declare dividends from net investment income
and distributions from net realized gains as determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles.
On July 12, 1995, the Board of Directors declared an income dividend and
a long-term capital gains distribution of $.40 and $.07 per share,
respectively, payable on July 13, 1995, to shareholders of record on
July 11, 1995. Additionally, on December 18, 1995, the Board of Directors
declared an income dividend and a short-term capital gains distribution
of $.28 and $.07 per share, respectively, payable on December 19, 1995,
to shareholders of record on December 15, 1995.
These dividends are either distributed to shareholders or reinvested by
the Fund in additional shares of common stock, which are issued to
stockholders. For those reinvesting the dividend, the number of shares
issued is based on the net asset value per share as of the close of
business on the business day previous to the payment date.
Note 3 - Purchases and Sales of Investments
For the year ended December 31, 1995, purchases and sales of investments,
other than short-term investments, aggregated $62,173,355 and $36,881,457,
respectively.
For federal income tax purposes, the cost of investments owned at December
31, 1995 was $63,679,999. Net unrealized appreciation of such investments
aggregated $7,815,025, which was composed of appreciation of $9,788,322 for
those securities having an excess of value over cost, and depreciation of
$1,973,297 for those securities having an excess of cost over value.
Note 4 - Investment Advisory Agreement and Related Party Transactions
The Fund's investment advisor, Key Equity Management Corporation ("Key
Equity"), is a wholly-owned subsidiary of Corbyn Investment Management.
Under an agreement between the Fund and Key Equity, the Fund pays Key
Equity a monthly fee at an annual rate of .75% of the Fund's month-end
net assets. The Fund's total expenses, excluding interest, taxes, brokerage
commissions, and extraordinary expenses, may not exceed 1.5% of average
daily net assets (1% of average daily net assets in excess of $30,000,000).
Investment advisory fees incurred for the year ended December 31, 1995 were
$494,166. At December 31, 1995, investment advisory fees payable amounted
to $44,801.
Certain of the Fund's officers and directors are also officers and
directors of Key Equity and Corbyn Investment Management. At December 31,
1995, investors for whom Corbyn Investment Management was investment
advisor held 1,089,207 shares of the Fund's common stock.
<PAGE>
GREENSPRING FUND, INCORPORATED
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<TABLE>
<CAPTION>
Year Ended December 31,
1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Year $ 13.39 $ 13.96 $ 13.78 $ 12.91 $ 11.32
Income From Investment Operations
Net Investment Income 0.70 0.51 0.40 0.51 0.49
Net Realized and
Unrealized Gain/Loss on
Investments 1.78 (0.12) 1.59 1.59 1.69
Total From Investment Operations 2.48 0.39 1.99 2.10 2.18
Less Distributions
Net Investment Income (0.68) (0.51) (0.40) (0.51) (0.52)
Net Realized Gain on
Investments (0.07) (0.45) (1.41) (0.72) (0.07)
Distributions in Excess of
Net Realized Gains (0.07) ( - ) ( - ) ( - ) ( - )
Total Distributions (0.82) (0.96) (1.81) (1.23) (0.59)
Net Asset Value, End of Year $ 15.05 $ 13.39 $ 13.96 $ 13.78 $ 12.91
Total Return 18.79% 2.83% 14.65% 16.52% 19.34%
Ratios/Supplemental Data
Net Assets, End of Year (000's) $ 71,839 $ 50,322 $ 29,885 $ 20,004 $ 18,916
Ratio of Expenses to Average Net
Assets 1.06% 1.27% 1.31% 1.48% 1.33%
Ratio of Net Investment Income to
Average Net Assets 4.97% 4.03% 2.78% 3.68% 3.79%
Portfolio Turnover 65.19% 76.55% 121.79% 100.17% 70.21%
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of
Directors of the Greenspring Fund, Incorporated
We have audited the accompanying statement of assets and liabilities of
Greenspring Fund, Incorporated, including the schedule of portfolio of
investments, as of December 31, 1995, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and the financial highlights for the four
years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights for the year ended December 31,
1991 were audited by other auditors whose report dated January 30, 1992,
expressed an unqualified opinion on the financial highlights.
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 financial
highlights 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 financial highlights referred
to above present fairly, in all material respects, the financial position of
Greenspring Fund, Incorporated as of December 31, 1995, the results of its
operations for the year then ended, the changes in net assets for each of the
two years in the period then ended, and the financial highlights for each of
the four years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
January 19, 1996
<PAGE>
Greenspring Fund, Incorporated
2330 West Joppa Road, Suite 110
Lutherville, Maryland 21093-4641
DIRECTORS
Charles vK. Carlson, CFA, Chairman
William E. Carlson
David T. Fu
Michael J. Fusting, CFA, CPA
Michael T. Godack
Richard Hynson, Jr.
OFFICERS
Charles vK. Carlson President
Michael T. Godack Senior Vice President
and Secretary
Michael J. Fusting Vice President and
Treasurer
CUSTODIAN
Wilmington Trust Company
1100 North Market Street
Wilmington, DE 19890
INDEPENDENT AUDITOR
Coopers & Lybrand L.L.P.
217 E. Redwood Street
Baltimore, Maryland 21202-3316
INVESTMENT ADVISOR
Key Equity Management Corporation
2330 West Joppa Road, Suite 108
Lutherville, Maryland 21093-7207
LEGAL COUNSEL
De Martino Finkelstein Rosen & Virga
1818 N Street, N.W.
Washington, D.C. 20036-2492
TRANSFER AGENT
Rodney Square Management Corporation
1105 North Market Street, Third Floor
Wilmington, DE 19890
Shareholder Services (800) 576-7498
Prospectus Fulfillment (800) 366-3863
