-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, KyABKRryILd6dichXevWxDwLzYfUZ5+DuOJcc0EF8i8oh2ofdV7qnDvh+B4ikjDH jXYA0LBwC094skU566a4Fg== 0000007649-95-000011.txt : 19950627 0000007649-95-000011.hdr.sgml : 19950627 ACCESSION NUMBER: 0000007649-95-000011 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19941231 FILED AS OF DATE: 19950626 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ASARCO INC CENTRAL INDEX KEY: 0000007649 STANDARD INDUSTRIAL CLASSIFICATION: PRIMARY SMELTING & REFINING OF NONFERROUS METALS [3330] IRS NUMBER: 134924440 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-00164 FILM NUMBER: 95549071 BUSINESS ADDRESS: STREET 1: 180 MAIDEN LN CITY: NEW YORK STATE: NY ZIP: 10038 BUSINESS PHONE: 2125102000 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN SMELTING & REFINING CO DATE OF NAME CHANGE: 19760607 10-K/A 1 ASARCO Incorporated FORM 10-K/A December 31, 1994 INDEX Page Number FORM 10-K/A i ITEM 14 ii EXHIBIT INDEX D1-D3 FORM 11-K D30-D43
SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 1994 FORM 10-K/A ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1994 Commission file number 1-164 ASARCO Incorporated (Exact name of registrant as specified in its charter) New Jersey 13-4924440 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 180 Maiden Lane, New York, N. Y. 10038 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 510-2000 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: Name of each exchange on Title of each class which registered Common Stock, without par value New York Stock Exchange 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_____ 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] As of February 28, 1995, there were of record 42,170,882 shares of Common Stock, without par value, outstanding, and the aggregate market value of the shares of Common Stock (based upon the closing price of Asarco Common Stock on the New York Stock Exchange - Composite Transactions) of ASARCO Incorporated held by nonaffiliates was approximately $1.1 billion. PORTIONS OF THE FOLLOWING DOCUMENTS ARE INCORPORATED BY REFERENCE: Part III: Proxy statement in connection with the Annual Meeting to be held on April 26, 1995. Part IV: Exhibit index is on pages D1 through D3. ASARCO Incorporated and Subsidiaries FORM 10-K/A December 31, 1994 The undersigned registrant hereby amends the 1994 Annual Report on Form 10-K as set forth in the pages attached hereto to add the information, financial statements and exhibits required by Form 11-K filed with respect to the Savings Plan of ASARCO Incorporated and Participating Subsidiaries pursuant to Rule 15d-21. The following item has been refiled to reflect such amendments: Item 14. Exhibits, Financial Statements Schedules and Reports on Form 8-K. As the Exhibits are considered a "discrete filing item", the Exhibits and Exhibit Index as amended have been refiled. Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to be signed on its behalf by the undersigned thereunto duly authorized. ASARCO Incorporated By /s/ K. R. Morano K. R. Morano Vice President and Chief Financial Officer Date: June 22, 1995 i PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K ii ASARCO Incorporated EXHIBIT INDEX
Exhibit Indexed No. Description on Page 3. Certificate of Incorporation and By-Laws (a) Certificate of Incorporation - restated, filed May 4, 1970 (Filed as an Exhibit to the Company's 1980 Annual Report on Form 10-K and incorporated herein by reference) (b) Certificate of Amendment to the Certificate of Incorporation effective April 23, 1975 (Filed as an Exhibit to the Company's 1980 Annual Report on Form 10-K and incorporated herein by reference) (c) Certificate of Amendment of Certificate of Incorporation executed April 14, 1981 (Filed as an Exhibit to the Post-Effective Amendment No. 8 to Registration Statement No. 2-47616, filed April 30, 1981 and incorporated herein by reference) (d) Certificate of Amendment of Restated Certificate of Incorporation filed on May 6, 1985 (Filed as an Exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1985 and incorporated herein by reference) (e) Certificate of Amendment of Certificate of Incorporation filed July 21, 1986 (Filed as an Exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1986 and incorporated herein by reference) (f) Certificate of Amendment of Restated Certificate of Incorporation, as amended filed April 22, 1987 (Filed as an Exhibit to the Company's 1987 Annual Report on Form 10-K and incorporated herein by reference) (g) Statement of