-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GI6iNC3uLUhEh7rEY57v7ZsIfsZdqi9MDZllcOd9gzRMoEdXayyzm3LMW0ZeFoDu AFfdeOnx4hbWQa/Vhe0i3A== 0000950144-98-007683.txt : 19980624 0000950144-98-007683.hdr.sgml : 19980624 ACCESSION NUMBER: 0000950144-98-007683 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980623 SROS: CSX SROS: NYSE SROS: PHLX FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY CORP CENTRAL INDEX KEY: 0000059229 STANDARD INDUSTRIAL CLASSIFICATION: LIFE INSURANCE [6311] IRS NUMBER: 570507055 STATE OF INCORPORATION: SC FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-05846 FILM NUMBER: 98652782 BUSINESS ADDRESS: STREET 1: P O BOX 789 STREET 2: 2000 WADE HAMPTON BLVD CITY: GREENVILLE STATE: SC ZIP: 29615 BUSINESS PHONE: 8032688283 MAIL ADDRESS: STREET 1: P O BOX 789 STREET 2: WADE HAMPTON BLVD CITY: GREENVILLE STATE: SC ZIP: 29602 11-K 1 THE LIBERTY CORPORATION 11-K 12-31-1997 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 11-K (Mark One) [XX] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1997 ----------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 1-5846 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: The Cosmos Broadcasting Corporation Retirement and Savings Plan --------------------------------------------------------------- B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: THE LIBERTY CORPORATION - ------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) South Carolina 57-0507055 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.)
Post Office Box 789, Wade Hampton Boulevard, Greenville, S. C. 29602 - ------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (864) 609-8256 1 2 REQUIRED INFORMATION A. Financial Statements and Schedules Independent Auditors' Report 8 Statements of Net Assets Available for Plan Benefits as of December 31, 1997 and 1996 9-10 Statements of Changes in Net Assets Available for Plan Benefits as of December 31, 1997 and 1996 11 Notes to Financial Statements 12-17 Schedule of Assets Held for Investment 18 Schedule of Reportable Transactions 19-20 B. Exhibits 23. Consent of Independent Auditors 21
2 3 SIGNATURES THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. The Cosmos Broadcasting Corporation Retirement and Savings Plan --------------------------------------------------------------- (Name of Plan) The Liberty Corporation Date: June 23, 1998 -------------------------- (Registrant/Issuer) /s/ Kenneth W. Jones -------------------------- Kenneth W. Jones Corporate Controller /s/ Martha G. Williams -------------------------- Martha G. Williams Vice President, General Counsel and Secretary 3 4 ITEM 1. CHANGES IN THE PLAN PLAN AMENDED AND RESTATED. Effective April 1, 1997, the net assets of The Liberty Corporation and Adopting Related Employers' 401(k) Thrift Plan merged with The Cosmos Broadcasting Corporation Profit Sharing Retirement Plan and Trust (for all applicable Cosmos participants). The merged plan was renamed The Cosmos Broadcasting Corporation Retirement and Savings Plan. The merged plan provides expanded investment selections and will retain the voluntary contribution, matching contribution, and profit sharing features for eligible Cosmos employees of the predecessor plan. ITEM 2. CHANGES IN INVESTMENT POLICY None. ITEM 3. CONTRIBUTIONS UNDER THE PLAN EMPLOYER'S PRETAX CONTRIBUTIONS Contributions under the Plan by The Cosmos Broadcasting Corporation and CableVantage (the "Company") are measured by reference to the employees' contributions which may be on a pre-tax or after-tax basis. Employer matching contributions are made only on pre-tax employee contributions in accordance with a formula set each year by the employer's board of directors. During 1997, the Company contributed an amount equal to 100% of a participant's pre-tax contribution, up to a maximum of 3% of the participant's compensation. Employer pre-tax matching contributions totaling $586,000 from April 1, 1997 to December 31, 1997 were credited to the accounts of participating employees. Prior to the plan merger date of April 1, 1997, this was not a feature of The Cosmos Broadcasting Corporation Profit Sharing Retirement Plan and Trust (for all applicable Cosmos participants). EMPLOYER'S DISCRETIONARY CONTRIBUTIONS In addition to making a matching pre-tax contribution, The Cosmos Broadcasting Corporation may make a separate discretionary contribution at the discretion of the Company's Board of Directors. If the Company elects to make a profit sharing contribution, it will be allocated among all participants who (1) are employed by the Company at the end of the applicable year and are credited with at least 1,000 hours of service for that year or (2) retire, die or become disabled during the applicable year. This allocation will be made after the end of the applicable year and will be based on each participant's compensation relative to the total compensation of all eligible participants (without regard to the participant's voluntary contributions). CableVantage does not currently make discretionary contributions. Employer discretionary contributions totaling $1,719,000 in 1997, were credited to the accounts of participating employees. ITEM 4. PARTICIPATING EMPLOYEES There were 927 enrolled participants in the Plan as of December 31, 1997. 