-----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, ObZHRMFXoqiGSoQQxDpsDTv9nyl+dw/8EfIIhAIKi0U5kBqDbE5kZhspqDdLlMuI 0EEwg8q3oyxLQlVJuBRiZA== 0000950152-96-006897.txt : 19961227 0000950152-96-006897.hdr.sgml : 19961227 ACCESSION NUMBER: 0000950152-96-006897 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19961226 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WAXMAN INDUSTRIES INC CENTRAL INDEX KEY: 0000105096 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-HARDWARE & PLUMBING & HEATING EQUIPMENT & SUPPLIES [5070] IRS NUMBER: 340899894 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10273 FILM NUMBER: 96686220 BUSINESS ADDRESS: STREET 1: 24460 AURORA RD CITY: BEDFORD HEIGHTS STATE: OH ZIP: 44146 BUSINESS PHONE: 2164391830 MAIL ADDRESS: STREET 1: 24460 AURORA ROAD CITY: BEDFORD HEIGHTS STATE: OH ZIP: 44146 11-K 1 WAXMAN INDUSTRIES 11-K 1 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 (Fee Required) For the fiscal year ended: June 30, 1996 OR Transition report pursuant to Section 15(d) of the Securities Exchange - - Act of 1934 (No Fee Required) For the transition period from: Commission file number 0-5888 A. Full title of the Plan and the address of the Plan, if different from that of the issuer named below: Waxman Industries, Inc. Profit Sharing and 401(K) Retirement Plan B. Name of issuer of the Securities held pursuant to the Plan and the address of its principal executive office: Waxman Industries, Inc. 24460 Aurora Road Bedford Heights, Ohio 44146 2 WAXMAN INDUSTRIES, INC. PROFIT SHARING AND 401(K) RETIREMENT PLAN FINANCIAL STATEMENTS AS OF JUNE 30, 1996, 1995 AND 1994 TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS 3 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Board of Directors of Waxman Industries, Inc.: We have audited the accompanying statements of participants' equity, including the schedule of assets held for investment purposes, of the Waxman Industries, Inc. Profit Sharing and 401(K) Retirement Plan (the Plan) as of June 30, 1996 and 1995, and the related statements of changes in participants' equity for each of the three years in the period ended June 30, 1996. These financial statements and the schedules referred to below are the responsibility of the plan administrator. Our responsibility is to express an opinion on these financial statements and schedules 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 participants' equity of the Plan as of June 30, 1996 and 1995, and the changes in participants' equity for each of the three years in the period ended June 30, 1996, 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 of assets held for investment purposes and reportable transactions 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 statements of changes in participants' equity is presented for purposes of additional analysis rather than to present the changes in participants' equity 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. As explained in Note 2, information certified by the trustee and presented in the schedules of assets held for investment purposes and reportable transactions does not disclose the historical cost of the investments. Disclosure of this information is required by the Department of Labor's Rules and Regulations for 4 Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. /s/ Arthur Andersen LLP. Cleveland, Ohio, December 13, 1996. 5 WAXMAN INDUSTRIES, INC. PROFIT SHARING AND 401(K) RETIREMENT PLAN INDEX JUNE 30, 1996, 1995, AND 1994 Statements of Participants' Equity as of June 30, 1996 and 1995 Statements of Changes in Participants' Equity for the Years Ended June 30, 1996, 1995 and 1994 Notes to Financial Statements Consent of Arthur Andersen LLP. - Item 23 Schedule I - Item 27a - Schedule of Assets Held for Investment Purposes as of June 30, 1996 Schedule II - Item 27d - Schedule of Reportable Transactions for the Year Ended June 30, 1996 6 WAXMAN INDUSTRIES , INC. PROFIT SHARING AND 401(K) RETIREMENT PLAN STATEMENTS OF PARTICIPANTS' EQUITY JUNE 30, 1996 AND 1995