Cancellation filed July 31, 1987 whereby 155,000 shares of Series A Cumulative Preferred Stock and 862,500 shares of $9.00 Convertible Exchangeable Preferred Stock were cancelled (Filed as an Exhibit to the Company's 1987 Annual Report on Form 10-K and incorporated herein by reference) (h) Statement of Cancellation filed November 20, 1987 whereby 1,026,900 shares of Series A Cumulative Preferred Stock were cancelled (Filed as an Exhibit to the Company's 1987 Annual Report on Form 10-K and incorporated herein by reference) (i) Statement of Cancellation filed December 18, 1987 whereby 1,250,000 shares of Series B Cumulative Convertible Preferred Stock were cancelled (Filed as an Exhibit to the Company's 1987 Annual Report on Form 10-K and incorporated herein by reference)
D1 ASARCO Incorporated EXHIBIT INDEX
Exhibit Indexed No. Description on Page (j) Statement of Cancellation filed March 3, 1988 whereby 27,000 shares of Series A Cumulative Preferred Stock were cancelled (Filed as an Exhibit to the Company's 1987 Annual Report on Form 10-K and incorporated herein by reference) (k) Certificate of Amendment of Restated Certificate of Incorporation, as amended, filed August 7, 1989 (Filed as an Exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1989 and incorporated herein by reference) (l) By-Laws as last amended on June 26, 1991 (Filed as an Exhibit to the Company's 1991 Annual Report on Form 10-K and incorporated herein by reference.) 4. Instruments defining the rights of security holders, including indentures (a) There are currently various separate indentures, agreements or similar instruments under which long-term debt of Asarco is currently outstanding. The Registrant hereby agrees to furnish to the Commission, upon request, a copy of any of the instruments which define the rights of holders of long-term debt securities. None of the outstanding instruments represent long-term debt securities in excess of 10% of the total assets of Asarco as of December 31, 1994 (b) Form of Rights Agreement dated as of July 26, 1989, between the Company and First Chicago Trust Company of New York, as Rights Agent, defining the rights of shareholders under a July 1989 Shareholders' Rights plan and dividend declaration (Filed as an Exhibit to the Company's report on Form 8-K filed on July 28, 1989 and incorporated herein by reference) (c) Rights Agreement Amendment dated as of September 24, 1992, between the Company and The Bank of New York, as Successor Rights Agent under the Rights Agreement listed above (Filed as an Exhibit to the Company's 1992 Annual Report on Form 10-K and incorporated herein by reference) (d) Second Rights Agreement Amendment dated as of February 23, 1995 between the Company and The Bank of New York (Filed as an Exhibit to the Company's report on Form 8-K filed on February 24, 1995 and incorporated herein by reference)
D2 ASARCO Incorporated EXHIBIT INDEX
Exhibit Indexed No. Description on Page (e) Indenture Agreement dated as of February 1, 1993 between the Company and Bankers Trust Company, as Trustee, covering the issuance of debt securities registered by the Company in April 1992, not to exceed $250 million (Filed as an Exhibit to the Company's 1992 Annual Report on form 10-K and incorporated herein by reference) 10. (a) Stock Option Plan as last amended on November 30, 1994 D9-D12 (b) Form of Employment Agreement entered into in 1985, as amended in March and April 1989, among the Company and currently 11 of its executive officers, including Messrs. R. de J. Osborne, F.R. McAllister, K.R. Morano, R.M. Novotny and R.J. Muth (Filed as an Exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1989 and incorporated herein by reference) (c) Deferred Fee Plan for Directors, as amended through January 26, 1994 (Filed as an Exhibit to the Company's 1993 Annual Report on Form 10-K and incorporated herein by reference) (d) Supplemental Pension Plan for Designated Mid-Career Officers, as amended through January 25, 1995 D13-D17 (e) Retirement Plan for Non-Employee Directors, as amended through January 25, 1995 D18-D22 (f) Directors' Stock Award Plan, as amended through January 27, 1993 (Filed as an Exhibit to the Company's 1992 Annual Report on Form 10-K and incorporated herein by reference) (g) Stock Incentive Plan adopted by the Company's Shareholders on April 25, 1990, as last amended on November 30, 1994 D23-D29 11. Statement re Computation of Earnings Per Share D4 21. Subsidiaries of the Registrant D5-D8 23. Report of Independent Accountants on Financial Statement Schedules and Consent of Independent Accountants are included on page A63 of this Annual Report on Form 10-K. 99. Report on Form 11-K relating to the Savings Plan for Salaried Employees of ASARCO Incorporated and Participating Subsidiaries. D30-D43
