-----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, KXV7E3BYM19ZfyGU615wYbNKLfVsYfN69etgTDhNse67wMluqPSmaOoxnOfA2HU+ ssXCySlP1sm6caBlAcB3rA== 0000950144-96-003030.txt : 19960531 0000950144-96-003030.hdr.sgml : 19960531 ACCESSION NUMBER: 0000950144-96-003030 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960530 SROS: CSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CRAWFORD & CO CENTRAL INDEX KEY: 0000025475 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE AGENTS BROKERS & SERVICES [6411] IRS NUMBER: 580506554 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 001-10356 FILM NUMBER: 96574747 BUSINESS ADDRESS: STREET 1: 5620 GLENRIDGE DR NE CITY: ATLANTA STATE: GA ZIP: 30342 BUSINESS PHONE: 4042560830 MAIL ADDRESS: STREET 1: 5620 GLENRIDE DR CITY: ATLANTA STATE: GA ZIP: 30342 10-K405/A 1 CRAWFORD & CO. 10-K405/A 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-K/A X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE ---- SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE ---- SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------------- ------------- Commission file number 1-10356. ------- CRAWFORD & COMPANY - -------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) Georgia 58-0506554 - -------------------------------------------- --------------------------------- (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification Number) 5620 Glenridge Dr., N.E., Atlanta, Georgia 30342 - -------------------------------------------- --------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (404) 256-0830 -------------- Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered ------------------- ----------------------------------------- Class A Common Stock - $1.00 Par Value New York Stock Exchange Class B Common Stock - $1.00 Par Value New York Stock Exchange - -------------------------------------- -----------------------
Securities registered pursuant to Section 12(g) of the Act: None - -------------------------------------------------------------------------------- (Title of Class) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- The aggregate market value of the voting stock held by nonaffiliates* of the Registrant was $129,000,000 as of March 1, 1996, based upon the closing price as reported on NYSE on such date. *All shareholders, other than Directors, Executive Officers, and 10% beneficial owners. Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ] The number of shares outstanding of each of the Registrant's classes of common stock, as of March 1, 1996 was: Class A Common Stock - $1.00 Par Value - 16,961,861 Shares Class B Common Stock - $1.00 Par Value - 17,281,505 Shares - -------------------------------------------------------------------------------- Documents incorporated by reference: (1) Annual Report to Shareholders for the Year Ended December 31, 1995, Part I - - Item 2; Part II - Items 5, 6, 7 and 8; Part IV - Item 14, and (2) Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 1996, Part III -Items 10, 11, 12, and 13. 2 PART I ITEM 1. BUSINESS Crawford & Company (the "Registrant") is a diversified service firm which provides claims services, risk management services, disability management, risk control services and risk management information services to insurance companies, self-insured corporations and governmental entities. The Registrant is not owned by or affiliated with any insurance company. DESCRIPTION OF SERVICES The percentages of consolidated revenues derived from each of the Registrant's principal service categories are shown in the following schedule:
Years Ended December 31, ------------------------ 1995 1994 1993 ---- ---- ---- Domestic Claims Services (including Risk Management and Other Services, other than Parent Care) 71.0% 75.1% 73.8% Domestic Disability Management Services (including Parent Care) 15.1% 17.0% 18.7% International Operations 13.9% 7.9% 7.5% ------ ------ ------ 100.0% 100.0% 100.0% ====== ====== ======
DOMESTIC CLAIMS SERVICES. Domestic claims services, which produced 71.0% of the Registrant's 1995 revenues, are provided by two of the Registrant's domestic service units, each servicing different markets while providing many of the same services. Insurance companies, which represent the major source of revenues, customarily manage their own claims administration function, but require various partial services which the Registrant provides through its Claims Services unit. The Registrant's Risk Management Services unit services clients which are self-insured or commercially insured through alternative loss funding methods, and provides them the more complete range of services they typically require, including the supervision of field locations, information services and medical cost-containment. In November of 1993, the Registrant reorganized and reduced its major domestic service units from six to three, expanding the Risk Management Services unit to include all of the services offered to the self-insured corporate market. In 1994, the Registrant designated 48 Risk Management Control branches to provide centralized account management to the self-insured market. While these reorganizations did not change the services offered by the Registrant, it made it easier for the Registrant to package these services and deliver them to its various clients. 2 3 The major elements of domestic claims administration services (which include the partial services required by most property and casualty insurance company clients as well as the expanded services required by self-insured clients) are as follows: - Initial Reporting - the Registrant's XPressLinkSM service provides 24-hour receipt, acknowledgement, and distribution of claims information through Electronic Data Interchange, customized reporting and referral programs, call center reporting, and facsimile receipt and distribution. - Investigation - the development of information necessary to determine the cause and origin of loss. - Evaluation - the determination of the extent and value of damage incurred and the coverage, liability and compensability relating to the parties involved. - Disposition - the resolution of the claim, whether by negotiation and settlement, by denial or by other resolution. Expanded services provided primarily, but not exclusively, to Registrant's self-insured clients through its Risk Management Services unit include the following: - Information Services - provides reports of detailed claims information of both a statistical and financial nature to self-insured corporations, governmental entities and insurance companies. The Registrant's basic information system is SISDATSM, but the registrant also offers SISDAT+SM, a risk management information system which integrates the basic information provided by the SISDATSM system with the on-line inquiry and flexible reporting capabilities of Risk Sciences Group's SIGMASM system (discussed below). - Management - the coordination and supervision of all parties involved in the claims settlement process, including the adjusting personnel directly involved in handling the claim. Typically, this management function is performed by an independent administrative unit within the Registrant which is not involved in the initial investigation of a claim. This function is provided primarily for self-insured clients and is handled by the Registrant's Risk Management Services unit. - Auditing Services - the Registrant's Sentinel Medical Review System(R), a bill audit program, utilizes proprietary software developed by the Registrant, to assist clients in controlling medical costs associated with workers compensation claims by comparing fees charged by health care providers with maximum fee schedules prescribed by state workers compensation regulations as well as usual and customary charges in non-fee schedule states. The Registrant also performs hospital bill audits related to workers compensation claims. 3 4 - Medical Review Services - provides a broad range of cost containment and utilization review services to insurance companies, service organizations and self-insured corporations involved in employee group health insurance plans. These services, which are designed to both control the cost and enhance the efficient delivery of medical benefits, include pre-admission review of hospitalizations, second surgical opinions, concurrent hospital utilization review, discharge planning, and the Early Medical Management InterventionSM (EMMISM) program which provides services to actively control workers compensation medical and indemnity costs at the onset of a claim through nurse screening for severity as claims are received from XPressLinkSM or directly from the client. The Registrant also provides a workers compensation PPO network to its self- insured clients. The claims administration services described above are provided to clients for a variety of different referral assignments which are generally classified as to the underlying insured risk categories used by insurance companies. The major categories are described below: - Automobile - relates to all types of losses involving use of the automobile. Such losses include bodily injury, physical damage, medical payments, collision, fire, theft and comprehensive liability. - Property - relates to losses caused by physical damage to commercial or residential real property and certain types of personal property. Such losses include those arising from fire, windstorm, or hail damage to commercial and residential property, burglary, robbery or theft of personal property and damage to property under inland marine coverage. - Workers Compensation - relates to claims arising under state and federal workers compensation laws. - Public Liability - relates to a wide range of non-automobile liability claims such as product liability, owners, landlords and tenants' liabilities and comprehensive general liability. Catastrophe services are provided by two subunits within the Registrant's Claims Services unit. The Catastrophe Services division provides quick response teams for support to clients by servicing insurance claims following hurricanes, tornados, earthquakes, floods and other natural disasters. In addition, the Registrant has established the Cornerstone Group, which provides catastrophic liability management services, including class action litigation support, cost containment, claims management systems development, and contingency planning, for clients faced with product liability, explosion, oil spill, chemical release and other man-made disasters. 4 5 DOMESTIC DISABILITY MANAGEMENT SERVICES. The Registrant's Disability Management Services unit, which produced 15.1% of the Registrant's 1995 revenues, serves both the insurance company and self-insured markets by offering a full range of medical and disability cost-containment services. The services it provides play an integral part in the resolution of many claims, particularly those workers compensation cases which involve lost time injuries or illnesses. In addition, Disability Management Services interfaces closely with Risk Management Services to provide medical case management, vocational consulting and return-to-work programs to the self-insured corporate market. Major categories of disability management services are discussed in the following paragraphs: - Vocational Services - provides vocational evaluation in order to assess an injured employee's potential to return to work. These services involve diagnostic testing and occupational, personal and motivational counseling of the employee. The Crawford Occupational Re-EmploymentSM (CORESM) program enlists the services of our vocational, medical and employment consultants to assist in the re-employment and preparation of injured individuals to return to work. - Medical Case Management Services - are typically provided by rehabilitation nurses who work closely with attending physicians and other medical personnel in order to expedite the injured person's physical recovery and rehabilitation and maximize the opportunity for the person to return to work. These services also involve coordinating and monitoring treatment plans and related costs to insure that such treatment is appropriate and necessary in the circumstances. - Health and Wellness Services - involves programs designed to improve employee performance on the job and thus reduce employer costs of absenteeism, health and accident claims and workers compensation claims. These include employee assistance programs which provide employees with appropriate counseling and referral for problems associated with drug or alcohol dependency, job-related stress, marital or family matters or other causes. ADDITIONAL RISK MANAGEMENT AND OTHER SERVICES. Management believes that additional risk management and other related services, which support and supplement the claims and disability management services offered, are important to enable the Registrant to provide the full range of services required by its clients. Some of these services are discussed in the following paragraphs: - RISK CONTROL SERVICES - involves the identification of factors which cause loss and the development of procedures and techniques designed to prevent, minimize or control these losses. These services are provided by risk control consultants, who develop complete programs for the client which emphasize preventative measures to reduce the costs of losses. Risk control consultants also perform risk assessments of larger, more complicated risks for the insurance industry. 5 6 Additionally, through Crawford/FPE the Registrant provides fire protection consulting and system design, industrial hygiene, and boiler and machinery consulting. With the Registrant's realignment of service units in November of 1993, Risk Control Services became a service under the Risk Management Services unit, thus making it easier to deliver its services to the self-insured corporate market. - RISK SCIENCES GROUP, INC. - is a software applications and consulting firm which is a wholly-owned subsidiary of the Registrant and part of the Risk Management Services unit. Risk Sciences Group (RSG) provides customized computer-based information systems and analytical forecasting services to the risk management and insurance industry. It manages the Registrant's basic information systems SISDATSM and SISDAT+SM, and has developed the SIGMASM system, an on-line risk management information system which supports multiple sources of claims, locations, risk control, medical, litigation, exposure and insurance policy information. With its staff of approximately 129 employees, RSG serves a variety of clients with specialized computer programs for long-term risk management planning; data and systems integration; development of historical claims/loss databases; claims administration and management; regulatory reporting; insurance and risk management cost control; and actuarial and financial analysis required for loss forecasting, reserve estimation and financial reporting. In April of 1993 the Registrant acquired Paradigm Infosystems, Inc., a company which specializes in the design and development of PC/LAN-based risk management information systems software. Paradigm incorporates the windows-style graphical user interface technology into its PC software resulting in a user-friendly product which meets a variety of client needs. Together, RSG and Paradigm provide users with claims processing software, risk management information services and systems consulting expertise. - PARENT CARE - offers a full menu of elder care service including comprehensive on-site assessments, complete care coordination and on-going care monitoring. Acquired by the Registrant during 1994, Parent Care provides its services through experienced health care professionals with an incite to local quality care needs and offers these services in Florida and New York to senior citizens and their children, attorneys and trust officers. - EDUCATION SERVICES - are provided by the Registrant's Learning & Resource Center, whose principal objective is to provide technical and management training to the Registrant's employees in order to assure consistent quality in the delivery of services to clients. In addition, the Learning & Resource Center markets its classrooms and correspondence courses in many risk management subjects to outside clients. 6 7 INTERNATIONAL OPERATIONS. International operations provided 13.9% of the Registrant's 1995 revenues. Through its Canadian subsidiary, Crawford & Company Insurance Adjusters Ltd., the Registrant provides in Canada generally the same array of claims, risk management and disability management services as the Registrant provides to the United States insurance and self-insured marketplace. In December 1990, the Registrant acquired Graham Miller Group Limited ("Graham Miller"), a London-based international loss adjusting firm. Graham Miller provides loss adjusting services to international insurance underwriters, including Lloyds of London, through owned or affiliated offices in approximately 40 countries. In April of 1994, Crawford & Company Insurance Adjusters Ltd. acquired all the outstanding capital stock of Finnamore & Partners Limited ("Finnamore"), a Canadian specialty loss adjusting firm headquartered in Halifax. Effective January 1, 1996, Finnamore was amalgamated with Crawford & Company Insurance Adjusters Ltd. In September of 1994, a subsidiary of the Registrant acquired all of the outstanding stock of Arnold & Green Ltd. ("A & G"), a United Kingdom based liability adjusting firm headquartered in Stockport, Cheshire, which handles claims in the fields of employers' liability, public liability, products and product guaranties, as well as professional indemnity errors and omissions and contractors' all risk loss exposures. In November of 1994, subsidiaries of the Registrant acquired the Brocklehurst Group ("Brocklehurst"), consisting primarily of a United Kingdom based chartered loss adjusting firm specializing in property, aviation, marine, agriculture and oil and energy exposures. The Registrant has consolidated Graham Miller's existing United Kingdom branches with those of Brocklehurst under the names "Crawford Brocklehurst" and "Brocklehurst Miller". A & G will continue to operate separately in the United Kingdom under the name "Crawford Arnold & Green". Outside of the United Kingdom and North America, the Registrant will do business as "Crawford Graham Miller". Non-North American revenues and expenses were reported on a three-month delayed basis until 1995. Such revenues and expenses are now reported on a two-month delayed basis and, accordingly, the Registrant's December 31, 1995 and 1994 consolidated financial statements reflect the non-North American financial position as of October 31, 1995 and September 30, 1994, respectively and the results of non-North American operations and cash flows for the 13-month period ended October 31, 1995 and the 12-month periods ending September 30, 1994 and 1993. This change had no material effect on the Registrant's financial position, results of operation, or cash flows. The major services offered by the Registrant through its U.K. headquartered international operations are listed below: - Property and Casualty - provides loss adjusting services for property, general liability, professional indemnity for directors and officers, product liability and medical malpractice. - Oil, Energy & Engineering - provides loss adjusting for oil, gas, petrochemicals, other energy risks, utilities and mining industries, as well as marine and off-shore risks. - Environmental Pollution - provides cost-containment and claims management services with respect to environmental related losses. - Construction - provides loss adjusting services under contractors' all risk, engineering all risk, and contractors' liability coverages. 