UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
| x | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year end December 31, 2002
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 000-23423
A. Full title of the plan and the address of the plan, if different from that of the issuer named below:
Virginia Bankers Association Defined Contribution Plan for Citizens and Farmers Bank
802 Main Street
West Point, Virginia 23181
C&F Mortgage Corporation 401(k) Plan
1400 Alverser Drive
Midlothian, Virginia 23113
B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:
C & F Financial Corporation
802 Main Street
West Point, Virginia 23181
VIRGINIA BANKERS ASSOCIATION DEFINED
CONTRIBUTION PLAN FOR
CITIZENS AND FARMERS BANK
West Point, Virginia
FINANCIAL REPORT
DECEMBER 31, 2002
CONTENTS
| Page | ||
| 1 | ||
| FINANCIAL STATEMENTS |
||
| 2 | ||
| 3 | ||
| 4-8 | ||
| SUPPLEMENTAL SCHEDULE |
||
| 9 | ||
To the Plan Administrator of the
Virginia Bankers Association Defined Contribution
Plan for Citizens and Farmers Bank
West Point, Virginia
We have audited the accompanying statements of net assets available for benefits of the Virginia Bankers Association Defined Contribution Plan for Citizens and Farmers Bank as of December 31, 2002 and 2001, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Virginia Bankers Association Defined Contribution Plan for Citizens and Farmers Ba as of December 31, 2002 and 2001, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes as of December 31, 2002 is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by the United States Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/ Yount, Hyde & Barbour, P.C.
YOUNT, HYDE & BARBOUR, P.C.
Winchester, Virginia
April 3, 2003
1
VIRGINIA BANKERS ASSOCIATION DEFINED CONTRIBUTION PLAN
FOR CITIZENS AND FARMERS BANK
Statements of Net Assets Available for Benefits
December 31, 2002 and 2001
| 2002 |
2001 | |||||
| Assets |
||||||
| Investments, at fair value |
$ | 4,259,852 | $ | 4,293,524 | ||
| Receivables: |
||||||
| Employer contribution |
$ | 177,149 | $ | 194,215 | ||
| Other |
1,248 | 941 | ||||
| Total receivables |
$ | 178,397 | $ | 195,156 | ||
| Cash |
$ | 2,752 | $ | 18,686 | ||
| Total assets |
$ | 4,441,001 | $ | 4,507,366 | ||
| Liabilities |
||||||
| Excess contribution refund |
$ | — | $ | 3,604 | ||
| Net assets available for benefits |
$ | 4,441,001 | $ | 4,503,762 | ||
See Notes to Financial Statements.
2
VIRGINIA BANKERS ASSOCIATION DEFINED CONTRIBUTION PLAN
FOR CITIZENS AND FARMERS BANK
Statements of Changes in Net Assets
Available for Benefits
For the Years Ended December 31, 2002 and 2001
| 2002 |
2001 |
|||||||
| Additions to net assets attributed to: |
||||||||
| Investment income (loss): |
||||||||
| Net depreciation in fair value of investments |
$ | (664,871 | ) | $ | (401,100 | ) | ||
| Interest and dividends |
80,474 | 98,186 | ||||||
| $ | (584,397 | ) | $ | (302,914 | ) | |||
| Contributions: |
||||||||
| Employer |
$ | 376,062 | $ | 384,360 | ||||
| Participant |
316,289 | 280,544 | ||||||
| Rollover contributions |
— | 19,248 | ||||||
| $ | 692,351 | $ | 684,152 | |||||
| Total additions |
$ | 107,954 | $ | 381,238 | ||||
| Deductions from net assets attributed to: |
||||||||
| Benefits paid to participants |
$ | 144,349 | $ | 212,707 | ||||
| Administrative expenses |
26,366 | 22,057 | ||||||
| $ | 170,715 | $ | 234,764 | |||||
| Net (decrease) increase |
$ | (62,761 | ) | $ | 146,474 | |||
| Net assets available for benefits: |
||||||||
| Beginning of period |
4,503,762 | 4,357,288 | ||||||
| End of period |
$ | 4,441,001 | $ | 4,503,762 | ||||
See Notes to Financial Statements.
