As filed with the Securities and Exchange Commission on January 21, 1997
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-3
Registration Statement Under the Securities Act of 1933
LIBERTY FINANCIAL COMPANIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Massachusetts 04-3260640
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
600 Atlantic Avenue, Boston, Massachusetts 02210-2214 (617) 722-6000
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
JOHN A. BENNING
Senior Vice President and General Counsel
Liberty Financial Companies, Inc.
600 Atlantic Avenue
Boston, MA 02210-2214
(617) 722-6000
(Name, Address, including Zip Code, and Telephone Number, including
Area Code, of Agent For Service)
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Approximate date of commencement of proposed sale to the public:
January 22, 1997
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ X]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of Class of Amount to be Maximum Maximum Amount of
Securities to be Registered Offering Price Aggregate Registration
Registered (shares) Per Share(1) Offering Price(1) Fee
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Common Stock,
$.01 par value
per share 2,000,000 $40.4375 $80,875,000.00 $24,508.00
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(1) Determined on the basis of the average of the high and low sales prices of
the Common Stock reported in the consolidated reporting system for trades
on the New York Stock Exchange on January 17, 1997 in accordance with Rule
457(c) under the Securities Act of 1933 solely for the purpose of
calculating the registration fee.
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PROSPECTUS
[LOGO]
LIBERTY FINANCIAL COMPANIES, INC.
DIVIDEND REINVESTMENT PLAN
Liberty Financial Companies, Inc. (the "Company") is offering to holders of
its Common Stock, $0.01 par value (the "Common Stock"), and any series of its
Preferred Stock, $0.01 par value ("Preferred Stock," together, with the Common
Stock, "LFC Stock") the opportunity to participate in its Dividend Reinvestment
Plan (the "Plan"). The Plan provides a convenient way for shareholders to
reinvest their cash dividends in additional shares of Common Stock, without
paying any brokerage commission or service charge for such purchase. Any holder
of record of shares of LFC Stock is eligible to enroll in the Plan. Outstanding
shares of Common Stock are, and the shares of Common Stock offered hereby will
be, listed on the New York Stock Exchange.
This Prospectus relates to 2,000,000 authorized and unissued shares of
Common Stock of the Company registered for purchase under the Plan on the date
hereof. It is suggested that this Prospectus be retained for future reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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The date of this Prospectus is January 15, 1997
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THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY THE COMMON STOCK COVERED BY THIS PROSPECTUS IN ANY JURISDICTION
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN AS CONTAINED HEREIN, IN CONNECTION WITH THE OFFER
DESCRIBED HEREIN, AND IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Commission's
public reference room located at 450 Fifth Street, N.W., Washington, D.C. 20549
and at the Commission's regional offices located at Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and 75 Park Place,
14th Floor, New York, New York 10007. Copies of such materials can be obtained
at prescribed rates by writing to the Securities and Exchange Commission, Public
Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549. Materials
filed after May 1, 1996 have been filed with the Commission electronically over
the Commission's EDGAR filing system. The Commission maintains a World Wide Web
site (http:// www.sec.gov) which includes access to its EDGAR database. The
Common Stock is listed on the New York Stock Exchange, Inc., and reports, proxy
statements and other information concerning the Company may be inspected at the
offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New
York 10005.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, with respect to the Common Stock
offered by this Prospectus. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. Such
additional information may be obtained from the public reference room of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are hereby incorporated by reference in this Prospectus the following
documents and information heretofore filed with the Commission:
1. The Company's Annual Report on Form 10-K for the year ended December
31, 1995 filed pursuant to the Exchange Act.
2. The Company's definitive proxy statement, dated March 27, 1996, in
connection with its Annual Meeting of Stockholders held May 8, 1996
filed pursuant to the Exchange Act.
3. The Company's Current Report on Form 8-K, dated April 9, 1996 filed
pursuant to the Exchange Act.
4. The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996 filed pursuant to
the Exchange Act.
5. The description of Common Stock contained in the Company's
Registration Statement filed under Section 12 of the Exchange Act,
including any amendment or report filed for the purpose of updating
such description.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the termination of the offering of Common Stock under the Plan shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
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The Company will provide upon request and without charge to each person to
whom this Prospectus is delivered a copy of any or all of the foregoing
documents incorporated herein by reference (other than exhibits to such
documents). Written requests should be directed to:
Liberty Financial Companies, Inc.
Investor Relations Department
600 Atlantic Avenue
Boston, Massachusetts 02210
Telephone requests may be directed to the Investor Relations Department at
(617) 722-6000. E-mail requests may be directed to William Rice, Director of
Investor Relations, at [email protected].
THE COMPANY
The Company is an asset accumulation and management company -- that is, the
Company earns revenues by accumulating financial assets from investors and
savers and managing those assets. The Company accumulates assets by offering
diverse investment and retirement-oriented insurance products through multiple
distribution channels. The Company currently has two core product lines --
retirement-oriented insurance products (principally annuities) and investment
management products (mutual funds, as well as wealth management and
institutional investment management). The Company's insurance products primarily
produce spread income for the Company; the investment management products
produce fee income for the Company.
