-----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, TWkiiYwM9mB819pd29tjyL5u5Q6SbxAsLd+UsPcLcib/9lCJ8niPjwTwUnl8Etap /dKHNBN9FW9+z91JzgpnnA== 0000950129-97-005345.txt : 19971222 0000950129-97-005345.hdr.sgml : 19971222 ACCESSION NUMBER: 0000950129-97-005345 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971219 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DANIEL INDUSTRIES INC CENTRAL INDEX KEY: 0000026821 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 741547355 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-06098 FILM NUMBER: 97741705 BUSINESS ADDRESS: STREET 1: 9753 PINE LAKE DR CITY: HOUSTON STATE: TX ZIP: 77055 BUSINESS PHONE: 7134676000 MAIL ADDRESS: STREET 1: 9753 PINE LAKE DRIVE CITY: HOUSTON STATE: TX ZIP: 77055 11-K 1 DANIEL INDUSTRIES, INC. - 09/30/97 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 (NO FEE REQUIRED) For the fiscal year ended September 30, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) For the transition period from to Commission File Number 1-6098 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: DANIEL INDUSTRIES, INC. 9753 Pine Lake Drive Houston, Texas 77055 =============================================================================== 2 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN Date DECEMBER 19, 1997 By /s/ James Hall ----------------- ---------------------------- James Hall Member of the Administrative Committee Date DECEMBER 19, 1997 By /s/ Wilfred Krenek ----------------- ---------------------------- Wilfred Krenek Member of the Administrative Committee Date DECEMBER 19, 1997 By /s/ Bela Vaczi ----------------- ---------------------------- Bela Vaczi Member of the Administrative Committee Date DECEMBER 19, 1997 By /s/ Michael R. Yellin ----------------- ---------------------------- Michael R. Yellin Member of the Administrative Committee 2 3 REPORT OF INDEPENDENT ACCOUNTANTS To the Members and Administrative Committee of Daniel Industries, Inc. Employees' Profit Sharing and Savings Plan In our opinion, the accompanying statements of net assets available for benefits and the related statement of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of Daniel Industries, Inc. Employees' Profit Sharing and Savings Plan at September 30, 1997 and 1996, and the changes in net assets available for benefits for the year ended September 30, 1997, 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. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The additional information included in schedules 1 and 2 is presented for purposes of additional analysis and is not a required part of the basic financial statements but is additional information required by ERISA. The fund information in the statement 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 net assets available for plan benefits and changes in net assets available for benefits of each fund. Schedules 1 and 2 and the 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. PRICE WATERHOUSE LLP Houston, Texas December 15, 1997 3 4 DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION SEPTEMBER 30, 1997
----------------------------------------------------------------------------------- FIDELITY RETIREMENT FIDELITY GOVERNMENT FIDELITY GROWTH FIDELITY MONEY INTERMEDIATE & FIDELITY BLUE CHIP MARKET BOND INCOME PURITAN GROWTH FIDELITY PORTFOLIO(*) FUND(*) PORTFOLIO(*) FUND FUND(*) CONTRAFUND(*) ----------- ------------ ---------- ----------- ----------- ------------ Investments at fair market value: Mutual funds $ 2,657,973 $ 5,965,626 $16,880,329 $ 1,564,464 $ 4,744,947 $ 4,648,055 Sponsor Stock Fund (Not Member directed) -- -- -- -- -- -- Sponsor Stock Fund (Member directed) -- -- -- -- -- -- Loans to Members -- -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- ----------- Total investments at fair market value 2,657,973 5,965,626 16,880,329 1,564,464 4,744,947 4,648,055 Employee contributions receivable 8,159 6,424 33,723 12,650 35,536 24,869 Employer contributions receivable -- -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $ 2,666,132 $ 5,972,050 $16,914,052 $ 1,577,114 $ 4,780,483 $ 4,672,924 =========== =========== =========== =========== =========== =========== ------------------------------------------------------- SPONSOR STOCK LOANS TO UNALLOCATED FUND(*) MEMBERS AMOUNTS TOTAL ----------- ----------- ----------- ------------- Investments at fair market value: Mutual funds $ -- $ -- $ -- $ 36,461,394 Sponsor Stock Fund (Not Member directed) 8,006,760 -- -- 8,006,760 Sponsor Stock Fund (Member directed) 2,118,999 -- -- 2,118,999 Loans to Members -- 587,816 -- 587,816 ----------- ----------- ----------- ------------- Total investments at fair market value 10,125,759 587,816 -- 47,174,969 Employee contributions receivable 7,506 -- -- 128,867 Employer contributions receivable 31,765 -- 800,000 831,765 ----------- ----------- ----------- ------------- NET ASSETS AVAILABLE FOR BENEFITS $10,165,030 $ 587,816 $ 800,000 $ 48,135,601 =========== =========== =========== =============
