UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from....................to.....................
Commission file number 0-15105
A. Full title of the plan:
Scott & Stringfellow Financial, Inc. Employee Stock Purchase Plan
B. Name of the issuer of the securities held pursuant to the Plan and the
address of its principal executive offices:
Scott & Stringfellow Financial, Inc.
909 East Main Street
Richmond, Virginia 23219
SCOTT & STRINGFELLOW FINANCIAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
INDEX
Page Number
FINANCIAL STATEMENTS
Independent Auditors' Report 3
Statements of Financial Condition -
December 31, 1995 and 1994 4
Statements of Income and Changes in Plan Equity
Years ended December 31, 1995, 1994, and 1993 5
Notes to Financial Statements 6
Signatures 10
Exhibit 23 - Consent of Independent Auditors 11
Independent Auditors' Report
Administrative Committee
Scott & Stringfellow Financial, Inc.
Employee Stock Purchase Plan:
We have audited the accompanying statements of financial condition of the Scott
& Stringfellow Financial, Inc. Employee Stock Purchase Plan as of December 31,
1995 and 1994, and the related statements of income and changes in plan equity
for each of the years in the three-year period ended December 31, 1995. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Scott & Stringfellow
Financial, Inc. Employee Stock Purchase Plan as of December 31, 1995 and 1994,
and the results of its operations and changes in plan equity for each of the
years in the three-year period ended December 31, 1995 in conformity with
generally accepted accounting principles.
KPMG Peat Marwick LLP
Richmond, Virginia
March 8, 1996
SCOTT & STRINGFELLOW FINANCIAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Financial Condition
December 31, 1995 and 1994
1995 1994
ASSETS
Investment - 125,337 shares in 1995 and 80,803
shares in 1994 of Scott & Stringfellow
Financial, Inc. common stock, at fair
value (cost of $1,347,631 and $830,010,
in 1995 and 1994, respectively) (note 7) $ 1,723,410 888,833
Cash in trust 149,719 103,671
Dividends and interest receivable 11,397 7,339
Receivable from Scott & Stringfellow
Financial, Inc. (note 3) 627 3,491
Total assets $ 1,885,153 1,003,334
LIABILITIES AND PLAN EQUITY
Due to Scott & Stringfellow
Financial, Inc. (Note 3) $ 143,509 83,876
Plan equity 1,741,644 919,458
Total liabilities and plan equity $ 1,885,153 1,003,334
See accompanying notes to financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
Statements of Income and Changes in Plan Equity
Years ended December 31, 1995, 1994 and 1993
1995 1994 1993
Investment income:
Dividend income on Scott & Stringfellow
Financial, Inc. common stock $ 43,408 25,879 15,802
Interest 3,157 1,698 1,394
Unrealized appreciation (depreciation) in
fair value of investments (note 4) 316,956 -6,868 65,690
Realized gains on sales and distributions
of investments in Scott & Stringfellow
Financial, Inc. common stock (note 5) 15,509 14,004 170
Total investment income 379,030 34,713 83,056
Participant contributions 549,268 426,426 455,805
Participant withdrawals -106,112 -74,142 -6,400
Net increase in plan equity 822,186 386,997 532,461
Plan equity - beginning of year 919,458 532,461 -
Plan equity - end of year $1,741,644 919,458 532,461
See accompanying notes to financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1995, 1994 and 1993
(1) Description of the Plan and Significant Accounting Policies
General
The Scott & Stringfellow Financial, Inc. Employee Stock Purchase Plan (the
"Plan"), which became effective on January 1, 1993, covers all full time and
some qualified part-time employees ("Participants") of Scott & Stringfellow
Financial, Inc. (the "Company") and its subsidiaries. The Company believes
that the Plan is not presently subject to the provisions of the Employee
Retirement Income Security Act of 1974. The Plan is administered by a
committee appointed by the Board of Directors of Scott & Stringfellow
Financial, Inc. ("Administrative Committee"). The Trustee of the plan is
Mellon Bank, N.A. ("Trustee"). The Trustee may acquire shares of Company stock
from the Company or, if directed by the Administrative Committee, by purchase
on the open market. The Company has reserved 294,000 shares of its common
stock for issuance and purchase by employees under the Plan.
Basis of Presentation
The accompanying financial statements have been prepared on the accrual basis
of accounting. Accordingly, interest and dividend income are recognized as
earned; Plan contributions and withdrawals are recognized when incurred; and
realized gains or losses on sales and distributions of investments and
unrealized appreciation or depreciation of investments are recognized as they
occur.
Investments
Marketable investments, including the Plan's investment asset, common stock of
Scott & Stringfellow Financial, Inc., are stated at estimated fair value as
determined by the Plan's Trustee (generally based upon quoted market prices).
Purchases and sales of investments are recorded as of trade date. The cost of
investments sold in each Participant's account is based on the first-in,
first-out method.
Federal Income Taxes
The Plan is intended to qualify as an employee stock purchase plan under
section 423 of the Internal Revenue Code of 1986, as amended (Section 423).
Under Section 423, neither the Plan nor its participants will incur federal
income tax as a result of purchasing Scott & Stringfellow Financial, Inc.
common stock under the Plan at not less than 85% of fair market value.
Interest and dividend income of the Plan allocated to the Participants are
taxed directly to the Participants. Participants disposing of the common
stock acquired under the Plan will recognize capital gain or loss and may also
have ordinary income under the circumstances specified by Section 423.