3
VIRGINIA BANKERS ASSOCIATION DEFINED CONTRIBUTION PLAN
FOR CITIZENS AND FARMERS BANK
Note 1. Description of the Plan
The following description of the Virginia Bankers Association Defined Contribution Plan for Citizens and Farmers Bank (Plan) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan sponsored by Citizens and Farmers Bank (Bank) pursuant to the provisions of Section 401(k) of the Internal Revenue Code (Code) established for the benefit of substantially all full time employees electing to participate in the Plan. Employees are eligible to participate in the Plan on the first day of the calendar quarter after completing three months of service and must be eighteen years old or older. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions
Each year, participants may contribute up to 20% of pretax annual compensation, as defined in the Plan. Participants may also contribute amounts representing distributions from other qualified defined benefit or defined contribution plans. Participants direct the investment of their contributions into various investment options offered by the Plan. The Bank matches 100% of the first 5% of compensation that a participant contributes to the Plan. The Bank may also make a discretionary profit sharing contribution, determined annually by its Board of Directors. This contribution is allocated in proportion to a participant’s covered compensation to covered compensation of all participants. Discretionary profit sharing contributions declared or made by the Bank were $177,149 and $194,215 during the plan years ended December 31, 2002 and 2001, respectively. Contributions are subject to certain limitations as established by the Code.
Participants’ Accounts
Each participant’s account is credited with the participant’s contribution and allocations of (a) the Bank’s contributions (b) Plan earnings and (c) forfeitures. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account.
4
Notes to Financial Statements
Vesting
Participants are vested immediately in their contributions plus actual earnings thereon. Vesting in the portion of their accounts contributed by the Bank is based on years of continuous service. A participant is 100% vested after seven years of credited service.
Investment Options
All assets in the Plan are directed by individual participants. Participants are given the option to direct account balances and all contributions made into any of 24 separate investment options consisting of managed, indexed or individual equity or fixed income funds.
A participant may choose to invest up to 25% (in increments of 5%) of their account balance and future contributions in the common stock of C&F Financial Corporation (Employer Common Stock), the remaining balance and future contributions may be invested in the other investment fund options.
Participant Loans
Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Loan transactions are treated as a transfer to (from) the investment fund from (to) the Participants Notes Fund. Loan terms are limited to 5 years or up to 30 years for the purchase of a primary residence. The loans are fully secured by the balance in the participant’s account and bear interest at 1/4 of 1% over the Corporation’s prime rate and will remain unchanged for the life of the loan. Principal and interest is paid ratably through monthly payroll deductions.
Payment of Benefits
On termination of service due to death, disability, or retirement, a participant may elect to receive either a lump sum amount equal to the value of the participant’s vested interest in his or her account, periodic installments for a period of up to 10 years or a combination of both. A written election must be made with the administrator at least 30 days before the benefit payment date. Participants whose vested account balance has never exceeded $5,000 must be paid out in the form of a lump sum distribution.
Forfeited Accounts
As of December 31, 2002 and 2001, forfeited nonvested account balances totaled $31,895 and $127,424, respectively. These accounts will be allocated to remaining participants’ accounts.
Reclassifications
Certain reclassifications have been made to prior period amounts to conform to current year presentation.
5
Note 2. Summary of Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method of accounting.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
Investment Valuation and Income Recognition
The Plan’s investments are stated at fair value. Quoted market prices are used to value investments. Shares of mutual funds are valued at the net asset value of shares held by the Plan at year end. Participant notes receivable are valued at cost which approximates fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
In accordance with the policy of stating investments at current value, net realized and unrealized appreciation (depreciation) for the year is reflected in the statements of changes in net assets available for benefits.
Benefit Payments
Benefit payments are recorded when paid.
Note 3. Plan Termination
Although it has not expressed any intent to do so, the Bank has the right under the Plan to terminate the Plan subject to the provisions of ERISA. In the event of plan termination, participants would become 100 percent vested in their employer contributions.
