<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
Amendment No. 1 to
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended December 31, 1998
Commission File Number 0-24133
FRANKLIN FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
TENNESSEE 62-1376024
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
230 PUBLIC SQUARE, FRANKLIN, TENNESSEE 37064
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (615) 790-2265
Securities registered pursuant to Section 12(b) of the Securities Exchange Act
of 1934: None
Securities registered pursuant to Section 12(g) of the Securities Exchange Act
of 1934:
COMMON STOCK, NO PAR VALUE
(Title of class)
<PAGE>
The undersigned Registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-KSB for
the fiscal year ended December 31, 1998, as set forth below:
Part III, Item 13(a) of the above-referenced Form 10-KSB is
amended to include as Exhibit 99 the information required by
Form 11-K with respect to the Franklin Financial Employees
Retirement Savings Plan (the "Plan"), which exhibit is filed
as part of the above-referenced Form 10-KSB in lieu of a
separate filing of an Annual Report on Form 11-K for the Plan
for the fiscal year ended December 31, 1998, in accordance
with Rule 15d-21.
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this amendment to be signed on its behalf by the
undersigned thereunto duly authorized.
FRANKLIN FINANCIAL CORPORATION
By: /S/ RICHARD E. HERRINGTON
------------------------------------------
Richard E. Herrington
President and Chief Executive Officer
Date: June 25, 1999
2
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration Statements (No.
33-92824, 333-65361, 333-65359 and 333-65363) each on Form S-8 of Franklin
Financial Corporation of our report dated June 22, 1999, relating to the
financial statements and related schedules for the Franklin Financial Employees
Retirement Savings Plan as of and for the years ended December 31, 1998 and
1997, which report appears in Exhibit 99 of this Amendment No. 1 to the Annual
Report on Form 10-KSB of Franklin Financial Corporation for the year ended
December 31, 1998.
/s/ Heathcott & Mullaly, P.C.
Brentwood, Tennessee
June 25, 1999
<PAGE>
EXHIBIT 99
Information required by Form 11-K with respect to the Franklin Financial
Employees Retirement Savings Plan for the fiscal year ended December 31, 1998
The following financial statements prepared in accordance with the
financial reporting requirements of ERISA include the following:
a. Independent Auditors' Report
b. Statement of Net Assets Available for Plan Benefits, as of December 31,
1998 and 1997
c. Statement of Changes in Net Assets Available for Plan Benefits, for the
Years Ended December 31, 1998 and 1997
d. Notes to Financial Statements
e. Schedule I: Line 27(a) - Schedule of Assets Held for Investment Purposes
f. Schedule III: Line 27(d) - Schedule of Reportable Transactions
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES
RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 AND 1997
(WITH INDEPENDENT AUDITORS' REPORT THEREON)
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
TABLE OF CONTENTS
Independent Auditors' Report.................................................1-2
Financial Statements:
Statements of Net Assets Available for Benefits.......................3
Statement of Changes in Net Assets Available for Benefits.............4
Notes to Financial Statements......................................5-10
Schedules:
Assets Held for Investment Purposes..................................11
Reportable Transactions...........................................12-14
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors of the
Franklin Financial Employees
Retirement Savings Plan
We have audited the accompanying statements of net assets available for plan
benefits of Franklin Financial Employees Retirement Savings Plan as of December
31, 1998 and 1997, and the related statements of changes in net assets available
for plan benefits for the years then ended. 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 net assets available for plan benefits of Franklin
Financial Employees Retirement Savings Plan as of December 31, 1998 and 1997,
and the changes in its net assets available for plan benefits for the years then
ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes and reportable transactions are presented for the
purpose of additional anaylsis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules are the responsibility of the Plan's management. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
<PAGE>
The schedule of assets held for investment purposes that accompanies the Plan's
financial statements does not disclose the historical cost of certain plan
investments held by the Plan custodian. Disclosure of this information is
required by the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974.
/s/ Heathcott & Mullaly, P.C.
Heathcott & Mullaly, P.C.