The executive office of the Company is located at 600 Atlantic Avenue,
Boston, Massachusetts 02210 (Telephone 617-722-6000).
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THE PLAN
The Company's Dividend Reinvestment Plan (the "Plan") is set forth below in
a question and answer format.
Purpose
1. What is the purpose of the Plan? The purpose of the Plan is to provide
each eligible stockholder, as described in Question 5 below (a "Participant"),
with a convenient and economical way of reinvesting, without the payment of any
brokerage commission or service charge, cash dividends on shares of all classes
of equity securities of the Company into shares of the Company's Common Stock.
As of the date of this Prospectus, the Company pays quarterly dividends on its
Common Stock and its Series A Convertible Preferred Stock. Shares of Common
Stock purchased under the Plan on behalf of Participants will be purchased
directly from the Company or, at the option of the Company, purchased in market
transactions, or purchased through any combination of the foregoing.
Advantages
2. What are the advantages to stockholders of participating in the Plan?
(bullet) Stockholders are not required to pay any commission or service charge
in connection with purchases under the Plan.
(bullet) The Plan provides Participants with the investment options discussed
under Question 3 below.
(bullet) Participants' dividends will be fully invested under the Plan because
the Plan permits fractional shares, as well as full shares, to be
credited to Participants' accounts.
(bullet) Participants will avoid the need for safekeeping of the stock
certificates for shares credited to their respective accounts under the
Plan. This safekeeping feature is available at no cost for any Common
Stock certificate of the Company the Participant may hold.
(bullet) Regular statements of account will provide each Participant with a
record of each transaction under the Plan and the number of shares held
in safekeeping.
Investment Alternatives
3. What are the investment alternatives available to Participants?
Participants have the following two alternatives for reinvesting some or all of
their dividends on their Common Stock or on their Preferred Stock in shares of
the Company's Common Stock:
(bullet) Automatically reinvest the dividends on all his or her full and
fractional shares of Common Stock in additional shares of Common Stock.
Similarly, a Participant who owns Preferred Stock may automatically
reinvest the dividends on all his or her shares of Preferred Stock in
additional shares of Common Stock; or
(bullet) Automatically reinvest the dividends on any portion of his or her
full and frac-
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tional shares of Common Stock in additional shares of Common Stock.
Similarly, a Participant who owns Preferred Stock may automatically
reinvest the dividends on any portion of his or her shares of Preferred
Stock in additional shares of Common Stock. (The dividends paid in cash
must be on full shares.)
If a stockholder owns shares of Common Stock and Preferred Stock, he or she
may elect different investment alternatives with respect to each class or series
of stock owned.
Administration
4. Who administers the Plan for Participants? Boston EquiServe is the Agent for
the Participants in the Plan (the "Agent"). The Agent administers the Plan,
maintains records, sends periodic statements of account to Participants and
performs other duties relating to the Plan. The Agent also acts as dividend
disbursing agent, transfer agent and registrar for the Company. The Company
reserves the right to designate a new Agent at any time without the prior
consent of the Participants.
Participation
5. Who is eligible to participate in the Plan? All holders of record of
Common Stock or Preferred Stock, with the exception noted in the next paragraph,
are eligible to participate fully in the Plan. If the Common Stock or Preferred
Stock of a stockholder is registered in a name other than that of the
stockholder (e.g., in the name of a broker or bank nominee), the stockholder who
wants to participate in the Plan must either make appropriate arrangements for
the nominee to participate in the Plan, or the stockholder must become a
stockholder of record by having such shares transferred from the brokerage or
other nominee account to the stockholder's own name directly with the transfer
agent.
Stockholders who reside in a jurisdiction outside of the United States in
which it is unlawful for the Company to allow such holders to participate in the
Plan are not eligible to participate.
Procedures Related to Participation by Stockholders
6. How does a stockholder participate? An eligible stockholder may join the
Plan at any time by completing the enclosed Stockholder Authorization Form and
returning it to the Agent in the envelope provided for this purpose. Those
stockholders who do not wish to participate in the Plan will continue to receive
cash dividends at such times as dividends are paid.
A stockholder may obtain additional Stockholder Authorization Forms at any
time by writing to:
Boston EquiServe
Mail Stop 45-01-06
Post Office Box 1681
Boston, Massachusetts 02105-1681
or by calling Boston EquiServe at (617) 575-3170.
7. What does the Stockholder Authorization Form provide? The Stockholder
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Authorization Form allows each stockholder to elect one of the following two
investment options:
(bullet) "Full Dividend Reinvestment" directs the Company to invest, in
accordance with the Plan, all of a Participant's dividends on all
shares of Common Stock and/or Preferred Stock then or subsequently
registered in a Participant's name; or
(bullet) "Partial Dividend Reinvestment" directs the Company to remit cash
dividends to the Participant on those full shares of Common Stock
and/or Preferred Stock specified in the appropriate space on the
Stockholder Authorization Form and directs the Company to reinvest the
remaining dividends in shares of Common Stock in accordance with the
Plan.
See Question 3 for additional related information regarding these
investment options.
