SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 2000 Commission File No. 1-13990
--------------- ---------
LANDAMERICA FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Virginia 54-1589611
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
101 Gateway Centre Parkway
Richmond, Virginia 23235-5153
(Address of principal executive offices) (Zip Code)
(804) 267-8000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days.
Yes _X_ No ___
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, No Par Value 13,442,056 August 8, 2000
------------------ --------------------
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements:
Consolidated Balance Sheets................................3
Consolidated Statements of Operations .....................5
Consolidated Statements of Cash Flows......................6
Consolidated Statements of Changes in
Shareholders' Equity....................................7
Notes to Consolidated Financial Statements.................8
Item 2. Management's Discussion and
Analysis of Financial Condition
and Results of Operations..............................10
Item 3. Quantitative and Qualitative Disclosures
about Market Risk......................................13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.........................................14
Item 4. Submission of Matters to a Vote of Security Holders.......15
Item 6. Exhibits and Reports on Form 8-K..........................16
Signatures................................................17
2
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 2000 1999
------ ---- ----
<S> <C> <C>
INVESTMENTS:
Fixed maturities available-for-sale - at fair value
(amortized cost: 2000 - $783,747; 1999 - $764,748) $ 755,109 $ 735,084
Equity securities - at fair value (cost: 2000 - $3,285;
1999 - $3,278) 1,877 1,807
Mortgage loans (less allowance for doubtful accounts: 2000 -
$89; 1999 - $138) 9,015 7,124
Invested cash 70,703 109,045
------------- -------------
Total investments 836,704 853,060
CASH 45,304 54,939
NOTES AND ACCOUNTS RECEIVABLE:
Notes (less allowance for doubtful accounts: 2000 -
$1,762; 1999 - $2,026) 12,079 12,701
Premiums (less allowance for doubtful accounts: 2000 -
$7,902; 1999 - $9,525) 42,527 35,542
Income tax recoverable - 4,256
------------- -------------
Total notes and accounts receivable 54,606 52,499
PROPERTY AND EQUIPMENT - at cost (less accumulated
depreciation and amortization: 2000 - $84,340; 1999 -
$81,097) 69,423 72,661
TITLE PLANTS 93,983 93,608
GOODWILL (less accumulated amortization: 2000 -
$38,730; 1999 - $33,208) 351,073 347,158
DEFERRED INCOME TAXES 81,097 80,980
OTHER ASSETS 119,479 103,016
------------- -------------
Total assets $ 1,651,669 $ 1,657,921
============= =============
</TABLE>
See accompanying notes.
3
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
LIABILITIES 2000 1999
----------- ---- ----
<S> <C> <C>
POLICY AND CONTRACT CLAIMS $ 556,833 $ 554,450
ACCOUNTS PAYABLE AND ACCRUED EXPENSES 142,558 150,408
FEDERAL INCOME TAXES 2,919 -
NOTES PAYABLE 196,400 207,653
OTHER 14,912 14,707
-------------- --------------
Total liabilities 913,622 927,218
-------------- --------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
--------------------
Preferred stock, no par value, authorized 5,000,000 shares,
no shares of Series A Junior Participating Preferred
Stock issued or outstanding; 2,200,000 shares of 7%
Series B Cumulative Convertible Preferred Stock
issued and outstanding 175,700 175,700
Common stock, no par value, 45,000,000 shares
authorized, shares issued and outstanding: 2000 -
13,409,016; 1999 - 13,680,421 337,898 342,138
Accumulated other comprehensive loss (30,046) (31,135)
Retained earnings 254,495 244,000
-------------- --------------
Total shareholders' equity 738,047 730,703
-------------- --------------
Total liabilities and shareholders' equity $ 1,651,669 $ 1,657,921
============== ==============
</TABLE>
See accompanying notes.