June 30, 1996 June 30, 1995 ------------- ------------- INVESTMENTS, at market value: Waxman Industries, Inc. common stock $1,412,700 $405,946 CIGNA funds: Fidelity Contrafund 111,018 63,649 Fidelity Income & Growth Fund 100,060 63,900 Guaranteed CIGNA fund 526,730 409,478 INVESCO Industrial Fund 23,177 13,110 Lifetime 20 Fund 46,824 27,801 Lifetime 30 Fund 130,001 86,786 Lifetime 40 Fund 173,182 104,848 Lifetime 50 Fund 140,283 88,753 Lifetime 60 Fund 7,744 10,998 20th Century Ultra Fund 85,603 43,948 Warburg Pincus Growth & Income Fund 111,730 91,869 Warburg Pincus International Equity Fund 120,263 87,136 Cash Account 42,955 -- Participant Loans 5,369 -- ========== ========== Participants' Equity $3,037,639 $1,498,222 ========== ==========
The accompanying notes to financial statements are an integral part of these statements. 7 WAXMAN INDUSTRIES, INC. ----------------------- PROFIT SHARING AND 401(K) RETIREMENT PLAN ----------------------------------------- STATEMENT OF CHANGES IN PARTICIPANTS' EQUITY -------------------------------------------- FOR THE YEAR ENDED JUNE 30, 1996 --------------------------------
WAXMAN INDUSTRIES, INC. FIDELITY INVESCO COMMON STOCK FIDELITY INCOME & GUARANTEED INDUSTRIAL LIFETIME LIFETIME FUND CONTRAFUND GROWTH FUND CIGNA FUND FUND 20 FUND 30 FUND -------------- ------------ ----------- ------------ ------------ ----------- ------------ INCREASES: CONTRIBUTIONS- WAXMAN INDUSTRIES, INC $ 917 $ 1,050 $ 1,132 $ 5,440 $ 318 $ 589 $ 1,577 PARTICIPANTS 24,423 37,673 43,621 161,965 8,574 16,967 48,881 LOAN REPAYMENT- PRINCIPAL -- 72 72 12 68 -- 21 INTEREST INCOME -- 9 8 6 7 -- 10 MARKET VALUE CHANGES OF INVESTMENTS 1,054,946 16,887 3,147 26,477 2,658 6,608 18,107 ---------- ---------- ---------- ---------- ---------- ---------- ---------- TOTAL INCREASES 1,080,286 55,691 47,980 193,900 11,625 24,164 68,596 ---------- ---------- ---------- ---------- ---------- ---------- ---------- DECREASES: DISTRIBUTIONS TO FORMER PARTICIPANTS 70,841 13,904 5,858 77,946 1,697 4,414 25,388 TRANSACTION COSTS 3,442 21 180 1,270 17 440 659 LOANS TO PARTICIPANTS -- 260 682 1,834 211 -- 191 ---------- ---------- ---------- ---------- ---------- ---------- ---------- TOTAL DECREASES 74,283 14,185 6,720 81,050 1,925 4,854 26,238 ---------- ---------- ---------- ---------- ---------- ---------- ---------- TRANSFERS BETWEEN FUNDS 751 5,863 (5,100) 4,402 367 (287) 857 ---------- ---------- ---------- ---------- ---------- ---------- ---------- NET INCREASE (DECREASE) 1,006,754 47,369 36,160 117,252 10,067 19,023 43,215 PARTICIPANTS' EQUITY, BEGINNING OF YEAR 405,946 63,649 63,900 409,478 13,110 27,801 86,786 ---------- ---------- ---------- ---------- ---------- ---------- ---------- PARTICIPANTS' EQUITY, END OF YEAR $1,412,700 $ 111,018 $ 100,060 $ 526,730 $ 23,177 $ 46,824 $ 130,001 ========== ========== ========== ========== ========== ========== ==========
The accompanying notes to financial statements are an integral part 8
WARBURG WARBURG 20TH PINCUS PINCUS LIFETIME LIFETIME LIFETIME CENTURY GROWTH & INTERNATIONAL CASH PARTICIPANT 40 FUND 50 FUND 60 FUND ULTRA FUND INCOME FUND EQUITY FUND ACCOUNT LOANS TOTAL - ----------- ------------ ------------ ------------- ----------- ------------- ------------ -------------- ------------ $ 1,501 $ 1,000 $ 126 $ 659 $ 1,408 $ 1,504 $ 3,359 $ -- $ 20,580 50,342 40,927 2,840 26,629 48,885 40,934 39,437 -- 592,098 582 211 -- 64 72 166 141 (141) 1,340 7 66 -- 8 9 39 18 -- 187 20,448 15,229 799 11,850 7,521 20,483 -- -- 1,205,160 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 72,880 57,433 3,765 39,210 57,895 63,126 42,955 (141) 1,819,365 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 4,181 5,137 6,877 12,963 20,731 21,910 -- -- 271,847 235 213 120 19 20 125 -- -- 6,761 589 1,656 -- 230 244 953 -- (5,510) 1,340 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 5,005 7,006 6,997 13,212 20,995 22,988 -- (5,510) 279,948 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 459 1,103 (22) 15,657 (17,039) (7,011) -- -- -- - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 68,334 51,530 (3,254) 41,655 19,861 33,127 42,955 5,369 1,539,417 104,848 88,753 10,998 43,948 91,869 87,136 -- -- 1,498,222 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- $ 173,182 $ 140,283 $ 7,744 $ 85,603 $ 111,730 $ 120,263 $ 42,955 $ 5,369 $3,037,639 ========== ========== ========== ========== ========== ========== ========== ========== ==========