Copies of exhibits may be acquired upon written request to the Treasurer and the payment of processing and mailing costs. D3 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- FORM 11-K ---------------- ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ----------------- Commission File No. 1-164 ----------------- For the fiscal year ended December 31, 1994 Savings Plan of ASARCO Incorporated and Participating Subsidiaries ASARCO Incorporated 180 Maiden Lane New York, New York 10038 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Financial Statements and Schedules December 31, 1994 and 1993 Savings Plan of ASARCO Incorporated and Participating Subsidiaries INDEX
Page Number Report of Independent Accountants D31 Statement of Net Assets Available for Benefits, with Fund Information at December 31, 1994 D32 Statement of Net Assets Available for Benefits, with Fund Information at December 31, 1993 D33 Statement of Changes in Net Assets Available for Benefits, with Fund Information for the year ended December 31, 1994 D34 Notes to Financial Statements D35-D40 Supplemental Schedules: Form 5500 Item 27a-Schedule of Assets Held for Investment Purposes at December 31, 1994 D41 Form 5500 Item 27d-Schedule of Reportable Transactions for the year ended December 31, 1994 D42 Consent of Independent Accountants D43
D30 REPORT OF INDEPENDENT ACCOUNTANTS --------------------------------- To the Savings Plan Committee of ASARCO Incorporated and Participating Subsidiaries: We have audited the accompanying statements of net assets available for benefits of the Savings Plan of ASARCO Incorporated and Participating Subsidiaries (the "Plan") as of December 31, 1994 and 1993, and the related statement of changes in net assets available for benefits for the year ended December 31, 1994. These financial statements are the responsibility of the Plan administrator. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1994 and 1993 and the changes in net assets available for benefits for the year ended December 31, 1994 in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules, as listed in the index on page D30, are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The Fund Information in the accompanying statements of net assets available for benefits and the statement of changes in net assets available for benefits is presented for purposes of additional analysis rather than to present the statements of net assets available for benefits and changes in net assets available for benefits of each fund. The supplemental schedules and Fund Information have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. COOPERS & LYBRAND L.L.P. New York, New York June 1, 1995 D31 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Statement of Net Assets Available for Benefits, with Fund Information at December 31, 1994 (dollars in thousands)
Vanguard Index Asarco Short Vanguard Vanguard Vanguard Fixed Trust Common VMMR Term U.S. Vanguard Extended U.S. Windsor Income 500 Stock Prime Treasury Wellington Market Growth II Loan ASSETS: Fund Portfolio Fund Portfolio Portfolio Fund Fund Fund Fund Fund Total ----- ------ ---- ------- ------- ----- ----- ----- ----- ----- ----- Investments, at fair value (Notes 3 and 4): ASARCO Common Stock Fund 1,965,216 units (cost: $18,612) $20,930 $20,930 Vanguard: Money Market Reserves Prime Portfolio (cost approximates market) $1,849 $16,907 18,756 Index Trust - 500 Portfolio 392,126 units (cost: $16,006) $16,850 16,850 Fixed Income Securities Fund - Short Term U.S. Treasury Portfolio 855,135 units (cost: $8,734) $8,372 8,372 Vanguard Wellington Fund 291,936 units (cost: $5,870) $5,660 5,660 Index Extended Market Fund - 68,269 units (cost: $1,292) $1,264 1,264 U.S. Growth Fund 84,911 units (cost: $1,278) $1,302 1,302 Windsor II Fund 249,901 units (cost: $4,209) $3,953 3,953 Loans to Participants (Note 6) $3,750 3,750 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Total Investments 1,849 16,850 20,930 16,907 8,372 5,660 1,264 1,302 3,953 3,750 80,837 Contributions Receivable: Participant 139 21 84 65 81 28 20 65 503 Company 182 182 Interest 19 19 Receivable Loans Receivable 36 6 22 16 30 6 4 16 (136) ------ ------- ------- ------- ------ ------ ------ ------ ------ ----- ------ TOTAL ASSETS 1,849 17,025 21,139 17,013 8,453 5,771 1,298 1,326 4,034 3,633 81,541 ------ ------- ------- ------- ------ ------ ------ ------ ------ ------ ------ NET ASSETS AVAILABLE FOR $1,849 $17,025 $21,139 $17,013 $8,453 $5,771 $1,298 $1,326 $4,034 $3,633 $81,541 PLAN BENEFITS ====== ======= ======= ======= ====== ====== ====== ====== ====== ====== =======