4
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(In thousands of dollars except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES
Title and other operating revenues:
Direct operations $ 202,872 $ 230,768 $ 367,792 $ 447,480
Agency operations 251,331 301,616 480,192 563,065
---------- ---------- ----------- -----------
454,203 532,384 847,984 1,010,545
Investment income 12,647 12,539 25,420 24,916
Loss on sales of investments (270) (778) (183) (1,413)
---------- ---------- ----------- -----------
466,580 544,145 873,221 1,034,048
---------- ---------- ----------- -----------
EXPENSES
Salaries and employee benefits 128,336 148,984 249,383 291,895
Agents' commissions 196,456 235,626 374,777 438,406
Provision for policy and contract claims 20,016 26,242 37,387 49,737
Interest expense 3,359 2,885 6,741 5,780
General, administrative and other 91,538 103,238 181,166 197,475
---------- ---------- ----------- -----------
439,705 516,975 849,454 983,293
---------- ---------- ----------- -----------
INCOME BEFORE INCOME TAXES 26,875 27,170 23,767 50,755
INCOME TAX EXPENSE (BENEFIT)
Current 7,471 9,997 6,987 23,101
Deferred 1,668 42 1,094 (4,347)
---------- ---------- ----------- -----------
9,139 10,039 8,081 18,754
---------- ---------- ----------- -----------
NET INCOME 17,736 17,131 15,686 32,001
DIVIDENDS - PREFERRED STOCK (1,925) (1,925) (3,850) (3,850)
---------- ---------- ----------- -----------
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 15,811 $ 15,206 $ 11,836 $ 28,151
========== ========== =========== ===========
NET INCOME PER COMMON SHARE $ 1.18 $ 1.01 $ 0.88 $ 1.86
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 13,348 14,987 13,395 15,152
NET INCOME PER COMMON SHARE ASSUMING
DILUTION $ 0.97 $ 0.86 $ 0.86 $ 1.59
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING ASSUMING DILUTION 18,242 19,978 18,286 20,179
</TABLE>
See accompanying notes.
5
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
2000 1999
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 15,686 $ 32,001
Depreciation and amortization 18,225 17,076
Amortization of bond premium 675 924
Realized investment losses 855 1,413
Deferred income tax (117) (4,347)
Change in assets and liabilities, net of businesses acquired:
Notes receivable 622 (4,090)
Premiums receivable (6,909) 5,724
Income taxes receivable/payable 7,175 (3,617)
Policy and contract claims 2,383 18,736
Accounts payable and accrued expenses (7,850) (15,219)
Other (7,484) (12,940)
----------- -----------
Net cash provided by operating activities 23,261 35,661
----------- -----------
Cash flows from investing activities:
Purchase of property and equipment, net (9,103) (27,064)
Purchase of business, net of cash acquired (12,881) -
Cost of investments acquired:
Fixed maturities - available-for-sale (104,247) (424,730)
Mortgage loans - net (1,891) (4,754)
Proceeds from investment sales or maturities:
Fixed maturities - available-for-sale 83,710 420,324
----------- -----------
Net cash used in investing activities (44,412) (36,224)
----------- ------------
Cash flows from financing activities:
Proceeds from the sale of common shares - 1,727
Cost of common shares repurchased (4,240) (27,003)
Repayment of cash surrender value loan (2,242) (5,567)
Dividends paid (5,191) (5,356)
Payments on notes payable (15,153) (77)
------------ -----------
Net cash used in financing activities (26,826) (36,276)
Net decrease in cash and invested cash (47,977) (36,839)
Cash and invested cash at beginning of period 163,984 174,027
----------- -----------
Cash and invested cash at end of period $ 116,007 $ 137,188
=========== ===========
</TABLE>
See accompanying notes.
