3.130 46.158 62,946 52,028 42.239 66.1 7.1 73.2 10.GOS 1.475 2.700 41,514 49,536 40,003 44.647 55.6 6.3 61.9 17.293 1,690 3.07 48.282 62.756 30,155 43.388 61.8 4.5 66.3 14.301 1,900 2.752 42.761 44,133 35.676 41.198 75.5 6.3 81.8 7.836 2.135 2.327 40,539 42.252 34.170 36.392 79.0 7.4 86.4 5.125 2.155 6.3 9.355

EXHIBIT No. IV

REPORT OF ASSOCIATION EXAMINATION OF THE EMMCO INSURANCE CO., SOUTH BEND, IND., AS OF DECEMBER 31, 1954

STATES PARTICIPATING

Indiana, zone 4 Kentucky, zone 3 New Mexico, zone 5 Pennsylvania, zone 2 SOUTH BEND, IND., November 25, 1955.

SIRS Pursuant to the requirements of the Indiana insurance law and in conformity with your several instructions, an examination has been made of the financial condition and affairs of the Emmco Insurance Co., at its principal office in South Bend, Ind.

The following report is respectfully submitted.

SCOPE OF EXAMINATION

The previous examination of the transactions and affairs of the Emmco Insurance Co., hereinafter referred to as the company, was made as of December 31, 1951, and was participated in by representatives of the States of Pennsylvania (zone 2), Georgia (zone 3), Indiana (zone 4) and Texas (zone 5).

This examination, covering the intervening period from the aforementioned date to and including December 31, 1954, was conducted by the Indiana Department of Insurance, under the auspices of the National Association of Insurance Commissioners, and was participated in by representatives appointed by the Insurance Departments of Pennsylvania (zone 2), Kentucky (zone 3), Indiana (zone 4) and New Mexico (zone 5).

This 3-year review consisted of a general survey of the company's operations and practices; a review of corporate records; detailed and/or test checks of accounting records; verification and evaluation of assets and determination of liabilities. The examination was made in conjunction with that of the Excel Insurance Co., a wholly owned subsidiary.

91018-58-pt. 2—13

HISTORY OBJECTS-GROWTH

The company was originally incorporated December 29, 1919, under the name of "Motor Underwriters Inc." On March 27, 1936, the articles of incorporation and the bylaws were revised to conform to the provisions of the Indiana insurance law approved March 8, 1935. The name of the corporation was changed to Emmco Insurance Co., Inc., and authority was granted to write all types of automobile insurance coverage, except bodily injury and property damage liability. In December 1941, the articles were amended to permit the writing of fire and allied lines and inland marine coverages. The name of the company was again changed, March 5, 1943, to Emmco Insurance Co.

The objects of the company are to engage in a general fire insurance business as provided for in the Indiana insurance law and the company's amended articles of incorporation.

The growth of the company during the period under review is depicted in the following summary:

The capital stock account at December 31, 1954, consisted of 6,000 shares of ccmmon stock with a par value of $200 per share.

A detailed listing from the stock certificate books revealed that the aforementioned number of shares were issued, outstanding, and fully paid for as of December 31, 1954. Of the 6,000 shares outstanding, 5,965 were owned by the Associates Investment Co., and 5 shares were owned by each of 7 directors of the company. It was noted that one check for the dividends on the total outstanding shares was issued to the Associates Investment Co.

During the period under review, dividends aggregating the following were disbursed:

1952

1953

1954

MANAGEMENT AND CONTROL

$2,880, 000 3,240,000 3, 240, 000

The company is organized and operates under the proprietary plan. The annual meeting of the stockholders is held on March 10 of each year unless that date falls on a Saturday, Sunday, or legal holiday, in which instance the meeting is held on the next succeeding business day.

The bylaws provide for the management and control of the company by a board of directors, consisting of not less than 5 and not more than 13 members, elected by the stockholders for a term of 1 year or until their successors are duly qualified. At December 31, 1954, the directorate was composed of the following (name, principal affiliation, and address):

J. D. Barnette, president, First Bank & Trust Co., South Bend, Ind.

H. W. Clark, vice president, George C. Clark, Metal Last Co., South Bend, Ind.
Lew Fleming, vice president and secretary, Associates Investment Co., South
Bend, Ind.

W. F. Gaunitz, president, Associates Investment Co., South Bend, Ind.

R. L. Oare, chairman of board, Associates Investment Co., South Bend, Ind.

T. F. Shortall, executive vice president and secretary, the company, South Bend, Ind.

T. H. Wickenden, engineering consultant, South Bend, Ind.

The official personnel of the company at December 31, 1954, included the following:

Robert L. Oare, chairman of the board.

W. F. Gaunitz, president.

T. F. Shortall, executive vice president and secretary.

M. C. Trescott, vice president.

W. C. Cook, vice president and assistant secretary.

E. D. Campbell, treasurer and assistant secretary.

P. J. Atherton, comptroller and assistant treasurer.
E. P. Aldrich, assistant secretary.

C. C. Clem, assistant treasurer.

FINANCE COMMITTEE

Supervision of the company's investments rests with the following members: Lew Fleming, W. F. Gaunitz, R. L. Oare, B. J. Voll, M. C. Trescott, C. C. Clem, secretary.