4 5 ITEM 5. ADMINISTRATION OF THE PLAN (a) Parties responsible for the administration of the Plan are: (1) the Plan Committee, made up of at least three members named by the Company, (2) the Trustee and (3) the Plan Administrator which is named by the Plan Committee. The Plan Committee is responsible for the administration and operation of the Plan, except as to responsibilities which have been specifically assigned to the Trustee, to an Investment Manager, or to the Plan Administrator. Present members of the Plan Committee are employed by The Liberty Corporation or its subsidiaries and include the following: Artie L. Bedard Mary Anne Bunton Faith E. Gibson Quentin Kennedy Susan W. Mink Pamela A. Purvis Samuel H. Schaeffer G. Neil Smith Sandra Carpenter Thompson Evon A. Trotter Stephen Watkins, Jr. 5 6 The Trustee is responsible for the management, investment and control of the assets of the Trust established by the Plan, and for the disbursements of benefits therefrom, except to the extent that the Trustee may be relieved of investment responsibility by the appointment of an Investment Manager or by direction of the Plan Committee. The present Trustee is Investors Fiduciary Trust Company, 801 Pennsylvania, Kansas City, MO 64105. Neuberger & Berman Pension Management, Inc. ("Neuberger & Berman") and Hellman Jordan Management Company, Inc. is Investment Manager of one of the nine funds comprising the Plan entitled Neuberger & Berman/Hellman, Jordan Common Stock Fund (see page 10, Notes to Financial Statements - Description of Plan for further details). Neuberger & Berman's address is 522 Fifth Avenue, New York, New York 10036. Hellman Jordan Management Company, Inc.'s address is P.O. Box 389, Boston, MA 02101. Investors Fiduciary Trust Company has investment responsibility for all of the other Plan funds. The Plan Administrator is currently an Administrative Committee which is responsible for the daily administration and operational functions of the Plan, including filing all reports with governmental agencies, providing Plan participants with information, preparing year-end reports to participants, maintaining all required records, interpreting the provisions of the Plan and settling disputes over the rights of employees, participants and beneficiaries. Present members of the Administrative Committee are employed by The Liberty Corporation and are stated as follows: Mary Anne Bunton Susan E. Cyr (b) For the year ended December 31, 1997, expenses of administration of the Plan of approximately $341,000, including fees and expenses of the Trustee and two of the Investment Managers, Neuberger & Berman and Hellman Jordan, were incurred and are paid out of the assets of the Plan. ITEM 6. CUSTODIAN OF INVESTMENTS (a) Investors Fiduciary Trust Company, 801 Pennsylvania, Kansas City, MO 64105. (b) The Trustees, Wachovia Bank, N.A., and Investors Fiduciary Trust Company received $13,000 and $80,000, respectively, during the year ended December 31, 1997. (c) No bond was furnished by Investors Fiduciary Trust Company, the custodian of the Plan. ITEM 7. REPORTS TO PARTICIPATING EMPLOYEES Each Plan participant receives a quarterly statement showing the balance in his Plan account (including a breakdown of the amounts invested in each investment fund offered), amounts contributed by him and by his Employer, dividends, interest and other gains credited to his account, any amounts forfeited or otherwise charged against his account, and additional shares purchased if the employee has elected to have some or all of his and his Employer's contributions invested in the Company's stock. These individualized reports, a copy of the proxy statement and a copy of the summary annual report are the reports that were distributed to Plan participants during the year ended December 31, 1997. 6 7 ITEM 8. INVESTMENT OF FUNDS (a) For the period January 1, 1997 to April 1, 1997, employee contributions and matching Employer contributions could be invested in increments of 25% in: The Liberty Corporation Stock Fund, which consists solely of Company common stock; the Money Market Fund, consisting of various money market instruments and U.S. Government securities; the Intermediate Bond Fund, consisting of intermediate - term government and good quality corporate bonds; or the Common Stock Fund, consisting of high quality common stock or securities convertible into common stock, other than Company stock. Beginning April 1, 1997, the following funds were available for investment under the Plan:
NAME OF FUND DESCRIPTION OF FUND ----------------------------------------------------- --------------------------------------------------------- Cosmos Unitized Fund A fund which invests solely in Common Stock of The Liberty Corporation Vanguard Institutional Money Market Reserve Fund A fund which invests in money market instruments Neuberger & Berman/Hellman Jordan Common Stock Fund A fund which invests in common stocks of medium and large companies Vanguard Institutional Bond Index Fund A fund which invests in bond-related securities Loomis Sayles Bond Fund A fund which invests in investment-grade debt securities Vanguard Wellington Fund A fund which invests in common and preferred stocks and debt securities Vanguard Index 500 Fund A fund which invests in securities of companies listed on the Standard and Poor's 500 index Templeton Foreign Fund A fund which invests in foreign stocks and debt securities T. Rowe Price Small Cap Value Fund A fund which invests in common stocks of companies with market capitalizations of $500 million or less
For the three years ended December 31, 1997, there were brokerage commissions paid by the Plan from the Nueberger Berman/Hellman Jordan Common Stock Fund only. (b) No brokerage transactions effected for the Plan during the year ended December 31, 1997, were directed to brokers because of research services provided.