6
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 2000 AND 1999
(In thousands of dollars except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Accumulated
Other Total
Preferred Stock Common Stock Comprehensive Retained Shareholders'
Shares Amounts Shares Amounts Income (Loss) Earnings Equity
------ ------- ------ ------- ------------- -------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance - December 31, 1998 2,200,000 $ 175,700 15,294,572 $ 382,828 $ 12,367 $ 200,294 $ 771,189
Net income - - - - - 32,001 32,001
Net unrealized loss on securities, net
of tax benefit of $(11,190) - - - - (20,083) - (20,083)
---------
Comprehensive income - - - - - - 11,918
---------
Stock option and incentive plans - - 58,379 1,727 - - 1,727
Common stock retired - - (937,500) (27,003) - - (27,003)
Preferred dividends (7%) - - - - - (3,850) (3,850)
Common dividends ($0.10/share) - - - - - (1,506) (1,506)
--------- --------- ---------- --------- --------- --------- ---------
Balance - June 30, 1999 2,200,000 $ 175,700 14,415,451 $ 357,552 $ (7,716) $ 226,939 $ 752,475
========= ========= ========== ========= ========= ========= =========
Balance - December 31, 1999 2,200,000 $ 175,700 13,680,421 $ 342,138 $ (31,135) $ 244,000 $ 730,703
Net income - - - - - 15,686 15,686
Unrealized gain on securities - - - - 1,089 - 1,089
---------
Comprehensive income - - - - - - 16,775
---------
Stock option and incentive plans - - 15,895 666 - - 666
Common stock retired - - (287,300) (4,906) - - (4,906)
Preferred dividends (7%) - - - - - (3,850) (3,850)
Common dividends ($0.10/share) - - - - - (1,341) (1,341)
--------- --------- ---------- --------- --------- --------- ---------
Balance - June 30, 2000 2,200,000 $ 175,700 13,409,016 $ 337,898 $ (30,046) $ 254,495 $ 738,047
========= ========= ========== ========= ========= ========= =========
</TABLE>
See accompanying notes.
7
<PAGE>
LANDAMERICA FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of dollars except per share amounts)
1. Interim Financial Information
The unaudited consolidated financial information included in this
report has been prepared in conformity with the accounting principles
and practices reflected in the consolidated financial statements
included in the Form 10-K for the year ended December 31, 1999 filed
with the Securities and Exchange Commission under the Securities
Exchange Act of 1934. This report should be read in conjunction with
the aforementioned Form 10-K. In the opinion of management, all
adjustments (consisting of normal recurring accruals) necessary for a
fair presentation of this information have been made. The results of
operations for the interim periods are not necessarily indicative of
results for a full year.
Certain 1999 amounts have been reclassified to conform to the 2000
presentation.
2. Earnings Per Share
The following table sets forth the computation of basic and diluted
earnings per share:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Numerator:
Net income - numerator for diluted
earnings per share $ 17,736 $ 17,131 $ 15,686 $ 32,001
Less preferred dividends 1,925 1,925 3,850 3,850
-------- -------- -------- --------
Numerator for basic earnings per
share $ 15,811 $ 15,206 $ 11,836 $ 28,151
======== ======== ======== ========
Denominator:
Weighted average shares -
denominator for basic earnings
per share 13,348 14,987 13,395 15,152
Effect of dilutive securities:
Assumed weighted average
conversion of preferred stock 4,825 4,825 4,825 4,825
Employee stock options 69 166 66 202
-------- -------- -------- --------
Denominator for diluted earnings
per share 18,242 19,978 18,286 20,179
======== ======== ======== ========
Basic earnings per common share $1.18 $1.01 $0.88 $1.86
===== ===== ===== =====
Diluted earnings per common share $0.97 $0.86 $0.86 $1.59
===== ===== ===== =====
</TABLE>
8
<PAGE>
3. Commitments and Contingencies
For additional information, see Pending Legal Proceedings on pages F-29
and F-30 and Legal Proceedings on pages 14 and 15 of the Form 10-K for
the fiscal year ended December 31, 1999, Legal Proceedings on page 14
of the Form 10-Q for the quarter ended March 31, 2000, and Legal
Proceedings on page 14 of this Form 10-Q.
9
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
Operating Revenues
Operating revenues for the second quarter of 2000 were $454.2 million, compared
to $532.4 million in the second quarter of 1999. This decline in revenue is due
primarily to the effects of interest rate increases on the level of business
available, particularly from residential refinancing transactions.
For the first six months of 2000, operating revenues were $848.0 million,
compared to $1.0 billion in the corresponding 1999 period. This decrease is
primarily the result of increases in mortgage interest rates and the resultant
decline in the amount of residential refinancing activity in 2000 compared to
1999.
Investment Income
Investment income in the first six months of 2000 was $25.4 million compared to
$24.9 million in the first six months of 1999. This increase was attributable to
increased yields earned on underlying investments offset by a decrease in the
average amounts invested.
Expenses
As a result of the adverse affects of interest rate increases on available
business, management instituted aggressive expense management efforts. The
results of these efforts were evident in both the first half and second quarter
of 2000 compared to the comparable periods of 1999.