7 8 Additionally evaluates machinery breakdown claims and provides peripheral services including plant valuation and loss prevention surveys. - Catastrophe - organizes major loss teams to provide claims management and cost containment services through proprietary information systems. - Marine - provides loss adjusting services for freight carriers liability, loss investigations, recoveries, salvage disposal, yatch and small craft, cargo, container, discharge, draft, general average, load, trailer and on/off live surveys, ship repairer liability and port stevedore liability. - Specie and Fine Art - provides loss adjusting services under fine art dealers' block and jewelry and furriers' block policies. - Entertainment Industry - provides a broad range of loss adjusting services for television, commercial and educational film production, and theater and live events. - Aviation - manages salvage removal and sale and provides loss adjusting services for hull related risks, as well as cargo and legal liability, hangar and airport owners'/operators' liability policies. - Banking, Financial and Political Risks - performs loss adjusting functions under bankers blanket bond, political risk, and financial contingency policies. - Livestock - performs loss adjusting on bloodstock, liability/equestrian activity. - Security Consultancy - performs loss prevention and bank surveys and adjusts cash-in- transit losses. - Reinsurance - provides external audits, portfolio analyses, and management and marketing research. Additionally provides underwriting review, cash control and management of discontinued operations. During 1994, the Registrant opened a health care management services office in London to provide medical and vocational case management services to the employer liability market and to provide specialized return to work and expert testimony services in the auto liability market. It is hoped these services will expand in the coming years, both within and outside of the United Kingdom. 8 9 COMPETITION, EMPLOYMENT AND OTHER FACTORS The claims services, risk management services, disability management, and risk control markets are each highly competitive and are composed of a large number of companies of varying size and scope of services. These include large insurance companies and insurance brokerage firms which, in addition to their primary services of insurance underwriting or insurance brokerage, also provide services such as claims administration, health and disability management, risk control and risk management information systems, which compete with services offered by the Registrant. Many of these companies are larger than the Registrant in terms of annual revenues and total assets; however, based on experience in the market, the Registrant believes that few, if any, such organizations derive revenues from independent claims administration activities which equal those of the Registrant. The majority of property and casualty insurance companies maintain their own staffs of salaried adjusters, with field adjusters located in those areas in which the volume of claims justifies maintaining a salaried staff. These companies utilize independent adjusters to service claims when the volume of claims exceeds the capacity of their staffs and when claims arise in areas not serviced by staff adjusters. The volume of property claim assignments referred to the Registrant fluctuates primarily depending on the occurrence of severe weather. The United States insurance industry generally uses internal adjusting personnel to make automobile claims adjustments by telephone and assigns the limited function of appraising physical damage to outside service organizations, such as the Registrant. The Registrant believes that such limited assignments from automobile insurers may continue, reflecting a perception by insurance companies that they can reduce adjusting expenses in amounts greater than the higher losses associated with telephone adjusting. In certain instances, however, insurers have attempted to reduce the fixed cost of their claims departments by increasing outside assignments to independent firms such as the Registrant. As insurance premiums have increased and corporate risk management personnel have become more aware of alternative methods of financing losses, there has been a trend toward higher retention levels of risk insurance or implementation of self-insurance programs by large corporations and governmental instrumentalities. These programs generally utilize an insurance company which writes specialized policies that permit each client to select its own level of risk retention, as well as permit certain risk management services to be provided to the client by service companies independent of the insurance company. In addition to providing full claims administration services for such clients, the Registrant generally provides statistical data such as loss experience analysis. The services are usually the subject of a contractual agreement with the specialty insurance company or the self-insured client that specifies the claims to be administered by the Registrant and the fee to be paid for its services (generally a fixed rate per assignment within the various risk classifications). In addition to the large insurance companies and insurance brokerage firms, the Registrant competes with a great number of smaller local and regional risk management services firms located throughout the United States and internationally. Many of these smaller firms have rate structures that are 9 10 lower than the Registrant's, but do not offer the broad spectrum of risk management services which the Registrant provides and, although such firms may secure business which has a local or regional source, the Registrant believes its broader scope of services and its large number of geographically dispersed offices provide it with a competitive advantage in securing business from national and international clients. The Registrant has approximately 442 branch offices which provide claims administration services in the fifty states of the United States, and through subsidiaries in nine provinces of Canada and Puerto Rico. In addition, it has 53 Risk Management Control branches. Disability Management Services are provided in approximately 188 office locations in the United States and 19 in Canada. At the end of 1995 the Registrant had 16 Risk Control offices and 7 Risk Sciences Group offices. Many of the Registrant's service units are co-located in the same facility. Internationally, the Registrant and its affiliates have 109 claims offices serving approximately 40 non-North American countries and one health care management office in London. The Registrant has branch profit-sharing agreements with most of its branch managers in the United States under which those managers participate in the profits of their respective branches. These agreements provide a formula for the determination of branch office profits and specify the managers' participation percentage, which is generally 40%. During 1995, revenues derived from services provided to American International Group and its subsidiaries (AIG) approximated 12% of total revenues. During 1994 and 1993, revenues derived from services provided by the Registrant to AIG were 14% and 16% of total revenue in each of such years. Revenues derived from AIG, an insurance holding company, principally relate to claims administration services provided under the high-risk retention programs described above. In addition, the Registrant also provides disability management services and other risk management services to AIG. The Registrant believes that its relationships with all its customers, including AIG, are good. At December 31, 1995, the total number of full-time employees was 7,189 compared with 7,896 at December 31, 1994. The Registrant, through its Learning & Resource Center, provides many of its employees with formal classroom training in basic and advanced skills relating to claims administration and disability management services. Such training is generally provided at the Registrant's education facility in Atlanta, Georgia, although much of the material is also available through correspondence courses. In many cases, employees are required to complete these or other professional courses in order to qualify for promotion from their existing positions. In addition to this technical training, the Registrant also provides ongoing professional education for certain of its management personnel on general management, marketing and sales topics. These programs involve both in-house and external resources. ITEM 2. PROPERTIES The Registrant's home office and educational facilities are owned by the Registrant and located in Atlanta, Georgia. As of December 31, 1995, the Registrant leased approximately 611 office locations under leases with remaining terms ranging from a few months to ten years. The remainder 10 11 of its office locations are occupied under various short-term rental arrangements. The Registrant also leases certain computer equipment. See Note 6 of Notes to Consolidated Financial Statements included in the Registrant's 1995 Annual Report to Shareholders filed herewith as Exhibit 13.1, which notes are incorporated herein by reference. The Registrant owns or leases approximately 3,120 automobiles which are used by the Registrant's field adjusters and certain of its management personnel in the United States and Canada. Additional vehicles are owned or leased by the Registrant's foreign subsidiaries for use by field and management personnel. ITEM 3. LEGAL PROCEEDINGS In the normal course of the claims administration services business, the Registrant is named as a defendant in suits by insureds or claimants contesting decisions by the Registrant or its clients with respect to the settlement of claims. Additionally, clients of the Registrant have brought actions for indemnification on the basis of alleged negligence on the part of the Registrant, its agents or employees in rendering service to clients. The majority of these claims are of the type covered by insurance maintained by the Registrant; however, the Registrant is self-insured for the deductibles under its various insurance coverages. In the opinion of the Registrant, adequate reserves have been provided for such self-insured risks. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to security holders for a vote during the fourth quarter of 1995. EXECUTIVE OFFICERS OF THE REGISTRANT The following are the names, positions held, and ages of each of the executive officers of the Registrant:
Name Office Age ---- ------ --- D. A. Smith Chairman, President and Chief Executive Officer 46 A. L. Meyers, Jr. President - Claims Services 58 J. R. Bryant President - Risk Management Services 45 R. P. Albright President - Disability Management 54 G. L. Box President - International Operations 62 D. R. Chapman Executive Vice President - Finance 56 G. N. Cox Senior Vice President - Human Resources 51 J. F. Osten Senior Vice President - General Counsel & Corporate Secretary 54 J. S. Tatum Vice President - Information Technology 41 L. H. Chase Vice President - Business Process Management 48
11 12 All of the above officers, except as indicated below, have been associated with the Registrant in management capacities for more than five years and have held the positions indicated in the above table for more than five years. Mr. Smith was appointed to his present position effective January 1, 1996. Prior to January 1, 1996 and since November 1, 1994, he was President and Chief Operating Officer. From August 1, 1992 to November 1, 1994, Mr. Smith was President - Claims Services. From January 1, 1991 to August 1, 1992, Mr. Smith was President of Crawford & Company International, Inc., and he was Vice President, and later, Senior Vice President with responsibility for the Registrant's Midwest Region from January 1, 1986 to January, 1991. Mr. Meyers was appointed to his present position effective September 1, 1995. He had previously retired from the Company in April 1994, after having served as General Manager of the Registrant's Fairfax, Virginia branch office since 1988. During the period between his retirement and appointment to his present position he served as a consultant and operations supervisor for the Registrant. Mr. Albright was appointed to his present position effective November 1, 1993. Prior to November 1, 1993 and since March 1, 1983, he was Senior Vice President - - Marketing. Mr. Bryant was appointed to his present position effective August 1, 1995. Prior to August 1, 1995 and since November 1, 1994, he was President - Claims Services. From January 1, 1993 to November 1, 1994, he was Vice President - National Sales Manager and from March, 1989 to December, 1992 he was Regional Director - RMS for the Registrant's Midwest Region becoming an Assistant Vice President on July 1, 1990. Mr. Box was appointed to his present position effective November 1, 1994. From July 1, 1994 to November 1, 1994, he was Vice President - International Operations, and for more than five years prior to July, 1994 was responsible for the management of the Registrant's Mid-Atlantic region. Mr. Tatum was appointed to his present position effective August 1, 1995. Prior to August 1, 1995 and since April 15, 1994, he was President of Risk Sciences Group, Inc. From January 1, 1992 to April 15, 1994, he was a Vice President of Risk Sciences Group, Inc. in charge of Northeast Operations and from June, 1990 to December 31, 1991, he was Director of Operations for Risk Sciences Group, Inc. Officers of the Registrant are appointed annually by the Board of Directors. PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS The information required by this Item is included on pages 26-27 of the Registrant's Annual Report to Shareholders for the year ended December 31, 1995 under the caption "Quarterly Financial Data" and is incorporated herein by reference. 12 13 ITEM 6. SELECTED FINANCIAL DATA The information required by this Item is included on page 28 of the Registrant's Annual Report to Shareholders for the year ended December 31, 1995, under the caption "Selected Financial Data" and is incorporated herein by reference. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information required by this Item is included on pages 24-25 of the Registrant's Annual Report to Shareholders for the year ended December 31, 1995 under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and is incorporated herein by reference. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The information required by this Item is included on pages 13-23 and pages 26-27 of the Registrant's Annual Report to Shareholders for the year ended December 31, 1995 under the captions "Consolidated Statements of Income", "Consolidated Balance Sheets", "Consolidated Statements of Shareholders' Investment", "Consolidated Statements of Cash Flows", "Notes to Consolidated Financial Statements", and "Quarterly Financial Data", and is incorporated herein by reference. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The information required by this Item is included on page 2 under the caption "Nominee Information" of the Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 1996, and is incorporated herein by reference. For other information required by this Item, see "Executive Officers of the Registrant" on pages 11 and 12 herein. ITEM 11. EXECUTIVE COMPENSATION The information required by this Item is included on pages 4-10 under the captions "Executive Compensation and Other Information", "Report of the Senior Compensation and Stock Option Committee of the Board of Directors on Executive Compensation", and "Compensation Committee Interlocks and Insider Participation" and on page 14 under the caption "Five Year Comparative Stock Performance Graph" of the Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 1996, and is incorporated herein by reference. 13 14 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The information required by this Item is included on pages 10-13 under the caption "Stock Ownership Information" of the Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 1996, and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The information required by this item is included on page 13 under the caption "Information with Respect to Certain Business Relationships" of the Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held April 18, 1996, and is incorporated herein by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) The following documents are filed as part of this report: 1. Financial Statements The Registrant's 1995 Annual Report to Shareholders contains the consolidated balance sheets as of December 31, 1995 and 1994, the related consolidated statements of income, shareholders' investment and cash flows for each of the three years in the period ended December 31, 1995, and the related report of Arthur Andersen LLP on the financial statements. These financial statements and the report of Arthur Andersen LLP are incorporated herein by reference and included as Exhibit 13.1 to this Form 10-K. The financial statements, incorporated by reference, include the following: - Consolidated Balance Sheets -- December 31, 1995 and 1994 - Consolidated Statements of Income for the Years Ended December 31, 1995, 1994 and 1993 - Consolidated Statements of Shareholders' Investment for the Years Ended December 31, 1995, 1994 and 1993 - Consolidated Statements of Cash Flows for the Years Ended December 31, 1995, 1994 and 1993 - Notes to Consolidated Financial Statements - December 31, 1995, 1994 and 1993 The reports of Touche Ross & Co. as of and for the years ended September 30, 1993 and September 30, 1994 are incorporated by reference to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1993 and to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1994, respectively. 14 15 2. Financial Statement Schedule - Report of Independent Public Accountants as to Schedule
Schedule Number -------- II Valuation and Qualifying Accounts for the Years Ended December 31, 1995, 1994 and 1993 Schedules I and III through V not listed above have been omitted because they are not applicable.