6
Notes to Financial Statements
Note 4. Investments
The following table presents investments that represent 5 percent or more of the Plan’s net assets.
| December 31, 2002 | |||
| Fidelity Spartan U.S. Money Market Fund |
$ | 435,226 | |
| Davis New York Venture Class A Fund |
492,441 | ||
| PIMCO Renaissance Class D Fund |
299,242 | ||
| ABN/AMRO Chicago Cap |
555,457 | ||
| Federated Cap Appreciation Fund |
318,391 | ||
| Goldman Sachs Fund |
296,152 | ||
| Liberty Acorn Fund |
387,273 | ||
| Oppenheimer Global Fund |
224,837 | ||
| PIMCO Total Return II Administrative Fund |
269,379 | ||
| First Eagle Sogen Overseas Class A Fund |
242,788 | ||
| December 31, 2001 | |||
| Spartan U.S. Equity Fund |
$ | 332,093 | |
| Spartan U.S. Treasury Money Market Fund |
440,814 | ||
| Davis New York Venture Class A Fund |
719,022 | ||
| Dreyfus Short Term Income Fund |
274,844 | ||
| Franklin Small-Mid Cap Growth A Fund |
272,386 | ||
| Janus Fund |
717,783 | ||
| PIMCO Renaissance Class D Fund |
385,854 | ||
| Third Avenue Value Fund |
267,234 | ||
During the Plan years ending December 31, 2002 and 2001, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) depreciated in value by $(664,871) and $(401,100), as follows:
| December 31, |
||||||||
| 2002 |
2001 |
|||||||
| Employer Common Stock |
$ | 34,593 | $ | 36,627 | ||||
| Registered Investment Companies |
(699,464 | ) | (437,727 | ) | ||||
| $ | (664,871 | ) | $ | (401,100 | ) | |||
Note 5. Tax Status
The Internal Revenue Service has determined and informed the trustee/administrator by a letter dated December 23, 1997, that the master Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). Although the Plan has been amended since receiving the determination letter, the Plan administrator and Plan sponsor believe that the Plan is designed and currently being operated in compliance with the applicable requirements of
7
Notes to Financial Statements
the IRC.
Note 6. Related-Party Transactions
The Plan allows funds to be invested in the common stock of C&F Financial Corporation, the parent company of Citizens and Farmers Bank, the Plan Sponsor. Therefore, C&F Financial Corporation is a party-in-interest. Investment in employer securities are allowed by ERISA and the Department of Labor and the fair value of the employer common stock is based on quotes from an active market.
Note 7. Administrative Expenses
Certain administrative expenses are absorbed by Citizens and Farmers Bank, the Plan Sponsor.
Note 8. Reconciliation of Financial Statements to Form 5500
Financial information reported on the 2002 Form 5500, Annual Return/Report of Employee Benefit Plan differs from the Plan’s financial statement as follows:
| Net Assets Available for Benefits |
Net Increase (Decrease) in Net Assets Available for Benefits |
|||||||
| Balance per financial statements |
$ | 4,441,001 | $ | (62,761 | ) | |||
| Less benefits payable |
(20,855 | ) | (20,855 | ) | ||||
| As reported on Form 5500 |
$ | 4,420,146 | $ | (83,616 | ) | |||
There were no reconciling items as of December 31, 2001.