Operating expenses for the second quarter of 2000 were $439.7 million compared
to $517.0 million in the second quarter of 1999. The decrease resulted
principally from reductions in salary and related expenses, agents commissions
and general, administrative and other expenses. Salary and related expenses
decreased from $149.0 million in 1999 compared to $128.3 million in 2000, which
constitutes a decrease of 14%. This decrease resulted from a reduction in
average staffing levels from 10,400 in the second quarter of 1999 to 8,200 in
the second quarter 2000. Agents commissions decreased $39.2 million from the
second quarter of 1999, which is in direct proportion to the decline in agency
revenues. General administrative and other expenses decreased $11.7 million for
the quarter from the comparable period in 1999.
Operating expenses for the first six months of 2000 were $849.5 million compared
to $983.3 million for the comparable period of 1999. Salary and related expenses
were $249.4 million during the first six months of 2000 compared to $291.9
million in the same period of 1999, a reduction of $42.5 million related to a
decrease in staffing levels. In addition, this decrease for the six month period
was principally due to a decline in agents commissions, down $63.6 million when
compared to the
10
<PAGE>
same period of 1999 which was in direct proportion to the decrease in agency
premiums. General, Administrative and Other expenses also decreased $16.3
million when compared to the prior year.
The provision for policy and contract claims decreased $12.4 million from the
first six months of 1999 to the first six months of 2000 as a result of the
lower amount of business written and continued recognition of improvement of the
Company's loss experience.
Net Income
LandAmerica reported net income of $17.7 million, or $0.97 per share on a
diluted basis, for the second quarter of 2000, compared to net income of $17.1
million, or $0.86 per share on a diluted basis, for the second quarter of 1999.
In addition to increased net income, the increase in earnings per share is also
the result of a decrease in the number of diluted shares outstanding due to the
Company's share repurchase program. On a weighted average basis, diluted shares
outstanding decreased in excess of 1.7 million from the first quarter of 1999
compared to the first quarter of 2000. The 2000 quarter included an after-tax
loss on sales of investments of $178,000, or $0.01 per diluted share, compared
to an after-tax loss of $506,000, or $0.02 per diluted share, in the
corresponding quarter of 1999.
For the six months ended June 30, 2000, net income was $15.7 million, or $0.86
per share on a diluted basis, compared to $32.0 million, or $1.59 per share on a
diluted basis, for the first six months of 1999. The first half of 2000 included
an after-tax loss on sales of investments of $121,000, or $0.01 per diluted
share, compared to a first half 1999 after-tax gain on sales of investments of
$918,000, or $0.04 per diluted share.
Liquidity and Capital Resources
Cash provided by operating activities for the six months ended June 30, 2000 was
$23.3 million. As of June 30, 2000, the Company held cash and invested cash of
$116.0 million and fixed maturity securities of $755.1 million.
In addition, the Company has a bank credit facility of which $45.0 million was
unused at June 30, 2000.
The Company believes that it will have sufficient liquidity and capital
resources to meet both its short and long term capital needs.
Interest Rate Risk
The following table provides information about the Company's financial
instruments that are sensitive to changes in interest rates. For investment
securities, the table presents principal cash flows and related weighted
interest rates by expected maturity dates. Actual cash flows could differ from
the expected amounts.
11
<PAGE>
Interest Rate Sensitivity
Principal Amount by Expected Maturity
Average Interest Rate
---------------------
(dollars in thousands)
<TABLE>
<CAPTION>
2005 and
2000 2001 2002 2003 2004 after Total Fair Value
---- ---- ---- ---- ---- ----- ----- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Taxable
available-for-sale
securities:
Book value $3,933 $31,418 $39,549 $48,634 $42,470 $338,778 $504,782 $485,176
Average yield 5.8% 6.2% 6.2% 6.2% 7.0% 6.9%
Non-taxable
available-for-sale
securities:
Book value 438 3,141 6,973 12,749 17,794 180,647 221,742 216,363
Average yield 7.2% 3.9% 4.5% 4.2% 4.8% 4.8%
Preferred stock:
Book value - - - - - 57,223 57,223 53,570
Average yield - - - - - 7.6%
</TABLE>
The Company also has variable rate long-term debt of $192.5 million bearing
interest at 6.93% at June 30, 2000. A .25% change in the interest rate would
affect income before income taxes by approximately $0.5 million annually.