ITEM 9. FINANCIAL STATEMENTS AND EXHIBITS Page No. (a) Financial Statements Report of Independent Auditors 8 Statements of Net Assets Available for Plan Benefits - December 31, 1997 and 1996 9-10 Statement of Changes in Net Assets Available for Plan Benefits - For the Year Ended December 31, 1997 11 Notes to Financial Statements - December 31, 1997 12-17 Schedule of Assets Held for Investment - December 31, 1997 18 Schedule of Transactions or Series of Transactions in Excess of 5% of the Current Value of Plan Assets - December 31, 1997 19-20 (b) Exhibits Consent of Independent Auditors 21
7 8 REPORT OF INDEPENDENT AUDITORS To the Administrative Committee of The Cosmos Broadcasting Corporation Retirement and Savings Plan and Board of Directors The Cosmos Broadcasting Corporation We have audited the accompanying statements of net assets available for plan benefits of The Cosmos Broadcasting Corporation Retirement and Savings Plan as of December 31, 1997 and 1996, and the related statement of changes in net assets available for plan benefits for the year ended December 31, 1997. 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 the Plan at December 31, 1997 and 1996, and the changes in its net assets available for plan benefits for the year ended December 31, 1997, in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment as of December 31, 1997 and transactions or series of transactions in excess of 5% of the current value of plan assets for the year ended December 31, 1997 are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 and are not a required part of the basic financial statements. The Fund Information in the statements of net assets available for plan benefits and the statement of changes in net assets available for plan benefits is presented for purposes of additional analysis rather than to present the net assets available for plan benefits and changes in net assets available for plan benefits of each fund. The supplemental schedules and Fund Information have been subjected to the auditing procedures applied in our audit 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. Ernst & Young LLP Greenville, South Carolina March 20, 1998 8 9 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION DECEMBER 31, 1997 (In Thousands)
----------------------------------------------------------------------------------------- NEUBERGER & BERMAN/ HELLMAN, CASH AND COSMOS VANGUARD INST. JORDAN VANGUARD INST. CASH UNITIZED MONEY MARKET COMMON STOCK BOND INDEX LOOMIS SAYLES EQUIVALENTS FUND RES. FUND FUND FUND BOND FUND ----------- ---------- -------------- ------------ -------------- ------------- ASSETS INVESTMENTS: AT FAIR VALUE MONEY MARKET FUNDS $ 31 $ - $ 5,880 $ - $ - $ - MUTUAL FUNDS - 2,440 - 36,879 2,910 2,329 OTHER FUND - - - - - - ----------- ---------- -------------- ------------ -------------- ------------- TOTAL INVESTMENTS 31 2,440 5,880 36,879 2,910 2,329 EMPLOYER'S CONTRIBUTION RECEIVABLE - 92 195 711 105 53 ----------- ---------- -------------- ------------ -------------- ------------- TOTAL ASSETS 31 2,532 6,075 37,590 3,015 2,382 LIABILITIES ACCRUED EXPENSES - - 1 10 - - ----------- ---------- -------------- ------------ -------------- ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 31 $ 2,532 $ 6,074 $ 37,580 $ 3,015 $ 2,382 =========== ========== ============== ============ ============== =============
--------------------------------------------------------------------------- VANGUARD VANGUARD T. ROWE PRICE WELLINGTON INDEX 500 TEMPLETON SMALL CAP FUND FUND FOREIGN FUND VALUE FUND LOAN FUND TOTAL ---------- ---------- ------------ ------------- --------- ------- ASSETS INVESTMENTS: AT FAIR VALUE MONEY MARKET FUNDS $ - $ - $ - $ - $ - $ 5,911 MUTUAL FUNDS 3,473 5,557 1,275 4,188 - 59,051 OTHER FUND - - - - 996 996 ---------- --------- ------------ ------------- --------- ------- TOTAL INVESTMENTS 3,473 5,557 1,275 4,188 996 65,958 EMPLOYER'S CONTRIBUTION RECEIVABLE 146 207 62 148 - 1,719 ---------- --------- ------------ ------------- --------- ------- TOTAL ASSETS 3,619 5,764 1,337 4,336 996 67,677 LIABILITIES ACCRUED EXPENSES - - - - - 11 ---------- --------- ------------ ------------- --------- ------- NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 3,619 $ 5,764 $ 1,337 $ 4,336 $ 996 $67,666 ========== ========= ============ ============= ========= =======
SEE NOTES TO FINANCIAL STATEMENTS. 9 10 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 (In Thousands) ASSETS Investment in The Liberty Corporation Profit Sharing Trust (Note 4) $ 33,602 Employer contributions receivable 1,578 --------- Net assets available for plan benefits $ 35,180 =========
See notes to financial statements. 10 11 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION DECEMBER 31, 1997 (In Thousands)