of this statement. 9 WAXMAN INDUSTRIES, INC. PROFIT SHARING AND 401(K) RETIREMENT PLAN STATEMENT OF CHANGES IN PARTICIPANTS' EQUITY FOR THE YEAR ENDED JUNE 30, 1995
Fidelity INVESCO Fidelity Income & Guaranteed Industrial Lifetime Lifetime Lifetime Lifetime Lifetime Contrafund Growth Fund CIGNA Fund Fund 20 Fund 30 Fund 40 Fund 50 Fund 60 Fund ---------- ----------- ---------- ---- ------- ------- ------- ------- ------- INCREASES: Contributions- Waxman Industries, Inc. 9,328 11,463 53,741 2,566 6,240 15,784 14,995 9,866 1,296 Participants 25,386 35,581 137,052 5,794 15,760 41,272 35,821 35,699 4,209 Transfer from previous trustee 20,068 15,721 218,817 3,506 3,979 23,996 48,075 37,769 4,825 Investment Income- Dividend income -- -- -- -- -- -- -- -- -- Interest income -- -- -- -- -- -- -- -- -- Realized appreciation of investments -- -- -- -- -- -- -- -- -- Market value changes of investments 9,144 2,932 10,944 1,173 2,216 6,940 8,119 6,909 668 --------- --------- --------- --------- --------- --------- --------- --------- --------- Total increases 63,926 65,697 420,554 13,039 28,195 87,992 107,010 90,243 10,998 --------- --------- --------- --------- --------- --------- --------- --------- --------- DECREASES: Distributions to former participants 322 1,177 14,190 -- 347 1,025 1,838 1,410 -- Transfer to new trustee -- -- -- -- -- -- -- -- -- Transaction costs -- -- 1,061 -- 47 200 160 80 -- Market value changes of investments -- -- -- -- -- -- -- -- -- Realized depreciation of investments -- -- -- -- -- -- -- -- -- --------- --------- --------- --------- --------- --------- --------- --------- --------- Total decreases 322 1,177 15,251 -- 394 1,225 1,998 1,490 0 --------- --------- --------- --------- --------- --------- --------- --------- --------- TRANSFERS BETWEEN FUNDS 45 (620) 4,175 71 -- 19 (164) -- -- --------- --------- --------- --------- --------- --------- --------- --------- --------- NET INCREASE (DECREASE) 63,649 63,900 409,478 13,110 27,801 86,786 104,848 88,753 10,998 PARTICIPANTS' EQUITY, beginning of year -- -- -- -- -- -- -- -- -- --------- --------- --------- --------- --------- --------- --------- --------- --------- PARTICIPANTS' EQUITY, end of year $ 63,649 $ 63,900 $ 409,478 $ 13,110 $ 27,801 $ 86,786 $ 104,848 $ 88,753 $ 10,998 ========= ========= ========= ========= ========= ========= ========= ========= =========
The accompanying notes to financial statements are an integral part of this statement. 10
Waxman Warburg Warburg 20th Industries, Inc. Pincus Pincus Waxman Fixed Money Century Common Stock Growth & International Diversified Industries Income Market Ultra Fund Fund Income Fund Equity Fund Fund Fund Fund Fund TOTAL - ---------- ---- ----------- ----------- ---- ---- ---- ---- ----- 6,127 8,973 12,771 15,506 $ -- $ -- $ -- $ -- $ 168,656 17,117 18,639 36,030 41,841 15,069 2,361 6,444 18,147 492,222 13,227 581,748 39,260 37,531 -- -- -- -- 1,048,522 -- -- -- -- 631 -- -- -- 631 -- -- -- -- 2,578 52 1,522 165 4,317 -- -- -- -- 2,699 -- -- -- 2,699 6,648 -- 5,847 -- -- -- -- -- 61,540 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 43,119 609,360 93,908 94,878 20,977 2,413 7,966 18,312 1,778,587 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 515 6,362 760 922 28,892 44,406 6,720 607 109,493 -- -- -- -- 191,687 634,958 99,579 122,298 1,048,522 -- 2,394 -- 12 -- -- -- -- 3,954 -- 194,387 -- 3,488 -- -- -- -- 197,875 -- -- -- -- -- 81,122 -- -- 81,122 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 515 203,143 760 4,422 220,579 760,486 106,299 122,905 1,440,966 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 1,344 (271) (1,279) (3,320) -- -- -- -- -- - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- 43,948 405,946 91,869 87,136 (199,602) (758,073) (98,333) (104,593) 337,621 -- -- -- -- 199,602 758,073 98,333 104,593 1,160,601 - ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- $ 43,948 $ 405,946 $ 91,869 $ 87,136 $ -- $ -- $ -- $ -- $1,498,222 ========== ========== ========== ========== ========== ========== ========== ========== ==========