3. Exhibits filed with this report.
Exhibit No. Document ----------- -------- 3.1 Restated Articles of Incorporation of the Registrant, as amended (incorporated by reference to Exhibit 19.1 to the Registrant's quarterly report on Form 10-Q for the quarter ended June 30, 1991). 3.2 Restated By-laws of the Registrant, as amended. 10.1 * Crawford & Company Incentive Stock Option Plan (incorporated by reference to Exhibit 10(a) to the Registrant's annual report on Form 10-K for the year ended December 31, 1981). 10.2 * Amendment to Crawford & Company Incentive Stock Option Plan (incorporated by reference to Appendix D on page D-1 of Registrant's Proxy Statement for the Special Meeting of Shareholders held on July 24, 1990). 10.3 * Crawford & Company 1987 Stock Option Plan (incorporated by reference to Exhibit 28(a) to the Registration Statement on Form S-8, Registration No. 33-22595). 10.4 * Amendment to Crawford & Company 1987 Stock Option Plan (incorporated by reference to Appendix C on page C-1 of the Registrant's Proxy Statement for the Special Meeting of Shareholders held on July 24, 1990). 10.5 * Crawford & Company 1990 Stock Option Plan, as amended (incorporated by reference to Exhibit 10.5 to the Registrant's annual report on Form 10-K for the year ended December 31, 1992).
15 16
Exhibit No. Document ----------- -------- 10.6 * Crawford & Company Annual Incentive Compensation Plan (incorporated by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K for the year ended December 31, 1992). 10.7 * Crawford & Company 1996 Annual Incentive Compensation Plan. 10.8 * Crawford & Company 1994-1996 Long-Term Executive Bonus Plan (incorporated by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K for the year ended December 31, 1993). 10.9 * Amended and Restated Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.9 to the Registrant's annual report on Form 10-K for the year ended December 31, 1993). 10.10 * Crawford & Company 1996 Employee Stock Purchase Plan (incorporated by reference to Appendix A on page A-1 of Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held on April 18, 1996). 10.11 * Amended and Restated Crawford & Company Medical Reimbursement Plan (incorporated by reference to Exhibit 10.9 to the Registrant's Annual Report on Form 10-K for the year ended December 31, 1994). 10.12 * Discretionary Allowance Plan (incorporated by reference to Exhibit 10.10 to the Registrant's Annual Report on Form 10-K for the year ended December 31, 1994). 10.13 * Deferred Compensation Plan (incorporated by reference to Exhibit 10.11 to the Registrant's Annual Report on Form 10-K for the year ended December 31, 1994). 11.1 Computation of Fully Diluted Earnings Per Share for the year ended December 31, 1995. 13.1 The Registrant's Annual Report to Shareholders for the year ended December 31, 1995 (only those portions incorporated herein by reference). 21.1 Subsidiaries of Crawford & Company. 23.1 Consent of Arthur Andersen LLP. 23.2 Consent of Deloitte & Touche. 24.1-8 Powers of Attorney.
16 17
Exhibit No. Document ----------- -------- 27.1 Financial Data Schedule (for SEC use only). 99.1 Touche Ross & Co. report as of and for the year ended September 30, 1993 (incorporated by reference to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1993). 99.2 Touche Ross & Co. report as of and for the year ended September 30, 1994 (incorporated by reference to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1994).
* Management contract or compensatory plan required to be filed as an exhibit pursuant to Item 601 of Regulation S-K. (b) No reports on Form 8-K have been filed during the last quarter of the year ended December 31, 1995. (c) The Registrant has filed the Exhibits listed in Item 14(a)(3). (d) Separate financial statements of Crawford & Company have been omitted since it is primarily an operating company. All subsidiaries included in the consolidated financial statements are wholly-owned. 17 18 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CRAWFORD & COMPANY Date March 25, 1996 By /s/ D. A. Smith --------------------- ------------------------------ D. A. SMITH, Chairman, President and Chief Executive Officer (Principal Executive Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
NAME AND TITLE -------------- Date March 25, 1996 /s/ D. A. Smith --------------------- ---------------------------------------------- D. A. SMITH, Chairman, President and Chief Executive Officer (Principal Executive Officer) and Director Date March 25, 1996 /s/ D. R. Chapman --------------------- ---------------------------------------------- D. R. CHAPMAN, Executive Vice President- Finance (Principal Financial Officer) Date March 25, 1996 /s/ J. F. Giblin --------------------- ---------------------------------------------- J. F. GIBLIN, Vice President and Controller (Principal Accounting Officer) Date March 25, 1996 * --------------------- ---------------------------------------------- VIRGINIA C. CRAWFORD, Director
18 19
NAME AND TITLE -------------- Date March 25, 1996 * --------------------- ---------------------------------------------- FORREST L. MINIX, Director Date March 25, 1996 * --------------------- ---------------------------------------------- J. HICKS LANIER, Director Date March 25, 1996 * --------------------- ---------------------------------------------- CHARLES FLATHER, Director Date March 25, 1996 * --------------------- ---------------------------------------------- JESSE S. HALL, Director Date March 25 , 1996 * --------------------- ---------------------------------------------- LINDA K. CRAWFORD, Director Date March 25, 1996 * --------------------- ---------------------------------------------- JESSE C. CRAWFORD, Director Date March 25, 1996 * --------------------- ---------------------------------------------- LARRY L. PRINCE, Director Date March 25, 1996 *By /s/ Judd F. Osten --------------------- ---------------------------------------------- JUDD F. OSTEN - As attorney-in-fact for the Directors above whose name an asterisk appears
19 20 (Logo) ARTHUR ANDERSEN LLP REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS AS TO SCHEDULE To Crawford & Company: We have audited, in accordance with generally accepted auditing standards, the consolidated financial statements included in Crawford & Company's annual report to shareholders incorporated by reference in this Form 10-K and have issued our report thereon dated January 30, 1996. Our audit was made for the purpose of forming an opinion on those statements taken as a whole, we did not audit the 1994 and 1993 financial statements of certain foreign operations, which statements reflect approximately 7% of consolidated assets in 1994 and approximately 4% of consolidated revenues in 1994 and 1993. The schedule listed in Item 14(a)2 is the responsibility of the Company's management, is presented for purposes of complying with the Securities and Exchange Commission's rules, and is not part of the basic consolidated financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. /s/ Arthur Andersen LLP Atlanta, Georgia January 30, 1996 21 SCHEDULE II CRAWFORD & COMPANY AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS ALLOWANCE FOR DOUBTFUL ACCOUNTS RECEIVABLE FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993 ----------------------------------------------------- (In Thousands of Dollars)
Col. A Col. B Col. C Col. D Col. E ------ ------ ------ ------ ------ Balance at Additions Additions Balance Beginning of Charged to (Deductions) at End of Period Period Costs and from Period Expenses Allowances(1) 1995 Deducted in Consolidated balance sheets from accounts receivable $10,220 $ (779) $ 862 $10,303 ======= ======= ======= ======= 1994 Deducted in Consolidated balance sheets from accounts receivable $10,128 $(1,693) $ 1,785 $10,220 ======= ======= ======= ======= 1993 Deducted in Consolidated balance sheets from accounts receivable $ 9,502 $ 2,543 $(1,917) $10,128 ======= ======= ======= =======
(1) Represents uncollectible accounts written off, net of recoveries. 22 EXHIBIT INDEX
Sequential Page Number Exhibit No. Description of Exhibit of Exhibit ----------- ---------------------- ---------- 3.1 Restated Articles of Incorporation of the Registrant, as amended (incorporated by reference to Exhibit 19.1 to the Registrant's quarterly report on Form 10-Q for the quarter ended June 30, 1991). 3.2 * Restated By-laws of the Registrant, as amended. 10.1 Crawford & Company Incentive Stock Option Plan (incorporated by reference to Exhibit 10(a) to the Registrant's annual report on Form 10-K for the year ended December 31, 1981). 10.2 Amendment to Crawford & Company Incentive Stock Option Plan (incorporated by reference to Appendix D on page D-1 of Registrant's Proxy Statement for the Special Meeting of Shareholders held on July 24, 1990). 10.3 Crawford & Company 1987 Stock Option Plan (incorporated by reference to Exhibit 28(a) to the Registration Statement on Form S-8, Registration No. 33- 22595). 10.4 Amendment to Crawford & Company 1987 Stock Option Plan (incorporated by reference to Appendix C on page C-1 of the Registrant's Proxy Statement for the Special Meeting of Shareholders held on July 24, 1990). 10.5 Crawford & Company 1990 Stock Option Plan, as amended (incorporated by reference to Exhibit 10.5 to the Registrant's annual report on Form 10-K for the year ended December 31, 1992). 10.6 Crawford & Company Annual Incentive Compensation Plan (incorporated by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K for the year ended December 31, 1992). 10.7 * Crawford & Company 1996 Annual Incentive Compensation Plan.
23 EXHIBIT INDEX
Sequential Page Number Exhibit No. Description of Exhibit of Exhibit ----------- ---------------------- ---------- 10.8 Crawford & Company 1994-1996 Long-Term Executive Bonus Plan (incorporated by reference to Exhibit 10.7 to the Registrant's annual report on Form 10-K for the year ended December 31, 1993). 10.9 Amended and Restated Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.9 to the Registrant's annual report on Form 10-K for the year ended December 31, 1993). 10.10 Crawford & Company 1996 Employee Stock Purchase Plan (incorporated by reference to Appendix A on page A-1 of Registrant's Proxy Statement for the Annual Meeting of Shareholders to be held on April 18, 1996). 10.11 Amended and Restated Crawford & Company Medical Reimbursement Plan (incorporated by reference to Exhibit 10.9 to the Registrant's annual report on Form 10-K for the year ended December 31, 1994). 10.12 Discretionary Allowance Plan (incorporated by reference to Exhibit 10.10 to the Registrant's annual report on Form 10-K for the year ended December 31, 1994). 10.13 Deferred Compensation Plan (incorporated by reference to Exhibit 10.11 to the Registrant's annual report on Form 10-K for the year ended December 31, 1994). 11.1 * Computation of Fully Diluted Earnings Per Share for the year ended December 31, 1995. 13.1 * The Registrant's Annual Report to Shareholders for the year ended December 31, 1995 (only those portions incorporated hereby by reference). 21.1 * Subsidiaries of Crawford & Company. 23.1 * Consent of Arthur Andersen LLP. 23.2 * Consent of Deloitte & Touche. 24.1-8* Powers of Attorney. 27.1 * Financial Data Schedule (for SEC use only). 99.1 Touche Ross & Co. report as of and for the year ended September 30, 1993 (incorporated by reference to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1993). 99.2 Touche Ross & Co. report as of and for the year ended September 30, 1994 (incorporated by reference to pages 19-21 of Registrant's Report on Form 10-K for the year ended December 31, 1994). * Filed by EDGAR
EX-3.2 2 RESTATED BY-LAWS 1 EXHIBIT 3.2 RESTATED BY-LAWS OF CRAWFORD & COMPANY (reflecting amendments made through January 30, 1996) ARTICLE I SHAREHOLDERS Section 1. Annual Meeting. The annual meeting of the shareholders for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held at such place, either within or without the State of Georgia, on such date, and at such time, as the Board of Directors or its Executive Committee may by resolution provide, or if the Board of Directors or Executive Committee fails to provide for such meeting by action by April 1 of any year, then such meeting shall be held at the principal office of the Company in Atlanta, Georgia at 11:00 a.m. on the third Tuesday in April of each year, if not a legal holiday under the laws of the State of Georgia, and if a legal holiday, on the next succeeding business day. The Board of Directors may specify by resolution prior to any special meeting of shareholders held within the year that such meeting shall be in lieu of the annual meeting. Section 2. Special Meetings. Except as otherwise provided by law, special meetings of the shareholders may be called by the Board of Directors, or its Executive Committee, or by the Chairman of the Board, or by the President, or by the holders of record of at least one-fourth (1/4) of the outstanding stock entitled to vote at such meeting. Such meeting may be held in such place, either within or without the State of Georgia, as is stated in the call and notice thereof. Section 3. Notice of Meeting. Written notice of each meeting of shareholders, stating the date, time and place of the meeting, and describing the purpose or purposes of the meeting if it is a special meeting, shall be mailed to each shareholder entitled to vote at such meeting at such shareholder's address shown on the Company's current record of shareholders not less than ten (10) nor more than sixty (60) days prior to such meeting. If an amendment to the Articles of Incorporation, a plan of merger or share exchange, or a sale of assets of the Company is to be considered at any annual or special meeting, the written notice shall state that consideration of such action is one of the purposes of such meeting. A shareholder may waive notice of a meeting before or after the meeting. The waiver must be in writing, must be signed by the shareholder entitled to the notice, and must be delivered to the Company for inclusion in the minutes or filing with the corporate records. A shareholder's attendance at a meeting (1) waives objection to lack of notice or defective notice of the meeting, unless the shareholder at the beginning of the meeting objects to holding a meeting or transacting business at 2 the meeting, and (2) waives objection to consideration of a particular matter at the meeting, that is not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented. Neither the business transacted at, nor the purpose of, any meeting need be stated in a waiver of notice of a meeting, except that, with respect to a waiver of notice of a meeting at which an amendment to the Articles of Incorporation, a plan of merger or share exchange, sale of assets, or any other action that would entitle the shareholder to dissenter's rights, is submitted to a vote of shareholders, the same material that the Georgia Business Corporation Code would have required to be sent to the shareholder in a notice of the meeting must be delivered to the shareholder prior to such shareholder's execution of the waiver of notice, or the waiver itself must expressly waive the right to such material. Notice of any meeting may be given by or at the direction of the Secretary or by the person or persons calling such meeting, if the Secretary fails to give such notice within twenty (20) days after the call of a meeting. No notice need be given of the new date, time or place of reconvening any adjourned meeting, if the new date, time and place to which the meeting is adjourned are announced at the adjourned meeting before adjournment, except that, if a new record date for the adjourned meeting is or must be fixed under the applicable provisions of the Georgia Business Corporation Code, notice of the adjourned meeting must be given to persons who are shareholders as of the new record date. Section 4. Quorum. A majority in interest of the issued and outstanding capital stock of the Company entitled to vote at any annual or special meeting of