Forward-Looking and Cautionary Statements
Certain information contained in this Quarterly Report on Form 10-Q includes
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act. Among other things, these statements
relate to the financial condition, results of operation and business of the
Company. In addition, the Company and its representatives may from time to time
make written or oral forward-looking statements, including statements contained
in other filings with the Securities and Exchange Commission and in its reports
to shareholders. These forward-looking statements are generally identified by
phrases such as "the Company expects," "the Company believes" or words of
similar import. These forward-looking statements involve certain risks and
uncertainties and other factors that may cause the actual results, performance
or achievements to be materially different from any future results, performance
or achievements expressed or implied by such forward-looking statements.
Further, any such statement is specifically qualified in its entirety by the
following cautionary statements.
In connection with the title insurance industry in general, factors that may
cause actual results to differ materially from those contemplated by such
forward-looking statements include the following: (i) the costs of producing
title evidence are relatively high, whereas premium revenues are subject to
regulatory and competitive restraints; (ii) real estate activity levels have
historically been cyclical and are influenced by such factors as interest rates
and the condition of the overall economy; (iii) the
12
<PAGE>
value of the Company's investment portfolio is subject to fluctuation based on
similar factors; (iv) the title insurance industry may be exposed to substantial
claims by large classes of claimants; and (v) the industry is regulated by state
laws that require the maintenance of minimum levels of capital and surplus and
that restrict the amount of dividends that may be paid by the Company's
insurance subsidiaries without prior regulatory approval.
The Company cautions that the foregoing list of important factors is not
exclusive. The Company does not undertake to update any forward-looking
statement that may be made from time to time by or on behalf of the Company.
Item 3. Quantitative and Qualitative Disclosures
about Market Risk
The information required by this Item is set forth under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Interest Rate Risk" in Item 2 of this report.
13
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
On or about June 16, 2000, Norman E. Taylor, Connie S. Taylor, Lynne
Thompson Jones-Brittle, Colin R. Callaghan and Miriam J. Callaghan
(collectively, the "Plaintiffs") filed a putative class action suit
(the "Taylor Suit") in the Superior Court of Los Angeles, California
(Case No. BC 231917) against LandAmerica Financial Group, Inc.,
Commonwealth Land Title Insurance Company, Commonwealth Land Title
Company, Lawyers Title Insurance Corporation and Lawyers Title Company
(collectively, the "LandAmerica Defendants"). The Plaintiffs purport to
represent a class defined in the complaint as "[a]ll persons or
entities who, from 1980 to the present, incident to purchase, sale or
refinancing of real property located in California, deposited funds in
escrow accounts controlled by the LandAmerica Defendants and were not
paid interest on their funds and/or were charged fees for services not
rendered or excessive fees for the services performed."
The Plaintiffs allege in the complaint that the LandAmerica Defendants
unlawfully (a) received interest, other credits or payments that served
as the functional equivalent of interest, on customer escrow funds; (b)
charged and retained fees for preparing and recording reconveyances
that they did not prepare or record, and charged and retained excessive
fees for other escrow-related services; and (c) swept or converted
funds in escrow accounts based upon contrived charges prior to the time
the funds escheated or should have escheated to the State of California
pursuant to the Unclaimed Property Law. The Plaintiffs assert claims
for relief against the LandAmerica Defendants based on (i) violation of
California's Unfair Business Practices Act, California Business and
Professions Code ss.ss. 17200, et. seq.; (ii) violation of California's
Deceptive, False and Misleading Advertising Act, California Business
and Professions Code ss.ss. 17500, et. seq.; (iii) violation of
California's Consumer Legal Remedies Act, California Civil Code ss.ss.
1750, et. seq.; (iv) breach of fiduciary duty; (v) breach of agents'
duties to their principals; (vi) conversion; and (vii) conspiracy. The
Plaintiffs seek injunctive relief, restitution of improperly collected
charges and interest and the imposition of an equitable constructive
trust over such amounts, damages according to proof, punitive damages,
costs and expenses, attorneys' fees, pre-and post-judgment interest and
such other and further relief as the Court may deem necessary and
proper.