June 22, 1999
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
ASSETS:
Investments held by Aetna Life Insurance
and Annuity Company, Custodian $ 978,836 908,040
Franklin Financial Corporation common stock 224,612 --
Participant loans 28,291 48,449
Cash 830 --
Total investments, at fair value 1,232,569 956,489
Receivables:
Employee contributions -- 6,031
Employer contributions 1,211 1,690
Total receivables 1,211 7,721
Total assets $1,233,780 964,210
LIABILITIES:
Refundable participant contributions $ -- 1,105
NET ASSETS AVAILABLE FOR PLAN BENEFITS $1,233,780 963,105
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income:
Interest $ 4,567 3,095
Net appreciation in fair value of investments 33,116 111,299
Total investment income 37,683 114,394
Contributions
Employer 80,364 55,744
Participants 194,871 133,045
Total contributions 275,235 188,789
TOTAL ADDITIONS 312,918 303,183
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Benefits paid to participants 39,196 29,125
Forfietures 3,047 --
Total deductions 42,243 29,125
INCREASE IN NET ASSETS 270,675 274,058
NET ASSETS AT BEGINNING OF YEAR 963,105 689,047
NET ASSETS AT END OF YEAR $1,233,780 963,105
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 AND 1997
(1) DESCRIPTION OF PLAN
The following description of the Franklin Financial Employees
Retirement Savings Plan provides only general information. Participants
should refer to the Plan agreement for a more comprehensive description
of the Plan's provisions.
(a) GENERAL
The Plan is a defined contribution plan covering all employees
of Franklin National Bank (the Company) who have three months
of service and are age twenty-one or older. The Plan is
subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). Franklin National Bank is a
wholly-owned subsidiary of Franklin Financial Corporation.
(b) CONTRIBUTIONS
Each year, participants may contribute up to 15% of pretax
annual income, as defined in the Plan. Participants may also
contribute amounts representing distributions from other
qualified defined benefit or contribution plans. The Company
contributes 50% of the first 6% of base compensation that a
participant contributes to the Plan. Additional amounts may be
contributed at the option of the Company. Contributions are
subject to certain limitations. Effective January 1, 1998 all
employer contributions are invested in Franklin Financial
Corporation stock.
(c) PARTICIPANTS ACCOUNTS
Each participant's account is credited with the participant's
contribution and allocations of (a) the Company's contribution
and (b) Plan earnings, and charged with an allocation of
administrative expenses, if any. Allocations are based on
participant earnings or account balances, as defined. The
benefit to which a participant is entitled is the benefit that
can be provided from the participant's vested account.
(d) VESTING
Participants are immediately vested in their contributions
plus actual earnings thereon. Vesting in the Company's
matching and discretionary contribution portion of their
accounts plus actual earnings is based on years of continuous
service. A participant is 100 percent vested after 3 years of
service.
5
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 AND 1997
(1) DESCRIPTION OF PLAN, CONTINUED
(d) VESTING, CONTINUED
Participants automatically become fully vested, regardless of
the years of service completed, upon attainment of the Plan's
normal retirement age of 65, upon death, or upon disability.
(e) INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct employee
contributions in any of thirteen investment options including
common stock of Franklin Financial Corporation. Participants
may change their investment options daily.
(f) PARTICIPANT NOTES RECEIVABLE
Participants may borrow from their fund accounts to a maximum
equal to the lesser of $50,000 or 50% of their account
balance. Loan transactions are treated as a transfer to (from)
the investment funds from (to) the Participant notes fund.
Loan terms are limited to five years. The loan term may exceed
five years for the purchase of a primary residence. The loans
are secured by the balance in the participant's account and
bear interest at a rate commensurate with local prevailing
rates as determined by the Plan administrator. Principal and
interest are paid ratably through monthly payroll deductions.
(g) PAYMENT OF BENEFITS
On termination of service due to death, disability or
retirement, a participant may elect to receive either a
lump-sum amount equal to the value of the participant's vested
interest in his or her account, or annual installments. For
termination of service due to other reasons, a participant may
receive the value of the vested interest in their account as a
lump sum distribution.
(h) FORFEITED ACCOUNTS
At December 31, 1997, there were no forfeited nonvested
accounts. During 1997, $18,928 was allocated from forfeited
nonvested accounts to participants based on participants'
earnings. Effective January 1, 1998, forfeited nonvested
accounts will be used to reduce future plan expenses.