8. How may a Participant change his or her method of participating in the
Plan? A Participant may change his or her method of participating in the Plan at
any time by completing a Stockholder Authorization Form and returning it to the
Agent at the address specified in Question 6.
See Questions 17-21 for additional related information.
9. When will dividends be invested? No Participant or any other stockholder
should assume that the Company will always pay dividends or pay them in any
particular amount. If the Board of Directors determines to pay a dividend, it
will be payable on a stated dividend payment date to stockholders of record on a
stated record date. With respect to the declaration of any dividend, the Company
will announce the dividend payment date and corresponding record date at least
ten days before the record date in question.
In the case of purchases directly from the Company, dividends on each class
of stock will be invested in shares of Common Stock on the same date as the
dividend payment date fixed by the Board of Directors of the Company for that
class of stock (the "Dividend Investment Date").
The prices to be paid for shares purchased from the Company will be
calculated as described in Question 11.
In the case of purchases of Common Stock in market transactions, the Agent
will make such purchases beginning on the Dividend Investment Date and will
complete the purchases as soon as practicable thereafter. Such purchases may be
made on any securities exchange where Common Stock is traded, in the
over-the-counter market or in negotiated transactions, and may be on such terms
as to price, delivery and otherwise as the Agent may determine.
No Participant shall have any authority or power to direct the time or
price at which Common Stock may be purchased under the Plan.
If the Stockholder Authorization Form signed by a stockholder entitled to a
dividend is received in good form by the Agent on or
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before the record date for the dividend payment, the dividend will be used to
purchase shares of Common Stock for the stockholder on the Dividend Investment
Date for that dividend. If the Stockholder Authorization Form is received by the
Agent after the record date for the dividend payment, then the reinvestment of
dividends will not begin until the next Dividend Investment Date.
For example, assume a dividend payable on March 15 with a record date of
February 28. In order to invest a dividend payable on March 15, a Stockholder
Authorization Form must be received in good form by the Agent no later than
February 28. If the Stockholder Authorization Form were received after the
February 28 record date, the dividend payable on March 15 would be paid in cash,
and the stockholder's participation in the Plan as to the reinvestment of
dividends would begin with the next Dividend Investment Date.
Number of Shares Purchased;
Purchase Price
10. How many shares of Common Stock will be purchased for stockholders? The
number of shares to be purchased depends upon the amount of dividends reinvested
and the purchase price of shares of Common Stock (with the purchase price
determined in accordance with Question 11). Each Participant's account will be
credited with that number of shares of Common Stock, including fractions
computed to three decimal places, equal to the total amount to be invested,
divided by the applicable purchase price of each share.
11. What will be the price of shares of Common Stock purchased under the
Plan? In the case of purchases directly from the Company, the price of shares of
Common Stock so purchased will be the mean between the high and low sales prices
for the Common Stock on the Dividend Investment Date as published in the Eastern
Edition of The Wall Street Journal report on New York Stock Exchange Composite
Transactions ("WSJ Report"), or if the New York Stock Exchange was closed or
there were no reported sales of shares of Common Stock as reported in the WSJ
Report for that date, then the mean between the high and low sales prices for
such shares on the next prior date on which the New York Stock Exchange was open
for trading and for which sales of such shares were so reported.
In the case of purchases in market transactions, the purchase price of the
Common Stock so purchased will be the average price paid by the Agent for all
shares purchased for all Participants. Participants should be aware of the risk
that the price actually paid for shares of Common Stock purchased may be higher
than the prices of such shares on the Dividend Investment Date, in the event
that such purchases are not completed on that date.
Costs
12. Are there any expenses to Participants in connection with reinvestment
of dividends in Common Stock under the Plan? No.
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Report to Participants
13. How will Participants be informed of their purchases of Common Stock?
As soon as practicable after each reinvestment of dividends in Common Stock a
Participant will receive a statement of his or her account. These statements are
a Participant's continuing record of the cost of his or her purchases and should
be retained for tax or other purposes. The Agent may charge fees to Participants
requesting copies of past statements.
Dividends on Shares in the Plan
14. Will Participants be credited with dividends on shares of Common Stock
held in their account under the Plan? Yes. The Company pays dividends, as
declared, to the record holders of all its issued and outstanding shares of
Common Stock. All dividends on shares held in the Plan for a Participant under
the "Full Dividend Reinvestment" option will be reinvested in additional shares
of Common Stock under the Plan, subject to the Company's option not to reinvest
dividends on fractional shares as discussed in Question 21. To the extent that a
Participant under the "Partial Dividend Reinvestment" option requests that cash
dividends on Plan shares be sent to him or her, the Agent will send the cash
dividend to the Participant in the usual manner. The remaining dividends on Plan
shares will be reinvested for the Participant's account in additional shares of
Common Stock.
Certificates for Shares
15. Will stock certificates be issued for shares of Common Stock purchased?
No. Certificates for shares of Common Stock purchased under the Plan will not be
issued to Participants unless requested as set forth below. The number of shares
credited to an account under the Plan will be shown on the Participant's
statement of account. This feature protects against loss, theft or destruction
of stock certificates.