See notes to financial statements. D32 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Statement of Net Assets Available for Benefits, with Fund Information at December 31, 1993 (dollars in thousands)
Vanguard Short Index Asarco Term Vanguard Vanguard Vanguard Fixed Trust Common VMMR U.S. Vanguard Extended U.S. Windsor Income 500 Stock Prime Treasury Wellington Market Growth II Loan ASSETS: Fund Portfolio Fund Portfolio Portfolio Fund Fund Fund Fund Fund Total ----- ------ ---- ------- ------- ----- ----- ----- ----- ----- ----- Investments, at fair value (Notes 3 and 4): ASARCO Common Stock Fund 1,930,424 units (cost: $17,873) $16,525 $16,525 Vanguard: Money Market Reserves Prime Portfolio (cost approximates market) $ 2,373 $12,213 14,586 Index Trust - 500 Portfolio 381,714 units (cost: $15,320) $16,731 16,731 Fixed Income Securities Fund - Short - Term U.S. Treasury Portfolio 780,443 units (cost: $8,034) $8,101 8,101 Vanguard Wellington Fund 180,033 units (cost: $3,614) $3,673 3,673 Index Extended Market Fund - 37,276 units (cost: $691) $724 724 U.S. Growth Fund 47,733 units (cost: $712) $713 713 Windsor II Fund 146,987 units (cost: $2,479) $2,505 2,505 Wachovia Bank of North Carolina: Guaranteed Investment Contracts (at cost plus interest) 9,710 9,710 Loans to Participants (Note 6) $3,606 3,606 ------ ------ ------ ------ ------ ------ ----- ---- ----- ------ ------- Total Investments 12,083 16,731 16,525 12,213 8,101 3,673 724 713 2,505 3,606 76,874 Contributions Receivable: Participant 150 20 91 71 73 22 17 59 503 Company 182 182 Interest 18 18 Receivable Loans Receivable 40 6 22 15 22 5 4 21 (135) ------- ------- ------- ------- ------ ------ ---- ---- ------ ------ ------ TOTAL 12,083 16,921 16,733 12,326 8,187 3,768 751 734 2,585 3,489 77,577 ------- ------- ------- ------- ------ ------ ---- ---- ------ ------ ------- ASSETS NET ASSETS AVAILABLE FOR PLAN BENEFITS $12,083 $16,921 $16,733 $12,326 $8,187 $3,768 $751 $734 $2,585 $3,489 $77,577 ======= ======= ======= ======= ====== ====== ==== ==== ====== ====== =======
See notes to financial statements. D33 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Statement of Changes in Net Assets Available for Benefits, with Fund Information at December 31, 1994 (dollars in thousands)
Vanguard Short Index Asarco Term Vanguard Vanguard Vanguard Fixed Trust Common VMMR U.S. Vanguard Extended U.S. Windsor Income 500 Stock Prime Treasury Wellington Market Growth II Loan ADDITIONS: Fund Portfolio Fund Portfolio Portfolio Fund Fund Fund Fund Fund Total ----- ------ ---- ------- ------- ----- ----- ----- ----- ----- ----- Investment Income (Note 3) Dividends $ 528 $ 285 $ 624 $ 442 $ 245 $ 35 $ 15 $ 237 $ 2,411 Interest $ 301 $ 215 516 ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------- Total 301 528 285 624 442 245 35 15 237 215 2,927 Net Appreciation (Depreciation) in the Fair Value of Investments (Note 3) (339) 4,072 (481) (281) (57) 26 (281) 2,659 Contributions (Notes 3, 4 & 5) Participants 1,771 217 951 789 975 326 232 805 6,066 Company 2,177 2,177 Loan Repayments (Note 6) 532 88 288 211 289 84 72 221 (1,785) Transfer from other plan 6 55 55 105 44 43 23 13 41 7 392 Interfund transfers (9,571) 90 (93) 5,862 713 1,431 250 332 986 ------ ------- ----- ------ ------ ------ ------ ------ ------ ------ ------ TOTAL ADDITIONS (9,264) 2,637 6,801 7,830 1,718 2,702 661 690 2,009 (1,563) 14,221 DEDUCTIONS Withdrawals 858 2,033 2,258 2,624 1,228 530 61 73 417 163 10,245 Loans (Note 6) 112 500 138 516 223 169 44 25 143 (1,870) Other (1) 3 1 9 12 ------ ------ ----- ----- ------ ---- ------ --- ---- ------ ------ TOTAL DEDUCTIONS 970 2,533 2,395 3,143 1,452 699 114 98 560 (1,707) 10,257 Net Increase (Decrease) (10,234) 104 4,406 4,687 266 2,003 547 592 1,449 144 3,964 NET ASSETS AVAILABLE FOR PLAN BENEFITS, BEGINNING OF YEAR 12,083 16,921 16,733 12,326 8,187 3,768 751 734 2,585 3,489 77,577 ------ ------- ------ ------ ------ ------ ------ ------ ------ ------ ------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, END OF YEAR $1,849 $17,025 $21,139 $17,013 $8,453 $5,771 $1,298 $1,326 $4,034 $3,633 $81,541 ====== ======= ======= ======= ====== ====== ====== ====== ====== ====== =======