(*) Denotes Plan holdings which represent 5% or more of the Plan's net assets available for benefits. The accompanying notes are an integral part of the financial statements. - 4 - 5 DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION SEPTEMBER 30, 1996
---------------------------------------------------------------------------------- FIDELITY RETIREMENT FIDELITY GOVERNMENT FIDELITY GROWTH FIDELITY MONEY INTERMEDIATE & FIDELITY BLUE CHIP MARKET BOND INCOME PURITAN GROWTH FIDELITY PORTFOLIO(*) FUND(*) PORTFOLIO(*) FUND FUND(*) CONTRAFUND(*) ------------ ----------- ----------- ----------- ----------- ----------- Investments at fair market value: Mutual funds $ 3,075,484 $ 7,104,525 $13,117,595 $ 1,057,011 $ 3,046,380 $ 2,989,307 Sponsor Stock Fund (Not Member directed) -- -- -- -- -- -- Sponsor Stock Fund (Member directed) -- -- -- -- -- -- Loans to Members -- -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- ----------- Total investments at fair market value 3,075,484 7,104,525 13,117,595 1,057,011 3,046,380 2,989,307 Employee contributions receivable 10,980 8,053 25,494 13,030 36,031 22,453 Employer contributions receivable -- -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $ 3,086,464 $ 7,112,578 $13,143,089 $ 1,070,041 $ 3,082,411 $ 3,011,760 =========== =========== =========== =========== =========== =========== ------------------------------------------------------- SPONSOR STOCK LOANS TO UNALLOCATED FUND (*) MEMBERS AMOUNTS TOTAL ----------- ----------- ----------- ------------- Investments at fair market value: Mutual funds $ -- $ -- $ -- $ 30,390,302 Sponsor Stock Fund (Not Member directed) 5,428,524 -- -- 5,428,524 Sponsor Stock Fund (Member directed) 901,536 -- -- 901,536 Loans to Members -- 476,163 -- 476,163 ----------- ----------- ----------- ------------- Total investments at fair market value 6,330,060 476,163 -- 37,196,525 Employee contributions receivable 6,214 -- -- 122,255 Employer contributions receivable 30,352 -- 800,000 830,352 ----------- ----------- ----------- ------------- NET ASSETS AVAILABLE FOR BENEFITS $ 6,366,626 $ 476,163 $ 800,000 $ 38,149,132 =========== =========== =========== =============
(*) Denotes Plan holdings which represent 5% or more of the Plan's net assets available for benefits. The accompanying notes are an integral part of the financial statements. - 5 - 6 DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION YEAR ENDED SEPTEMBER 30, 1997
------------------------------------------------------------------------------ FIDELITY RETIREMENT FIDELITY GOVERNMENT FIDELITY GROWTH FIDELITY MONEY INTERMEDIATE & FIDELITY BLUE CHIP MARKET BOND INCOME PURITAN GROWTH PORTFOLIO FUND PORTFOLIO FUND FUND ------------- ------------ ------------- ------------ ------------- ADDITIONS TO NET ASSETS: Investment income: Cash dividends $ 146,691 $ 416,451 $ 733,018 $ 92,168 $ 157,923 Interest on loans to Members 2,141 3,730 9,122 5,258 10,206 Other 98 39 213 60 164 Net appreciation -- 81,625 3,563,678 237,448 994,572 ------------ ------------ ------------ ------------ ------------ Total investment income 148,930 501,845 4,306,031 334,934 1,162,865 Contributions: Participating employees 111,988 84,464 381,822 164,406 452,277 Participating employers -- -- -- -- -- Rollover from qualified plans -- -- 20,071 13,896 38,245 Repayments on loans to Members 6,795 15,141 33,158 17,410 61,226 ------------ ------------ ------------ ------------ ------------ TOTAL ADDITIONS 267,713 601,450 4,741,082 530,646 1,714,613 ------------ ------------ ------------ ------------ ------------ DEDUCTIONS FROM NET ASSETS: Member distributions (480,029) (386,079) (769,465) (230,212) (359,233) Loans to Members (42,350) (47,125) (115,557) (17,469) (47,155) Administrative expenses (19,000) (1,608) (3,432) (3,440) (311) Transfer to qualified plan (229,708) (107,943) (467,985) (174) (27,256) ------------ ------------ ------------ ------------ ------------ TOTAL DEDUCTIONS (771,087) (542,755) (1,356,439) (251,295) (433,955) ------------ ------------ ------------ ------------ ------------ Interfund transfers (89,629) (1,252,920) 213,923 167,536 247,663 ------------ ------------ ------------ ------------ ------------ Allocation of prior year employer contribution 172,671 53,697 172,397 60,186 169,751 ------------ ------------ ------------ ------------ ------------ INCREASE (DECREASE) IN NET ASSETS (420,332) (1,140,528) 3,770,963 507,073 1,698,072 NET ASSETS AVAILABLE FOR BENEFITS AT THE BEGINNING OF YEAR 3,086,464 7,112,578 13,143,089 1,070,041 3,082,411 ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS AT THE END OF YEAR $ 2,666,132 $ 5,972,050 $ 16,914,052 $ 1,577,114 $ 4,780,483 ============ ============ ============ ============ ============ ------------------------------------------------------------------------------- SPONSOR FIDELITY STOCK LOANS TO UNALLOCATED CONTRAFUND FUND (a) MEMBERS AMOUNTS TOTAL ------------ ------------ ------------- ------------ ------------ ADDITIONS TO NET ASSETS: Investment income: Cash dividends $ 207,607 $ -- $ -- $ -- $ 1,753,858 Interest on loans to Members 7,092 1,917 -- -- 39,466 Other 124 32 -- -- 730 Net appreciation 929,788 3,389,059 -- -- 9,196,170 ------------ ------------ ------------ ----------- --------------- Total investment income 1,144,611 3,391,008 -- -- 10,990,224 Contributions: Participating employees 305,100 85,945 -- -- 1,586,002 Participating employers -- 394,469 -- 800,000 1,194,469 Rollover from qualified plans 16,927 -- -- -- 89,139 Repayments on loans to Members 44,016 10,524 (188,270) -- -- ------------ ------------ ------------ ----------- --------------- TOTAL ADDITIONS 1,510,654 3,881,946 (188,270) 800,000 13,859,834 ------------ ------------ ------------ ----------- --------------- DEDUCTIONS FROM NET ASSETS: Member distributions (168,163) (482,955) (27,488) -- (2,903,624) Loans to Members (39,818) (17,937) 327,411 -- -- Administrative expenses (153) (3,924) -- -- (31,868) Transfer to qualified plan (104,807) -- -- -- (937,873) ------------ ------------ ------------ ----------- --------------- TOTAL DEDUCTIONS (312,941) (504,816) 299,923 -- (3,873,365) ------------ ------------ ------------ ----------- --------------- Interfund transfers 328,618 384,809 -- -- -- ------------ ------------ ------------ ----------- --------------- Allocation of prior year employer contribution 134,833 36,465 -- (800,000) -- ------------ ------------ ------------ ----------- --------------- INCREASE (DECREASE) IN NET ASSETS 1,661,164 3,798,404 111,653 -- 9,986,469 NET ASSETS AVAILABLE FOR BENEFITS AT THE BEGINNING OF YEAR 3,011,760 6,366,626 476,163 800,000 38,149,132 ------------ ------------ ------------ ----------- --------------- NET ASSETS AVAILABLE FOR BENEFITS AT THE END OF YEAR $ 4,672,924 $ 10,165,030 $ 587,816 $ 800,000 $ 48,135,601 ============ ============ ============ =========== ===============
(a) The portion of this fund which is attributable to Members' Employer Matching Contribution Accounts is not Member directed. In addition, the portion of this fund which is attributable to assets held by the Plan, as of June 30, 1995, as a result of Discretionary Employer Contributions is not Member directed. The accompanying notes are an integral part of the financial statements. - 6 - 7 Notes to Financial Statements Note 1 - Description of the Plan The following description provides only general information relating to the Plan and is qualified by the terms of the Plan. Capitalized terms which are not otherwise defined herein are defined in the Plan. Members should refer to the Summary Plan Description or the Plan document for a more complete explanation of the Plan's provisions. The Plan document is controlling at all times. The Daniel Industries, Inc. Employees' Profit Sharing and Retirement Plan (the "Profit Sharing Plan") was initially established effective September 30, 1953. The Daniel Industries, Inc. Employees' Savings Plan (the "Savings Plan") was initially established effective October 1, 1982, as a stock purchase plan and was amended to become a pre-tax savings plan effective April 1, 1984. Effective October 1, 1991, the Profit Sharing Plan was merged into