COSMOS PENSION CASH AND VANGUARD INST. MONEY MONEY CASH COSMOS MONEY MARKET MARKET INTERMEDIATE MARKET EQUIVALENTS UNITIZED RESERVE FUND BOND FUND FUND FUND FUND FUND ------ ------------ ------- ----------- -------- ------------- ADDITIONS TO NET ASSETS ATTRIBUTED TO Investment income: Net appreciation (depreciation) in fair value of investments (Note 5) $ - $ (5) $ - $ - $ 92 $ - Interest 82 38 - - 1 - Dividends - - - 1 10 315 ------ ------------ ------- ----------- -------- ------------- Total investment income 82 33 - 1 103 315 Other income - - - - - - Contributions: Participants - - - - 59 102 Employer - - - - 123 264 ------ ------------ ------- ----------- -------- ------------- Total Contributions - - - - 182 366 Transfers from other Qualified Plans - - - - - 4 ------ ------------ ------- ----------- -------- ------------- Total additions 82 33 - 1 285 685 DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO Benefits paid to participants (88) (99) - - (93) (1,141) Administrative expenses (2) - - - (2) (16) Loan balances of terminated employees - - - - - - ------ ------------ ------- ---------- ------- ------------- Total deductions (90) (99) - - (95) (1,157) Interfund transfers (net) (6,282) (2,474) (30) 30 (1,579) 2,344 ------ ------------ ------- ----------- -------- ------------- Net (decrease) increase prior to merger (6,290) (2,540) (30) 31 (1,389) 1,872 Merger from The Liberty Corporation an Adopting Related Employee's 401K Thrift Plan - - - - 1,685 4,202 ------ ------------ ------- ----------- -------- ------------- Net (decrease) increase (6,290) (2,540) (30) 31 296 6,074 Net assets available for plan benefits at January 1, 1997 6,290 2,540 30 - 2,236 - ------ ------------ ------- ----------- -------- ------------- Net assets available for plan benefits at December 31, 1997 $ - $ - $ - $ 31 $ 2,532 $ 6,074 ====== ============ ======= =========== ======== =============
NUEBERGER & BERMAN/HELLMAN VANGUARD INST. VANGUARD JORDON COMMON BOND INDEX LOOMIS SAYLES WELLINGTON VANGUARD INDEX STOCK FUND FUND BOND FUND FUND 500 FUND -------------- -------------- ------------- ---------- -------------- ADDITIONS TO NET ASSETS ATTRIBUTED TO Investment income: Net appreciation (depreciation) in fair value of investments (Note 5) $ 9,949 $ 134 $ (3) $ (71) $ 269 Interest 40 - 39 173 33 Dividends 101 148 108 79 47 -------------- -------------- ------------- ---------- -------------- Total investment income 10,090 282 144 181 349 Other income 11 - - - - Contributions: Participants 475 50 34 92 157 Employer 953 138 70 193 282 -------------- -------------- ------------- ---------- ------------- Total Contributions 1,428 188 104 285 439 Transfers from other Qualified Plans 8 - - - 6 -------------- -------------- ------------- ---------- ------------- Total additions 11,537 470 248 466 794 DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO Benefits paid to participants (1,998) (179) (9) (28) (264) Administrative expenses (297) (6) (1) (5) (7) Loan balances of terminated employees - - - - - -------------- -------------- ------------- --------- ------------- Total deductions (2,295) (185) (10) (33) (271) Interfund transfers (net) (8,751) 1,173 2,144 3,186 5,241 -------------- -------------- ------------- ---------- ------------- Net (decrease) increase prior to merger 491 1,458 2,382 3,619 5,764 Merger from The Liberty Corporation an Adopting Related Employee's 401K Thrift Plan 13,005 1,557 - - - -------------- -------------- ------------- ---------- ------------- Net (decrease) increase 13,496 3,015 2,382 3,619 5,764 Net assets available for plan benefits at January 1, 1997 24,084 - - - - -------------- -------------- ------------- ---------- ------------- Net assets available for plan benefits at December 31, 1997 $ 37,580 $ 3,015 $ 2,382 $ 3,619 $ 5,764 ============== ============== ============= ========== =============
T. ROWE PRICE SMALL CAP TEMPLETON VALUE FOREIGN FUND FUND LOAN FUND TOTAL ------------ --------- --------- ------- ADDITIONS TO NET ASSETS ATTRIBUTED TO Investment income: Net appreciation (depreciation) in fair value of investments (Note 5) $ (204) $ 303 $ - $ 10,464 Interest 104 233 - 743 Dividends 39 33 - 881 ------------ --------- --------- --------- Total investment income (61) 569 - 12,088 Other income - - - 11 Contributions: Participants 50 100 - 1,119 Employer 87 196 - 2,306 ------------ --------- --------- --------- Total Contributions 137 296 - 3,425 Transfers from other Qualified Plans - 8 - 26 ------------ --------- --------- --------- Total additions 76 873 - 15,550 DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO Benefits paid to participants (5) (55) - (3,959) Administrative expenses - (5) - (341) Loan balances of terminated employees - - (22) (22) ------------ --------- --------- --------- Total deductions (5) (60) (22) (4,322) (10) Interfund transfers (net) 1,266 3,523 209 - ------------ --------- --------- --------- Net (decrease) increase prior to merger 1,337 4,336 187 11,228 Merger from The Liberty Corporation an Adopting Related Employee's 401K Thrift Plan - - 809 21,258 ------------ --------- --------- --------- Net (decrease) increase 1,337 4,336 996 32,486 Net assets available for plan benefits at January 1, 1997 - - - 35,180 ------------ --------- --------- --------- Net assets available for plan benefits at December 31, 1997 $ 1,337 $ 4,336 $ 996 $67,666 ============ ========= ========= =========