See notes to financial statements. D34 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements 1. Plan Description Effective January 1, 1980 ASARCO Incorporated (the "Company") established the Savings Plan of ASARCO Incorporated and Participating Subsidiaries (the "Plan"), which has been amended thereafter. Contributions were commenced in July 1980. The Plan is a defined contribution plan and is administered by the Savings Plan Committee in accordance with authority delegated by the Fiduciary Committee. The Plan is designed to provide a method of savings by eligible employees for their retirement and other needs, and to enable them to acquire a stock interest in the Company. In 1994, participants were able to invest in one or a combination of eight funds: the Vanguard Index Trust-500 Portfolio; the Asarco Common Stock Fund; the Vanguard Money Market Reserves-Prime Portfolio; the Fixed Income Securities Fund-Short term U.S. Treasury Portfolio; the Vanguard Wellington Fund; the Vanguard Windsor II; the Vanguard U.S. Growth Portfolio; and the Vanguard Index Trust-Extended Market Portfolio. Reference should be made to the Plan document for a complete description of the Plan including eligibility requirements and vesting provisions. 2. Significant Plan Amendments On July 27, 1994 the Plan was amended effective July 1, 1994, to change the eligibility waiting period from one year to six months of employment; to accept rollovers from another employer's qualified savings plan; and to charge the cost of the loan administration fees to plan participants. In addition, on June 1, 1994, the Enthone-OMI, Inc. Retirement Savings Plan was merged into the Company's Plan. On November 23, 1993, the Plan was amended effective January 1, 1994 to comply with the Department of Labor regulations issued under Section 404(c) of ERISA and the Omnibus Budget Reconciliation Act of 1993, which limited annual covered compensation to $150,000. On April 28, 1993, the Plan was amended effective January 1, 1993 to permit direct rollover to another qualified plan or IRA and to impose a mandatory 20% withholding on the taxable portion of an in-service withdrawal or distribution not utilizing direct rollover. 3. Summary of Significant Accounting Policies Investments Valuation: Investments in equity securities listed on an exchange are valued at the latest quoted sales price on the valuation date. Securities not traded or unlisted are valued at the mean of the latest quoted bid and asked prices. Bond investments are valued utilizing the latest bid prices. Short-term investments are stated at amortized cost which approximates market. Investments in the Fixed Income Fund are valued by the investment manager at cost plus reinvested interest. Fixed income contracts may be valued below cost plus interest in the event that an issuer defaults under a contract or if a penalty is assessed for early termination of a performing contract. D35 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements - Continued Investment Transactions and Investment Income: Transactions are accounted for on a trade date basis. Average cost is the basis used in the determination of gains or losses on sales of securities. Dividend income is recorded at the ex-dividend date. Income from other investments is recorded as earned. The Plan presents, in the statement of changes in net assets, the net change in the fair value of its investments which consists of realized and unrealized gains or losses on those investments. Realized and unrealized gains and losses disclosed in the Plan's Form 5500 are calculated using revalued cost. Contributions: The Company's matching contributions are measured by reference to the participant's contributions and are not discretionary. Loans to Participants: Loans to participants are presented in the Statement of Net Assets Available for Plan Benefits as Plan assets. Other: The Plan uses the accrual method for recognizing contributions, withdrawals and investment income. 