shareholders and represented either in person or by proxy shall constitute a quorum for the transaction of business at such annual or special meeting. Once a share is represented for any purpose at a meeting other than solely to object to holding the meeting or transacting business at the meeting, it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be (under the provisions of the Georgia Business Corporation Code) set for that adjourned meeting. If a quorum shall not be present, the holders of a majority of the stock represented may adjourn the meeting to some later time. When a quorum is present, a vote of a majority of the stock represented in person or by proxy shall determine any question, except as otherwise provided by the Articles of Incorporation, these By-laws, or by law. Section 5. Proxies. A shareholder may vote, execute consents, waivers and releases and exercise any of his other rights, either in person or by proxy duly executed in writing by the shareholder. A proxy for any meeting shall be valid for any adjournment of such meeting. Section 6. Record Date. The Board shall have power to close the stock transfer books of the Company for a period not -2- 3 to exceed fifty (50) days preceding the date of any meeting of shareholders, or the date for payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect; provided, however, that in lieu of closing the stock transfer books as aforesaid, the Board may fix in advance a date, not exceeding seventy (70) days preceding the date of any meeting of shareholders, or the date of the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, as a record date for the determination of the shareholders entitled to notice of, and to vote at, any such meeting, or entitled to receive payment of any such dividend, or to any such allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, and in such case only such shareholders as shall be shareholders of record on the date so fixed shall be entitled to such notices of, and to vote at, such meeting, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights, as the case may be, notwithstanding any transfer of any stock on the books of the Company after any such record date fixed as aforesaid. ARTICLE II DIRECTORS Section 1. Powers of Directors. The Board of Directors shall have the management of the business of the Company, and, subject to any restrictions imposed by law, by the charter, or by these By-Laws, may exercise all the power of the corporation. Section 2. Number and Term of Directors. The number of Directors which shall constitute the full Board shall be ten (10), but the number may be increased or decreased by amendment of these By-Laws either by the Board of Directors or by the affirmative vote of a majority of the voting power of the outstanding stock of the Company entitled to vote generally in the election of Directors, voting as a class. At each annual meeting the shareholders entitled to vote thereon shall elect the Directors, who shall serve until their successors are elected and qualified; provided that the shareholders entitled to vote thereon at any special meeting may remove any Director, with or without cause, and may fill any vacancy created thereby. Any vacancy in the Board of Directors occurring between meetings of the shareholders may be filled by the vote of a majority of the remaining Directors, though less than a quorum. Section 3. Meetings of the Directors. The Board may by resolution provide for the time and place of regular meetings, and no notice need be given of such regular meetings. Special meetings of the Directors may be called by the full Board of Directors, by the Executive Committee of the Board of Directors, by the Chairman of the Board, by the President, or by at least any two -3- 4 (2) of the Directors. There shall be an annual meeting of the Board of Directors at the place of and immediately following the annual meeting of shareholders. Section 4. Quorum. A majority of the number of Directors fixed as herein provided or fixed as otherwise provided by law shall constitute a quorum for the transaction of business at any meeting thereof. If a quorum shall not be present, a majority of the Directors present at any such meeting may adjourn the meeting to some later time. Section 5. Action. When a quorum is present, the vote of a majority of the Directors present shall be the act of the Board of Directors, unless a greater vote is required by law, by the Articles of Incorporation or by these By-Laws. Section 6. Notice of Meetings. Notice of each meeting of the Board shall be given by the Secretary by mailing the same at least five (5) days before the meeting or by telephone or telegraph or in person at least two (2) days before the meeting, to each Director, except that no notice need be given of regular meetings fixed by the resolution of the Board. Any Director may waive notice, either before or after any meeting, and shall be deemed to have waived notice if he is present at the meeting. If the Secretary fails to give such notice in the manner specified in the call, within five (5) days after receiving notice of the call, the person or persons calling such meetings, or any person designated by him or them may give such notice. Neither the business to be transacted at or the purpose of any regular or special meeting of the Board need be specified in the notice or waiver of notice of such meeting. Section 7. Committees. The Board may by resolution provide for an Executive Committee and one or more other committees, each consisting of such Directors as are designated by the Board. Any vacancy in such Committee may be filled by the Board. Except as otherwise provided by law, by these By-Laws, or by resolution of the full Board, such Executive Committee shall have and may exercise the full powers of the Board of Directors during the interval between the meetings of the Board and wherever by these By-Laws, or by resolution of the shareholders, the Board of Directors is authorized to take action or to make a determination, such action or determination may be taken or made by such Executive Committee, unless these By-Laws or such resolution expressly require that such action or determination be taken or made by the full Board of Directors. The Executive Committee, or other Committee, shall by resolution fix its own rules of procedure, and the time and place of its meetings, and the person or persons who may call, and the method of call, of its meetings. Section 8. Compensation. A fee for serving as a Director and reimbursement for expenses for attendance at meetings of the Board of Directors or any Committee thereof may be fixed by resolution of the full Board. -4- 5 Section 9. Qualifications of Directors (a) Corporate Officers. Except as provided in subsection (c) below, no person who is or has been an officer of the Company shall be eligible for nomination or renomination as a member of the Board of Directors of the Company at any time after the earlier of the following occurrences: (i) such person has attained the age of seventy (70), or (ii) the second anniversary of the date of such person's retirement, resignation or removal as an officer of the Company. (b) Other Directors. Except as provided in subsection (c) below, no person shall be eligible for nomination or renomination as a member of the Board of Directors of the Company at any time after the earlier of the following occurrences: (i) such person has attained the age of seventy (70), or (ii) the second anniversary of the termination by retirement of the "Principal Employment" (as hereinafter defined) of such person. As used herein, the term "Principal Employment" means the principal employment, professional affiliation or business activity as set forth in the Company's Proxy Statement dated March 24, 1986 (in the case of directors holding office on April 22, 1986) or the first Proxy Statement of the Company that contains such information (in the case of directors first elected after April 22, 1986). (c) Exceptions. The provisions of subsections (a) and (b) above shall not apply with respect to any person who, at the time of such person's nomination or re-nomination as a member of the Board of Directors of the Company, is the beneficial owner of ten percent (10%) or more of the voting power of the outstanding stock of the Company entitled to vote generally in the election of Directors. ARTICLE III OFFICERS Section 1. Officers. The officers of the Company shall consist of a Chairman of the Board, a corporate President, one or more business unit Presidents, one or more Vice Presidents, a Secretary, a Comptroller, a Treasurer, and such other officers or assistant officers as may be elected by the Board of Directors. Any two (2) or more offices may be held by the same person. The Board may designate one or more Vice Presidents as Executive Vice Presidents or Senior Vice Presidents, and may designate the order in which the Vice Presidents may act. Section 2. Chairman of the Board. Subject to the control of the Board of Directors, the Chairman of the Board shall give supervision and direction to the affairs of the Company, and shall be the chief executive officer of the Company. He shall preside at all meetings of the shareholders and of the Board of Directors. -5- 6 Section 3. Corporate President. The corporate President shall be the chief operating officer of the Company and shall give general supervision and administrative direction to the affairs of the Company, subject to the direction of the Board of Directors and Chairman of the Board. Section 4. Business Unit President. A business unit President shall be the chief operating officer of the designated major business unit of the Corporation, reporting to the Chairman of the Board or the corporate President, as the Board of Directors shall designate. Business units need not have a President, and in the absence of such an officer, will be managed by one or more Vice Presidents. Section 5. Vice President. A Vice President shall have such powers and perform such duties as the Board of Directors, corporate President, or, in the case of the business unit Vice President, as that business unit President may prescribe. A Vice President shall act in case of the absence or disability of the corporate President or business unit President. If there is more than one Vice President, such Vice Presidents shall act in the order of precedence as set out by the Board of Directors, or in the absence of such designation, as designated by the corporate President or business unit President. Section 6. Treasurer. The Treasurer shall receive and have the custody of all moneys and securities of the Company, shall pay such dividends as may be declared from time to time by the Board of Directors, and do and perform all such duties as may be required of him by its Board of Directors, and such other duties as usually devolve upon such officers. Section 7. Comptroller. The Comptroller shall be responsible for the maintenance of proper financial books and records of the Company. Section 8. Secretary. The Secretary shall keep the minutes of the meetings of the shareholders, the Directors, the Executive Committee, and the other committees of the Board and shall have custody of the seal of the Company. Section 9. Assistant Secretaries. The Assistant Secretaries, in the order of their seniority, shall, in the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary, and shall perform such other duties as the Board of Directors shall prescribe. Section 10. Assistant Treasurers. The Assistant Treasurers, in the order of their seniority, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer, and shall perform such other duties as the Board of Directors shall prescribe. Section 11. Other Duties and Authorities. Each officer, employee and agent shall have such other duties and -6- 7 authorities as may be conferred on them by the Board of Directors and, subject to any directions of the Board, by the Chairman of the Board, the corporate President, and any business unit President. Section 12. Removal. Any officer may be removed at any time by the Board of Directors and such vacancy may be filled by the Board of Directors. A contract of employment for a definite term shall not prevent the removal of any officer; but this provision shall not prevent the making of a contract of employment with any officer and any officer removed in breach of his contract of employment shall have a cause of action therefor. Section 13. Salary. The salaries of all officers of the Company shall be fixed by the Board of Directors or by a duly authorized Committee of the Board. ARTICLE IV DEPOSITORIES, SIGNATURES AND SEAL Section 1. Depositories. All funds of the Company shall be deposited in the name of the Company in such depository or depositories as the Board may designate and shall be drawn out on checks, drafts or other orders signed by such officer, officers, agent or agents as the Board may from time to time authorize. Section 2. Contracts. All contracts and other instruments shall be signed on behalf of the Company by such officer, officers, agent or agents, as the Board may from time to time by resolution provide. Section 3. Seal. The corporate seal of the Company shall be as follows, or in such other form as the Board may from time to time by resolution provide: (Imprint of Seal) If the seal is affixed to a document, the signature of the Secretary or an Assistant Secretary shall attest the seal. The seal and its attestation may be lithographed or otherwise printed on any document and shall have, to the extent permitted by law, the same force and effect as if it had been affixed and attested manually. ARTICLE V STOCK TRANSFERS Section 1. Form and Execution of Certificates. The certificates of shares of capital stock of the Company shall be in -7- 8 such form as may be approved by the Board of Directors and shall be signed by the Chairman of the Board or the President and by the Secretary or any Assistant Secretary or Treasurer or any Assistant Treasurer, provided that any such certificate may be signed by the facsimile of the signature of either or both of such officers imprinted thereon if the same is countersigned by a transfer agent of the Company, and provided further that certificates bearing the facsimile of the signature of such officers imprinted thereon shall be valid in all respects as if such person or persons were still in office, even though such officer or officers have died or otherwise ceased to be officers. Section 2. Transfer of Shares. Shares of stock in the Company shall be transferable only on the books of the Company by proper transfer signed by the holder of record thereof or by a person duly authorized to sign for such holder of record. The Company or its transfer agent shall be authorized to refuse any transfer unless and until it is furnished such evidence as it may reasonably require showing that the requested transfer is proper. Upon the surrender of a certificate for transfer of shares of stock, such certificate shall at once be conspicuously marked on its face "Cancelled" and filed with the permanent stock records of the Company. Section 3. Lost, Destroyed or Mutilated Certificates. The Board may by resolution provide for the issuance of certificates in lieu of lost, destroyed or mutilated certificates and may authorize such officer or agent as it may designate to determine the sufficiency of the evidence of such loss, destruction or mutilation and the sufficiency of any security furnished to the Company and to determine whether such duplicate certificate should be issued. Section 4. Transfer Agent and Registrar. The Board may appoint a transfer agent or agents and a registrar or registrars of transfers, and may require that all stock certificates bear the signature of such transfer agent or such transfer agent and registrar. ARTICLE VI INDEMNIFICATION Section 1. The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that he is or was a director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including court costs and attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably -8- 9 incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. Section 2. The Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including court costs and attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company and except that no such indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the Company unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper. Section 3. To the extent that a director, officer, employee or agent of the Company shall be successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 1 and 2 of this Article, or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including court costs and attorneys' fees) actually and reasonably incurred by him in connection therewith. Section 4. Any indemnification under Sections 1 and 2 of this Article (unless ordered by a court) shall be made by the Company only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in said Sections 1 and 2. Such determination shall be made (1) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable a quorum of disinterested -9- 10 directors so directs, by independent legal counsel in a written opinion, or (3) by the shareholders. Section 5. Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the Company in advance of the final disposition or such action, suit or proceeding as authorized by the Board of Directors in the manner provided in Section 4 of this Article upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Company as authorized in this Article, and, if such person is a director, upon receipt of a written affirmation of such director's good faith belief that he or she has met the standards of conduct required by the Georgia Business Corporation Code. Section 6. The indemnification provided by this Article shall not be deemed exclusive of any other rights to which those indemnified may be entitled under any agreement, vote of shareholders or disinterested directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. Section 7. The Board of Directors may authorize, by a vote of a majority of the full Board, the Company to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Company would have the power to indemnify him against such liability under the provisions of this Article. ARTICLE VII AMENDMENT Section 1. The Board of Directors or the shareholders entitled to vote thereon shall have the power to alter, amend or repeal the By-laws or adopt new by-laws. The shareholders may prescribe that any by-law or by- laws adopted by them shall not be altered, amended or repealed by the Board of Directors. Action by the Board of Directors with respect to by-laws shall be taken by an affirmative vote of a majority of all directors then holding office. An action by the shareholders with respect to by-laws shall be taken by the affirmative vote of a majority of the shares then issued and outstanding and entitled to vote. -10- EX-10.7 3 1996 INCENTIVE COMPENSATION PLAN 1 EXHIBIT 10.7 CRAWFORD & COMPANY 1996 INCENTIVE COMPENSATION PLAN Crawford & Company hereby establishes the Crawford & Company 1996 Incentive Compensation Plan, effective as of January 1, 1996, to provide to the officers and key employees of Crawford & Company additional cash incentive compensation which is tied to the attainment of targeted increases in adjusted revenues and adjusted pre-tax income of Crawford & Company on a consolidated basis. I. DEFINITIONS The capitalized terms used in the Plan shall have the following meanings: 1.1 Actual Earnings shall mean the reported Earnings of the Company for the period with respect to which the Incentive Compensation Pool is determined. 1.2 Actual Earnings Percentage shall mean the percentage computed by multiplying (i) the Target Earnings Percentage by (ii) a fraction (which may not be larger than one) the numerator of which is Covered Earnings and the denominator of which is the difference between (A) the Target Earnings and (B) the Threshold Earnings. 1.3 Actual Revenues shall mean the reported Revenues of the Company for the period with respect to which the Incentive Compensation Pool is determined. 1.4 Chief Executive Officer shall mean the Chief Executive Officer of the Company. 1.5 Committee shall mean the Senior Compensation and Stock Option Committee of the Board of Directors of the Company. 1.6 Company shall mean Crawford & Company. 1.7 Covered Earnings shall mean the difference between (i) the Actual Earnings and (ii) the Threshold Earnings (but not less than zero). 1.8 Covered Salaries shall mean the base salaries of the Participants. 1.9 Earnings shall mean the reported pre-tax income of the Company, on a consolidated basis, adjusted to eliminate the effect, if any, of the cumulative effects of changes in 2 accounting principles and any significant gains or losses resulting from the disposition of any major assets of the Company, such as the sale of land, the sale and leaseback of buildings, or the sale or other disposition of a subsidiary or portion of the Company's operations. 1.10 Incentive Compensation Pool shall mean the sum of (1) the Incentive Compensation Pool--Sales and Account Management; plus (2) the Incentive Compensation Pool--Other Officers and Key Employees. 1.11 Incentive Compensation Pool--Other Officers and Key Employees shall mean the sum of (1) the amount computed by multiplying the lesser of Actual Earnings or Threshold Earnings by 1.5%; plus (2) the amount computed by multiplying (i) Actual Earnings by (ii) the Actual Earnings Percentage. In no event shall the Incentive Compensation Pool--Other Officers and Key Employees exceed 100% of the Covered Salaries of its Participants. 1.12 Incentive Compensation Pool--Sales and Account Management shall mean the greater of (1) the amount computed by multiplying the lesser of Actual Earnings or Threshold Earnings by .5%; or (2) the amount computed by multiplying the growth in Actual Revenues over Threshold Revenues by 1.5%, reduced by 10% for every 1% decline in the consolidated Pre-Tax Profit Margin of the Company on a pro rata basis. In no event shall the Incentive Compensation Pool--Sales and Account Management exceed 100% of the Covered Salaries of its Participants. 1.13 Participant shall mean any officer (other than the Chief Executive Officer) or home office or regional employee of the Company or its domestic or foreign subsidiaries designated by the Chief Executive Officer to participate in the Incentive Compensation Pool--Sales and Account Management or the Incentive Compensation Pool--Other Officers and Key Employees. 1.14 Pre-Tax Profit Margin shall mean the percentage derived by dividing Earnings by Revenues, both adjusted to eliminate the effect, if any, of significant acquisitions made by the Company in the relevant period. 1.15 Revenues shall mean the reported revenues of the Company, on a consolidated basis, adjusted to eliminate the effect, if any, of significant acquisitions made by the Company in the period with respect to which the Incentive Compensation Pool is determined. 1.16 Target Earnings shall mean the Committee's determination of achievable earnings for the Company for the fiscal year. -2- 3 1.17 Target Earnings Percentage shall mean 5.22%. 1.18 Threshold Earnings shall mean the Committee's determination of Earnings below which no amount will be added to the Incentive Compensation Pool for earnings growth. 1.19 Threshold Revenues shall mean the Committee's determination of achievable Revenues for the Company in the period with respect to which the Incentive Compensation Pool is determined. 1.20 Plan shall mean this Crawford & Company 1996 Incentive Compensation Plan. II. ESTABLISHMENT OF THRESHOLD REVENUES AND EARNINGS As soon as possible following the availability of audited financial statements of the Company for the immediately preceding fiscal year and the preparation of operational budgets for the current fiscal year, the Committee shall meet to establish the (i) Threshold Revenues, (ii) Threshold Earnings and (iii) Target Earnings for the current fiscal year. Any adjustments to the audited revenues and pre-tax income of the Company in the calculations of Revenues and Earnings shall be approved by the Committee. III. ALLOCATION AND PAYMENT TO PARTICIPANTS The Chief Executive Officer shall have total authority and discretion with respect to the determination of amounts to be paid to the Participants in each of the Incentive Compensation Pools under the provisions of this Plan. He may delegate that responsibility and allocate amounts available for distribution to the heads of the business units and support divisions of the Company. In the event that an individual is no longer a Participant at the end of any period with respect to which the Incentive Compensation Pool is determined by virtue of his no longer being an employee of the Company or any of its domestic or foreign subsidiaries on that date, such individual shall not be eligible for any payments under this Plan, unless such individual's employment has been terminated by reason of death, disability, or retirement. Nothing herein contained shall be construed to require the Committee or the Chief Executive Officer to authorize the allocation and payment of all or any amounts available for distribution under the terms of this Plan. Amounts not distributed with respect to any year shall not be carried over to subsequent fiscal years. Payment to individual Participants shall be as soon as practical after the close of the fiscal period, the availability of reported Revenues and Earnings for that period, the calculation of the Incentive Compensation Pool for that period by the Chief -3- 4 Financial Officer of the Company, and the approval of that calculation by the Committee. IV. NO CONTRACT OF EMPLOYMENT The establishment of this Plan shall not grant to any Participant the right to remain an employee for any specific term of employment or in any specific capacity or as a Participant or at any specific rate of compensation. V. NO ALIENATION OR ASSIGNMENT A Participant shall have no right or power to alienate, commute, anticipate or otherwise assign at law or equity all or any portion of amounts which may be payable to him hereunder and the Committee and the Chief Executive Officer shall have the right, in light of any such action, to suspend temporarily or terminate permanently the status of such an individual as a Participant under this Plan. VI. ADMINISTRATION, AMENDMENT AND TERMINATION The Committee shall have all powers necessary to administer this Plan in its absolute discretion and its determination shall be binding on the Company and the Participants. The Board of Directors of the Company and the Committee have the right to amend or terminate this Plan at any time. VII. CONSTRUCTION This Plan shall be construed in accordance with the laws of the State of Georgia and the masculine shall include the feminine and the singular the plural, where appropriate. VII. TERMINATION OF FORMER PLAN The Annual Incentive Compensation Plan adopted effective January 1, 1993, is hereby terminated. -4- 5 IN WITNESS WHEREOF, Crawford & Company has caused its duly authorized officer to execute the Plan this 30th day of January, 1996, to evidence the adoption of this Plan. CRAWFORD & COMPANY /s/ Dennis A. Smith - --------------------------------------- Dennis A. Smith, Chairman of the Board, President and Chief Executive Officer -5- EX-11.1 4 COMPUTATION OF EARNINGS PER SHARE 1 EXHIBIT 11.1 CRAWFORD & COMPANY AND SUBSIDIARIES COMPUTATION OF FULLY DILUTED EARNINGS PER SHARE YEAR ENDED DECEMBER 31, 1995
GENERAL INFORMATION: Net income $36,020,000 Weighted average common shares outstanding 34,851,425 Dilutive option shares outstanding at year-end 847,340 Option shares outstanding prior to exercise during year 42,001 Average exercise price per outstanding dilutive option share $ 13.85 Average market price per share $ 16.01 Year-end market price per share $ 16.13 Average market price of shares issued upon exercise during year $ 16.07 COMPUTATIONS: Dilutive option shares outstanding at year-end 847,340 Shares repurchased at $16.01 (proceeds of $11,731,497 divided by $16.01) (732,643) ----------- Net additional shares issuable 114,697 Option shares outstanding prior to exercise during year 42,001 Shares repurchased at $16.07 (proceeds of $382,839 divided by $16.07) (23,823) ----------- Net additional shares issued 18,178 Contingently issuable shares related to convertible notes payable issued November 30, 1994 515,101 Weighted average common shares outstanding 34,851,425 ---------- Adjusted shares outstanding 35,499,401 ========== FULLY DILUTED EARNINGS PER SHARE: Net income ($36,020,000 divided by 35,499,401) $ 1.01 PERCENTAGE DILUTION: Net income ($.02 divided by $1.03) 1.94% ============
EX-13.1 5 ANNUAL REPORT 1 EXHIBIT 13.1 CONSOLIDATED STATEMENTS OF INCOME
1995 1994 1993 For the years ended December 31, 1995, 1994 and 1993 in thousands of dollars except share and per share data REVENUES $ 607,577 $ 587,781 $ 576,298 ---------- ---------- ---------- COSTS AND EXPENSES: Costs of services provided, less reimbursed expenses of $34,025 in 1995, $31,751 in 1994 and $31,657 in 1993 439,029 421,047 408,737 Selling, general and administrative expenses 108,168 98,683 102,711 ---------- ---------- ---------- 547,197 519,730 511,448 ---------- ---------- ---------- INCOME BEFORE INCOME TAXES 60,380 68,051 64,850 INCOME TAXES 24,360 27,450 26,800 ---------- ---------- ---------- INCOME BEFORE CUMULATIVE EFFECTS OF ACCOUNTING CHANGES 36,020 40,601 38,050 CUMULATIVE EFFECTS OF ACCOUNTING CHANGES -- -- (2,575) NET INCOME $ 36,020 $ 40,601 $ 35,475 ========== ========== ========== PER SHARE AMOUNTS: Income before cumulative effects of accounting changes $ 1.03 $ 1.14 $ 1.06 Cumulative effects of accounting changes -- -- (0.07) ---------- ---------- ---------- Net income $ 1.03 $ 1.14 $ 0.99 ========== ========== ========== CASH DIVIDENDS PER SHARE: Class A Common Stock $ 0.58 $ 0.56 $ 0.52 ========== ========== ========== Class B Common Stock $ 0.54 $ 0.50 $ 0.44 ========== ========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING 34,851,425 35,723,496 35,984,448 ========== ========== ==========
- -------------------------------------------------------------------------------- The accompanying notes are an integral part of these statements. Crawford & Company| 13 2 CONSOLIDATED BALANCE SHEETS
1995 1994 in thousands of dollars December 31, 1995 and 1994 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 40,802 $ 38,968 Short-term investments, at fair value 5,596 18,766 Accounts receivable, less allowance for doubtful accounts of $10,303 in 1995 and $10,220 in 1994 111,636 104,942 Unbilled revenues, at estimated billable amounts 60,486 59,601 Prepaid income taxes 6,115 5,634 Prepaid expenses and other current assets 9,745 9,215 -------- -------- TOTAL CURRENT ASSETS 234,380 237,126 -------- -------- PROPERTY AND EQUIPMENT, AT COST: Furniture and fixtures 52,504 48,623 Data processing equipment 48,607 44,186 Automobiles 2,169 2,358 Buildings and improvements 15,928 15,247 Land 2,099 2,099 -------- -------- 121,307 112,513 Less accumulated depreciation and amortization (84,859) (75,065) -------- -------- NET PROPERTY AND EQUIPMENT 36,448 37,448 -------- -------- OTHER ASSETS: Intangible assets arising from acquisitions, less accumulated amortization of $7,596 in 1995 and $5,833 in 1994 55,731 51,684 Prepaid pension obligation 34,243 23,500 Other 6,181 6,623 -------- -------- TOTAL OTHER ASSETS 96,155 81,807 -------- -------- $366,983 $356,381 ======== ========
- -------------------------------------------------------------------------------- The accompanying notes are an integral part of these balance sheets. 14 |Crawford & Company 3
