-----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, QLRAzzohT8TVWPJgLpTqNnXXIjN6zzAmlXFB3vCprFV/W3OhqHNRlC2hx8OglOJm fe4+FCWgIrcxXLs/8UkVqQ== 0000101829-97-000031.txt : 19970630 0000101829-97-000031.hdr.sgml : 19970630 ACCESSION NUMBER: 0000101829-97-000031 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970627 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED TECHNOLOGIES CORP /DE/ CENTRAL INDEX KEY: 0000101829 STANDARD INDUSTRIAL CLASSIFICATION: AIRCRAFT ENGINES & ENGINE PARTS [3724] IRS NUMBER: 060570975 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-00812 FILM NUMBER: 97630939 BUSINESS ADDRESS: STREET 1: UNITED TECHNOLOGIES BLDG STREET 2: ONE FINANCIAL PLZ CITY: HARTFORD STATE: CT ZIP: 06101 BUSINESS PHONE: 2037287000 FORMER COMPANY: FORMER CONFORMED NAME: UNITED TECHNOLOGIES MICROELECTRONICS CENTER DATE OF NAME CHANGE: 19850825 FORMER COMPANY: FORMER CONFORMED NAME: UNITED TECHNOLOGIES CORP DATE OF NAME CHANGE: 19841205 11-K 1 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Plan period ended December 31, 1996 Commission File Number 1-812 UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN (Full title of the plan) UNITED TECHNOLOGIES CORPORATION One Financial Plaza Hartford, Connecticut 06101 (Name of issuer of the securities held pursuant to the plan and the address of its principal executive office) FINANCIAL STATEMENTS OF THE UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN REPORT OF INDEPENDENT ACCOUNTANTS To the Participants and Administrator of the United Technologies Corporation Defined Contribution Retirement Plan In our opinion, the accompanying statements of net assets available for benefits with fund information and the related statement of changes in net assets available for benefits with fund information present fairly, in all material respects, the net assets available for benefits of the United Technologies Corporation Defined Contribution Retirement Plan at December 31, 1996 and 1995 and the changes in net assets available for benefits for the period ended December 31, 1996, in conformity with generally accepted accounting principles. 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 of these statements in accordance with generally accepted auditing standards which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above. PRICE WATERHOUSE LLP Hartford, Connecticut June 26, 1997 UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN Statement of Net Assets Available for Benefits With Fund Information December 31, 1996
UTC Funds Income Equity Stock Global Combined Fund Fund Fund Fund Assets: Investments: Beneficial interests in contracts issued by insurance companies, at cost plus accrued interest $5,006,173 $ - $ - $ - $5,006,173 Beneficial interests in Bankers Trust Company Pyramid Equity Index Fund, at market - 1,886,841 - 697 1,887,538 Beneficial interests in Bankers Trust Company Pyramid Fixed Income Index Fund, at market - - - 598 598 Beneficial interests in Bankers Trust Company Pyramid International Securities Index Fund, at market - - - 972 972 United Technologies Corporation Common Stock, at market - - 111,182 - 111,182 Temporary investments, at cost plus accrued interest 210 - 11 - 221 Total Investments 5,006,383 1,886,841 111,193 2,267 7,006,684 Contributions and fund transfers receivable 1,402 - 2,109 - 3,511 Total Assets 5,007,785 1,886,841 113,302 2,267 7,010,195 Liabilities: Contributions and fund transfers payable 16,559 32,564 3,315 61 52,499 Total Liabilities 16,559 32,564 3,315 61 52,499 Net Assets Available for Benefits $4,991,226 $1,854,277 $ 109,987 $ 2,206 $6,957,696 Units of participation 874,078 117,700 10,153 1,067 Unit value $ 5.71 $ 15.75 $ 10.83 $ 2.07
The accompanying notes are an integral part of these financial statements. UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN Statement of Net Assets Available for Benefits With Fund Information December 31, 1995
UTC Funds Income Equity Stock Global Combined Fund Fund Fund Fund Assets: Investments: Beneficial interests in contracts issued by insurance companies, at cost plus accrued interest $4,899,519 $ - $ - $ - $4,899,519 Beneficial interests in Bankers Trust Company Pyramid Equity Index Fund, at market - 1,368,711 - 586 1,369,297 Beneficial interests in Bankers Trust Company Pyramid Fixed Income Index Fund, at market - - - 465 465 Beneficial interests in Bankers Trust Company Pyramid International Securities Index Fund, at market - - - 540 540 United Technologies Corporation Common Stock, at market - - 1,186 - 1,186 Temporary investments, at cost plus accrued interest 209 22 - - 231 Total Investments 4,899,728 1,368,733 1,186 1,591 6,271,238 Contributions and fund transfers receivable 446,715 85,970 - - 532,685 Total Assets 5,346,443 1,454,703 1,186 1,591 6,803,923 Liabilities: Contributions payable 625 14,613 102 52 15,392 Accrued investment purchases - - - 20 20 Total Liabilities 625 14,613 102 72 15,412 Net Assets Available for Benefits $5,345,818 $1,440,090 $ 1,084 $ 1,519 $6,788,511 Units of participation 1,006,968 112,602 142 817 Unit value $ 5.31 $ 12.79 $ 7.62 $ 1.86