6
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 AND 1997
(1) DESCRIPTION OF PLAN, CONTINUED
(i) PLAN TERMINATION
Although it has not expressed any intent to do so, the Company
has the right to discontinue its contributions at any time and
to terminate the Plan subject to the provisions of ERISA. In
the event of Plan termination, participants will become 100
percent vested in their accounts.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BASIS OF PRESENTATION
The financial statements of the Plan have been prepared on an
accrual method of accounting.
(b) ESTIMATES
The preparation of financial statements in conformity with
generally accepted accounting principles requires the plan
administrator to make estimates and assumptions that affect
certain reported amounts and disclosures. Accordingly, actual
results may differ from those estimates.
(c) INVESTMENTS
Investments are stated at fair value as reported by the
Custodian. Fair values have been determined by quoted prices
on an active market. Participant notes receivables are valued
at cost which approximates fair value.
(d) PAYMENT OF BENEFITS
Benefits are recorded when paid.
(3) TAX STATUS
The Plan has received a determination letter in which the Internal
Revenue Service stated the Plan, as currently designed, is in
compliance with the applicable requirements of the Internal Revenue
Code.
7
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998 AND 1997
(4) RELATED PARTY TRANSACTION
Certain Plan investments are shares of institutional funds managed by
Aetna Life Insurance and Annuity Company. Aetna Life Insurance and
Annuity Company is the custodian of the Plan and, therefore, these
transactions qualify as party-in-interest.
8
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES
RETIREMENT SAVINGS PLAN
Notes to Financial Statements, continued
5. PARTICIPANT DIRECTED FUNDS
Under provisions of the Plan, the participants may direct contributions
among thirteen investment programs. Amounts relating to each of these
investment programs as of December 31, 1998 and for the year then ended
are as follows:
<TABLE>
<CAPTION>
Aetna Aetna
Aetna Aetna Guaranteed Guaranteed
Aetna Variable Aetna Investments Accumulation Accumulation Aetna
Variable Encore Income Advisors Account Accrual Fixed
Fund Fund Shares Fund Short-Term Long-Term Account
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments at fair value:
Investments held by Aetna
Life Insurance and Annuity
Company, Custodian $329,647 35,235 10,770 89,042 1,750 2,506 244,421
Franklin Financial
Corporation Common
Stock -- -- -- -- -- -- --
Participant Loans -- -- -- -- -- -- --
Cash -- -- -- -- -- -- --
------- ------ ------ ------ ----- ----- -------
Total investments at fair
value 329,647 35,235 10,770 89,042 1,750 2,506 244,421
------- ------ ------ ------ ----- ----- -------
Contributions receivable:
Employer's -- -- -- -- -- -- --
Participant's -- -- -- -- -- -- --
------- ------ ------ ------ ----- ----- -------
Total contributions
receivable -- -- -- -- -- -- --
------- ------ ------ ------ ----- ----- -------
Net assets available for
plan benefits 329,647 35,235 10,770 89,042 1,750 2,506 244,421
------- ------ ------ ------ ----- ----- -------
------- ------ ------ ------ ----- ----- -------
Additions to net assets attributed
to:
Investment income:
Net appreciation
(depreciation) in fair value
of investment 40,123 1,522 596 14,188 49 110 13,110
Interest
------- ------ ------ ------ ----- ----- -------
Total investment income 40,123 1,522 596 14,188 49 110 13,110
------- ------ ------ ------ ----- ----- -------
Contributions:
Employer
Participants 39,135 22,351 4,071 15,604 910 579 37,850
------- ------ ------ ------ ----- ----- -------
Total contributions 39,135 22,351 4,071 15,604 910 579 37,850
------- ------ ------ ------ ----- ----- -------
Other
Total additions
Deduction from net assets