1995 1994 in thousands of dollars LIABILITIES AND SHAREHOLDERS' INVESTMENT CURRENT LIABILITIES: Short-term borrowings $ 10,154 $ 9,123 Accounts payable 12,366 10,999 Accrued compensation and related costs 26,764 34,837 Other accrued liabilities 29,394 28,438 Deferred revenues 15,504 16,642 Current installments of long-term debt 872 1,298 -------- -------- TOTAL CURRENT LIABILITIES 95,054 101,337 -------- -------- NONCURRENT LIABILITIES: Long-term debt, less current installments 9,412 9,962 Deferred income taxes 14,854 8,207 Deferred revenues 10,498 9,172 Postretirement medical benefit obligation 7,938 7,440 Self-insured risks 7,347 7,110 Other 1,020 - -------- -------- TOTAL NONCURRENT LIABILITIES 51,069 41,891 -------- -------- SHAREHOLDERS' INVESTMENT: Class A Common Stock, $1.00 par value; 50,000,000 shares authorized; 17,229,986 and 17,449,130 shares issued in 1995 and 1994, respectively 17,230 17,449 Class B Common Stock, $1.00 par value; 50,000,000 shares authorized; 17,297,730 and 17,580,213 shares issued in 1995 and 1994, respectively 17,298 17,580 Retained earnings 189,294 180,772 Cumulative translation adjustment (2,962) (2,648) -------- -------- TOTAL SHAREHOLDERS' INVESTMENT 220,860 213,153 -------- -------- $366,983 $356,381 ======== ========
- -------------------------------------------------------------------------------- Crawford & Company| 15 4 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' INVESTMENT
For the years ended December 31, 1995, 1994 and 1993 in thousands of dollars Common Stock Additional Cumulative Class A Class B Paid-In Retained Translation Nonvoting Voting Capital Earnings Adjustment BALANCE AT 12/31/92 $17,953 $17,950 $4,677 $150,743 $ (254) Net income 35,475 Translation adjustment (2,352) Cash dividends paid (17,274) Stock options exercised, net 62 65 768 ------- ------- ------ -------- ------- BALANCE AT 12/31/93 18,015 18,015 5,445 168,944 (2,606) Net income 40,601 Translation adjustment (42) Cash dividends paid (18,941) Shares repurchased (607) (475) (6,010) (9,832) Stock options exercised, net 41 40 565 ------- ------- ------ -------- ------- BALANCE AT 12/31/94 17,449 17,580 -- 180,772 (2,648) Net income 36,020 Translation adjustment (314) Cash dividends paid (19,541) Shares repurchased (277) (334) (848) (7,957) Stock options exercised, net 58 52 848 ------- ------- ------ -------- ------- Balance at 12/31/95 $17,230 $17,298 -- $189,294 $(2,962) ======= ======= ====== ======== =======
- -------------------------------------------------------------------------------- The accompanying notes are an integral part of these statements. 16| Crawford & Company 5 CONSOLIDATED STATEMENTS OF CASH FLOWS
1995 1994 1993 For the years ended December 31, 1995, 1994 and 1993 in thousands of dollars CASH FLOWS FROM OPERATING ACTIVITIES: Net income $36,020 $40,601 $35,475 Reconciliation of net income to net cash provided by operating activities: Cumulative effects of accounting changes -- -- 2,575 Depreciation and amortization 16,865 14,912 15,779 Deferred income taxes 5,205 210 14,603 Loss on sales of property and equipment 928 179 38 Changes in operating assets and liabilities, net of effects of acquisitions: Short-term investments 13,170 10,414 (9,445) Accounts receivable, net (6,392) (8,028) 4,797 Unbilled revenues (1,172) 1,967 4,371 Prepaid or accrued income taxes (462) 4,038 (4,553) Accounts payable and accrued liabilities (2,368) 7,006 (12,573) Deferred revenues 188 2,767 1,435 Prepaid expenses and other assets (14,681) (1,929) (26,427) ------- ------- ------- Net cash provided by operating activities 47,301 72,137 26,075 ------- ------- ------- CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions of property and equipment (12,575) (11,769) (9,182) Net assets of companies acquired, excluding cash (4,998) (24,918) -- Proceeds from sales of property and equipment 137 241 1,060 ------- ------- ------- Net cash used in investing activities (17,436) (36,446) (8,122) ------- ------- ------- CASH FLOWS FROM FINANCING ACTIVITIES: Dividends paid (19,541) (18,941) (17,274) Repurchase of common stock (9,416) (16,924) -- Issuance of common stock 958 646 895 Increase in short-term borrowings 684 704 2,826 Decrease in long-term debt (827) (2,170) (1,172) ------- ------- ------- Net cash used in financing activities (28,142) (36,685) (14,725) ------- ------- ------- Effect of exchange rate changes on cash and cash equivalents 111 (149) (447) ------- ------- ------- Increase (Decrease) in Cash and Cash Equivalents 1,834 (1,143) 2,781 Cash and Cash Equivalents at Beginning of Year 38,968 40,111 37,330 ------- ------- ------- Cash and Cash Equivalents at End of Year $40,802 $38,968 $40,111 ======= ======= =======
- -------------------------------------------------------------------------------- The accompanying notes are an integral part of these statements. Crawford & Company| 17 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 1995, 1994 and 1993 1. SUMMARY OF MAJOR ACCOUNTING AND REPORTING POLICIES NATURE OF OPERATIONS The Company is a worldwide diversified service firm which provides claims services, risk management services, disability management, risk control services and risk management information services to insurance companies, self-insured corporations and governmental entities. The majority of the Company's revenues are derived from domestic claims services, including risk management services. PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of all significant intercompany transactions. The financial statements of the Company's international claims adjusting firm, Crawford & Company International, Inc. (CCI), are included in the Company's consolidated financial statements on a delayed basis in order to provide sufficient time for accumulation of CCI's worldwide results. This reporting delay, previously three months, was changed to two months during 1995. Accordingly, the Company's December 31, 1995 and 1994 consolidated financial statements reflect the financial position of CCI as of October 31, 1995 and September 30, 1994, respectively, and the results of CCI's operations and cash flows for the thirteen-month period ended October 31, 1995 and the twelve-month periods ended September 30, 1994 and 1993. This change had no material effect on the Company's financial position, results of operations or cash flows. FOREIGN CURRENCY TRANSLATION The financial statements of the Company's foreign subsidiaries are translated into U.S. dollars at current exchange rates. Resulting translation adjustments are accumulated as a component of shareholders' investment and excluded from net income. CASH FLOWS The Company considers all highly liquid investments purchased with a maturity of three months or less to be cash equivalents for purposes of the statements of cash flows. INCOME TAXES The Company accounts for certain income and expense items differently for financial reporting and income tax purposes. Provisions for deferred taxes are made in recognition of these temporary differences. The most significant differences result from prepayment of pension costs, the use of accelerated depreciation methods and deferred recognition of unbilled revenues for income tax purposes; and deferred revenue, self-insurance, employee compensation and receivables valuation reserves provided for financial reporting purposes. PROPERTY AND DEPRECIATION The Company depreciates the cost of property and equipment over the estimated useful lives of the related assets. The estimated useful lives and depreciation methods for the principal property and equipment classifications are as follows:
ESTIMATED CLASSIFICATION USEFUL LIVES METHOD Furniture and Straight-line fixtures 3-10 years and double- declining balance Data processing equipment 3-5 years Straight-line Automobiles 3-4 years Straight-line Buildings and improvements 7-40 years Straight-line
Maintenance and repairs are charged to expense as incurred. Renewals and betterments are capitalized. The cost of property retired or sold and the related accumulated depreciation are removed from the applicable accounts, and the resulting gains and losses are reflected in the consolidated statements of income. INTANGIBLE ASSETS Other assets include the following intangible assets (net of amortization) arising from acquisitions:
1995 1994 in thousands of dollars Amortized over fifteen years $ 1,050 $ 1,109 Amortized over twenty years 4,460 4,879 Amortized over forty years 50,221 45,696 ------- ------- $55,731 $51,684 ======= =======
Goodwill in excess of associated expected operating cash flows is considered to be impaired and is written down to fair value. REVENUE RECOGNITION Revenue is recognized in unbilled revenues as services are provided. Deferred revenues represent the unearned portion of fees derived from certain annual fixed-rate claim service agreements. MANAGEMENT'S USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 18 |Crawford & Company 7 SELF-INSURED RISKS The Company self-insures certain insurable risks consisting primarily of professional liability, employee medical and disability, workers compensation and auto liability. Insurance coverage is obtained for catastrophic property and casualty exposures (including professional liability on a claims-made basis), as well as those risks required to be insured by law or contract. Provision for claims under the self-insured program is recorded based on the Company's estimate of the aggregate liability for claims incurred. At December 31, 1995 and 1994, accrued self-insured risks totaled $15,185,000 and $15,340,000, respectively, including current liabilities of $7,838,000 and $8,230,000, respectively. INDUSTRY CONCENTRATION AND MAJOR CUSTOMER Substantial portions of the Company's revenues and accounts receivable are derived from the property and casualty insurance industry. Services provided to an insurance holding company and its subsidiaries approximated 12% of consolidated revenues in 1995, 14% in 1994 and 16% in 1993. NET INCOME PER SHARE Net income per share is computed based on the weighted average number of total common shares outstanding of Class A and Class B during the respective years. The effect of common stock equivalents is less than 3% dilutive and, therefore, is not included in the computation. ACCOUNTING CHANGES Effective January 1, 1993, the Company adopted new accounting standards for postretirement benefits other than pensions, other postemployment benefits, and income taxes, by reflecting the cumulative effects of the changes in income upon adoption. The cumulative effects (to January 1, 1993) of these accounting changes are detailed below:
in thousands of dollars Postretirement benefits other than pensions, net of related income taxes of $1,890 $(2,835) Other postemployment benefits, net of related income taxes of $160 (240) Income taxes 500 ------- $(2,575) =======
Effective January 1, 1994, the Company implemented Financial Accounting Standard (FAS) No. 115, "Accounting for Certain Investments in Debt and Equity Securities." The Company generally invests its excess cash in short-term debt securities and has engaged an outside money manager to manage its short-term investment portfolio in accordance with investment guidelines established by the Company. Accordingly, the Company has classified its entire portfolio of debt securities as "trading securities." In accordance with FAS No. 115, these securities are reported at their estimated fair value in the accompanying financial statements, with unrealized holding gains and losses included in earnings. This change in accounting principle had no material effect on the Company's financial position, results of operations or cash flows. RECLASSIFICATIONS Certain reclassifications of prior year amounts have been made in the accompanying consolidated balance sheets to conform to the current year presentation. In addition, costs associated with the Company's distributed branch computer network totaling $22,808,000, $19,843,000 and $19,397,000 in 1995, 1994 and 1993, respectively, were reclassified from selling, general and administrative expenses to costs of services provided in the accompanying consolidated statements of income. 2. RETIREMENT PLANS The Company and its subsidiaries sponsor various defined contribution and defined benefit retirement plans covering substantially all employees. Employer contributions under the Company's defined contribution plans are determined annually, based on employee contributions, a percentage of each covered employee's compensation, and the profitability of the Company. The cost of these plans totaled $3,493,000, $4,216,000 and $4,331,000 in 1995, 1994 and 1993, respectively. Benefits payable under the Company's defined benefit plans are generally based on career compensation. The Company's funding policy is to make cash contributions in amounts sufficient to maintain the plans on an actuarially sound basis, but not in excess of deductible amounts permitted under federal income tax regulations. Plan assets are invested primarily in equity and fixed income securities. Crawford & Company| 19 8 Pension expense related to the defined benefit plans in 1995, 1994 and 1993 included the following components:
1995 1994 1993 in thousands of dollars Service costs of benefits $ 9,160 $ 8,832 $ 6,698 Interest costs on projected benefit obligations 14,673 12,711 11,505 Actual return on plan assets (24,183) 4,211 (12,525) Net amortization and deferrals 10,572 (16,749) 1,857 ------- ------- ------- Pension expense $10,222 $ 9,005 $ 7,535 ======= ======= =======
The following schedule reconciles the funded status of the plans with amounts reported in the Company's balance sheets at December 31, 1995 and 1994:
1995 1994 in thousands of dollars Accumulated benefit obligation at September 30: Vested portion $167,527 $131,249 Nonvested portion 12,607 12,641 -------- -------- 180,134 143,890 Effect of projected future compensation levels 27,360 23,452 -------- -------- Projected benefit obligation at September 30 207,494 167,342 Less: Fair market value of plan assets at September 30 199,680 156,493 -------- -------- Unfunded projected benefit obligation 7,814 10,849 Contributions made in fourth quarter (2,300) -- Unrecognized net transition asset 477 556 Unrecognized net loss (37,420) (34,905) -------- -------- Net prepaid pension cost (31,429) (23,500) Less pension obligation included in other accrued liabilities (2,814) -- -------- -------- Prepaid pension included in other assets $(34,243) $(23,500) ======== ========
The discount rate and rate of increase in future compensation levels used in determining the projected benefit obligations ranged from 7.5% to 8% and 5% to 5.5%, respectively, at September 30, 1995, and were 8% and 5%, respectively, at September 30, 1994. The expected long-term rate of return on plan assets used in determining net periodic pension costs ranged from 8% to 9.25% in 1995 and was 9.25% in 1994. 3. POSTRETIREMENT MEDICAL AND OTHER POSTEMPLOYMENT BENEFITS Certain retirees and a fixed number of long-term employees are entitled to receive postretirement medical benefits under the Company's various medical benefit plans. Effective January 1, 1993, the Company adopted FAS No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," which requires that the expected cost of such benefits be charged to expense during the years that employees render service. The cumulative effect to January 1, 1993, of this accounting change reduced first quarter 1993 net income by $2.8 million (the equivalent of $0.08 per share of common stock), net of $1.9 million of deferred income tax benefits. The effect of this accounting change on 1993 income before cumulative effects of accounting changes was not material. Net postretirement medical benefit expense for 1995 and 1994, exclusive of the transition obligation, includes the following components:
1995 1994 in thousands of dollars Service cost of benefits $ 40 $ 40 Interest cost on Accumulated Postretirement Benefit Obligation (APBO) 594 594 ---- ---- $634 $634 ==== ====
The APBO at December 31, 1995 and 1994 was comprised of the following:
1995 1994 in thousands of dollars Retirees $5,099 $4,676 Eligible active participants 1,466 1,342 Other active participants 1,491 1,357 ------ ------ 8,056 7,375 Unrecognized net gain (loss) (118) 65 ------ ------ Postretirement Medical Benefit Obligation recognized in balance sheets $7,938 $7,440 ====== ======