11 WAXMAN INDUSTRIES, INC. ----------------------- PROFIT SHARING AND 401(K) RETIREMENT PLAN ----------------------------------------- STATEMENT OF CHANGES IN PARTICIPANTS' EQUITY -------------------------------------------- FOR THE YEAR ENDED JUNE 30, 1994 --------------------------------
------------------------------------------------------------------------ Waxman Fixed Money Diversified Industries Income Market Fund Fund Fund Fund Total ----------- ------------ ----------- ----------- ------------ INCREASES: Contributions- Waxman Industries, Inc. $ -- $ 55,000 $ -- $ -- $ 55,000 Participants 42,908 15,291 33,442 20,844 112,485 Investment Income- Dividend income 1,625 -- -- -- 1,625 Interest income 4,912 108 4,302 2,935 12,257 Gain (loss) on sale of investments 241 (8,950) 29 -- (8,680) ----------- ----------- ----------- ----------- ----------- Total increases 49,686 61,449 37,773 23,779 172,687 ----------- ----------- ----------- ----------- ----------- DECREASES: Distributions to former participants 21,688 36,251 6,561 3,933 68,433 Unrealized depreciation of investments 6,868 368,735 5,680 -- 381,283 ----------- ----------- ----------- ----------- ----------- Total decreases 28,556 404,986 12,241 3,933 449,716 ----------- ----------- ----------- ----------- ----------- NET INCREASE (DECREASE) 21,130 (343,537) 25,532 19,846 (277,029) PARTICIPANTS' EQUITY, beginning of year 178,472 1,101,610 72,801 84,747 1,437,630 ----------- ----------- ----------- ----------- ----------- PARTICIPANTS' EQUITY, end of year $ 199,602 $ 758,073 $ 98,333 $ 104,593 $ 1,160,601 =========== =========== =========== =========== ===========
The accompanying notes to financial statements are an integral part of this statement. 12 WAXMAN INDUSTRIES, INC. ----------------------- PROFIT SHARING AND 401(K) RETIREMENT PLAN ----------------------------------------- NOTES TO FINANCIAL STATEMENTS ----------------------------- JUNE 30, 1996, 1995 AND 1994 ---------------------------- 1. SUMMARY OF PLAN: --------------- The following description of the Waxman Industries, Inc. (the Company) Profit Sharing and 401(K) Retirement Plan (the Plan) provides only general information. Participants should refer to the plan agreement for a more comprehensive description of the Plan's provisions. General - ------- The Plan is a defined-contribution plan. It is subject to the provisions of the Employee Retirement Income Security Act of 1974. Trustee - ------- Effective October 1, 1994, the trustee, recordkeeper, disbursement agent and investor of the Plan was changed from National City Bank to Connecticut General Life Insurance Company (CIGNA). Plan assets were transferred to CIGNA on October 3, 1994. The Plan's trustee maintains all records of investment transactions and determines the valuation of the investment portfolio. Eligibility - ----------- Certain employees of the Company are eligible to participate in the Plan provided they are at least 21 years of age and have completed one year of service with the Company, as defined in the plan agreement. Participant and Employer Contributions - -------------------------------------- Participants may defer up to 15% of their pretax compensation by making contributions to the Plan, subject to certain limitations. Also, participants may direct the investment of their post September 1994 contributions to thirteen investment options. Participants have the option to transfer cumulative balances, except those relating to prior Company contributions, between investment options. Effective October 1, 1994, the Company may make discretionary matching contributions to the Plan of $.50 per every $1.00 contributed by the participant with the maximum Company match being 4% of the participants' compensation. The amount of Company contributions made to the Plan is limited by the Code and is determined at the discretion of the Board of Directors of the Company. Participants may direct the investment of the Company's year-end contributions. Company contributions are allocated to the accounts of eligible participants on a monthly basis, as established in Section 4.2 of the Plan. Investment Options - ------------------ 13 Investment options as of June 30, 1996 and 1995 include the following: Fidelity Contrafund - ------------------- The