8
VIRGINIA BANKERS ASSOCIATION DEFINED CONTRIBUTION PLAN
FOR CITIZENS AND FARMERS BANK
Schedule of Assets Held for Investment Purposes
December 31, 2002
| Description of Asset/Identity of Issue |
Fair Value | ||
| Registered Investment Companies |
|||
| Ariel Fund |
$ | 207,864 | |
| ABN/AMRO Chicago Cap Fund |
555,457 | ||
| Fidelity U.S. Bond Index Fund |
49,068 | ||
| Spartan U.S. Equity Index Fund |
41,368 | ||
| Spartan Total Market Index Fund |
76,293 | ||
| Managers Bond Index Fund |
866 | ||
| Fidelity Instl Cash Portfolio Fund |
11,539 | ||
| Fidelity Spartan U.S. Money Market Fund |
435,226 | ||
| Davis New York Venture Class A Fund |
492,441 | ||
| Oppenheimer Global Fund |
224,837 | ||
| First Eagle Sogen Overseas Class A Fund |
242,788 | ||
| PIMCO Renaissance Class D Fund |
299,242 | ||
| PIMCO Total Return II Administrative Fund |
269,379 | ||
| Strong Advantage Fund |
151,114 | ||
| Goldman Sachs Fund |
296,152 | ||
| Liberty Acorn Fund |
387,273 | ||
| Federated Cap Appreciation Fund |
318,391 | ||
| $ | 4,059,298 | ||
| Common Stock |
|||
| C&F Financial Corporation—Employer Common Stock |
$ | 192,245 | |
| Loan |
|||
| Participant notes |
$ | 8,309 | |
| Total assets held for investment |
$ | 4,259,852 | |
9
C&F MORTGAGE CORPORATION 401(K) PLAN
Midlothian, Virginia
FINANCIAL REPORT
DECEMBER 31, 2002
CONTENTS
| Page | ||
| 1 | ||
| FINANCIAL STATEMENTS |
||
| 2 | ||
| 3 | ||
| 4-8 | ||
| SUPPLEMENTAL SCHEDULE |
||
| 9 and 10 | ||
To the Plan Administrator of
C&F Mortgage Corporation 401(k) Plan
(formerly Virginia Bankers Association Defined Contribution
Plan for C&F Mortgage Corporation)
Richmond, Virginia
We have audited the accompanying statements of net assets available for benefits of the C&F Mortgage Corporation 401(k) Plan as of December 31, 2002 and 2001, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the C&F Mortgage 401(k) Plan as of December 31, 2002 and 2001, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes as of December 31, 2002 is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by the United States Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/ Yount, Hyde, & Barbour, P.C.
YOUNT, HYDE & BARBOUR, P.C.
Winchester, Virginia
April 4, 2003
1
C&F MORTGAGE CORPORATION 401(K) PLAN
Statements of Net Assets Available for Benefits
December 31, 2002 and 2001
| 2002 |
2001 | |||||
| Assets |
||||||
| Investments, at fair value |
$ | 2,566,995 | $ | 2,063,061 | ||
| Receivables: |
||||||
| Employer contribution |
$ | 465,326 | $ | 299,183 | ||
| Employee deferrals |
1,978 | — | ||||
| Dividends |
1,619 | 1,174 | ||||
| Total receivables |
$ | 468,923 | $ | 300,357 | ||
| Cash |
$ | 9,495 | $ | 17,485 | ||
| Net assets available for benefits |
$ | 3,045,413 | $ | 2,380,903 | ||
See Notes to Financial Statements.
2
C&F MORTGAGE CORPORATION 401(K) PLAN
Statements of Changes in Net Assets
Available for Benefits
For the Years Ended December 31, 2002 and 2001
| 2002 |
2001 |
|||||||
| Additions to net assets attributed to: |
||||||||
| Investment (loss): |
||||||||
| Net (depreciation) in fair value of investments |
$ | (371,260 | ) | $ | (190,003 | ) | ||
| Interest and dividends |
6,128 | 4,588 | ||||||
| $ | (365,132 | ) | $ | (185,415 | ) | |||
| Contributions: |
||||||||
| Employer |
$ | 465,458 | $ | 299,183 | ||||
| Participant |
539,847 | 501,618 | ||||||
| Rollover and other contributions |
134,770 | 55,150 | ||||||
| $ | 1,140,075 | $ | 855,951 | |||||
| Total additions |
$ | 774,943 | $ | 670,536 | ||||
| Deductions from net assets attributed to: |
||||||||
| Benefits paid to participants |
$ | 94,305 | $ | 34,567 | ||||
| Administrative expenses |
16,128 | 13,338 | ||||||
| Total deductions |
$ | 110,433 | $ | 47,905 | ||||
| Net increase |
$ | 664,510 | $ | 622,631 | ||||
| Net assets available for benefits: |
||||||||
| Beginning of period |
2,380,903 | 1,758,272 | ||||||
| End of period |
$ | 3,045,413 | $ | 2,380,903 | ||||
See Notes to Financial Statements.