the Savings Plan. The Savings Plan was thereafter called the Daniel Industries, Inc. Employees' Profit Sharing and Savings Plan (the "Plan") and was amended from time to time to reflect certain changes in the Internal Revenue Code, as amended (the "Code"). The Plan has been amended and restated effective January 1, 1998. See Note 5. Participation The Plan is a defined contribution plan in which each Employee of Daniel Industries, Inc. (the "Company" or the "Sponsor"), Daniel Measurement and Control, Inc. (formerly Daniel Flow Products, Inc.), Daniel Valve Company and Oilfield Fabricating and Machine, Inc. (together, the "Employers") is initially eligible to participate on the second Entry Date (the first day of each Calendar Quarter) next following the date such Employee was first employed by an Employer. Oilfield Fabricating and Machine, Inc. adopted the Plan effective July 1, 1996. Daniel En-Fab Systems, Inc. terminated its participation in the Plan on June 30, 1995. Approximately $938,000 in assets belonging to Members of the Plan previously employed by Daniel En-Fab Systems, Inc. were transferred to another qualified plan during the Plan year. Daniel Industrial, Inc. terminated its participation in the Plan effective November 30, 1995. Assets remaining in the Plan belonging to Members previously employed by Daniel Industrial, Inc. and Daniel En-Fab Systems, Inc. are immaterial to the Plan as a whole. Contributions The Plan provides for Discretionary Employer Contributions in such amount, if any, that shall be determined by the Employers. Upon receipt of the related funds from the Employers, these contributions are allocated among each Employer's Active Members in 7 8 the proportion which the Considered Compensation of each Member for the Plan Year bears to the total Considered Compensation of all Members of that Employer for the Plan Year. Prior to receipt of the related funds previously determined to be contributed by the Employers, these contributions appear as unallocated amounts in the financial statements. A summary of Discretionary Employer Contributions for the Plan Year ended September 30, 1997 is as follows:
Discretionary Employer Contributions for Plan Year Employer Ended September 30, 1997 ----------------------------- --------------------------- Daniel Industries, Inc. $ 65,011 Daniel Measurement and Control, Inc. 535,390 Oilfield Fabricating & Machine Inc. 26,044 Daniel Valve Company 173,555 --------- $ 800,000 =========
Further, an eligible Employee may choose, by completing and returning to the Administrative Committee of the Plan (the "Administrative Committee") a Salary Deferral Agreement, to authorize his Employer to reduce his Considered Compensation by a certain amount and to contribute on his behalf such amount to a trust (the "Trust") created under the Plan. The maximum reduction in compensation that a Member participating in the Plan may elect for contribution to the Plan is determined by the Administrative Committee; the nontaxable portion of each Member's annual Salary Deferral Contribution is limited to the maximum amount permitted by the Secretary of the Treasury ($9,500 for the 1997 calendar year). In addition, such contributions by Members who are "highly compensated employees" (within the meaning of Section 414(q) of the Code) are subject to nondiscrimination limitations that are affected by contributions made by all other Members. Each Employer makes contributions ("Salary Deferral Contributions") for each Member employed by such Employer in amounts equal to the amounts by which each such Member's Considered Compensation was reduced pursuant to his Salary Deferral Agreement. In addition, each Employer is required to make a matching contribution (an "Employer Matching Contribution") for each Member employed by such Employer in an amount equal to the lesser of 1.5% of such Member's Considered Compensation or 50% of such Member's Salary Deferral Contributions. Under certain circumstances, a Member may make additional Rollover Contributions and Voluntary Employee Contributions to the Trust. Salary Deferral Contributions, Employer Matching Contributions and Discretionary Employer Contributions made on behalf of each Member are credited to such Member's Salary Deferral Contribution Account, Employer Matching Contribution Account and Discretionary Employer Contribution Account, respectively. Each of such Accounts reflects the contributions, forfeitures and Investment Gain or Loss allocated to such Account. A Member's Discretionary Employer Contribution Account, Salary Deferral Contribution Account, Employer Matching Contribution Account, Rollover Contribution Account and Voluntary Employee Contribution Account are referred to collectively as a Member's Accounts. 8 9 A summary of Members' Salary Deferral Contributions and a summary of Employer Matching Contributions for the Plan Year ended September 30, 1997, are as follows:
Members' Salary Deferral Contributions for Plan Year Ended Employer September 30, 1997 - --------------------------- --------------------------------- Daniel Industries, Inc. $ 158,504 Daniel Measurement and Control, Inc. 999,773 Oilfield Fabricating & Machine, Inc. 46,586 Daniel Valve Company 381,139 ---------- $1,586,002 ==========
Employer Matching Contributions for Plan Year Ended Employer September 30, 1997 - --------------------------- ----------------------------------- Daniel Industries, Inc. $ 38,580 Daniel Measurement and Control, Inc. 251,239 Oilfield Fabricating & Machine, Inc. 10,822 Daniel Valve Company 93,828 ---------- $ 394,469 ==========
Investments The Plan provides for assets held by the Plan as a result of Employer Matching Contributions to be invested in the Sponsor Stock Fund. Assets held by the Plan as of June 30, 1995, as a result of Discretionary Employer Contributions and invested in the fund entitled the Company Stock Fund shall be invested in the Sponsor Stock Fund. The Plan further provides that assets held by the Plan as a result of Salary Deferral Contributions, Discretionary Employer Contributions (except as specified above) and Rollover Contributions shall be invested in such categories of assets as may be determined by the Administrative Committee. Such categories of assets include seven investment alternatives. Except for the Sponsor Stock Fund, all of the investment alternatives are mutual funds managed by Fidelity Management and Research Company. The investment options are as follows: Fidelity Retirement Government Money Market Portfolio-invests in U.S. Government securities and repurchase agreements for these securities. Fidelity Intermediate Bond Fund-normally invests in investment grade debt securities. Fidelity Growth & Income Portfolio-invests mainly in equity securities of companies that pay current dividends and offer potential growth of earnings. Fidelity Puritan Fund-invests in a broadly diversified portfolio of high-yielding equity and debt securities. 9 10 Fidelity Blue Chip Growth Fund-invests mainly in common stocks of well-known and established companies. Fidelity Contrafund-invests mainly in equity securities of companies that are undervalued or out-of-favor. Sponsor Stock Fund-invests primarily in Daniel Industries, Inc. common stock. In addition, a loan to a Member is a Member-directed investment of that Member's Account. Earnings and losses on assets in the investment funds are allocated solely to the Account of the Member, or Beneficiary, on whose behalf the investment in the fund was made. The Plan provides that each Member is required to designate the percentage of his share of Salary Deferral Contributions and Discretionary Employer Contributions and of his Rollover Contributions to be invested in each fund. A Member has the right to change the percentage of his share of such contributions to be invested in a particular fund on any business day. In addition, a Member has the right to change, by amount or percentage, his interest in each of his Accounts (subject to limitations described above) to be invested in the respective funds on any business day. Members may participate in all funds simultaneously. As Employer Matching Contributions are invested in the Sponsor Stock Fund, all Members who are eligible for such contributions become participants in such fund. Vesting A Member is always 100% vested in all of his Accounts except his Discretionary Employer Contribution Account. The balance in each Member's Discretionary Employer Contribution Account vests with such Member in 20% annual increments beginning with such Member's third employment anniversary date. Accordingly, Members are fully vested at the end of seven years. A Member's interest in the Discretionary Employer Contribution Account also becomes fully vested upon Retirement or upon death