Fidelity Contrafund is invested primarily in common stock and securities convertible into common stocks of both domestic and foreign companies. Fidelity Income & Growth Fund - ----------------------------- Fidelity Income & Growth Fund is invested in a diversified portfolio of equity and fixed-income securities. Guaranteed CIGNA Fund - --------------------- Guaranteed CIGNA Fund is invested primarily in commercial mortgages and private bond placements. This fund has a full guarantee by CIGNA against loss of principal and credited interest. This interest rate is periodically reviewed and revised to reflect current investment conditions. INVESCO Industrial Fund - ----------------------- INVESCO Industrial Fund is invested primarily in dividend-paying common stocks of domestic industrial companies. It may also invest in fixed-income securities. Lifetime 20, 30, 40, 50, & 60 Funds ("CIGNA LIFETIME FUNDS") - ------------------------------------------------------------ The "CIGNA LIFETIME FUNDS" are a family of five distinct investment portfolios structured to maximize return and minimize risk over a specific time period based on the participant's approximate age. Each fund primarily is invested in a diversified mix of stock and bond funds, designed to fit the time horizons and risk tolerances of investors at different stages of their lives. 20th Century Ultra Fund - ----------------------- 20th Century Ultra Fund is invested primarily in common stocks of medium-sized companies that meet certain technical and fundamental criteria. Waxman Industries, Inc. Common Stock - ------------------------------------ The Waxman Industries, Inc. Common Stock is invested only in common stock of the Company. 14 Warburg Pincus Growth & Income Fund - ----------------------------------- Warburg Pincus Growth & Income Fund is invested primarily in common stocks and securities which derive their value from common stocks. Warburg Pincus International Equity Fund - ---------------------------------------- Warburg Pincus International Equity Fund is invested primarily in common stocks of companies that are generally non-U.S. based. Investment options as of June 30, 1994 included the following: Diversified Fund - ---------------- The Diversified Fund was invested in securities, bonds, obligations, notes, debentures, mortgages, or other tangible or intangible property or interests in property, either real or personal. No part of such fund was invested in capital stock of the Company. Waxman Industries Fund - ---------------------- The Waxman Industries Fund was invested only in common stock of the Company. This fund option is still available under the current Plan investment options. Fixed Income Fund - ----------------- The Fixed Income Fund was invested in high-quality bonds with heavy emphasis on U.S. Government securities. The maturity of these securities usually ranged from five to twelve years. Money Market Fund - ----------------- The Money Market Fund was invested in short-term securities (generally under 90-day maturities) such as certificates of deposit, repurchase agreements and treasury bills, which preserve capital. Earnings on this fund followed standard money market interest rate patterns. The Plan provides for the establishment and maintenance of several accounts for each participant which represent, in total, the participants' equity in the net assets of the Plan. The individual participants' accounts shall distinguish funds attributable to participant deferral contributions and Company contributions. Participants are immediately vested in the value of their contributions. Participants are vested in Company contributions ratably over five years of service and fully vest after five years of service. Realized and unrealized appreciation (depreciation) and market value changes of investments and investment income of the Plan are allocated on a pro-rata basis to the accounts of participants on a daily basis. Distributions to terminated participants generally commence at age 60 or earlier in cases of death or disability. The form of payment is designated by the participant. Earlier distributions of vested benefits may be made for participants who leave