benefits paid to participants 3,606 -- -- 2,323 -- -- 6,631
Forfeitures -- 3,047 -- -- -- -- --
------- ------ ------ ------ ----- ----- -------
Total deduction 3,606 3,047 -- 2,323 -- -- 6,631
------- ------ ------ ------ ----- ----- -------
Net increase (decrease) prior to
interfund transfers 75,652 20,826 4,667 27,469 959 689 44,329
Interfund transfers (28,738 (18,894) (1,844) 30,685) -- -- (63,575)
Net assets available for benefits:
Beginning of year 282,733 33,303 7,947 92,258 791 1,817 263,667
------- ------ ------ ------ ----- ----- -------
End of year 329,647 35,235 10,770 89,042 1,750 2,506 244,421
------- ------ ------ ------ ----- ----- -------
------- ------ ------ ------ ----- ----- -------
</TABLE>
<TABLE>
<CAPTION>
Portfolio Portfolio Portfolio Franklin
Partners Partners Partners Fidelity VIP Financial
Scudder MFS MFS Equity- Fidelity VIP Corporation
Intn'l Research Emerging Income Growth Common
Growth Growth Equities Portfolio Portfolio Stock Other Total
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments at fair value:
Investments held by Aetna
Life Insurance and Annuity
Company, Custodian 8,256 20,409 58,909 63,523 114,368 -- -- 978,836
Franklin Financial
Corporation Common
Stock -- -- -- -- -- 224,612 -- 224,612
Participant Loans -- -- -- -- -- -- 28,291 28,291
Cash -- -- -- -- -- -- 830 830
----- ------ ------ ------ ------- ------- ------ ---------
Total investments at fair
value 8,256 20,409 58,909 63,523 114,368 224,612 29,121 1,232,569
----- ------ ------ ------ ------- ------- ------ ---------
Contributions receivable:
Employer's -- -- -- -- -- -- 1,211 1,211
Participant's -- -- -- -- -- -- -- --
----- ------ ------ ------ ------- ------- ------ ---------
Total contributions
receivable -- -- -- -- -- -- 1,211 1,211
----- ------ ------ ------ ------- ------- ------ ---------
Net assets available for
plan benefits 8,256 20,409 58,909 63,523 114,368 224,612 30,332 1,233,780
----- ------ ------ ------ ------- ------- ------ ---------
----- ------ ------ ------ ------- ------- ------ ---------
Additions to net assets attributed
to:
Investment income:
Net appreciation
(depreciation) in fair value
of investment 1,357 4,611 15,533 8,244 31,922 (98,249) -- 33,116
Interest 4,567 4,567
----- ------ ------ ------ ------- ------- ------ ---------
Total investment income 1,357 4,611 15,533 8,244 31,922 (98,249) 4,567 37,683
----- ------ ------ ------ ------- ------- ------ ---------
Contributions:
Employer 80,364 80,364
Participants 3,440 5,666 15,176 21,764 28,325 -- -- 194,871
----- ------ ------ ------ ------- ------- ------ ---------
Total contributions 3,440 5,666 15,176 21,764 28,325 80,364 -- 275,235
----- ------ ------ ------ ------- ------- ------ ---------
Other
Total additions
Deduction from net assets
benefits paid to participants 1,051 3,330 6,540 4,015 10,703 -- 997 39,196
Forfeitures -- -- -- -- -- -- -- 3,047
----- ------ ------ ------ ------- ------- ------ ---------
Total deduction 1,051 3,330 6,540 4,015 10,703 -- 997 42,243
----- ------ ------ ------ ------- ------- ------ ---------
Net increase (decrease) prior to
interfund transfers 3,746 6,947 24,169 25,993 49,544 (17,885) 3,570 270,675
Interfund transfers (2,493) (7,063) (16,569) (27,752) (16,581) 242,497 (28,303) --
Net assets available for benefits:
Beginning of year 7,003 20,525 51,309 65,282 81,405 -- 55,065 963,105
----- ------ ------ ------ ------- ------- ------ ---------
End of year 8,256 20,409 58,909 63,523 114,368 224,612 30,332 1,233,780
----- ------ ------ ------ ------- ------- ------ ---------
----- ------ ------ ------ ------- ------- ------ ---------
</TABLE>
9
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES
RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS, CONTINUED
5. PARTICIPANT DIRECTED FUNDS, CONTINUED
Amounts relating to each of these investment programs as of December
31, 1997 are as follows:
<TABLE>