SEE ACCOMPANYING NOTES. 11 12 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 1. PLAN MERGER Effective April 1, 1997, the net assets of The Liberty Corporation and Adopting Related Employers' 401(k) Thrift Plan, a "qualified cash or deferred arrangement plan" under Section 401K of the Internal Revenue Code (for all applicable Cosmos participants) merged with The Cosmos Broadcasting Corporation Profit Sharing Retirement Plan and Trust, a discretionary profit sharing plan. The merged plan was renamed The Cosmos Broadcasting Corporation Retirement and Savings Plan ("the Plan"). The merged plan provides expanded investment options and will retain the voluntary contribution, matching contribution, and profit sharing features for eligible Cosmos employees of the predecessor plan. The Liberty Corporation (the "Company") will submit the revised plan to the Internal Revenue Service to obtain a determination letter that the Plan, as amended and restated, is qualified under Section 401 of the Internal Revenue Code. 2. DESCRIPTION OF PLAN The following description of the Plan provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. GENERAL Any employee of the company who (a) was a participant as of March 31, 1997 in either of the two existing plans being combined into the revised Plan or (b) has completed 1,000 hours of service in a calendar year or in the first 12 months of employment is eligible to participate in the plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974. CONTRIBUTIONS Participation in the 401-k portion of the Plan is voluntary. Eligible employees may elect to contribute up to a total of 13% of their compensation on either a pre-tax or after-tax basis, or a combination of both, through payroll deductions. Each participating employer makes matching contributions on pre-tax employee contributions of up to 3% of each participant's annual compensation. The matching percentage may be changed by resolution of the Board of Directors of the Company, effective at the beginning of any plan year (January 1). On an annual basis Cosmos Broadcasting Corporation contributes to the profit-sharing portion of the Plan, in the subsequent fiscal year, discretionary contributions equal to amounts authorized by the Board of Directors. PARTICIPANT ACCOUNT Each participant's account is credited with the participant's contributions and allocations of (a) the Company's contributions and (b) Plan earnings, and is charged with an allocation of administrative expenses. Allocations are based on participant contributions or account balances, as defined. Forfeited balances of terminated participants' nonvested accounts are used to reduce future company contributions. INVESTMENT OPTIONS As of December 31, 1997, the Plan is comprised of nine separate investment funds:
NAME OF FUND DESCRIPTION OF FUND ----------------------------------------------------- --------------------------------------------------------- Cosmos Unitized Fund A fund which invests solely in Common Stock of The Liberty Corporation Vanguard Institutional Money Market Reserve Fund A fund which invests in money market instruments Neuberger & Berman/Hellman Jordan Common Stock Fund A fund which invests in common stocks of medium and large companies Vanguard Institutional Bond Index Fund A fund which invests in bond-related securities Loomis Sayles Bond Fund A fund which invests in investment-grade debt securities Vanguard Wellington Fund A fund which invests in common and preferred stocks and debt securities Vanguard Index 500 Fund A fund which invests in securities of companies listed on the Standard and Poor's 500 index Templeton Foreign Fund A fund which invests in foreign stocks and debt securities T. Rowe Price Small Cap Value Fund A fund which invests in common stocks of companies with market capitalizations of $500 million or less
12 13 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS Employee participants may elect to invest their contributions in any fund. Beginning April 1, 1997, the plan was changed to provide for the monthly transfers of a participant's or former participant's future and/or existing account balances under the plan. Matching employer contributions and discretionary employer contributions will be invested in the same way as the employee's pre-tax contributions upon which they are based. At December 31, 1997, there were 927 active participants in the Plan whom were electing to invest, either wholly or partially, in the following funds: The Cosmos Unitized Fund, Vanguard Institutional Money Market Reserve Fund, Neuberger & Berman/Hellman Jordan Common Stock Fund, Vanguard Institutional Bond Index Fund, Loomis Sayles Bond Fund, Vanguard Wellington Fund, Vanguard Index 500 Fund, Templeton Foreign Fund, and the T. Rowe Price Small Cap Value Fund. VESTING Amounts credited to a participant's employee account, either before tax or after tax, are fully vested at all times. Amounts credited to a participant's employer matching and discretionary account vest based on the total number of years of service (as defined under the Plan) with the Company or its related employers:
NUMBER OF YEARS PERCENTAGE OF SERVICE OF VESTING ----------------- ----------- Less than 3 years -- 3 years 25% 4 years 50% 5 years 75% 6 years 100%