Certificates for any number of shares up to the number of full shares
credited to an account under the Plan (including any share certificates
deposited with the Agent under the safekeeping feature described in
Question 24 below) will be issued upon written request of a Participant. A
Withdrawal/Termination form is provided on the reverse side of the account
statement for this purpose. This form should be mailed to the Agent at the
address specified in Question 6.
Shares credited to the account of a Participant under the Plan may not be
pledged. A Participant who wishes to pledge such shares must request that
certificates for such shares be issued in his or her name.
Certificates for fractional shares will not be issued under any
circumstances.
16. In whose name will accounts be maintained and certificates registered
when issued? Accounts for each Participant will be maintained by the Agent in a
Participant's name as shown on the Company's records at the time the Participant
enters the Plan (the "Account Name"). When issued, certificates for full shares
will be registered in the Account Name.
Upon written request, certificates may also be registered and issued in a
name
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other than the Account Name, subject to compliance with any applicable laws and
the payment by the Participant of any applicable taxes, provided that the
request bears the signature of the Participant and the signature is guaranteed
by a commercial bank or trust company or by a member of any recognized national
or regional stock exchange.
Changing Participation; Withdrawal from Plan
17. When will a Participant's request to change his or her method of
participation become effective? Any changes in a Participant's method of
participating in the Plan will become effective with respect to an upcoming
Dividend Investment Date if written notice of such change is received in good
form by the Agent before the record date for the next dividend payment.
18. May a Participant withdraw from the Plan and may a Participant sell
shares held in the Plan? In order to withdraw from the Plan, a Participant must
notify the Agent in writing that he or she wishes to withdraw. A Withdrawal/
Termination form is provided on the reverse side of the account statement for
this purpose. This form should be mailed to the Agent at the address specified
in Question 6.
When a Participant withdraws from the Plan or upon termination of the Plan
by the Company, certificates for full shares of Common Stock credited to a
Participant's account under the Plan will be issued and a cash payment will be
made for any fraction of a share, based on the then current market price.
A request to withdraw from the Plan must be received before the next
upcoming dividend record date. Thereafter, all dividends on shares withdrawn
from the Plan will be paid in cash. If the request to withdraw is received in
good form on or after the record date for a dividend, any cash dividend paid on
that dividend payment date will be reinvested in Common Stock and credited to
the participant's account in accordance with the Participant's previous
instructions under the Plan. A Participant may elect to re-enroll in the Plan at
any time.
Any Participant, including a Participant who is withdrawing from the Plan,
may sell some or all of his or her full shares in the Plan either through the
Participant's broker or through the Agent. If a Participant elects to sell
through a broker, he or she first must request the Agent to send the Participant
a certificate or certificates representing the requested number of full shares
in the Plan credited to the Participant's account. As soon as practicable after
receipt of such request, the Agent will issue a certificate or certificates
representing such number of shares to the Participant. Alternatively, a
Participant may request the Agent to sell all or a portion of the full shares
credited to his or her account under the Plan. The Agent will use its best
efforts to make the sale in the open market within ten trading days after
receipt of the request, and the Participant will receive the proceeds of the
sale minus any brokerage commission and transfer taxes. No check for the
proceeds of such sale will be mailed prior to the settlement of funds from the
Agent's brokerage firm. Cur-
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rently, the settlement is three business days after the sale of the shares. A
Participant who requests the Agent to sell shares but who also wishes to have
additional shares sold through his or her broker will receive a certificate in
his or her name representing the full shares that he or she wishes to sell
through any such broker.
All information relating to the sale of shares will be reported to the
Internal Revenue Service as required, with copies provided to the Participants.
A Participant who wishes to sell some or all of his or her shares in the
Plan should be aware of the risk under both selling options that the price of
Common Stock may decrease between the time that the Participant determines to
sell shares in the Plan and the time that the sale is completed. This investment
risk is borne solely by the Participant.
20. What happens to a fraction of a share when a Participant withdraws from
the Plan? When a Participant withdrawals from the Plan, a cash adjustment
representing any fraction of a share will be mailed to the Participant. The cash
payment will be based upon the closing market price of the Common Stock, on the
business day prior to the business day that the account is terminated by the
Agent, as published in the WSJ Report.
21. What happens to a Participant's Plan account if all shares in the
Participant's own name are transferred or sold? If a Participant disposes of all
shares of stock registered in his or her own name outside of the Plan, unless
all shares in the Plan account are withdrawn, the Agent will continue to
reinvest the dividends on the shares held in the Plan account.
If a Participant, however, has only a fractional share of stock credited to
his or her account under the Plan on the record date for any dividend on the
Common Stock, the Company reserves the right not to reinvest any additional
dividends on such fractional share. If the Company exercises the right, the
Participant will receive, if applicable, a cash adjustment representing such
fraction of a share and a cash payment for the dividend. The cash payment for
the fractional share will be based upon the closing price of the Common Stock,
on the date of exercise by the Company, as published in the WSJ Report.