4. Investment Funds Vanguard Fiduciary Trust Company ("Vanguard") is the investment manager and participant recordkeeper for all investment funds of the Plan. Vanguard is also the trustee of all the funds with the exception of certain investment contracts held in the Fixed Income Fund, for which Wachovia Bank of North Carolina, N.A. is trustee. Upon enrollment in the Plan participants may direct their elected contributions to be invested in one or more of the following funds in multiples of 5%: o Fixed Income Fund - A fund which consists of fixed income contracts and money market investments. At times, this fund will maintain a significant portion of its assets in money market investments to provide liquidity for transactions. After January 1, 1993, exchanges and employee elected contributions were no longer invested in this fund and it was phased out shortly after December 31, 1994. o Vanguard Index Trust-500 Portfolio - A fund invested in all of the stocks included in the Standard & Poor's 500 Composite Index in approximately the same proportions as they are represented in the index. o Vanguard Money Market Reserves-Prime Portfolio - A fund invested in a portfolio of high quality money market instruments with maturities of one year or less. D36 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements - Continued o Vanguard Fixed Income Securities Fund-Short Term U.S. Treasury Portfolio - A fund invested primarily in short-term U.S. Treasury securities with an average maturity of two to three years. o Vanguard Wellington Fund - A fund invested in bonds and common stocks. the bonds are held for relative stability of income and principal, while the common stocks are held for potential growth of capital and income. o Vanguard Index Trust - Extended Market Portfolio - A fund which provides investment results that correspond to the aggregate price and yield performance of the Wilshire 4500 Index. the Wilshire 4500 Index consists of over 4,500 U.S. common stocks (primarily medium and small capitalization stocks) that are not included in the standard & Poor's 500 Composite Stock Price Index. o Vanguard U.S. Growth Portfolio - a fund invested primarily in a diversified portfolio of common stocks with above-average growth potential. o Vanguard Windsor II - A fund invested in common stocks to provide capital appreciation and dividend income. o Asarco Common Stock Fund - A fund that invests exclusively in ASARCO Incorporated common stock with a small amount invested in the Vanguard Money Market Reserves-Prime Portfolio to allow for timely responsiveness to Plan transactions. The Plan also maintains the following fund: o Loan Fund - A fund designed to facilitate the recordkeeping and other administrative functions relating to loans made to participants based on their account balances (See Note 6). These loans are receivables of the Plan. There is some degree of risk with any investment, which is generally related to fluctuation in market value or, with respect to the Vanguard Money Market Reserves-Prime Portfolio and Fixed Income Funds, deterioration in credit quality. Participants are advised to read a Vanguard prospectus or the Plan's summary plan description before investing in any fund. Vanguard as recordkeeper maintains individual account records reflecting each participant's net interest in each fund of the Plan in which such participant invests. Participant's net interests in each fund of the Plan are represented by units of participation. The following schedule shows the number of units and the net asset value per unit or per share in each fund as of December 31, 1994 and December 31, 1993: D37 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements - Continued
1994 1993 ---- ---- Net Asset Net Asset Number of Value Number of Value Units Per Unit Units Per Unit Fixed Income Fund 1,849,115 $ 1.00 Fixed Income Fund 12,082,786* $ 1.00 Asarco Common Stock Fund 1,965,216* $10.65 Asarco Common Stock Fund 1,930,424* $ 8.56 Vanguard Index Trust - 500 Vanguard Index Trust - 500 Portfolio 392,126* $42.97 Portfolio 381,714* $43.83 Vanguard Money Market Reserves Vanguard Money Market Reserves - Prime Portfolio - Prime Portfolio 16,907,259* $ 1.00 12,213,498* $ 1.00 Vanguard Fixed Income Vanguard Fixed Income Securities Fund - Short Securities Fund - Short Term U.S. Treasury Portfolio Term U.S. Treasury Portfolio 855,135* $ 9.79 780,443* $10.38 Vanguard Wellington Fund 291,936* $19.39 Vanguard Wellington Fund 180,033 $20.40 Vanguard Windsor II Fund 249,901 $15.82 Vanguard Windsor II Fund 146,987 $17.04 Vanguard U.S. Growth Fund 84,911 $15.33 Vanguard U.S. Growth Fund 47,733 $14.93 Vanguard Index Extended Vanguard Index Extended Market 37,276 $19.43 Market 68,269 $18.52