All amounts credited to a participant's employee (before tax or after tax) and employer matching accounts are fully vested upon termination of employment due to a participant's death, total disability or retirement, or after a participant has completed six or more years of service. Also, each employee is fully vested at his or her 65th birthday. FORFEITURES AND PAYMENT OF BENEFITS A participant who has completed less than six years of service and is terminated for any reason other than those mentioned above forfeits the non-vested amounts in his employer matching account. All amounts credited to the employee's account (before tax or after tax) and all vested amounts credited to the employer's matching account are distributable upon termination in the form of a lump sum or installment payments. LOANS The Plan allows participants to obtain loans, within stated limits, from the vested portion of their account balance. Repayment is required over a period not to exceed five years, unless the loan is used for the purchase of a principal residence. Interest is charged on outstanding loans at a rate determined by the plan administrator. These participant loans are reported in the accompanying financial statements in the Loan Fund. Reversion to SPECIAL FUND The Cosmos Broadcasting Corporation Pension Plan and Trust Agreement for Technicians was terminated during 1992. In 1993, twenty-five percent (25%) of the excess assets were reverted to a special fund within the Profit Sharing Plan. The reversion is included on the statement of net assets available for plan benefits in the cash and cash equivalents fund. The reversion is to be allocated in no more than seven years to the accounts of those participants who were active participants in the pension plan upon its termination. An allocation of approximately $1,000 of the reversion was made during 1997. 13 14 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INVESTMENT VALUATION AND INCOME RECOGNITION Investments are carried in the financial statements at market value. Securities traded on a national securities exchange are valued at the last reported sales price on the last business day of the Plan year; investments traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the average of the last reported bid and ask prices. The difference between proceeds received and the cost of investments sold is recognized as realized gains (losses) in the statements of changes in net assets available for plan benefits. Cost is determined based on the average cost method for The Liberty Corporation stock, and the first-in, first-out basis for other investments. The net change in the aggregate market value of investments is reflected in the statements of net assets available for plan benefits as unrealized gains (losses). USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates that effect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. LOAN BALANCES OF CERTAIN TERMINATED PARTICIPANTS When a participant with an outstanding loan balance terminates his or her employment with the Plan sponsor, the balance of the loan becomes due and payable. In the event a borrower fails to repay all or a portion of such loan, the outstanding balance of the loan plus interest due is deducted from the balance of the account from which the loan was made. 4. INVESTMENT IN THE MASTER TRUST Investments of the Plan were maintained in a Master Trust for the period, January 1, 1997 to March 31,1997. The Liberty Corporation Profit Sharing Trust was a master trust established to provide the trust functions for the assets and liabilities of the following profit sharing plans: The Liberty Corporation Profit Sharing Plan and The Cosmos Broadcasting Corporation Profit Sharing Retirement Plan. Employees of The Liberty Corporation, Liberty Life Insurance Company, Pierce National Life Insurance Company, The Cosmos Broadcasting Corporation, Liberty Capital Advisors, Inc., Liberty Properties Group, Inc., Liberty Investment Group, Liberty Insurance Services Corporation and Special Services Corporation participate in one of the plans. The combined investments of the Master Trust, and Master Trust income (including unrealized appreciation or depreciation in fair value of investments) were allocated between the plans based on respective participant account balances. The Plan had an approximate 28% share of the net assets of the Master Trust at December 31, 1996 and March 31, 1997. The investments of the Master Trust were held by Wachovia Bank of North Carolina, N.A. (Wachovia). The financial information by investment fund within the Master Trust relating to net assets available for benefits as of December 31, 1996 is presented on the following page. This information has been provided by Wachovia and has not been audited by independent auditors. This information has been certified by Wachovia to be complete and accurate. 14 15 THE LIBERTY CORPORATION PROFIT SHARING TRUST STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION DECEMBER 31, 1996 (IN $000'S)