The allegations in the Taylor Suit are substantially the same as those
in the Baker Suit and the State of California Suit reported on pages 14
and 15 of the Company's Form 10-K for the fiscal year ended December
31, 1999. Following the June 8, 2000 decision of the San Francisco
Superior Court granting the LandAmerica Defendants' demurrer, the
plaintiffs in the Baker Suit have not amended and refiled their
complaint against the LandAmerica Defendants, as they have with respect
to other parties to that litigation.
The LandAmerica Defendants intend to vigorously defend the Taylor Suit.
The suit is still in its initial stages, and at this time no estimate
of the amount or range of loss that could result from an unfavorable
outcome can be made.
14
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders
a) The Annual Meeting of Shareholders of the Company (the
"Meeting") was held on May 16, 2000.
c) At the Meeting, the shareholders elected five directors to
serve three-year terms and two directors to serve two-year
terms. The voting with respect to each nominee was as follows:
<TABLE>
<CAPTION>
Votes Broker
Nominee Term Votes For Withheld Non-Votes
------- ---- --------- -------- ---------
<S> <C> <C> <C> <C>
Janet A. Alpert 3 11,320,445 946,812 0
Michael Dinkins 3 11,311,657 955,600 0
James Ermer 3 11,316,020 951,237 0
Lowell G. Freiberg 3 11,139,532 1,127,725 0
John P. McCann 3 11,324,844 942,413 0
Julious P. Smith, Jr. 2 11,308,258 958,999 0
Howard E. Steinberg 2 11,283,350 983,907 0
</TABLE>
The terms of office of the following directors continued after
the meeting: Robert F. Norfleet, Jr., Eugene P. Trani, George
E. Bello, Theodore L. Chandler, Jr., Charles H. Foster, Jr.,
Herbert Wender, and Marshall B. Wishnack.
The shareholders at the Meeting also considered a proposal
to approve the LandAmerica Financial Group, Inc. 2000 Stock
Incentive Plan as described in the Proxy Statement for such
Meeting. The voting with respect to such matter was as
follows:
Delivered,
For Against Abstain Not-Voted
--- ------- ------- ---------
8,214,404 2,639,536 217,127 1,196,190
No other matters were voted upon at the Meeting or during
the quarter for which this report is filed.
15
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
Exhibit No. Document
----------- --------
10.1 Form of LandAmerica Financial Group, Inc.
Employee Non-Qualified Stock Option
Agreement, dated May 17, 2000, with Schedule
of Optionees and Options Awarded.
10.2 Employee Non-Qualified Stock Option
Agreement, dated May 17, 2000, between the
Registrant and Charles H. Foster, Jr.
10.3 Form of LandAmerica Financial Group, Inc.
Amendment to Non-Qualified Stock Option
Agreements, dated June 20, 2000, with
Schedule of Optionees and Agreements Being
Amended.
10.4 Form of LandAmerica Financial Group, Inc.
Non-Employee Director Non-Qualified Stock
Option Agreement.
11 Statement re: Computation of Earnings Per
Share.
27 Financial Data Schedule (electronic copy
only).
b) Reports on Form 8-K
-------------------
None
16
<PAGE>
Signatures
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
LANDAMERICA FINANCIAL GROUP, INC.
-------------------------------------
(Registrant)
Date: August 11, 2000 /s/ Charles Henry Foster, Jr.
----------------------- -------------------------------------
Charles Henry Foster, Jr.
Chairman and Chief Executive Officer
Date: August 11, 2000 /s/ G. William Evans
------------------------ -------------------------------------
G. William Evans
Executive Vice President and Chief
Financial Officer
17
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EXHIBIT INDEX
Exhibit No. Document
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10.1 Form of LandAmerica Financial Group, Inc. Employee
Non-Qualified Stock Option Agreement, dated May 17, 2000, with
Schedule of Optionees and Options Awarded.
10.2 Employee Non-Qualified Stock Option Agreement, dated May 17,
2000, between the Registrant and Charles H. Foster, Jr.
10.3 Form of LandAmerica Financial Group, Inc. Amendment to
Non-Qualified Stock Option Agreements, dated June 20, 2000,
with Schedule of Optionees and Agreements Being Amended.
10.4 Form of LandAmerica Financial Group, Inc. Non-Employee
Director Non-Qualified Stock Option Agreement.
11 Statement Re: Computation of Earnings Per Share.
27 Financial Data Schedule (electronic copy only).