3
C&F MORTGAGE CORPORATION 401(K) PLAN
Note 1. Description of the Plan
The following description of the C&F Mortgage Corporation 401(k) Plan (Plan) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan maintained by C&F Mortgage Corporation pursuant to the provisions of Section 401(k) of the Internal Revenue Code (Code) established for the benefit of substantially all employees electing to participate in the Plan. Employees are eligible to participate in the Plan on the first day of the month following their employment date and must be eighteen years old or older. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions
Each participant may elect to have compensation deferred up to the maximum percentage allowed by the Code. The Company may make a discretionary profit sharing contribution, determined annually by its Board of Directors. The contribution is allocated in proportion to a participant’s contributions to the total contributions of all participants. Discretionary contributions declared or made by the Company, net of forfeitures, were $465,458 and $299,183 during the plan years ended December 31, 2002 and 2001, respectively. Participants entering the Plan may roll over contributions from other plans. Contributions are subject to certain limitations as established by the Internal Revenue Code.
Participants’ Accounts
Each participant’s account is credited with the participant’s contribution and allocations of the Company’s contributions and plan earnings. Allocations are based on participant contributions or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account.
4
Notes to Financial Statements
Vesting
The Plan’s vesting provision provides that participants are immediately vested in their elective contributions and earnings thereon. Vesting in the Company’s contributions occurs as follows:
| Number of Years of Vesting Service |
Vested Interest |
||
| Less than 2 years |
0 | % | |
| 2 years but less than 3 years |
25 | % | |
| 3 years but less than 4 years |
50 | % | |
| 4 years but less than 5 years |
75 | % | |
| 5 years or more |
100 | % |
Investment Options
All assets in the Plan are directed by individual participants. Participants are given the option to direct account balances and all contributions into over 50 separate investment options. The options include pooled separate accounts, guaranteed interest accounts, money market and managed accounts.
A participant may choose to invest up to 25% (in increments of 5%) of their account balance and future contributions in the common stock of C&F Financial Corporation (Employer Common Stock). Participants may change their investment options daily.
Payment of Benefits
Upon retirement or termination of service a participant may elect to receive either a lump sum amount equal to the value of the participant’s vested interest in his or her account, periodic installments for a period of up to 10 years or a combination of both. A written election must be made with the administrator at least 30 days before the benefit payment date. Participants whose vested account balance has never exceeded $5,000 must be paid out in the form of a lump sum distribution.
Forfeited Accounts
At December 31, 2002 and 2001, forfeited nonvested accounts totaling $7,277 and $9,343, respectively, were used to reduce employer contributions.
5
Notes to Financial Statements
Note 2. Summary of Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method of accounting.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
Investment Valuation and Income Recognition
The Plan’s investments in pooled separate accounts of Manufacturers Life Insurance Company represents ownership of units of participation in various mutual funds. The value of a unit of participation is the total value of each mutual fund within the separate accounts divided by the number of units outstanding. The investments in the pooled separate accounts are stated at fair value and are based on quoted redemption values of the underlying mutual funds on the last day of the year. The Plan’s Guaranteed Interest Accounts guarantee a rate of return for a defined term. The assets are commingled with other assets of Manufacturers Life Insurance Company’s general account and are reported at fair value as determined by Manufacturers Life Insurance Company. Common stock is stated at the fair value determined by quoted market prices.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
In accordance with the policy of stating investments at current value, net realized and unrealized appreciation (depreciation) for the year is reflected in the statements of changes in net assets available for benefits.
Benefit Payments
Benefit payments are recorded when paid.