DECEMBER 31, 1996 FUND INFORMATION (UNAUDITED) -------------------------------------------------------------------- COMMON STOCK INTERMEDIATE LIBERTY STOCK FUND MONEY MARKET FUND FUND BOND FUND ------------------ ----------------- ------------ ------------- ASSETS INVESTMENTS: AT FAIR VALUE SHORT-TERM INVESTMENTS (TOTAL COST OF $27,170 IN $ 47 $ 17,940 $ 7,563 $ 1,582 1996) THE LIBERTY CORPORATION COMMON STOCK (TOTAL COST OF $5,197 IN 1996) 7,371 --- --- --- OTHER COMMON STOCKS (TOTAL COST OF $54,451 IN --- --- 75,569 --- 1996) SECURITIES OF US GOVERNMENT AND AGENCIES (TOTAL COST OF $3,358 IN 1996) --- --- --- 3,333 CORPORATE BONDS (TOTAL COST OF $1,662 IN 1996) --- --- --- 1,644 CORPORATE COLLATERALIZED MORTGAGE OBLIGATIONS (TOTAL COST OF $1,374 IN 1996) --- --- --- 1,421 CORPORATE ASSET-BACKED SECURITIES (TOTAL COST OF $3,361 IN 1996) --- 3,022 --- 324 REAL ESTATE INVESTMENT TRUST (TOTAL COST OF $552 IN 1996) --- --- 729 --- DUE FROM BROKER FOR SECURITIES SOLD --- --- 241 --- ACCRUED INVESTMENT INCOME 36 91 168 66 CONTRIBUTIONS RECEIVABLE FROM EMPLOYER 534 1,002 2,712 700 ---------------- --------------- ------------ ------------- TOTAL ASSETS 7,988 22,055 86,982 9,070 LIABILITIES ACCRUED EXPENSES 3 12 28 3 DUE TO (FROM) OTHER FUNDS (1) (420) 414 (1) ---------------- --------------- ------------ ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 7,986 $ 22,463 $ 86,540 $ 9,068 ================ =============== ============ =============
COSMOS PENSION MONEY MARKET TOTAL --------------- --------- ASSETS INVESTMENTS: AT FAIR VALUE SHORT-TERM INVESTMENTS (TOTAL COST OF $27,170 IN $ 38 $ 27,170 1996) THE LIBERTY CORPORATION COMMON STOCK (TOTAL COST OF $5,197 IN 1996) --- 7,371 OTHER COMMON STOCKS (TOTAL COST OF $54,451 IN --- 75,569 1996) SECURITIES OF US GOVERNMENT AND AGENCIES (TOTAL COST OF $3,358 IN 1996) --- 3,333 CORPORATE BONDS (TOTAL COST OF $1,662 IN 1996) --- 1,644 CORPORATE COLLATERALIZED MORTGAGE OBLIGATIONS (TOTAL COST OF $1,374 IN 1996) --- 1,421 CORPORATE ASSET-BACKED SECURITIES (TOTAL COST OF $3,361 IN 1996) --- 3,346 REAL ESTATE INVESTMENT TRUST (TOTAL COST OF $552 IN 1996) --- 729 DUE FROM BROKER FOR SECURITIES SOLD --- 241 ACCRUED INVESTMENT INCOME --- 361 CONTRIBUTIONS RECEIVABLE FROM EMPLOYER --- 4,948 --------------- --------- TOTAL ASSETS 38 126,133 LIABILITIES ACCRUED EXPENSES --- 46 DUE TO (FROM) OTHER FUNDS 8 --- --------------- --------- NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 30 $ 126,087 =============== =========
SEE NOTES TO FINANCIAL STATEMENT. 15 16 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 5. INVESTMENTS During 1997, the Plan's investments (including investments bought, sold, and held during the year) appreciated (depreciated) in value by $10,464 as follows:
NET APPRECIATION (DEPRECIATION) IN FAIR MARKET VALUE VALUE DURING YEAR AT END OF YEAR ---------------------- -------------- ($000'S) YEAR ENDED DECEMBER 31, 1997 ---------------------------------- Intermediate Bond Fund ($ 5) $ - Cosmos Unitized Fund 92 2,440 Vanguard Institutional Money Market Reserve Fund - 5,880 Neuberger & Berman/Hellman, Jordan Common Stock Fund 9,949 36,879 Vanguard Institutional Bond Index Fund 134 2,910 Loomis Sayles Bond Fund (3) 2,329 Vanguard Wellington Fund (71) 3,473 Vanguard Index 500 Fund 269 5,557 Templeton Foreign Fund (204) 1,275 T. Rowe Price Small Cap Value Fund 303 4,188 ====================== ============= $10,464 $64,931 ====================== =============
The market value of individual investments that represent 5% or more of the Plan's total assets are as follows:
DECEMBER 31, 1997 ------------ ($000'S) Vanguard Institutional Money Market Reserve Fund $ 5,880 Neuberger & Berman/Hellman Jordan Common Stock Fund 36,879 Vanguard Wellington Fund 3,473 Vanguard Index 500 Fund 5,557 T. Rowe Price Small Cap Value Fund 4,188
16 17 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 6. INCOME TAX STATUS The Plan is an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974. Both of the predecessor plans had previously received favorable determination letters from the Internal Revenue Service that the related trusts were qualified under Section 401 of the Internal Revenue Code. The Plan will file a determination letter with the Internal Revenue Service requesting that the Plan, as amended and restated, will continue to be qualified under Section 401(a) of the Internal Revenue Code, and the related trust is not subject to income taxation. The Plan is required to operate in conformity with the Internal Revenue Code to maintain its qualification. The Plan Committee is not aware of any course of action or events that have occurred that might adversely affect the Plan's qualified status. 7. PRIORITIES ON TERMINATION OF PLAN Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event that the Plan is terminated, all expenses will be paid and the accounts of the affected participants will be proportionately adjusted to reflect such expenses and all contributions and withdrawals up to the date of termination. The Plan will then be revalued and each participant will be paid all amounts credited to his accounts. The accounts of all participants become fully vested as of the date of termination. An exception to this method of distribution at termination is made for the case in which termination is due to revocation of the Plan's exemption from income taxes under Section 401 of the Internal Revenue Code. In that case, all contributions, including those made by the employer, would be returned to the respective contributors. 8. TRANSACTIONS WITH PARTIES-IN-INTEREST The Plan also received dividends of $54,000 in 1997 from The Liberty Corporation and interest of $160,000 in 1997 from a short-term investment fund sponsored by the Plan trustee. 17 18 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN LINE 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT DECEMBER 31, 1997 (In $000's except units data)