*Represents 5% or more of net assets available for plan benefits. 5. Contributions Each eligible employee wishing to participate in the Plan must elect to authorize pre-tax contributions by payroll deduction. Contributions are stated in whole percentages of 1% to 12% of the participant's basic earnings, as defined. A participant may elect to decrease or suspend the pre-tax contributions once each Plan Year. A participant may not otherwise alter the amount of the elected pre-tax contributions until the beginning of the next Plan Year. The Internal Revenue Code of 1986, as amended, (the "Code") limited the maximum amount an employee may contribute on a pre-tax basis to $9,240 and $8,994 in 1994 and 1993, respectively. Matching Company Contribution - The Company matches the first 6% of a participant's monthly contribution at the rate of 50%. The matching contribution may be made in either cash or ASARCO Common Stock and in the case of cash, the Trustee is required to purchase ASARCO Common Stock. Contributions for the year ended December 31, 1994 consisted of the following: Cash $ 160 Asarco Common Stock 2,176,840 ------------ $2,177,000 ============ D38 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements - Continued The Company is not obligated to make a contribution during any period in which it has no accumulated retained earnings. The Company's contributions are subject to all legal restrictions which may apply, including Sections 401 and 415 of the Code, which limit the annual contributions to an employee's account. Participants are 100% vested upon participation. 6. Loans The Plan provides for loans to participants who have participated in the Plan for at least one year, subject to certain limitations. The maximum loan allowed to each participant is limited to the lessor of 50% of the total value of the participant's accounts, or $50,000 reduced by the highest outstanding balance of any other Plan loan to such participant during the prior twelve-month period. A participant's loan is repayable within no more than five years or immediately upon termination of employment. Interest is currently accrued at the prime rate. Loans are secured by a lien on the participant's interest in the Plan. Loan repayments are made through payroll withholding from the participant's earnings. A participant may pre-pay a loan at any time without penalty. 7. Tax Status The Plan, as amended through July 1, 1994, has received a favorable determination from the Internal Revenue Service ("IRS") that it is a qualified plan and trust under Section 401(a) of the Code and, thus, exempt from federal income taxes under provisions of Section 501(a) of the Code. 8. Plan Expenses The Company pays all administrative expenses of the Plan including trust, recordkeeping, consulting, audit and legal fees, with the exception of loan administration fees which are charged to participants. In addition, the Company pays for investment fees related to the Fixed Income contracts held by the Wachovia Bank of North Carolina. All investment fees related to Vanguard Mutual Funds are paid from the net assets of such funds. All taxes (excluding transfer taxes on shares of Asarco Common Stock distributed to participants or their beneficiaries), brokerage commissions and expenses directly related to the investment of the Plan assets are paid from the assets of the relevant fund of the Plan. D39 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Notes to Financial Statements - Continued 9. Termination Priorities The Company reserves the right to amend or discontinue the Plan by action of the Board at any time. In the event of termination or partial termination of the Plan or a complete discontinuance of matching Company contributions under the Plan, each affected participant shall be 100% vested in their share of the Plan net assets. 10. Executive Life Contract All contributions and transfers to the Fixed Income Fund made from January to December 1988 were invested in a fixed income contract providing a 9.5% rate of interest maturing December 31, 1992 with Executive Life Insurance Company (ELIC Contract and ELIC, respectively) the California subsidiary of First Executive Corporation. On April 11, 1991, the California State Insurance regulators placed ELIC in conservatorship, freezing its assets and providing time to evaluate alternatives such as selling the company or rehabilitating it. During 1991, the Company made arrangements to protect participant's interest in this contract through its commitment to pay the full contract value as of December 31, 1991 plus interest based on the blended rate of all contracts held in the fixed income fund after December 31, 1991. Such rate is adjusted quarterly. The Company also obtained a five-year irrevocable letter of credit from Barclays Bank PLC, to further back this commitment. The Company received a Department of Labor exemption to proceed with this transaction and to obtain an assignment of