<CAPTION>
Aetna Aetna
Aetna Aetna Guaranteed Guaranteed
Aetna Variable Aetna Investments Accumulation Accumulation Aetna
Variable Encore Income Advisors Account Accrual Fixed
Fund Fund Shares Fund Short-Term Long-Term Account
----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments at fair value:
Investments held by Aetna
Life Insurance and Annuity
Company, Custodian $282,733 33,303 7,947 92,258 791 1,817 263,667
Participant Loans - - - - - - -
-------- ------ ----- ------ --- ----- -------
Total investments at fair
value 282,733 33,303 7,947 92,258 791 1,817 263,667
-------- ------ ----- ------ --- ----- -------
Contributions receivable:
Employer's - - - - - - -
Participant's - - - - - - -
-------- ------ ----- ------ --- ----- -------
Total contributions
receivable - - - - - - -
-------- ------ ----- ------ --- ----- -------
Total assets 282,733 33,303 7,947 92,258 791 1,817 263,667
-------- ------ ----- ------ --- ----- -------
-------- ------ ----- ------ --- ----- -------
Liabilities:
Refundable participant
contributions - - - - - - -
-------- ------ ----- ------ --- ----- -------
Net assets available for
benefits $282,733 33,303 7,947 92,258 791 1,817 263,667
-------- ------ ----- ------ --- ----- -------
-------- ------ ----- ------ --- ----- -------
</TABLE>
<TABLE>
<CAPTION>
Portfolio Portfolio Portfolio
Partners Partners Partners Fidelity VIP
Scudder MFS MFS Equity- Fidelity VIP
Intn'l Research Emerging Income Growth
Growth Growth Equities Portfolio Portfolio Other Total
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments at fair value:
Investments held by Aetna
Life Insurance and Annuity
Company, Custodian 7,003 20,525 51,309 65,282 81,405 - 908,040
Participant Loans ----- ------ ------ ------ ------ ------ -------
- - - - - 48,449 48,449
Total investments at fair
value 7,003 20,525 51,309 65,282 81,405 48,449 956,489
----- ------ ------ ------ ------ ------ -------
Contributions receivable:
Employer's - - - - - 1,690 1,690
Participant's - - - - - 6,031 6,031
----- ------ ------ ------ ------ ------ -------
Total contributions
receivable - - - - - 7,721 7,721
----- ------ ------ ------ ------ ------ -------
Total assets 7,003 20,525 51,309 65,282 81,405 56,170 964,210
----- ------ ------ ------ ------ ------ -------
----- ------ ------ ------ ------ ------ -------
Liabilities:
Refundable participant
contributions - - - - - 1,105 1,105
----- ------ ------ ------ ------ ------ -------
Net assets available for
benefits 7,003 20,525 51,309 65,282 81,405 55,065 963,105
----- ------ ------ ------ ------ ------ -------
----- ------ ------ ------ ------ ------ -------
</TABLE>
10
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
EIN: 62-1376027
PLAN NUMBER: 001
PLAN YEAR ENDED: DECEMBER 31, 1998
LINE 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT
<TABLE>
<CAPTION>
Identity of Issue, Description of Current
Borrower, Lessor Investment Cost Value
<S> <C> <C> <C>
* Aetna Growth and Income Institutional fund ** $ 329,624
* Aetna Money Market Money Market $ 35,605 35,605
* Aetna Bond Institutional fund ** 10,770
* Aetna Balanced Institutional fund ** 89,020
* Aetna Guaranteed Accumulation Institutional fund ** 1,750
Account - Short Term
* Aetna Guaranteed Accumulation Institutional fund ** 2,506
Account - Long Term
* Aetna Fixed Account #26 Institutional fund ** 244,309
* Aetna Fixed Account #27 Institutional fund ** 112
Portfolio Partners Scudder Int'l Growth Mutual fund ** 8,256
Portfolio Partners MFS Research Mutual fund ** 20,409
Growth
Portfolio Partners MFS Emerging Mutual fund ** 58,631
Equities
Fidelity VIP Equity Income Portfolio Mutual fund ** 63,501
Fidelity VIP Growth Portfolio Mutual fund ** 114,343
* Participant Loans 8.25% - 8.75% -- 28,291
* Franklin Financial Corporation Employer Stock 322,863 224,612
----------
TOTAL INVESTMENTS $1,231,739
</TABLE>
* Party-in-interest to the Plan.