NAME OF ISSUER AND CURRENT TITLE OF EACH ISSUE UNITS COST VALUE - ------------------------------------------------------ --------- ------------ ------------- MONEY MARKET FUNDS Inst. Federated Auto Government Trust 31,314 $ 31 $ 31 COMMON STOCKS Cosmos Unitized Fund 215,124 1,477 2,440 MUTUAL FUNDS Vanguard Institutional Money Market Reserve Fund 5,880,411 5,880 5,880 Neuberger & Berman/Hellman Jordan Common Stock Fund 2,906,183 24,317 36,879 Vanguard Institutional Bond Index Fund 288,417 2,816 2,910 Loomis Sayles Bond Fund 181,553 2,334 2,329 Vanguard Wellington Fund 117,949 3,553 3,473 Vanguard Index 500 Fund 61,690 5,317 5,557 Templeton Foreign Fund 128,170 1,470 1,275 T. Rowe Price Small Cap Value Fund 178,975 3,916 4,188 ------------ ------------ TOTAL MUTUAL FUNDS 49,603 62,491 LOANS Participant Loans 995,434 996 996 ------------ ------------ TOTAL INVESTMENTS $ 52,107 $ 65,958 ============ ============
18 19 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN LINE 27D - SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1997 (IN $000'S, EXCEPT NUMBER OF SHARES DATA)
CURRENT VALUE ON REALIZED PURCHASE SALES EXPENSES TRANSACTION GAIN PARTY INVOLVED DESCRIPTION OF ASSETS PRICE PRICE INCURRED COST DATE (LOSS) - ----------------------------- ---------------------------------------- -------- ------ -------- ------ ----------- -------- Category (i) - Individual transactions in excess of 5% of Plan Assets Wachovia Bank, N.A Money Market Fund $ --- $6,214 $ --- $6,214 $ 6,214 $ --- Wachovia Bank, N.A Intermediate Bond Fund --- 2,434 --- 2,434 2,434 --- Investors Fiduciary Trust Co. Loomis Sayles Bond Fund 2,105 --- --- 2,105 2,105 --- Investors Fiduciary Trust Co. T. Rowe Price Small Cap Value Fund 3,329 --- --- 3,329 3,329 --- Investors Fiduciary Trust Co. Vanguard Wellington Fund 2,924 --- --- 2,924 2,924 --- Investors Fiduciary Trust Co. Vanguard Institutional Bond Fund 3,269 --- --- 3,269 3,269 --- Investors Fiduciary Trust Co. Vanguard Inst. Money Market Reserve Fund 10,207 --- --- 10,207 10,207 --- Investors Fiduciary Trust Co. Vanguard Inst. Money Market Reserve Fund --- 3,679 --- 3,679 3,679 --- Investors Fiduciary Trust Co. Vanguard Index 500 Fund 4,880 --- --- 4,880 4,880 --- Investors Fiduciary Trust Co. Neuberger & Berman/Hellman Jordan Fund --- 1,839 --- 1,310 1,839 529 Investors Fiduciary Trust Co. Neuberger & Berman/Hellman Jordan Fund --- 8,586 --- 5,964 8,586 2,622
19 20 THE COSMOS BROADCASTING CORPORATION RETIREMENT AND SAVINGS PLAN LINE 27D - SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1997 (CONTINUED) (IN $000'S, EXCEPT NUMBER OF SHARES DATA)
CURRENT VALUE ON REALIZED PURCHASE SALES EXPENSES TRANSACTION GAIN PARTY INVOLVED DESCRIPTION OF ASSETS PRICE PRICE INCURRED COST DATE (LOSS) - ----------------------------- ---------------------------------------- -------- ------ -------- ------ ----------- -------- Category (iii) - Series of transactions in excess of 5% of Plan Assets Wachovia Bank, N.A Money Market Fund $ 1,397 $7,266 $ --- $7,268 $ 7,266 $ (2) Wachovia Bank, N.A Intermediate Bond Fund 2,039 4,359 --- 4,364 4,359 (5) Investors Fiduciary Trust Co. Loomis Sayles Bond Fund 2,378 45 --- 44 45 1 Investors Fiduciary Trust Co. T. Rowe Price Small Cap Value Fund 4,229 344 --- 314 344 30 Investors Fiduciary Trust Co. Templeton Foreign Fund 1,890 411 --- 419 411 (8) Investors Fiduciary Trust Co. Vanguard Wellington Fund 3,693 149 --- 141 149 8 Investors Fiduciary Trust Co. Vanguard Inst. Bond Fund 4,613 1,837 --- 1,797 1,837 40 Investors Fiduciary Trust Co. Vanguard Inst. Money Market Reserve Fund 11,537 5,657 --- 5,657 5,657 --- Investors Fiduciary Trust Co. Vanguard Index 500 Fund 5,776 489 --- 459 489 30 Investors Fiduciary Trust Co. Cosmos Unitized Fund 763 1,073 --- 754 1,073 319 Investors Fiduciary Trust Co. Neuberger & Berman/Hellman Jordan Fund 29,102 27,729 --- 22,110 27,729 5,619
THERE WERE NO CATEGORY (II) OR (IV) REPORTABLE TRANSACTIONS DURING 1997. 20 EX-23 2 CONSENT OF INDEPENDENT AUDITORS 1 EXHIBIT 23 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-22591) pertaining to The Cosmos Broadcasting Corporation Retirement and Savings Plan of our report dated March 20, 1998, with respect to the financial statements and schedules of The Cosmos Broadcasting Corporation Retirement and Savings Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1997. ERNST & YOUNG LLP Greenville, South Carolina June 19, 1998 21 -----END PRIVACY-ENHANCED MESSAGE-----