the Company prior to retirement if approved by the plan administrator. Under certain conditions, as indicated in Section 9.1 of the plan agreement, the plan administrator 15 may permit participants to withdraw a portion of their Company contribution and/or participant deferral contribution. Participant Loans - ----------------- Participants may borrow from their fund accounts a maximum equal to the lesser of $50,000 or 50 percent of their account balance. Loan transactions are treated as a transfer to (from) the investment fund (to) the Participant Loans fund. Loan terms range from one to five years or up to twenty-five years for the purchase of a primary residence. The loans are secured by the balance in the participant's account and bear interest at a rate commensurate with local prevailing rates as determined quarterly by the Plan administrator. Interest rates are at prime plus one percent. Principal and interest are paid ratably through monthly payroll deductions. Plan Termination - ---------------- The Plan is administered by the Company acting through its Board of Directors. Although it has not expressed any intent to do so, the Company may amend or terminate the Plan at its discretion, subject to applicable Internal Revenue Service and ERISA regulations. The rights of all participants to benefits accrued prior to any such termination are nonforfeitable. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: ------------------------------------------ Basis of Accounting - ------------------- The accompanying financial statements are prepared on the accrual basis of accounting. Use of Estimates - ---------------- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases during the reporting period. Actual results could differ from those estimates. Contributions - ------------- Contributions due from the Company are accrued as of the end of the fiscal year. There was no employee or employer contribution accrual as of June 30, 1996. Administrative Expenses - ----------------------- Fees of the Trustee, legal counsel and auditors of the Plan are paid by the Company and thus are not reflected in the accompanying financial statements. Costs specific to various transactions are paid directly by the Plan and are reflected in the accompanying statement of changes in participants' equity for the periods presented. Investments - ----------- The accompanying statements of participants' equity reflect investments at their fair market values as of June 30, 1996 and 1995. The Plan's trustee maintains all records of investment transactions and determines the valuation of the investment portfolio. Information with respect to: (1) investments held and their market values as presented 16 in the statements of participants' equity and (2) unrealized appreciation and depreciation as presented in the statements of changes in participants' equity has been certified by the Plan's trustee as being complete and accurate. The records of the Plan's trustee (CIGNA) are based solely on market value. Accordingly, no historical cost basis information is available and is not disclosed in the schedules of assets held for investment purposes (Schedule I) and reportable transactions (Schedule II). 3. AMOUNTS DUE TO TERMINATED PARTICIPANTS: -------------------------------------- Participants' equity includes $21,632 of amounts due to terminated participants at June 30, 1996. These amounts are recorded as a liability in the Plan's Form 5500; however, these amounts are not recorded as a liability in the accompanying statements of participants' equity in accordance with generally accepted accounting principles. The following table reconciles participants' equity per the accompanying financial statements to the Form 5500 as filed by the Company for the year ended June 30, 1996:
Benefits Participants' Participants' Payable to Benefits Equity Equity Participants Paid June 30, 1996 June 30, 1995 ------------ -------- ------------- ------------- Per financial statements $ -- $ 271,847 $ 3,037,639 $ 1.498,222 Accrued benefit payments 21,632 21,632 (21,632) -- Prior year reversal -- (40,109) -- (40,109) ----------- ----------- ----------- ----------- Per Form 5500 $ 21,632 $ 253,370 $ 3,016,007 $ 1,458,113 =========== =========== =========== ===========