(2) Summary of Significant Provisions of the Plan
The following brief description of the Plan is provided for general
information purposes only. Participants should refer to the Plan document for
more complete information.
Contributions
Participants may contribute a minimum of $75 per calendar quarter and a
maximum of 15% of quarterly base compensation, subject to the annual purchase
limitation of section 423. During 1995, this limitation was $25,000. All
Participant contributions, including reinvestment of dividend and interest
income, are invested in the common stock of Scott & Stringfellow Financial,
Inc. at 85% of the fair market value, as defined, of the shares on each
investment date, which is the last business day of each calendar quarter on
which shares of the common stock are traded over-the-counter. Company
contributions are made to the plan equal to the difference between participant
contributions and the purchase price of Scott & Stringfellow Financial, Inc.
common stock when shares are purchased in the open market. There were no
Company contributions in 1995, 1994 and 1993.
Participant Accounts
Each participant's account ("Account") is credited with an allocation of
shares purchased with the Participant's and Company's contributions and
reinvested dividend and interest income allocable to the shares maintained in
the Participant's Account. Participants are immediately 100% vested in their
Account. As of December 31, 1995 there were 181 employees participating in
the plan.
Withdrawals and Sales
Participants may withdraw from the Plan at any time and may direct the Trustee
to either sell or withdraw the shares held in their Account. Participants may
make partial withdrawals once per calendar year. Proceeds of shares sold,
less expenses of the sale and any required income tax withholding, are
remitted to the withdrawing Participant.
Plan Termination
The Plan shall terminate when there are no remaining shares of the Company's
common stock reserved for the Plan or at any time at the discretion of the
Company's Board of Directors.
(3) Receivable From and Due to Scott & Stringfellow Financial, Inc.
The amounts receivable from Scott & Stringfellow Financial, Inc. at December
31, 1995 and 1994 totaling $627 and $3,491, respectively, represent amounts
due as a result of sales of shares of Scott & Stringfellow Financial, Inc.
common stock by Participants.
Due to Scott & Stringfellow Financial, Inc. at December 31, 1995 and 1994
totaling $143,509 and $83,876, respectively, represent amounts due for the
purchase of 11,848 and 8,675, respectively, shares of Scott & Stringfellow
Financial, Inc. common stock. The common stock was acquired at an average per
share cost of $12.11 in 1995 and $9.67 in 1994.
(4) Unrealized Appreciation (Depreciation) in Fair Value of Investments
During 1995, 1994 and 1993, the Plan's investment in Scott & Stringfellow
Financial, Inc. common stock appreciated (depreciated) as follows:
Year ended December 31,
1995 1994 1993
Unrealized appreciation, end of year $375,778 58,822 65,690
Unrealized appreciation, beginning of year 58,822 65,690 -
Increase (decrease) in unrealized appreciation $316,956 -6,868 65,690
Unrealized appreciation includes the increase in value to Participants as a
result of the purchase of shares at 85% of fair market value.
(5) Realized Gains on Sales and Distributions
The aggregate cost and proceeds/market value relating to realized gains on
Scott & Stringfellow Financial, Inc. common stock was as follows:
Proceeds/fair
value at date of Realized
distribution Cost gains
Year ended December 31, 1995:
Sale of common stock $ 30,073 25,674 4,399
Distribution of common stock to participants 59,489 48,379 11,110
Total 89,562 74,053 15,509
Year ended December 31, 1994:
Sale of common stock $ 73,144 62,182 10,962
Distribution of common stock to participants 29,297 26,255 3,042
Total 102,441 88,437 14,004
Year ended December 31, 1993:
Distributions of common stock to participants $ 1,209 1,039 170
(6) Administrative Expenses
Under the Plan, expenses incurred in the purchase of shares and the expenses of
the Trustee are payable by the Company. Expenses incurred in the sale of shares
for a withdrawing participant are netted from the proceeds of such sale. All
other administrative expenses of the Plan are the responsibility of the Plan.
However in 1995, 1994 and 1993, the Company elected to pay for all
administrative expenses of the Plan.
(7) Stock Dividend
During 1994, the Plan received 10,205 shares of Scott & Stringfellow Financial,
Inc. common stock as a result of a 6:5 stock split effected in the form of a 20%
stock dividend declared by the Company. The stock dividend was declared on May
18, 1994 and distributed on August 26, 1994 to shareholders of record on August
5, 1994. Accordingly, the stock dividend was accounted for on the record date
of August 5, 1994 similar to a stock split and therefore had no effect on the
total market value of Scott & Stringfellow Financial, Inc. common stock held by
the Plan on that date.
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the members of the Plan Committee have duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
SCOTT & STRINGFELLOW FINANCIAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
By: Date:
/s/ David Plageman March 28, 1996
- -------------------------
David Plageman
Chairman of the Plan Administration Committee
Exhibit 23
Consent of Independent Auditors
Administrative Committee
Scott & Stringfellow Financial, Inc.
Employee Stock Purchase Plan:
We consent to incorporation by reference in the Registration Statement No.
33 54700 on Form S 8 of Scott & Stringfellow Financial, Inc. of our report dated
March 8, 1996, relating to the statements of financial condition of the Scott &
Stringfellow Financial, Inc. Employee Stock Purchase Plan as of December 31,
1995 and 1994, and the related statements of income and changes in plan equity
for each of the years in the three-year period ended December 31, 1995, which
report appears in the December 31, 1995 annual report on Form 11K of the Plan.
KPMG Peat Marwick LLP
Richmond, Virginia
March 25, 1996