Voting
22. How will a Participant's shares held under the Plan be voted at
meetings of stockholders? Each Participant will receive a single proxy card
covering those shares of Common Stock credited to his or her account under the
Plan and those shares of Common Stock registered in the Participant's name that
are not within the Plan. If the proxy card is returned properly signed and
marked for voting, all of the shares will be voted as marked. The total number
of full shares held may be voted in person at the meeting.
If a proxy card is returned properly signed but without indicating
instructions as to the manner in which shares are to be voted with respect to
any item, all of the Par-
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ticipant's shares will be voted (to the extent legally permissible) in
accordance with the recommendations of the Board of Directors of the Company. If
the proxy card is not returned, or if it is returned unsigned or improperly
signed, none of the Participant's shares covered by such proxy card will be
voted unless the Participant or his or her other duly appointed representative
votes in person at the meeting. These procedures are consistent with the actions
taken with respect to stockholders who are not participating in the Plan.
Taxes
23. What are the Federal income tax consequences of participation in the
Plan? Set forth below is a general summary of the Federal income tax
consequences of participating in the Plan, current as of the date of this
Prospectus.
(bullet) The tax consequences to a particular Participant may vary on account of
the Participant's particular circumstances.
(1) A Participant who reinvests dividends under the Plan will be treated in
the same manner as if he or she had received a cash distribution in an amount
equal to the amount of dividends reinvested.
(2) If shares acquired under the Plan are purchased in market transactions,
a Participant will be treated as having received an additional cash distribution
in the amount of his or her ratable share of brokerage commissions paid by the
Company.
(3) All distributions under the Plan will be treated as dividends for
federal income tax purposes (and will be taxable as ordinary income) to the
extent of the Participant's ratable share of the Company's current and
accumulated earnings and profits.
(4) A Participant's tax basis of shares acquired directly from the Company
under the Plan will equal the amount of his or her reinvested dividends. A
Participant's tax basis of shares purchased in market transactions under the
Plan will be the amount of reinvested dividends, increased by his or her ratable
share of the brokerage commissions paid by the Company.
(5) A Participant's holding period for shares acquired under the Plan will
begin on the day following the credit of such shares to the Participant's
account.
(6) A Participant will not realize any taxable income when the Participant
receives certificates for whole shares held in the Participant's account, either
upon the Participant's request for those shares or upon termination of
participation in the Plan or discontinuation of the Plan by the Company.
(7) A Participant will realize gain or loss when shares are sold or
exchanged or, in the case of a fractional share, when the Participant receives a
cash redemption payment upon termination of participation in the Plan; the
amount of such gain or loss will be the difference between the amount which the
Participant receives for the shares or fractional shares and the tax basis
therefor. The character and the tax treatment of such gain or loss will depend
on whether
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such shares constituted a capital asset in the hands of the Participant, on the
Participant's holding period for the shares, and, in the case of a fractional
share redemption, possibly on the extent of the Participant's remaining holdings
in the Company.
If a Participant is subject to federal income tax withholding on dividends
received from the Company or on proceeds from the sale or redemption of shares
acquired under the Plan, including backup withholding of 31% on payments made to
persons other than corporations and other exempt entities and withholding of 30%
(or a lesser treaty rate) on dividend payments made to non-U.S. persons, the
Company will deduct the amount required to be withheld from such dividends or
proceeds before reinvesting such dividends to purchase shares under the Plan or
releasing such proceeds to the Participant. Payments of dividends and proceeds
to nonexempt persons and amounts, if any, of tax withheld will be reported to
the Internal Revenue Service by the Company as required by law. The filing of
any documentation required to obtain exemption from, or reduction of, federal
income tax withholding is the responsibility of the Participant.
All Participants, as well as eligible stockholders who are considering
participating in the Plan, are urged to consult with their own tax advisers
regarding the particular Federal, state, local and foreign tax consequences of
their participation in the Plan and the subsequent disposition of shares
purchased pursuant to the Plan. The rules summarized above may not be applicable
to certain Participants in the Plan, such as foreign residents or tax-exempt
entities. This federal income tax discussion is based on federal income tax law
in effect as of the date of this Prospectus. Participants should consult their
tax advisors with respect to the impact of any changes or proposed changes in
the Federal income tax law after the date of this Prospectus.
Share Safekeeping
24. How does the share safekeeping feature of the Plan operate? The Plan
provides a share deposit and safekeeping feature for holders of Common Stock to
eliminate the need for such Participants to hold physical stock certificates. If
the Participant currently holds physical share certificates for Common Stock and
would like the Agent to maintain custody of these certificates, the Participant
simply completes the tear-off section on the reverse side of the account
statement and the portion designated for stock deposit. There is no charge for
this service. The certificates do not need to be endorsed. Please make certain
your stock certificates are sent by certified or registered/insured mail or by
some other safe means (such as through your stock broker or bank) as the
Participant bears solely the risk of loss in transit to the Agent.
The share safekeeping feature is not available for certificates for
Preferred Stock.
Other Information
25. What happens if the Company declares a stock dividend or stock split?
Any shares of the Company's Common Stock
13
<PAGE>
issued in connection with a stock split or stock dividend distributed by the
Company will be added to the Participant's account.