CORPORATE RECORDS

ARTICES OF INCORPORATION

No amendments during the period under review.

BYLAWS

The following sections comprising article IV were amended March 10, 1953, to read as follows:

"SECTION 1. OFFICERS.-The officers of the Company shall consist of the Chairman of the Board of Directors, the President, an Executive Vice President, the Secretary, the Treasurer and such number of other vice presidents, assistant vice presidents, assistant secretaries, assistant treasurers, and other officers as may from time to time be elected by the Board of Directors. Any two or more offices may be held by the same person excepting that the duties of the President and Secretary shall not be performed by one person.

"SEC. 2. ELECTION.-At the first meeting after their election, the Directors shall elect annually the officers enumerated in Section 1 of this Article to hold office until the next succeeding annual meeting of the shareholders and until others are elected and shall have qualified in their stead, excepting as in this Article provided.

"SEC. 3. CHAIRMAN OF THE BOARD OF DIRECTORS.-The Chairman of the Board of Directors shall be a director. He shall preside at all meetings of shareholders and at all meetings of the directors and shall have general supervision of the affairs of the corporation. He is charged with the responsibility for the prudential affairs of the Company and for the maintenance of harmony and accord and may at his discretion discharge any and all officers, except directors, and appoint their successors who shall hold office until the next meeting of directors. He shall also perform all such other duties as are incidental to his office or properly required of him by the Board of Directors.

"SEC. 4. PRESIDENT.-The President shall be a director. In the absence of the Chairman of the Board of Directors, he shall preside at all meetings of shareholders and at all meetings of the Board of Directors. Subject to any order and direction of the Chairman of the Board of Directors, he shall have general supervision of the affairs of the corporation and may, at his discretion, discharge any and all officers excepting directors and officers who are also directors, and appoint their successors who shall hold office until the next meeting of directors and shall have power to employ and to discharge all clerks, employees, and agents of the Company. He shall make reports to the directors and shareholders and perform all such other duties as are incidental to his office or properly required of him by the Board of Directors or the Chairman of the Board of Directors.

"SEC. 5. EXECUTIVE VICE PRESIDENT.-In the absence of the Chairman of the Board of Directors and of the President, the Executive Vice President shall preside at all meetings of the shareholders. Subject to the power of the Chairman of the Board of Directors and of the President, the Executive Vice President

shall have general supervision of the affairs of the corporation and may employ and discharge subordinate officers, employees, clerks, and agents. The Executive Vice President shall perform all such duties as are incidental to his office or properly required of him by the Board of Directors, the Chairman of the Board of Directors, and the President.

"SEC. 6. OTHER VICE PRESIDENTS.-In the absence of the Chairman of the Board of Directors and of the President and of the Executive Vice President, any other Vice President who is authorized by the Chairman of the Board of Directors or by the President may preside at all meetings of the shareholders. Each other Vice President shall assist the President and the Executive Vice President and each other Vice President shall perform all such duties as are incidental to his office or properly required of him by the Board of Directors, the Chairman of the Board of Directors, and the President.

"SEC. 7. SECRETARY.-The Secretary shall keep full and accurate minutes of the meetings of shareholders and of directors in the proper record book of the Company provided therefor. give due notice of all annual meetings of shareholders and regular meetings of directors and of all special meetings of shareholders and directors on proper call therefor being filed with him. He shill have custody of the seal of the corporation and shall perform all such duties as are incidental to his office or as may be assigned to him by the Board of Directors or by the Chairman of the Board of Directors and the President.

"SEC. 8. TREASURER.-The Treasurer shall perform all duties which are incidental to his office or which may be assigned to him by the Board of Directors, the Chairman of the Board of Directors, and the President.

"SEC. 9. ASSISTANT VICE PRESIDENTS. ASSISTANT SECRETARIES, ASSISTANT TREASUBERS, AND OTHER SUBORDINATE OFFICERS.-Each Assistant Vice President, Assistant Secretary, Assistant Treasurer, and other subordinate officers shall perform such duties as he may be directed to perform by the Board of Directors, the Chairman of the Board of Directors, the President, and such other officer or officers to whom he is directly subordinate.

"SEC. 10. VACANCIES.—A vacancy in any office, existing at the time of a meeting of the Board of Directors, may be filled by the Board of Directors by the election of a new officer who shall hold his office, subject to the provisions of this Article, until the next annual meeting of shareholders and until his successor is elected."

MINUTES

A comprehensive review was made of all stockholders', directors', and committee meetings and the proceedings as reported appeared to be properly recorded.

FIDELITY BOND

The company, together with the Excel Insurance Co., is indemnified, through an authorized insurer, for all loss of money or other property, real or personal, including property of others for which the insured is legally liable through any fraudulent or dishonest act or acts committed by any person named or occupying a position listed in the following schedule:

In accordance with the provision of section 92 of the Indiana insurance law, as amended, the position schedule bond referred to above is on deposit with the Indiana Department of Insurance.

10,000

10,000

10,000

10,000

10,000

100,000