The accompanying notes are an integral part of these financial statements. UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN Statement of Changes in Net Assets Available for Benefits With Fund Information Period Ended December 31, 1996
UTC Funds Income Equity Stock Global Combined Fund Fund Fund Fund Additions to net assets attributed to: Investment Income: Net appreciation in fair value of investments $ - $ 333,092 $ 3,156 $ 200 $ 336,448 Interest 359,766 19 14 - 359,799 Dividends - - 278 - 278 Total Investment Income 359,766 333,111 3,448 200 696,525 Contributions: Participants' 151,238 63,538 4,940 207 219,923 Employer's 296,058 82,166 3,306 280 381,810 Total Contributions 447,296 145,704 8,246 487 601,733 Deductions from net assets attributed to: Cash distributions to participants 967,023 166,747 - - 1,133,770 Total Deductions 967,023 166,747 - - 1,133,770 Inter-fund and inter-plan transfers (194,631) 102,119 97,209 - 4,697 Net (Decrease)/Increase (354,592) 414,187 108,903 687 169,185 Net Assets Available for Benefits December 31, 1995 5,345,818 1,440,090 1,084 1,519 6,788,511 Net Assets Available for Benefits December 31, 1996 $4,991,226 $1,854,277 $ 109,987 $ 2,206 $6,957,696
The accompanying notes are an integral part of these financial statements. UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN Notes to Financial Statements NOTE 1 - DESCRIPTION OF THE PLAN General. The United Technologies Corporation (UTC) Defined Contribution Retirement Plan (the Plan) is a defined contribution savings and money purchase plan administered by UTC. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). Eligible employees of UTC and certain of its subsidiaries may participate after completing one year of service. The following is a brief description of the Plan. For more complete information, participants should refer to the plan document which is available from UTC. Contributions and Vesting. The employer makes contributions for each participant up to 3.5 percent of the participant's compensation. In addition, certain participants may elect to contribute, through payroll deductions, between 1 and 12 percent of their total compensation with up to the first 4 percent of each participant's contribution being matched 50 percent by the employer. Participant contributions, plus actual earnings thereon, are fully vested at all times under the Plan. Generally, employer contributions, plus actual earnings thereon, become fully vested after two years of Plan participation. Participant Accounts. Each participant's account is credited with the participant's contributions and allocations of (a) UTC's contributions and (b) Plan earnings. 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. Forfeited balances of terminated participants' nonvested amounts are used to reduce future UTC contributions. For the period ended December 31, 1996, approximately $ 90,600 of forfeitures were used to fund UTC's contributions. Investment Options. Participants may elect to allocate the contributions in any whole percentage among the following funds. Participants are permitted to transfer their accounts between investment funds once per quarter in any whole percentage. . The Income Fund is invested in contracts issued by five insurance companies. . The Equity Fund is principally invested in the BT Pyramid Equity Index Fund, which is a commingled trust fund managed by Bankers Trust Company (BT), the Trustee, and includes a portfolio of common stocks replicating the Standard & Poor's Composite Index of 500 stocks. . The UTC Stock Fund consists principally of 1,678 and 26 shares of UTC Common Stock at December 31, 1996 and 1995, respectively. Share amounts reflect the 2 for 1 stock split effective December 10, 1996. . The Global Fund is invested in almost equal proportions in three different funds managed by the Trustee: the BT Pyramid International Securities Index Fund, the BT Pyramid Fixed Income Index Fund and the BT Pyramid Equity Index Fund (as described above). The BT Pyramid International Securities Index Fund invests in four other international index funds managed by the Trustee. The BT Pyramid Fixed Income Index Fund invests primarily in obligations of the U.S. Government and its agencies and other publicly traded, high-grade domestic debt instruments. Payment of Benefits. Generally, benefits are paid in a lump sum to a terminating participant. A participant terminating due to retirement may elect to receive benefits in installments over two to twenty years. At the participant's election, the portion of a lump sum distribution attributable to the UTC Stock Fund may be paid in shares of UTC Common Stock instead of cash. There were no distributions in common stock for the period ended December 31, 1996. NOTE 2 - SUMMARY OF ACCOUNTING PRINCIPLES Basis of Accounting. The financial statements of the Plan are prepared under the accrual method of accounting. Benefits are recorded when paid. Master Trust. The Plan's assets are kept in a Master Trust maintained by the Trustee. Under the Master Trust agreement, the assets of certain employee savings plans of UTC and its subsidiaries are