As soon as practicable after the payment of a stock dividend or stock
split, a statement will be sent to each Participant which will indicate the
number of shares of Common Stock credited to each Participant's account under
the Plan as a result of the stock split or stock dividend.
26. May the Plan be changed or discontinued? While the Company presently
intends to continue the Plan indefinitely, the Company reserves the right to
amend, suspend, modify or terminate the Plan at any time. Notice of any such
amendment, suspension or modification will be sent to Participants. Should the
Company decide to terminate the Plan, it will provide Participants with prior
notice of such action.
27. What is the responsibility of the Company and the Agent under the Plan?
The Company and the Agent administering the Plan will not be liable for any act
done in good faith or for any good faith omission to act.
The Participant should recognize that neither the Company nor the Agent can
assure the participant of a profit or protect him or her against any economic
loss on the shares purchased for his or her account under the Plan. An
investment in the Company's Common Stock may be subject to significant market
fluctuations.
28. Who interprets and regulates the Plan? The Company reserves the right
to interpret and regulate the Plan as may be necessary or desirable in
connection with the operation of the Plan. The Plan will be governed by the laws
of the Commonwealth of Massachusetts.
29. How may stockholders obtain answers to other questions regarding the
Plan? Any additional questions should be addressed to the Agent at the address
indicated in Question 6.
USE OF PROCEEDS
The Company is unable to determine the number of shares of Common Stock
that it will ultimately issue under the Plan or the price at which such shares
will be sold. Cash retained by the Company from the reinvestment of dividends
under the Plan will be added to the funds of the Company and will be used for
general corporate purposes.
LEGAL OPINION
The legality of the shares of Common Stock offered under the Plan has been
passed upon by John A. Benning, Senior Vice President, General Counsel and
Secretary of the Company. As of the date of this Prospectus, Mr. Benning
beneficially owns 92,598 shares of Common Stock (calculated in accordance with
applicable rules of the Commission.)
14
<PAGE>
EXPERTS
The consolidated financial statements of the Company contained in and
incorporated by reference into the Company's Annual Report on Form 10-K for the
year ended December 31, 1995 incorporated by reference in this Prospectus have
been examined by KPMG Peat Marwick LLP, independent certified public
accountants, as set forth in their report included therein, and are incorporated
by reference herein in reliance upon such report and upon the authority of such
firm as experts in accounting and auditing.
INDEMNIFICATION
Section 67 of Chapter 156B of the General Laws of the Commonwealth of
Massachusetts provides that to the extent specified in or authorized by the
articles of organization, a by-law adopted by shareholders or a resolution
adopted by the holders of the majority of shares of stock entitled to vote on
the election of directors, a Company can indemnify directors, officers and other
employees or agents of the Company except as to any matter as to which such
person shall have been adjudicated in any proceeding not to have acted in good
faith in the reasonable belief that the action was in the best interests of the
Company. The Company's Restated Articles of Organization generally require the
Company to indemnify directors and officers to the fullest extent permissible
under Massachusetts law.
As of the date of this Prospectus, Liberty Mutual Insurance Company
("Liberty Mutual") owns indirectly approximately 82% of the outstanding shares
of Common Stock. As such, Liberty Mutual may be deemed to be controlling person
of the Company for purposes of the Securities Act of 1933 (the "Securities
Act"). Pursuant to an Intercompany Agreement between the Company and Liberty
Mutual the Company has agreed, among other things, to indemnify Liberty Mutual
against certain civil liabilities, including liabilities under the Securities
Act.
The Company also carries insurance on behalf of its directors, officers and
employees against certain liabilities which they might incur, including certain
liabilities under the Securities Act.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the Company
pursuant to the provisions described above, or otherwise, the Company has been
informed that in the opinion of the Commission such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable.
15
<PAGE>
============================================
TABLE OF CONTENTS
PAGE
---------
Available Information 2
Incorporation of Certain
Documents by Reference 3
The Company 4
The Plan 5
Purpose 5
Advantages 5
Investment Alternatives 5
Administration 6
Participation 6
Procedures Related to
Participation by
Stockholders 6
Number of Shares Purchased;
Purchase Price 8
Costs 8
Report to Participants 9
Dividends on Shares in the Plan 9
Certificates for Shares 9
Changing Participation;
Withdrawal from Plan 10
Voting 11
Taxes 12
Share Safekeeping 13
Other Information 13
Use of Proceeds 14
Legal Opinion 14
Experts 15
Indemnification 15
===========================================
[LOGO]
LIBERTY
FINANCIAL
COMPANIES, INC.
DIVIDEND
REINVESTMENT
PLAN
===========================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following is an itemized statement of estimated expenses of the
Registrant in connection with the issuance and sale of the Common Stock
registered hereunder.
SEC registration fee ........................................... $24.508.00
New York Stock Exchange Listing Fee............................. 7,000.00
Certified public accountants fees and expenses.................. 1,000.00
Printing and mailing Prospectus................................. 10,000.00
Blue sky and legal investment matters........................... 2,000.00
Miscellaneous................................................... 1,000.00
----------
Total......................................................... $45,508.00
==========
Item 15. Indemnification of Directors and Officers.