or Separation on account of Total and Permanent Disability. In addition, under the terms of the Daniel Industries, Inc. Employees' Profit Sharing and Savings Plan Partial Termination Agreement, any Member whose employment is terminated as a result of the Company's Restructuring Plan announced on February 2, 1995, shall become fully vested in his Discretionary Employer Contribution Account. Non-vested amounts are forfeited upon termination of employment and are used to restore any accounts required to be restored. Any excess forfeited balances at the end of the Plan Year are allocated to remaining Members on the same basis used to allocate Discretionary Employer Contributions of the Employers as described above. Distributions and Withdrawals Upon the death, Total Permanent Disability, or Retirement of a Member, or his termination of employment with his Employer, such Member or his validly designated Beneficiary is entitled to a 10 11 distribution of the vested interest of the amount in the Member's Accounts net of any outstanding loans. Each Member who has completed five years of Vesting Service and who has given written notice to the Administrative Committee may withdraw a specified amount of his Discretionary Employer Contribution Account, but not in excess of 25% of his vested interest in such account. The number of such withdrawals available to a Member is limited to one prior to his completion of ten years of Vesting Service and one subsequent to his completion of ten years of Vesting Service. A Member who is suffering a qualifying financial hardship may file a written request with the Administrative Committee to withdraw from his Salary Deferral Contribution Account, Employer Matching Contribution Account and Rollover Contribution Account an amount necessary to ease his hardship. However, a Member is not entitled to make a financial hardship withdrawal of any earnings credited to the Member's Salary Deferral Contribution Account or of any Employer Matching Contributions or earnings credited to the Member's Employer Matching Contribution Account after December 31, 1988. Upon reaching age 55 and completing 25 years of service, a Member, upon giving written notice to the Administrative Committee, may make one withdrawal of an amount not in excess of the total balance in his Accounts other than his Salary Deferral Contribution Account. Upon reaching age 60 and completing 25 years of service, a Member, upon giving written notice to the Administrative Committee, may make one withdrawal of an amount not in excess of the total balance in his Accounts (exclusive of any Account(s) from which he made a prior withdrawal pursuant to this provision). The Plan provides that, for the purpose of receiving a distribution or making any of the withdrawals described above, a Member's Accounts shall be valued on the Valuation Date coincident with the distribution or withdrawal. Subject to the limitations established by Section 401(a)(9) of the Code, distributions are payable in accordance with the Member's choice in cash or in kind, or both, in any one or a combination of the following manners: (i) in one lump sum; or (ii) in substantially equal periodic installments for a specified number of years not to exceed the greater of (a) 25 years or (b) the life expectancy of the Member or the joint and last survivor life expectancy of the Member and his spouse or other Beneficiary or such shorter period as may result from the allocation of losses to his Accounts. Loans A Member may borrow up to 50% of his Employer Matching Contribution Account, Salary Deferral Contribution Account and Rollover Contribution Account may be borrowed is $1,000 and the maximum is $50,000. A Member may have no more than one loan outstanding at any time. At September 30, 1997, the Plan had outstanding loans to Members in the amount of $587,816 earning interest at rates ranging from 7.90% to 9.26%. 