combined. Participating plans purchase units of participation in the investment funds based on their monthly contribution to such funds and the unit value of the applicable investment fund at the end of the month. The unit value of each fund is determined at each month end by dividing the sum of uninvested cash, accrued income and the current value of investments by the total number of outstanding units in such funds. Income from the funds' investments increases the plans' unit values. Distributions to participants reduce the number of participation units held by the plans. Investment Valuation. Except for the Income Fund, the Plan's investments are stated at fair value. The fair value of the Equity Fund, the UTC Stock Fund, and the Global Fund is determined by the Trustee by reference to published market data. The Income Fund's investment contracts are stated at contract value which represents contributions plus earnings, less Plan withdrawals. Plan Expenses. Plan expenses are payable out of Plan assets, unless paid by the employer. The expenses for the 1996 plan year were paid by the employer. Use of Estimates. The preparation of financial statements requires UTC to make estimates and assumptions that affect the reported amounts in the financial statements. Actual results could differ from those estimates. NOTE 3 - INVESTMENT CONTRACTS Under these contracts, each insurance company guarantees repayment in full of the principal amount invested plus interest credited at a fixed rate for a specified period. Interest is credited to each contract based on an annual interest rate set each year by the individual insurance companies. This rate, which differs among contracts, takes into account any difference between prior year credited interest and the actual amount of investment earnings allocable to the contract in accordance with the established allocation procedures of the insurance company. The weighted average rates for 1996 and 1995 were 7.5% and 7.25%, respectively. The following is a summary of the investment contracts held in the Income Fund and the portion allocable to the Plan:
(Thousands of Dollars) December 31, December 31, 1996 1995 CIGNA $ 1,512,307 $ 1,566,944 Aetna 457,815 494,944 Travelers 388,845 432,342 Prudential 236,966 219,677 Metropolitan Life 782,764 587,847 $ 3,378,697 $ 3,301,754 Amount of the contracts allocable $ 5,006 $ 4,900 to the Plan
NOTE 4 - FUNDING POLICY The Corporation funds its obligation to the plan on a monthly basis. At December 31, 1996, the minimum funding requirements under ERISA have been met. NOTE 5 - PLAN TERMINATION Although it has not expressed any intent to do so, UTC has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100 percent vested in their accounts. NOTE 6 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 The following are reconciliations of net assets available for benefits and benefits paid from the financial statements to Form 5500:
December 31, 1996 1995 < Net assets available for benefits c per the financial statements $ 6,957,696 $ 6,788,511 Amounts allocated to participant withdrawals (150,301) (529,952) Net assets available for benefits per Form 5500 $ 6,807,395 $ 6,258,559
Year Ended December 31, 1996 Benefits paid to participants per the financial statements $1,133,770 Add: Amounts allocated to participant withdrawals at December 31, 1996 150,301 Less: Amounts allocated to participant withdrawals at December 31, 1995 (529,952) Benefits paid to participants per Form 5500 $ 754,119 Amounts allocated to participant withdrawals are recorded on Form 5500 for benefit claims that have been processed and approved for payment prior to December 31 but not yet paid as of that date. NOTE 7 - TAX STATUS The Internal Revenue Service has determined and informed UTC by letter dated April 22, 1996 that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). The Plan has been amended since receiving the determination letters. However, the Plan administrator and tax counsel believe that the Plan is designed and currently being operated in compliance with the applicable requirements of the IRC. NOTE 8 - SUBSEQUENT EVENT Effective January 1, 1997, Fidelity Institutional Retirement Services Company assumed the participant account recordkeeping responsibilities from Bankers Trust. SIGNATURES The Plan (or other persons who administer the employee benefit plan), pursuant to the requirements of the Securities Exchange Act of 1934, has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. UNITED TECHNOLOGIES CORPORATION DEFINED CONTRIBUTION RETIREMENT PLAN Dated: June 26, 1997 By: /s/ Daniel P. O'Connell Daniel P. O'Connell Corporate Director, Employee Benefits and Human Resources Systems United Technologies Corporation Exhibit 23 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 33-58937) of United Technologies Corporation of our report dated June 26, 1997 appearing in the United Technologies Corporation Defined Contribution Retirement Plan's Annual Report on Form 11-K for the year ended December 31, 1996. PRICE WATERHOUSE LLP Hartford, Connecticut June 26, 1997 -----END PRIVACY-ENHANCED MESSAGE-----