Section 67 of Chapter 156B of the General Laws of the Commonwealth of
Massachusetts provides that to the extent specified in or authorized by the
articles of organization, a by-law adopted by shareholders or a resolution
adopted by the holders of the majority of shares of stock entitled to vote on
the election of directors, a Massachusetts corporation can indemnify directors,
officers and other employees or agents of the corporation except as to any
matter as to which such person shall have been adjudicated in any proceeding not
to have acted in good faith in the reasonable belief that the action was in the
best interests of the corporation. The Company's Restated Articles of
Organization generally require the Company to indemnify directors and officers
to the fullest extent permissible under Massachusetts law.
As of the date of this Prospectus, Liberty Mutual Insurance Company
("Liberty Mutual") owns indirectly approximately 82% of the outstanding shares
of Common Stock. As such, Liberty Mutual may be deemed to be controlling person
of the Company for purposes of the Securities Act of 1933 (the "Securities
Act"). Pursuant to an Intercompany Agreement between the Company and Liberty
Mutual the Company has agreed, among other things, to indemnify Liberty Mutual
against certain civil liabilities, including liabilities under the Securities
Act.
The Company also carries insurance on behalf of its directors, officers and
employees against certain liabilities which they might incur, including certain
liabilities under the Securities Act.
See "Item 17. Undertakings" for a description of the Securities and
Exchange Commission's position regarding certain indemnification provisions.
II-1
<PAGE>
Item 16. Exhibits.
4.1 Restated Articles of Organization filed January 27, 1995 (previously
filed as Exhibit 3.1 to the Company's Registration Statement on Form
S-4 (filed under the name NEW LFC, INC.) Registration No. 33-88824)
and incorporated herein by reference thereto.
5.1 Opinion and Consent of John A. Benning, Esquire.
23.1 Consent of KPMG Peat Marwick LLP
24.1 Power of Attorney
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
Provided, however, that paragraphs (i) and (ii) shall not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
II-2
<PAGE>
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that, in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless, in the opinion of its counsel, the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by its is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Boston, Commonwealth of Massachusetts on
January 20, 1997.
LIBERTY FINANCIAL COMPANIES, INC.
(Registrant)
By: /s/ Kenneth R. Leibler*
----------------------------------
Kenneth R. Leibler
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below on January 20, 1997 by the
following persons in the capacities indicated.
Name Capacity
- - ---- --------
/s/ Kenneth R. Leibler* President, Chief Executive Officer
- - --------------------------- (Principal Executive Officer) and Director
Kenneth R. Leibler
II-3
<PAGE>
/s/ C. Allen Merritt, Jr. Senior Vice President and Treasurer
- - --------------------------- (Principal Financial Officer)
C. Allen Merritt, Jr.
/s/ Gregory H. Adamian* Director
- - ---------------------------
Gregory H. Adamian
/s/ Gerald E. Anderson* Director
- - ---------------------------
Gerald E. Anderson
/s/ Michael J. Babcock* Director
- - ---------------------------
Michael J. Babcock
/s/ Michael von Clemm* Director
- - ---------------------------
Michael von Clemm
/s/ Harold W. Cogger* Director
- - ---------------------------
Harold W. Cogger
/s/ Gary L. Countryman* Chairman and Director
- - ---------------------------
Gary L. Countryman
/s/ Paul J. Darling, II* Director
- - ---------------------------
Paul J. Darling, II
/s/ C. Herbert Emilson* Director
- - ---------------------------
C. Herbert Emilson
/s/ David F. Figgins* Director
- - ---------------------------
David F. Figgins
/s/ John B. Gray* Director
- - ---------------------------
John B. Gray
II-4
<PAGE>
- - --------------------------- Director
John P. Hamill
/s/ Marian L. Heard* Director
- - ---------------------------
Marian L. Heard
/s/ Raymond H. Hefner, Jr.* Director
- - ---------------------------
Raymond H. Hefner, Jr.
/s/ Edmund F. Kelly* Director
- - ---------------------------
Edmund F. Kelly
/s/ Sabino Marinella* Director
- - ---------------------------
Sabino Marinella
/s/ Ray B. Mundt* Director
- - ---------------------------
Ray B. Mundt
/s/ Richard A. Smith* Director
- - ---------------------------
Richard A. Smith
/s/ Glenn P. Strehle* Director
- - ---------------------------
Glenn P. Strehle
/s/ Stephen J. Sweeney* Director
- - ---------------------------
Stephen J. Sweeney
/s/ Stanley A. Wainer* Director
- - ---------------------------
Stanley A. Wainer
By:/s/ John A. Benning
---------------------
John A. Benning
Attorney-in-fact
II-5
<PAGE>
Exhibit Index
5.1 Opinion and Consent of John A. Benning, Esquire.
23.1 Consent of KPMG Peat Marwick LLP
24.1 Power of Attorney
II-6
Exhibit 5.1
January 16, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
This opinion is delivered to you in connection with the Registration
Statement (the "Registration Statement") on Form S-3 of Liberty Financial
Companies, Inc. (the "Company") being filed with the Securities and Exchange
Commission by the Company under the Securities Act of 1933, as amended (the
"Act"), for registration under the Act of 2,000,000 shares of the Company's
Common Stock, $.01 par value per share (the "Common Stock"), in connection with
the Company's Dividend Reinvestment Plan ("DRIP") set forth in the Registration
Statement. I am Senior Vice President, General Counsel and Clerk of the Company,
and have acted as such General Counsel in rendering this opinion to you. I have
made such examination of law and have examined such certificates (including
certificates of public officials and of officers of the Company) as I have
deemed necessary for purposes of rending this opinion.