11 12 Trustee and Investment Manager The Trustee of the Plan is Fidelity Management Trust Company. Under the terms of the Plan, as amended, and/or the Trust Agreement between the Company and Fidelity Management Trust Company, the Trustee's duties are to maintain custody of the assets of the Trust Fund, to invest and reinvest the assets of the Trust Fund subject to the instruction of the Members and the terms of the Trust, and to perform certain ministerial, record keeping and administrative functions under the Plan. The Trustee is appointed by the Board of Directors of the Company and serves as Trustee under the terms of the Trust and the Plan until termination of the Trust, the resignation of the Trustee or the removal of the Trustee by the Board of Directors of the Company. In addition, the Trustee shall vote the shares of the Company's common stock and the shares of the mutual funds held by the Trust subject to instruction by the Members who have interests in the Sponsor Stock Fund and in the mutual funds. Fidelity Investments Institutional Services Company ("Fidelity"), the Plan's investment manager, makes investment decisions regarding all of the Plan's investments except the Sponsor Stock Fund. The investment manager is appointed by the Plan's Administrative Committee which reviews its performance. Termination of the Plan The Company currently intends to continue the Plan indefinitely, but it may terminate the Plan at any time, withdraw from the Plan, or amend it in whole or in part. Any Employer that has adopted the Plan may terminate the Plan with respect to itself by executing and delivering to the Trustee a notice of termination that specifies the date on which the Plan will terminate. If the Plan is terminated, all vested and non-vested amounts credited to the Accounts of each Member will be paid to such Member or his Beneficiary after payment of all expenses and adjustments. Note 2 - Significant Accounting Policies Basis of Presentation The financial statements of the Plan are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles. Investments Investments are stated at fair market value as determined by quoted market prices as of the end of the Plan year. Recognition of Income Interest income is recorded as earned on an accrual basis. Any change in the net asset value of each mutual fund is recorded in the Statement of Changes in Net Assets Available for Benefits with Fund Information as net appreciation (depreciation). Dividends are recorded when distributed to Members. 12 13 Net Appreciation and Depreciation of Investments The Department of Labor requires that the components of net appreciation (depreciation) for investments be segregated and calculated on a revalued cost basis for ERISA annual report (Form 5500) reporting purposes. Under the revalued cost basis, realized gains (losses) are calculated by taking the proceeds from the sale of assets less the fair value of the assets at the beginning of the plan year, or at time of purchase if acquired during the current plan year. Unrealized appreciation (depreciation) of investments is calculated by taking the fair value of the assets at the end of the plan year less the fair value of the assets at the beginning of the plan year, or at time of purchase if acquired during the current plan year. Use of Estimates The preparation of the Plan's financial statements in conformity with generally accepted accounting principles may require the Plan's management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the related reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management believes that any estimates made in connection with these financial statements are reasonable. Risks and Uncertainties The Plan is subject to the normal risks associated with international and domestic debt, equity and venture capital markets. Administrative Expenses Trustee and recordkeeping fees and expenses relating to the Plan's mutual funds are paid by the Plan. Legal and audit fees relating to the Plan are paid by the Company. Note 3 - Member Distribution Obligations Distribution payments to members are recognized only upon payment. Obligations for distribution payments to Members are reflected as liabilities in the Form 5500 Annual Return/Report of Employee Benefit Plan. Note 4 - Federal Income Tax Status Based on the design and current operation of the Plan, management believes that the Plan is qualified under Section 401(a), and, therefore, the Trust is exempt from taxation under Section 501(a) of the Code. The Internal Revenue Service granted favorable letter of determination to the Plan on April 24, 1996. Generally, contributions to a qualified plan are deductible by the Company when made. Earnings of the Trust are tax exempt and 13 14 Members are not taxed on their benefits until withdrawn from the Plan and not rolled over into another qualified plan