The discount rate used in determining the APBO was 7.5% and 8% for 1995 and 1994, respectively. The assumed rate of increase in the per capita costs of covered healthcare benefits (the healthcare cost trend rate) was 12% in 1995, decreasing gradually to 6.0% by the year 2004. 20 |Crawford & Company 9 The effect of increasing the healthcare cost trend rate by one percentage point in each year would increase the APBO, which is unfunded, by approximately $759,000 and the total service and interest cost components of the 1995 and 1994 net postretirement benefit cost by approximately $76,000. Effective January 1, 1993, the Company also adopted the provisions of FAS No. 112, "Employers' Accounting for Postemployment Benefits." This standard requires recognizing postemployment benefits, including disability-related medical benefits, on the accrual basis of accounting. The cumulative effect to January 1, 1993, of this accounting change reduced first quarter 1993 net income by $240,000 (the equivalent of $0.01 per share), net of $160,000 of deferred income tax benefits. The effect of this accounting change on 1993 income before cumulative effects of accounting changes was not material. 4. INCOME TAXES The provisions for income taxes consist of the following:
1995 1994 1993 in thousands of dollars Currently payable $19,155 $27,240 $12,197 Current deferred (1,442) 703 13,501 Noncurrent deferred 6,647 (493) 1,102 ------- ------- ------- $24,360 $27,450 $26,800 ======= ======= =======
Cash payments for income taxes were $18,571,000 in 1995, $22,796,000 in 1994 and $19,739,000 in 1993. The provisions for income taxes are reconciled to the federal statutory rates of 35% in 1995, 1994 and 1993, as follows:
1995 1994 1993 in thousands of dollars Federal income taxes at statutory rate $21,133 $23,818 $22,698 State income taxes, net of federal benefit 2,512 3,079 2,976 Other 715 553 1,126 ------- ------- ------- $24,360 $27,450 $26,800 ======= ======= =======
The provisions for income taxes include foreign income taxes of $2,541,000 in 1995, $1,831,000 in 1994 and $837,000 in 1993. The Company does not provide for additional U.S. and foreign income taxes on undistributed earnings considered to be permanently reinvested in its foreign subsidiaries. At December 31, 1995, such undistributed earnings totaled $12,441,000. Effective January 1, 1993, the Company adopted FAS No. 109, "Accounting For Income Taxes," which changed the manner of accounting for income taxes. The cumulative effect of this change in accounting principle to January 1, 1993, increased first quarter 1993 net income by $500,000 (the equivalent of $0.02 per share). The effect of this accounting change on 1993 income before cumulative effects of accounting changes was not material. Deferred income taxes consisted of the following at December 31, 1995 and 1994:
1995 1994 in thousands of dollars Accounts receivable reserves $ 884 $ 553 Accrued compensation 4,040 4,491 Self-insured risks 6,901 6,146 Deferred revenues 10,401 10,325 Postretirement benefits 3,175 2,976 Other 2,427 1,869 -------- ------- Gross deferred tax assets 27,828 26,360 -------- ------- Unbilled revenues 10,862 11,094 Depreciation and amortization 7,820 8,189 Prepaid pension obligation 17,706 9,719 Other 179 892 -------- ------- Gross deferred tax liabilities 36,567 29,894 -------- ------- Net deferred tax liability (8,739) (3,534) Less noncurrent net deferred tax liability (14,854) (8,207) -------- ------- Current net deferred tax asset $ 6,115 $ 4,673 ======== =======
5. COMMON STOCK The Company has two classes of Common Stock outstanding, Class A Common Stock and Class B Common Stock. These two classes of stock have essentially identical rights, except that shares of Class A Common Stock generally do not have any voting rights. Under the Company's Articles of Incorporation, amended as of July 24, 1990, the Board of Directors may pay higher (but not lower) cash dividends on the nonvoting Class A Common Stock than on the voting Class B Common Stock. The Company's stock option plans provide for the granting of stock options to key employees at prices not less than 100% of the market price of the stock as of the grant date. The options, which have an option life of ten years from the date of grant, are exercisable at various dates through December 2005. Crawford & Company| 21 10 As of December 31, 1995, the Company had reserved 2,116,510 authorized but unissued Class A shares for issuance under the plans (including 1,054,885 shares available for future grants) and 229,620 authorized but unissued Class B shares. The activity under the plans for the years 1995, 1994 and 1993 was as follows:
1995 1994 1993 CLASS A COMMON STOCK (NONVOTING) Outstanding, beginning of year 1,024,085 928,457 820,157 Options granted 231,100 244,100 191,900 Options exercised (60,580) (45,612) (70,565) Options forfeited (132,980) (102,860) (13,035) --------- --------- ------- Outstanding, end of year 1,061,625 1,024,085 928,457 ========= ========= ======= Exercisable, end of year 431,475 472,800 381,447 ========= ========= ======= CLASS B COMMON STOCK (VOTING) Outstanding, beginning of year 300,555 358,452 428,037 Options exercised (53,060) (43,282) (65,935) Options forfeited (17,875) (14,615) (3,650) ========= ========= ======= Outstanding, end of year 229,620 300,555 358,452 ========= ========= ======= Exercisable, end of year 229,620 277,395 272,552 ========= ========= =======
Options granted prior to the July 24, 1990 amendment to the Articles of Incorporation are exercisable for one share of Class B Common Stock and one share of Class A Common Stock. At December 31, 1995, these outstanding options have option prices ranging from $11.33 to $33.75. Exercisable options have option prices ranging from $11.33 to $33.75. Options were exercised during the year at prices ranging from $11.33 to $31.13. Options granted after July 24, 1990 are exercisable for one share of Class A Common Stock. At December 31, 1995, these outstanding options have option prices ranging from $11.75 to $25.00. Exercisable options have option prices ranging from $11.75 to $25.00. Options were exercised during the year at prices ranging from $15.75 to $16.38. 6. LEASE COMMITMENTS AND OBLIGATIONS The Company and its subsidiaries lease office space and certain computer equipment under operating leases. In addition, the Company leases a major portion of its automobile fleet under 12-month operating leases that require the Company to guarantee specified residual values and monthly rental payments for up to two months after the end of the lease term. License and maintenance costs related to the leased vehicles are paid by the Company. Rental expense for all operating leases was was $49,122,000 in 1995, $46,512,000 in 1994 and $49,160,000 in 1993, including rental expense for automobile leases of $13,531,000 in 1995, $12,474,000 in 1994 and $13,172,000 in 1993. The Company also leases certain computer and office equipment under capital leases with terms ranging from 24 to 60 months. The Company incurred no such capital lease obligations in 1995, $60,000 in 1994 and $160,000 in 1993. These transactions represent noncash investing and financing activities and consequently have been excluded from the accompanying consolidated statements of cash flows. At December 31, 1995, future minimum payments under capital leases and noncancellable operating leases with remaining terms of more than 12 months were as follows:
CAPITAL OPERATING LEASES LEASES in thousands of dollars 1996 $ 75 $30,221 1997 36 21,219 1998 22 12,048 1999 -- 8,337 2000 -- 3,191 Subsequent to 2000 -- 8,922 ---- ------- Total minimum lease payments 133 $83,938 ======= Amount representing interest 16 ---- Present value of future minimum lease payments (See Note 9) $117 ====
7. ACQUISITIONS On April 30, 1994, the Company acquired the stock of Finnamore & Partners Ltd. ("Finnamore"), a Canadian loss adjusting firm. On September 30 and November 30, 1994, the Company acquired the stock of Arnold & Green Ltd. ("A & G") and the Brocklehurst Group ("Brocklehurst"), respectively, two loss adjusting firms based in the United Kingdom. These businesses were acquired for $17.2 million in cash and $10.4 million in notes payable. The Company acquired assets with a fair value of $47.2 million, including $24.7 million of intangible assets, and assumed liabilities of $19.6 million. These transactions were accounted for by the purchase method of accounting. The financial statements of Finnamore, A & G and Brocklehurst are included in the Company's statements on a delayed basis in order to provide sufficient time for the accumulation of their operating results. Accordingly, the December 31, 1994 consolidated balance sheet includes the Finnamore and Brocklehurst balance sheets as of November 30, 1994, and the A & G balance sheet as of September 30, 1994. The Company's 1994 consolidated statement of 22 |Crawford & Company 11 income reflects the results of Finnamore for the seven-month period ended November 30, 1994, but does not include any revenues or expenses relating to A & G or Brocklehurst operations. The following table presents unaudited pro forma operating results as if these acquisitions had occurred on January 1, 1993. The information included in the table reflects certain pro forma adjustments, including adjustments to reflect the loss of investment income and amortization of intangibles.
1994 1993 Unaudited (in thousands of dollars, except per share data) Revenues $630,758 $625,435 Income before income taxes 69,653 67,067 Income before accounting changes 41,267 38,966 Income per share before accounting changes 1.16 1.08
The pro forma results do not purport to be indicative of results that actually would have occurred had the acquisitions taken place on January 1, 1993, nor are they intended to be a projection of future results. 8. FOREIGN OPERATIONS The Company provides claims services through branch offices located in approximately 40 countries outside the United States. Selected financial information as of December 31, 1995, 1994 and 1993, covering the Company's foreign operations is presented below:
U.S. FOREIGN CONSOLIDATED OPERATIONS OPERATIONS TOTALS in thousands of dollars 1995 Revenues $523,367 $ 84,210 $607,577 Pretax Income 57,368 3,012 60,380 Total Assets 256,417 110,566 366,983 1994 Revenues $541,969 $ 45,812 $587,781 Pretax Income 66,749 1,302 68,051 Total Assets 250,923 105,458 356,381 1993 Revenues $533,582 $ 42,716 $576,298 Pretax Income (Loss) 65,966 (1,116) 64,850 Total Assets 268,085 58,178 326,263
9. LONG-TERM DEBT AND SHORT-TERM BORROWINGS Long-term debt at December 31, 1995 and 1994 consisted of the following:
1995 1994 in thousands of dollars Unsecured convertible loan notes issued in connection with acquisition of foreign subsidiary; non interest bearing; due November 1997 $7,900 $7,823 6% loan notes issued in connection with acquisition of foreign subsidiary; payable annually through October 1997 1,464 2,115 Loan note issued in connection with acquisition of foreign subsidiary; non interest bearing; payable annually through 2000 based on earnings levels attained 526 482 Loan notes issued in connection with acquisition of foreign subsidiary; variable interest, currently 4.75%; paid in full December 1995 -- 409 Mortgage payable, secured by building 277 286 Capital leases (see Note 6) 117 145 ------ ------ 10,284 11,260 Less current installments (872) (1,298) ------ ------ $9,412 $9,962 ====== ======
The convertible loan notes are convertible into Crawford Class A Common Stock based on certain factors, including the market price of the stock and currency exchange (approximately 500,000 shares based on the market price and currency exchange at December 31, 1995 and 1994). The Company maintains credit lines with banks in order to meet seasonal working capital requirements or other financing needs that may arise. Short-term borrowings totaled $10.2 million and $9.1 million at December 31, 1995 and 1994, respectively. The weighted average interest rate on short-term borrowings during 1995 and 1994 was 6.9% and 6.5%, respectively. Crawford & Company| 23 12 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS [ARTHUR ANDERSEN LLP LOGO] To the Stockholders of Crawford & Company: We have audited the consolidated balance sheets of CRAWFORD & COMPANY (a Georgia corporation) AND SUBSIDIARIES as of December 31, 1995 and 1994 and the related consolidated statements of income, shareholders' investment, and cash flows for each of the three years in the period ended December 31, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We did not audit the 1994 and 1993 financial statements of certain foreign operations, which statements reflect approximately 7% of consolidated assets in 1994 and approximately 4% of consolidated revenues in 1994 and 1993. Those statements were audited by other auditors whose report has been furnished to us, and our opinion, in so far as it relates to the amounts included for those entities, is based solely on the report of other auditors. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Crawford & Company and subsidiaries as of December 31, 1995 and 1994 and the results of their operations and their cash flows for each of the three years in the period ended December 31, 1995 in conformity with generally accepted accounting principles. ARTHUR ANDERSEN LLP /s/ Arthur Andersen LLP Atlanta, Georgia January 30, 1996 MANAGEMENT'S DISCUSSION AND ANALYSIS of Financial Condition and Results of Operations FINANCIAL CONDITION At December 31, 1995, current assets exceeded current liabilities by approximately $139.3 million, an increase of $3.5 million over the working capital balance at December 31, 1994. Cash and cash equivalents at the end of 1995 totaled $40.8 million, increasing $1.8 million from the balance at the end of 1994. Short-term investments totaled $5.6 million at December 31, 1995, decreasing from $18.8 million at December 31, 1994. During 1995, cash was generated primarily from operating activities, while the principal uses of cash were for dividends paid to shareholders, contributions to the Company's retirement trust, acquisitions of property and equipment and the repurchase of common stock. At December 31, 1995, the ratio of current assets to current liabilities was 2.5 to 1 compared with 2.3 to 1 at the end of 1994. During 1994, the Company announced that it may purchase up to an aggregate of 2,000,000 shares of its Class A and Class B Common Stock through open market purchases. Through December 31, 1995, the Company has reacquired 883,400 shares of its Class A Common Stock and 809,100 shares of its Class B Common Stock at an average cost of $15.50 and 15.63 per share, respectively. The Company maintains credit lines with banks in order to meet seasonal working capital requirements of its foreign subsidiaries or other financing needs that may arise. Short-term borrowings outstanding as of December 31, 1995, totaled $10.2 million, as compared to $9.1 million at the end of 1994. The Company believes that its current financial resources, together with funds generated from operations and existing and potential long-term borrowing capabilities, will be sufficient to maintain its current operations. The Company does not engage in any hedging activities to compensate for the effect of exchange rate fluctuations on the operating results of its foreign subsidiaries. Foreign currency denominated debt is maintained primarily to hedge the currency exposure of its net investment in foreign operations. Shareholders' investment at the end of 1995 was $220.9 million, compared with $213.2 million at the end of 1994. Long-term debt totaled $9.4 million at December 31, 1995, or approximately 4.3% of shareholders' investment. RESULTS OF OPERATIONS 1995 COMPARED WITH 1994 REVENUES Revenues from services provided increased by 3.4%, or $19.8 million, during 1995. Unit volume, measured principally by chargeable hours and excluding acquisitions, decreased approximately 5.8% during 1995. This decrease was