** Data not provided by fund custodian.
11
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
EIN: 62-1376027
PLAN NUMBER: 001
PLAN YEAR ENDED: DECEMBER 31, 1998
LINE 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
<TABLE>
<CAPTION>
CURRENT
VALUE OF
ASSET
IDENTITY OF ON
PARTY DESCRIPTION PURCHASE SELLING LEASE EXPENSE COST OF TRANSACTION NET GAIN
INVOLVED OF ASSET PRICE PRICE RENTAL INCURRED ASSET DATE OR LOSS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1) SINGLE TRANSACTIONS
* Aetna Fixed Institutional $219,461 - - - $219,461 $219,461 -
Account #26 Fund
* Aetna Fixed Institutional - $219,461 - - $219,461 $219,461 -
Account #27 Fund
* Aetna Fixed Institutional - $ 53,831 - - $ 53,831 $ 53,831 -
Account #27 Fund
*Aetna Institutional - $ 92,647 - - $ 92,647 $ 92,647 -
Growth and Fund
Income
* Franklin Employer $244,540 - - - $244,540 $244,540 -
Financial Corp Stock
2) SERIES OF NONSECURITY TRANSACTIONS
None reportable.
</TABLE>
12
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
EIN: 62-1376027
PLAN NUMBER: 001
PLAN YEAR ENDED: DECEMBER 31, 1998
LINE 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
<TABLE>
<CAPTION>
CURRENT
VALUE OF
ASSET
IDENTITY OF ON
PARTY DESCRIPTION PURCHASE SELLING LEASE EXPENSE COST OF TRANSACTION NET GAIN
INVOLVED OF ASSET PRICE PRICE RENTAL INCURRED ASSET DATE OR LOSS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
3) AGGREGATE TRANSACTIONS IN ONE ISSUE OF SECURITIES
* Aetna Institutional $105,293 -- -- -- $105,293 $105,293 --
growth and Fund -- $ 98,503 -- -- $ 98,503 $ 98,503 --
income
* aetna Money $ 29,967 -- -- -- $ 29,967 $ 29,967 --
money Market -- $ 26,510 -- -- $ 26,510 $ 26,510 --
market
* Aetna $ 21,535 -- -- -- $ 21,535 $ 21,535 --
Balanced -- $ 38,938 -- -- $ 38,938 $ 38,938 --
*Aetna Fixed Institutional $245,612 -- -- -- $245,612 $245,612 --
Account #26 Fund -- $ 7,108 -- -- $ 7,108 $ 7,108 --
*Aetna Fixed Institutional $ 25,610 -- -- -- $ 25,610 $ 25,610 --
Account #27 Fund -- $296,471 -- -- $296,471 $296,471 --
</TABLE>
13
<PAGE>
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT SAVINGS PLAN
EIN: 62-1376027
PLAN NUMBER: 001
PLAN YEAR ENDED: DECEMBER 31, 1998
LINE 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
<TABLE>
<CAPTION>
CURRENT
VALUE OF
ASSET
IDENTITY OF ON
PARTY DESCRIPTION PURCHASE SELLING LEASE EXPENSE COST OF TRANSACTION NET GAIN
INVOLVED OF ASSET PRICE PRICE RENTAL INCURRED ASSET DATE OR LOSS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Portfolio Mutual $ 20,344 -- -- -- $ 20,344 $ 20,344 --
Partners Fund -- $ 28,277 -- -- $ 28,277 $ 28,277 --
MFS
Emerging Eq
Fidelity VIP Mutual $ 29,177 -- -- -- $ 29,177 $ 29,177 --
Equity Fund -- $ 39,180 -- -- $ 39,180 $ 39,180 --
Income
Fidelity VIP Mutual $ 44,523 -- -- -- $ 44,523 $ 44,523 --
Growth Fund -- $ 43,482 -- -- $ 43,482 $ 43,482 --
Portfolio
* Franklin Employer $322,863 -- -- -- $322,863 $322,863 --
Financial Stock
Corp
</TABLE>
4) OTHER TRANSACTIONS INVOLVING SECURITIES OR PARTIES INVOLVED IN SINGLE
TRANSACTIONS REPORTABLE
None Reportable.
* Party-in-interest to the Plan.
14
<PAGE>
S I G N A T U R E S
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Plan has caused this annual report to be signed on the 25th day of June,
1999, by the undersigned thereunto duly authorized.
FRANKLIN FINANCIAL EMPLOYEES RETIREMENT
SAVINGS PLAN
By: /s/ Gordon E. Inman
------------------------------------
Gordon E. Inman, Trustee
(Plan Administrator)
By: /s/ Richard E. Herrington
------------------------------------
Richard E. Herrington, Trustee
(Plan Administrator)