Note 3. Plan Termination
Although it has not expressed any intent to do so, the Company has the right under the Plan to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants would become 100 percent vested in the portion of their account not previously vested.
6
Notes to Financial Statements
Note 4. Investments
The Plan’s investment assets are currently held by the custodians, Manulife Financial Corporation and Raymond James Financial Services, Inc. The following table presents investments for the years ended December 31, 2002 and 2001 that represent 5 percent or more of the Plan’s net assets.
| December 31, | ||||||
| 2002 |
2001 | |||||
| Manulife Lifestyle Fund—Aggressive Portfolio |
$ | 427,693 | $ | 407,650 | ||
| Manulife Lifestyle Fund—Balanced Portfolio |
283,886 | 193,013 | ||||
| Manulife Lifestyle Fund—Growth Portfolio |
676,535 | 665,742 | ||||
| C&F Financial Corporation—Employer Common Stock |
249,359 | 156,480 | ||||
During the years ended December 31, 2002 and 2001, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) depreciated in value by $(371,260) and $(190,003), respectively as follows:
| December 31, |
||||||||
| 2002 |
2001 |
|||||||
| Pooled separate accounts |
$ | (410,675 | ) | $ | (229,622 | ) | ||
| Employer Common stock |
39,380 | 39,606 | ||||||
| Guaranteed investment contracts |
35 | 13 | ||||||
| $ | (371,260 | ) | $ | (190,003 | ) | |||
Note 5. Tax Status
The Internal Revenue Service has determined and informed the trustee/administrator by a letter dated August 7, 2001, that the Master Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). The Plan administrator and Plan sponsor believe that the Plan is designed and currently being operated in compliance with the applicable requirements of the IRC.
7
Notes to Financial Statements
Note 6. Related Party Transactions
Certain Plan investments are units of pooled separate accounts managed in part by Manufacturers Advisor Corporation. Group annuity contracts for guaranteed interest accounts are issued by Manufacturers Life Insurance Company. Both Manufacturers Advisor Corporation and the Manufacturers Life Insurance Company are affiliates of Manulife Financial Corporation, the Plan asset custodian. Therefore, transactions in these investments qualify as party-in-interest. Fees charged for services by the party-in-interest are based on customary rates for such services.
The Plan allows funds to be invested in the common stock of C&F Financial Corporation, the parent company of C&F Mortgage Corporation, the Plan Sponsor. Therefore C&F Financial Corporation is a party-in-interest. Employer securities are allowed by ERISA and the Department of Labor and the fair value of employer common stock is based on quotes from an active market.
Note 7. Administrative Expenses
Certain administrative expenses are absorbed by C&F Mortgage Corporation, the Plan sponsor.
Note 8. Significant Amendments & Events
Effective January 1, 2002, the Plan was amended to include various changes to the Plan. The most significant changes included changing the name of the Plan to C&F Mortgage Corporation 401(k) Plan. The plan trustees were also formally changed to the Corporation’s Chief Financial Officer and the Human Resource Manager.
Effective January 1, 2001, C&F Title Agency, Inc., an affiliated corporation, adopted the C&F Mortgage Corporation 401(k) Plan. Also on this date, the Plan was amended to permit employees filling certain job positions of the Ellicott City, Maryland branch office to become eligible for any employer matching contributions. These positions include receptionists, set up clerks, administrative assistants, and loan processors.