the contract up to the amount advanced on behalf of ELIC plus the blended rate of interest. The Department of Labor exemption was effective as of December 2, 1991 and at that time the trustee and investment management responsibilities were transferred from State Street Bank and Trust Company to Wachovia Bank of North Carolina, N.A. (ELIC Contract Trustee). On September 3, 1993 the California Superior Court approved a rehabilitation plan for ELIC's successor, Aurora Life Assurance Company, in which plan sponsors were given the choice to participate in the rehabilitation plan. As a result of this rehabilitation plan the Fixed Income Fund received a payment from ELIC in the amount of $577,393 on such date. At December 31, 1993 the value of the ELIC Contract in the Plan was $1,950,314. During February 1994, the Company and the ELIC Contract Trustee elected not to participate in the rehabilitation plan. As a result, on April 4, 1994, ELIC paid $1,522,386 in cash to the ELIC Contract Trustee, who forwarded such amount to the Fixed Income Fund of the Plan. Between January 1994 and April 6, 1994, the Company paid the Plan an amount equivalent to the remaining contract value. This eliminated the ELIC Contract Obligation in the Fixed Income Fund as agreed under the assignment entered into between the Company and the Plan pursuant to the exemption dated December 2, 1991. Any future recoveries will be paid to the ELIC Contract Trustee and forwarded to the Company as reimbursement for payments to the Plan since December 2, 1991 or, in the case of any excess amounts, to the Plan participants. D40 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Form 5500 Item 27a Schedule of Assets Held for Investment Purposes at December 31, 1994
Cost or Market Rate of Book Value Value Interest Maturity Date Fixed Income Fund Vanguard Fiduciary Trust Company: Vanguard Money Market Reserves - Prime Portfolio Fund $ 1,013,042 $ 1,013,042 Wachovia Bank of North Carolina, N.A.: 1990 Contract - Principal Mutual 836,076 836,076 8.9% 01/03/95 --------- ------------ Total Fixed Income Fund 1,849,118 1,849,118 Vanguard Fiduciary Trust Company: Vanguard Index Trust - 500 Portfolio 16,006,428 16,849,665* Asarco Common Stock Fund 18,612,474 20,929,551* Vanguard Fixed Income Securities Fund - Short Term U.S. Treasury Portfolio 8,734,281 8,371,771* Vanguard Money Market Reserves - Prime Portfolio 16,907,259 16,907,259* Vanguard Wellington Fund 5,869,957 5,660,635* Vanguard Index Extended Market Fund 1,291,702 1,264,334 Vanguard U. S. Growth Fund 1,277,573 1,301,689 Vanguard Windsor II Fund 4,209,498 3,953,428 Loan Fund Participants' Loans - 3,749,709 6.0%-10.5% ---------- ---------- TOTAL INVESTMENTS $74,758,290 $80,837,159 =========== ===========
* Represents 5% or more of net assets available for plan benefits. D41 Savings Plan of ASARCO Incorporated and Participating Subsidiaries Form 5500 Item 27d Schedule of Reportable Transactions for the year ended December 31, 1994
Number of Number of Purchase Selling Basis of Net Gain Description of Asset Purchases Sales Price Price Asset or (Loss) -------------------- --------- ----- ----- ----- ----- --------- Common Stock of ASARCO Incorporated 106 167 $4,141,324 $3,807,958 $3,265,502 $542,456 Vanguard Index Trust 500 Portfolio 93 161 $4,229,040 $3,771,398 $3,796,666 $(25,268) Vanguard Money Market Reserves-Prime Portfolio 177 174 $9,900,869 $5,207,108 $5,207,108 $ - Vanguard Fixed Income Securities Fund-Short Term U.S. Treasury Portfolio 135 151 $3,660,204 $2,908,260 $2,971,776 $(63,516) Vanguard Wellington Fund 98 122 $3,596,769 $1,327,589 $1,349,723 $(22,134)
D42 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the Prospectuses constituting part of the Registration Statements of ASARCO Incorporated on Form S-3 (File Nos. 33-45631 and 33-55993) and on Form S-8 (File Nos. 2-67732, 2-83782 and 33-34606) of our report dated June 1, 1995 on our audits of the Statements of Net Assets Available for Benefits of the Savings Plan of ASARCO Incorporated and Participating Subsidiaries as of December 31, 1994 and 1993, the Supplemental Schedules as of December 31, 1994 and for the year then ended and the Statement of Changes in Net Assets Available for Benefits for the year ended December 31, 1994, which report is included in this Annual Report on Form 11-K. We also consent to the incorporation by reference of such report in the 1994 Annual Report on Form 10-K of ASARCO Incorporated. COOPERS & LYBRAND L.L.P. New York, New York June 1, 1995 D43 -----END PRIVACY-ENHANCED MESSAGE-----