4. FEDERAL INCOME TAXES: -------------------- The Plan obtained its latest determination letter on November 21, 1996, in which the Internal Revenue Service stated that the Plan, as amended and restated was in compliance with the applicable requirements of the Code. The plan administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code and that the Plan was qualified and the related trust was tax exempt as of June 30, 1996. Accordingly, income taxes have not been provided in the accompanying financial statements. Annually, informational returns are prepared and filed with the Internal Revenue Service. 5. PARTY-IN-INTEREST TRANSACTIONS: ------------------------------ There were no prohibited transactions with a party in interest, as defined by ERISA. 6. REPORTABLE TRANSACTIONS: ----------------------- Schedule II summarizes the Plan's reportable transactions for the year ended June 30, 1996. As defined, a reportable transaction is a transaction or accumulation of transactions in one security in amounts in excess of 5% of the fair value of the Plan's assets at the beginning of the plan year. 17 SCHEDULE I WAXMAN INDUSTRIES, INC. ----------------------- PROFIT SHARING AND 401(K) RETIREMENT PLAN ----------------------------------------- ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES ---------------------------------------------------------- JUNE 30, 1996 ------------- EMPLOYER IDENTIFICATION NUMBER: 34-0899894 ------------------------------- ---------- PLAN NUMBER: 001 -----------------
MARKET VALUE (a) ------------ 313,933 Shares of Waxman Industries, Inc. Common Stock $1,412,700 2,534 Units of Fidelity Contrafund 111,018 4,896 Units of Fidelity Income & Growth Fund 100,060 18,642 Units of Guaranteed CIGNA Fund 526,730 1,509 Units of INVESCO Industrial Fund 23,177 3,464 Units of Lifetime 20 Fund 46,824 9,756 Units of Lifetime 30 Fund 130,001 13,389 Units of Lifetime 40 Fund 173,182 11,027 Units of Lifetime 50 Fund 140,283 650 Units of Lifetime 60 Fund 7,744 2,843 Units of 20th Century Ultra Fund 85,603 6,755 Units of Warburg Pincus Growth & Income Fund 111,730 5,244 Units of Warburg Pincus International Equity Fund 120,263 Cash Account 42,955 Participant Loans 5,369 ---------- $3,037,639 ========== (a) The Plan has requested historical cost information related to the above investments, however, this information has not been provided because of the nature of the trustee's recordkeeping system.
The accompanying notes to financial statements are an integral part of this schedule. 18 SCHEDULE II WAXMAN INDUSTRIES, INC. ----------------------- PROFIT SHARING AND 401(K) RETIREMENT PLAN ----------------------------------------- ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS ---------------------------------------------- FOR THE YEAR ENDED JUNE 30, 1996 -------------------------------- EMPLOYER IDENTIFICATION NUMBER: 34-0899894 ------------------------------------------- PLAN NUMBER: 001 -----------------
PURCHASE SELLING HISTORIC GAIN/ PRICE PRICE COST (LOSS) -------- ------- --------- ------- Purchases - Guaranteed CIGNA Fund $181,266 - $181,266 $ - Lifetime 30 Fund 59,306 - 59,306 - Warburg Pincus Growth & Income Fund 56,444 - 56,444 - Warburg Pincus International Equity Fund 54,378 - 54,378 - Waxman Industries, Inc. Common Stock 28,690 - 28,690 - Sales - Guaranteed CIGNA Fund $ - $90,491 (a) $ (a) Lifetime 30 Fund - 27,255 (a) (a) Warburg Pincus Growth & Income Fund - 38,246 (a) (a) Warburg Pincus International Equity Fund - 35,146 (a) (a) Waxman Industries, Inc. Common Stock - 76,433 (a) (a) (a) The Plan has requested historical cost information related to the above investments, however, this information has not been provided because of the nature of the trustee's recordkeeping system.
The accompanying notes to financial statements are an integral part of this schedule. 19 [ARTHUR ANDERSEN LOGO] Exhibit 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report included in this Form 11-K into the Company's previously filed Form S-8 Registration Statement No. 33-57477. /s/ Arthur Andersen LLP. Cleveland, Ohio December 20, 1996. -----END PRIVACY-ENHANCED MESSAGE-----