8
C&F MORTGAGE CORPORATION 401(K) PLAN
Schedule of Assets Held for Investment Purposes
December 31, 2002
| Description of Asset/Identity of Issue |
Fair Value | ||
| Pooled Separate Accounts |
|||
| Manulife Aggressive Growth Fund |
$ | 21,549 | |
| Manulife Balanced Fund |
54,848 | ||
| Manulife Capital Growth Stock Fund |
6,289 | ||
| Manulife Developing Markets Fund |
13,814 | ||
| Manulife Discovery Fund |
5,808 | ||
| Manulife Emerging Growth Stock Fund |
5,742 | ||
| Manulife Equity Income Fund |
5,468 | ||
| Manulife Foreign Fund |
7,082 | ||
| Manulife Blue Chip Fund |
5,444 | ||
| Manulife Prudential Jennison Growth Fund |
3,989 | ||
| Manulife Large-Cap Fund |
33,994 | ||
| Manulife Fidelity Advisor Dividend Growth Fund |
20,425 | ||
| Manulife Growth Plus Stock Fund |
14,681 | ||
| Manulife High-Core Bond Fund |
5,266 | ||
| Manulife High-Yield Fund |
9,095 | ||
| Manulife Spectrum Income Fund |
3,741 | ||
| Manulife 500 Index Fund |
47,959 | ||
| Manulife International Stock Fund |
3,655 | ||
| Manulife Equity Growth Fund |
30,338 | ||
| Manulife Lifestyle Fund-Aggressive Portfolio |
427,693 | ||
| Manulife Lifestyle Fund-Balanced Portfolio |
283,886 | ||
| Manulife Lifestyle Fund-Conservative Portfolio |
11,010 | ||
| Manulife Lifestyle Fund-Growth Portfolio |
676,535 | ||
| Manulife Lifestyle Fund-Moderate Portfolio |
104,564 | ||
| Manulife Wietz Ptns Fund |
44,749 | ||
| Manulife AIM Constellation Fund |
6,452 | ||
| Manulife Beacon Fund |
38,076 | ||
| Manulife Overseas Fund |
5,697 | ||
| Manulife Science & Technology Fund |
79,339 | ||
| Manulife Select Twenty Fund |
48,873 | ||
| Manulife Quantitative Mid Cap Fund (VS) |
24,303 | ||
| Manulife Lord Abbett Develop Growth Fund |
6,155 | ||
| Manulife Small-Mid-Cap Growth Fund |
26,306 | ||
| Carried Forward |
$ | 2,082,825 | |
9
C&F MORTGAGE CORPORATION 401(K) PLAN
Schedule of Assets Held for Investment Purposes
(Continued)
December 31, 2002
| Description of Asset/Identity of Issue |
Fair Value | ||
| Carried Forward |
$ | 2,082,825 | |
| Pooled Separate Accounts (cont’d) |
|||
| Manulife Dominion Social Equity Fund |
1,779 | ||
| Manulife Value & Restructuring Fund |
36,037 | ||
| Manulife Worldwide Fund |
14,991 | ||
| Manulife Short Term Fund |
4,098 | ||
| Manulife Total Return Fund |
19,818 | ||
| Manulife New York Venture Fund |
17,254 | ||
| Manulife Balance Sheet Fund |
23,010 | ||
| Manulife Capital Opportunities Fund |
7,622 | ||
| Manulife Global Equities Fund |
447 | ||
| Manulife Passport Fund |
2,106 | ||
| Manulife Net Net Fund |
3,269 | ||
| Manulife TRP Equity Income Fund |
24,564 | ||
| Manulife Mid Cap Fund |
20,323 | ||
| Manulife Index Mid Fund |
157 | ||
| Manulife Index Small Fund |
7,224 | ||
| Manulife Money Market Fund |
47,336 | ||
| $ | 2,312,860 | ||
| Common Stock |
|||
| C&F Financial Corporation—Employer Common Stock |
$ | 249,359 | |
| Guaranteed Interest Accounts |
|||
| Guaranteed Investment Contract |
$ | 4,776 | |
| Total assets held for investment purposes |
$ | 2,566,995 | |
10
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
| VIRGINIA BANKERS ASSOCIATION DEFINED CONTRIBUTION PLAN FOR CITIZENS AND FARMERS BANK | ||||||||
| C&F MORTGAGE CORPORATION 401(K) PLAN | ||||||||
| (Name of Plans) | ||||||||
| Date |
June 30, 2003 |
/s/ THOMAS F. CHERRY | ||||||
| Thomas F. Cherry Chief Financial Officer | ||||||||
(Certification of CEO/CFO under Section 906 of the Sarbanes-Oxley Act of 2002 is provided separately as correspondence with this filing.)