partially offset by changes in the mix of services provided and in the rates charged for those services, the combined effects of which increased revenues by approximately 2.4% during 1995. The Company's fourth quarter 1994 acquisitions of the Brocklehurst Group and Arnold & Green Ltd., two loss adjusting firms based in the United Kingdom, and the acquisition of Finnamore & Partners Ltd., a Canadian loss adjusting firm, in the second quarter of 1994, increased revenues by 6.8% during 1995. Effective January 1, 1995, the Company changed its method of reporting its principal service categories to correspond with internal 24 |Crawford & Company 13 management reporting. Accordingly, risk control and information consulting services, previously disclosed as other risk management services, are now reported as a component of domestic claims services along with certain disability management services which are closely aligned with the Company's risk management services. International claims and disability management services, previously reported as components of claims services and disability management services, are now reported as international operations. Domestic revenues from Claims Services to insurance companies and Risk Management Services to self-insured clients totaled $402.3 million for 1995, down 1.1% from related 1994 revenues of $406.7 million. These declines reflect lower claims frequency throughout the property and casualty insurance industry and increased competition in the self-insured corporate market. The Company generated $29.1 million in revenue from services provided by its "catastrophe" adjusters during 1995, principally to clients affected by natural or man-made disasters, including hurricanes, floods, hail storms, oil spills and chemical-related incidents. During 1994, such revenue approximated $35.0 million. Domestic revenues from Disability Management Services, which serves both the insurance company and self-insured markets, totaled $92.0 million for 1995, a decrease of 7.8% from 1994 revenues of $99.7 million. The demand for these services continues to be affected by regulatory changes and other medical cost containment alternatives such as health maintenance organizations as well as increased competition in the self-insured corporate market. Revenues from the Company's international operations increased to $84.2 million in 1995, from $46.3 million in 1994. These increases result primarily from the Company's late 1994 acquisitions in the United Kingdom and strong Canadian growth. COMPENSATION AND FRINGE BENEFITS The Company's most significant expense is the compensation of its employees, including related payroll taxes and fringe benefits. These expenses decreased from 64.8% of revenues in 1994 to 64.0% in 1995. This decrease is primarily due to lower employee group medical and workers compensation costs and a decrease in incentive compensation expense, which is based on growth in earnings. Salaries and wages of personnel other than contract managers increased by 7.0%, from $278.4 million in 1994 to $298.0 million in 1995. Contract managers' compensation is based on the operating income of the offices which they manage. Compensation of these managers totaled $30.7 million during 1995, declining 23.8% from related 1994 costs of $40.3 million. Payroll taxes and fringe benefits totaled $60.2 million in 1995, decreasing 2.9% from 1994 costs of $62.0 million, due primarily to lower employee group medical and workers compensation costs. EXPENSES OTHER THAN COMPENSATION AND FRINGE BENEFITS Expenses other than compensation and related payroll taxes and fringe benefits approximated 26.0% of revenues for 1995, compared to 23.6% of revenues for 1994. These increases resulted principally from an increase in systems development costs associated with the development of systems designed to enhance the Company's service delivery to its clients, higher automobile fleet costs and increases in other operating costs related to the Company's late 1994 acquisitions in the United Kingdom. RESULTS OF OPERATIONS 1994 COMPARED WITH 1993 REVENUES Revenues from services provided increased by 2%, or $11.5 million, during 1994. Unit volume, measured principally by chargeable hours, decreased approximately 1.1% during 1994. This decline was more than offset by the combined effects of changes in the mix of services provided and in the rates charged for those services, which increased revenues by approximately 3.1% during 1994. Domestic revenues from Claims Services to insurance companies and Risk Management Services to self-insured clients totaled $406.7 million for 1994, increasing 2.7% from related 1993 revenues of $396.2 million. The Company encountered strong competition in the self-insured corporate market segment, particularly from insurers attempting to capture a larger share of the corporate market. As a consequence, the Company's revenues from Risk Management Services to self-insured clients declined during 1994, partially offsetting solid growth in revenues from domestic claims services provided to property and casualty insurers. The Company generated approximately $35 million in revenue from services provided by the Company's "catastrophe" adjusters during 1994, principally to clients affected by natural or man-made disasters, including earthquakes, floods, oil spills and chemical-related incidents. During 1993, such revenue approximated $31 million. Domestic revenues from Disability Management Services, which serves both the insurance company and self-insured markets, totaled $99.7 million for 1994, a decrease of 7.4% from the $107.8 million reported for 1993. The demand for these services was affected by the uncertainty regarding health care reform legislation and the competitive environment in the corporate market. Revenues from the Company's international operations increased to $46.3 million in 1994, from $43.1 million in 1993. This increase resulted primarily from strong Canadian growth. COMPENSATION AND FRINGE BENEFITS The Company's most significant expense is the compensation of its employees, including related payroll taxes and fringe benefits. These expenses increased from 63.6% of revenues in 1993 to 64.8% in 1994, primarily due to higher employee group medical and pension costs and an increase in incentive compensation expense, which is based on growth in earnings. Salaries and wages of personnel other than contract managers increased by 3.6%, from $268.6 million in 1993 to $278.4 million in 1994. Contract managers' compensation is based on the operating income of the offices which they manage. Compensation of these managers totaled $40.3 million during 1994, substantially unchanged from related 1993 costs of $40.2 million. Payroll taxes and fringe benefits totaled $62.0 million in 1994, increasing 7.6% from 1993 costs of $57.6 million, due primarily to higher employee group medical and pension costs. EXPENSES OTHER THAN COMPENSATION AND FRINGE BENEFITS Expenses other than compensation and fringe benefits totaled $139.0 million in 1994, down 4.2% from $145.1 million in 1993, due primarily to lower automobile fleet costs and a reduction in the provision for bad debts. Crawford & Company| 25 14 QUARTERLY FINANCIAL DATA
1995 1994 1993 in thousands of dollars except per share data Quarterly Financial Data (Unaudited), Dividend Information and Common Stock Quotations First Quarter: Revenues $148,649 $148,792 $147,956 Income before income taxes 15,884 16,892 15,338 Income before cumulative effects of accounting changes 9,478 10,087 9,238 Cumulative effects of accounting changes -- -- (2,575) Net income 9,478 10,087 6,663 Per share amounts: Income before cumulative effects of accounting changes 0.27 0.28 0.26 Cumulative effects of accounting changes -- -- (0.07) Net income 0.27 0.28 0.19 Cash dividends per share: Class A Common Stock 0.1450 0.1400 0.1300 Class B Common Stock 0.1350 0.1250 0.1100 Common stock quotations: Class A - High 15.75 17.75 23.00 Class A - Low 14.50 15.75 21.13 Class B - High 16.00 16.75 24.25 Class B - Low 14.63 15.13 21.75 Second Quarter: Revenues $150,863 $147,824 $146,420 Income before income taxes 11,026 17,478 16,116 Net income 6,580 10,433 9,716 Net income per share 0.19 0.29 0.27 Cash dividends per share: Class A Common Stock 0.1450 0.1400 0.1300 Class B Common Stock 0.1350 0.1250 0.1100 Common stock quotations: Class A - High 17.50 17.13 22.38 Class A - Low 15.50 15.63 16.00 Class B - High 17.75 16.75 22.38 Class B - Low 15.75 14.88 16.25
- -------------------------------------------------------------------------------- The quotations listed in this table set forth the high and low closing prices per share of Crawford & Company Class A Common Stock and Class B Common Stock, respectively, as reported on the NYSE Composite Tape. 26 |Crawford & Company 15
1995 1994 1993 in thousands of dollars except per share data Third Quarter: Revenues $150,954 $149,051 $144,308 Income before income taxes 15,806 18,806 18,734 Net income 9,431 10,776 10,154 Net income per share 0.27 0.30 0.28 Cash dividends per share: Class A Common Stock 0.1450 0.1400 0.1300 Class B Common Stock 0.1350 0.1250 0.1100 Common stock quotations: Class A - High 17.25 16.75 18.75 Class A - Low 14.75 15.50 15.88 Class B - High 17.63 16.38 18.50 Class B - Low 14.88 15.50 15.88 Fourth Quarter: Revenues $157,111 $142,114 $137,614 Income before income taxes 17,664 14,875 14,662 Net income 10,531 9,305 8,942 Net income per share 0.30 0.27 0.25 Cash dividends per share: Class A Common Stock 0.1450 0.1400 0.1300 Class B Common Stock 0.1350 0.1250 0.1100 Common stock quotations: Class A - High 16.13 15.75 16.38 Class A - Low 15.25 14.50 15.50 Class B - High 16.63 16.00 16.75 Class B - Low 15.25 14.50 15.13
- ------------------------------------------------------------------------------- The approximate number of record holders of the Company's stock as of February 1, 1996: Class A -- 1,389 and Class B -- 1,133. Crawford & Company| 27 16 SELECTED FINANCIAL DATA
1995 1994 1993 1992 1991 For the years ended December 31, 1995, in thousands of dollars except share and per share data 1994, 1993, 1992 and 1991 Revenues $ 607,577 $ 587,781 $ 576,298 $ 597,745 $ 538,027 Income Before Accounting Changes 36,020 40,601 38,050 40,417 37,442 Income Per Share Before Accounting Changes 1.03 1.14 1.06 1.13 1.05 Total Assets 366,983 356,381 326,263 316,889 292,512 Long-Term Debt 9,412 9,962 734 1,806 2,489 Cash Dividends Per Share: Class A Common Stock 0.58 0.56 0.52 0.47 0.41 Class B Common Stock 0.54 0.50 0.44 0.40 0.35 Weighted Average Shares Outstanding 34,851,425 35,723,496 35,984,448 35,835,401 35,656,345
- ------------------------------------------------------------------------------- NOTE: Effective January 1, 1993, the Company adopted new accounting standards for postretirement benefits other than pensions, other postemployment benefits, and income taxes, by reflecting the cumulative effects of the changes in income upon adoption. The cumulative effects (to January 1, 1993) of these accounting changes are detailed in Note 1 to the accompanying consolidated financial statements. - -------------------------------------------------------------------------------- 28 |Crawford & Company EX-21.1 6 LISTING OF SUBSIDIARY 1 EXHIBIT 21.1 CRAWFORD & COMPANY LISTING OF SUBSIDIARY CORPORATIONS*
Jurisdiction in Subsidiary Which Organized ---------- --------------- Crawford & Company of New York, Inc. New York Risk Sciences Group, Inc. Delaware Crawford & Company Insurance Adjusters, Ltd. Province of Ontario Crawford and Company, Inc. (P.R.) Commonwealth of Puerto Rico Crawford & Company (Bermuda) Limited Bermuda Crawford & Company HealthCare Management, Inc. Delaware Crawford & Company International, Inc. Georgia Graham Miller International, Inc. Georgia Crawford & Company International Limited England Crawford/Brocklehurst, Ltd. England Crawford Arnold & Green Limited England Brocklehursts, Inc. California Brocklehurst Miller, Inc. Texas
* Excludes subsidiaries which, if considered in the aggregate as a single subsidiary, would not constitute a significant subsidiary as of the year ending December 31, 1995. EX-23.1 7 CONSENT OF INDEPENDENT PUBLIC ACCOUNTS 1 (Logo) ARTHUR ANDERSEN LLP EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our reports included or incorporated by reference in this Form 10-K into Crawford & Company's previously filed Registration Statement File Nos. 2-78989, 33-22595, 33-47536 and 33-36116. /s/ Arthur Andersen LLP Atlanta, Georgia March 18, 1996 EX-23.2 8 INDEPENDENT AUDITORS CONSENT 1 (logo) DELOITTE & TOUCHE Exhibit 23.2 Chartered Accountants Telephone: National 171 936 3000 Deloitte & Touche International + 44 171 936 3000 Stonecutter Court Telex: 884739 TRLNDN G 1 Stonecutter Street Fax (Gp.3): 0171 583 1198 London EC4A 4TR LDE: DX 599 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statements 2-79898, 33-22595, 33-36116, and 33-47536 of Crawford and Company on Form S-8 of our report dated December 1, 1994, appearing in this Annual Report on From 10-K of Craford and Company for the year ended December 31, 1995. /s/ DELOITTE & TOUCHE DELOITTE & TOUCHE March 18, 1996 EX-24.1 9 POWER OF ATTORNEY 1 EXHIBIT 24.1 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Virginia C. Crawford EX-24.2 10 POWER OF ATTORNEY 1 EXHIBIT 24.2 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Jesse C. Crawford EX-24.3 11 POWER OF ATTORNEY 1 EXHIBIT 24.3 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Linda K. Crawford EX-24.4 12 POWER OF ATTORNEY 1 EXHIBIT 24.4 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Jesse S. Hall EX-24.5 13 POWER OF ATTORNEY 1 EXHIBIT 24.5 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ J. Hicks Lanier EX-24.6 14 POWER OF ATTORNEY 1 EXHIBIT 24.6 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Larry L. Prince EX-24.7 15 POWER OF ATTORNEY 1 EXHIBIT 24.7 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Charles Flather EX-24.8 16 POWER OF ATTORNEY 1 EXHIBIT 24.8 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that the undersigned director or officer, or both, of CRAWFORD & COMPANY, a Georgia corporation (the "Corporation"), hereby constitutes and appoints JUDD F. OSTEN and DONALD R. CHAPMAN, and each of them, his or her true and lawful attorney-in-fact and agent to sign (1) the Corporation's Annual Report on Form 10-K for the year ended December 31, 1995; (2) the Registration Statement on Form S-8 covering 1,000,000 shares of the Class A Common Stock of the Corporation related to the 1996 Employee Stock Purchase Plan, and any and all amendments to, and supplements to any prospectus contained in, such Registration Statement and any and all instruments and documents filed as a part of or in connection with such amendments or supplements; and (3) any other reports or registration statements to be filed by the Corporation with the Securities and Exchange Commission and/or any national securities exchange under the Securities Exchange Act of 1934, as amended, and any and all amendments thereto, and any and all instruments and documents filed as part of or in connection with any such reports or registration statements or reports or amendments thereto; and in connection with the foregoing, to do any and all acts and things and execute any and all instruments which such attorneys-in-fact and agents may deem necessary or advisable to enable this Corporation to comply with the securities laws of the United States and of any State or other political subdivision thereof; hereby ratifying and confirming all that such attorneys-in-fact and agents, or any one of them, shall do or cause to be done by virtue hereof. IN WITNESS WHEREOF, the undersigned has subscribed these presents this 30th day of January, 1996. /s/ Forrest L. Minix EX-27 17 FINANCIAL DATA SCHEDULE
5 1,000 YEAR DEC-31-1995 DEC-31-1995 40,802 5,596 172,122 10,303 0 234,380 121,307 84,859 366,983 95,054 9,412 0 0 34,528 186,332 366,983 0 607,577 0 439,029 108,168 0 0 60,380 24,360 36,020 0 0 0 36,020 1.03 0
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