or individual retirement account. Note 5 - Subsequent Events Effective October 1, 1997, the Administrative Committee added two additional investment alternatives to the categories of assets available for investment of the Plan's assets. The two alternatives are the Fidelity Spartan U.S. Equity Index Fund managed by Fidelity Management and Research Company and the Janus Worldwide Fund managed by Janus Capital. The Plan has been amended and restated effective January 1, 1998, to provide for the following: 1) A change in the Plan Year to the calendar year. 2) The merger of the Bettis Corporation Retirement Savings Plan and the Shafer Valve Company 401(k)Plan into the Plan. 3) A Matching Contribution of 100% of the first three percent of a Member's Considered Compensation contributed to the Plan as Salary Deferral Contributions and 50% of the next two percent of a Member's Considered Compensation contributed to the Plan as Salary Deferral Contributions. 4) Assets held by the Plan as a result of Employer Matching Contributions to be invested, according to each Member's direction, in such categories of assets as may be determined by the Administrative Committee. 5) The elimination of the vesting schedule with regard to the Discretionary Employer Contribution Account. 6) A Supplemental Contribution to be made by the Employer on a discretionary basis. 7) Assets held by the Plan as of June 30, 1995, as a result of Discretionary Employer Contributions, to be invested effective January 1, 1999, according to each Member's direction, in such categories of assets as may be determined by the Administrative Committee. 14 15 Schedule 1 DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF SEPTEMBER 30, 1997
(b) Identity of issue, (c) Description of investment including borrower, lessor maturity date, rate of interest, (e) Current (a) or similar party collateral, par or maturity value (d) Cost value - --- ---------------------- --------------------------------------- ----------- ----------- * Sponsor Stock Fund Common Stock $ 3,833,575 $10,125,759 * Fidelity Contrafund Mutual Fund 3,673,009 4,648,055 * Fidelity Blue Chip Growth Fund Mutual Fund 3,877,304 4,744,947 * Fidelity Growth & Income Portfolio Mutual Fund 12,008,812 16,880,329 * Fidelity Puritan Fund Mutual Fund 1,408,513 1,564,464 * Fidelity Intermediate Bond Fund Mutual Fund 6,021,707 5,965,626 * Fidelity Retirement Government Money Market Portfolio Mutual Fund 2,657,973 2,657,973 * Participant Loans Loans, with interest ranging from 7.90% to 9.26% - 587,816 ----------- ----------- Plan assets held for Investment $33,480,893 $47,174,969 =========== ===========
* Represents an investment associated with a party in interest. 16 Schedule 2 DANIEL INDUSTRIES, INC. EMPLOYEES' PROFIT SHARING AND SAVINGS PLAN ITEM 27d-SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED SEPTEMBER 30, 1997
(h) Current (a) value of Identity (b) (c) (d) (g) asset on (i) of party Description Purchase Selling Cost transaction Net gain involved of asset price price of asset date or (loss) - ----------- -------------- ---------- ---------- --------- ---------- ---------- Fidelity Sponsor $1,662,062 $1,255,421 $ 851,979 $1,255,421 $ 403,442 Investments Stock Fund Fidelity Growth & 3,150,444 2,951,387 2,545,834 2,951,387 405,553 Investments Income Fund Fidelity Intermediate 862,114 2,082,639 2,109,205 2,082,639 (26,566) Investments Bond Fund Fidelity Retirement 2,053,894 2,471,405 2,471,405 2,471,405 - Investments Government Money Market Fund Fidelity Blue Chip 1,395,656 691,660 589,447 691,660 102,213 Investments Growth Fund Fidelity Contrafund 1 ,600,464 871,505 811,819 871,505 59,686 Investments Fidelity Puritan Fund 860,247 590,241 554,075 590,241 36,166 Investments
Columns (e) and (f) have been omitted because they are not applicable. NOTE: This schedule is a listing of a series of investment transactions in the same security which exceed five percent of the Plan's assets as of the beginning of the Plan year. 17 Index to Exhibits
No. Description - --- ----------- 23 Consent of Price Waterhouse LLP
EX-23 2 CONSENT OF PRICE WATERHOUSE 1 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 2-79399), of Daniel Industries, Inc. of our report dated December 15, 1997, appearing on Page 3 of this Annual Report on Form 11- K. PRICE WATERHOUSE LLP Houston, Texas December 19, 1997 -----END PRIVACY-ENHANCED MESSAGE-----