Based upon and subject to the foregoing, I am of the opinion that the
shares of Common Stock to be issued by the Company pursuant to the Registration
Statement have been validly authorized for issuance and will, when issued in
accordance with the terms of the DRIP, be legally issued, fully paid and
nonassessable.
I understand that this opinion is to be used in connection with the
Registration Statement. I consent to the filing of this opinion as an exhibit to
the Registration Statement and the reference to myself in the Registration
Statement under the caption "Legal Matters."
Very truly yours,
/s/ John A Benning
-------------------------------
John A. Benning
Senior Vice President
and General Counsel
KMC/mr
Encl.
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
Liberty Financial Companies, Inc.
We consent to incorporation by reference in the registration statement on Form
S-3 of Liberty Financial Companies, Inc. of our report dated February 16, 1996,
relating to the consolidated balance sheets of Liberty Financial Companies, Inc.
and subsidiaries as of December 31, 1995 and 1994 and the related consolidated
statements of income, stockholders' equity and cash flows for each of the years
in the three-year period ended December 31, 1995, and all related schedules,
which report appears in the December 31, 1995 annual report of Form 10-K of
Liberty Financial Companies, Inc. and to the reference to our firm under the
caption "EXPERTS" in the prospectus.
KPMG PEAT MARWICK LLP
Boston, Massachusetts
January 17, 1997
Exhibit 24.1
Power of Attorney
Each person whose signature appears below hereby appoints each of Gary L.
Countryman, Edmund F. Kelly, Kenneth R. Leibler, C. Allen Merritt, and John A.
Benning, and each or any of them acting singly with full power to act without
the other, to be his or her true and lawful attorney-in-fact with authority,
with full power of substitution and resubstitution, together or individually to
execute in the name of each such person, in any and all capacities, and to file
with the Securities and Exchange Commission any and all Registration Statements
on Forms S-3 (for a dividend reinvestment plan) or S-8 (for sale of LFC stock
under employee benefit plans) under the Securities Act of 1933, as amended (the
"Securities Act), and any and all amendments (including post-effective
amendments) to any such Registration Statement, together with any exhibits
thereto and other documents therewith, necessary or advisable to enable the
Company to comply with the Securities Act and any rules, regulations and
requirements of the Securities and Exchange Commission in respect thereof,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them or their or
his substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Signature Capacity Date
- - --------- -------- ----
/s/ Gregory H. Adamiam Director November 13, 1996
- - --------------------------
Gregory H. Adamian
/s/ Gerald E. Anderson Director November 13, 1996
- - --------------------------
Gerald E. Anderson
/s/ Michael J. Babcock Director November 13, 1996
- - --------------------------
Michael J. Babcock
/s/ Michael von Clemm Director November 13, 1996
- - --------------------------
Michael von Clemm
/s/ Harold W. Cogger Director November 13, 1996
- - --------------------------
Harold W. Cogger
/s/ Gary L. Countryman Chairman and Director November 13, 1996
- - --------------------------
Gary L. Countryman
<PAGE>
/s/ Paul J. Darling, II Director November 13, 1996
- - --------------------------
Paul J. Darling, II
/s/ C. Herbert Emilson Director November 13, 1996
- - --------------------------
C. Herbert Emilson
/s/ David F. Figgins Director November 13, 1996
- - --------------------------
David F. Figgins
/s/ John B. Gray Director November 13, 1996
- - --------------------------
John B. Gray
Director November 13, 1996
- - --------------------------
John P. Hamill
/s/ Marian L. Heard Director November 13, 1996
- - --------------------------
Marian L. Heard
/s/ Raymond H. Hefner, Jr. Director November 13, 1996
- - --------------------------
Raymond H. Hefner, Jr.
/s/ Edmund F. Kelly Director November 13, 1996
- - --------------------------
Edmund F. Kelly
/s/ Kenneth R. Leibler President and November 13, 1996
- - -------------------------- Chief Executive Officer
Kenneth R. Leibler and Director
/s/ Sabino Marinella Director November 13, 1996
- - --------------------------
Sabino Marinella
<PAGE>
/s/ Ray B. Mundt Director November 13, 1996
- - --------------------------
Ray B. Mundt
/s/ Richard A. Smith Director November 13, 1996
- - --------------------------
Richard A. Smith
/s/ Glenn P. Strehle Director November 13, 1996
- - --------------------------
Glenn P. Strehle
/s/ Stephen J. Sweeney Director November 13, 1996
- - --------------------------
Stephen J. Sweeney
/s/ Stanley A. Wainer Director November 13, 1996
- - --------------------------
Stanley A. Wainer
