-----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, CYIrUfDkoEV5GxxTvshP4T8NEncJczKYaj4qcyqmDsXEHgB9hjLUO6D7wLEcim/E 1dKKuj9bA9CQbGw5xWXgrA== 0000950129-96-001292.txt : 19960625 0000950129-96-001292.hdr.sgml : 19960625 ACCESSION NUMBER: 0000950129-96-001292 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960624 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: QUANEX CORP CENTRAL INDEX KEY: 0000276889 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 381872178 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05725 FILM NUMBER: 96584487 BUSINESS ADDRESS: STREET 1: 1900 W LOOP SOUTH STE 1500 STREET 2: ATTN THOMAS M BEWLEY CITY: HOUSTON STATE: TX ZIP: 77027 BUSINESS PHONE: 7139614600 MAIL ADDRESS: STREET 1: 1900 WEST LOOP SOUTH STREET 2: SUITE 1500 CITY: HOUSTON STATE: TX ZIP: 77027 11-K 1 NICHOLS-HOMESHIELD 401(K) SAVINGS PLAN-DAVENPORT 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 December 31, 1995. 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 1-5725 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Nichols-Homeshield 401(k) Savings Plan -- Davenport B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Quanex Corporation 1900 West Loop South, Suite 1500 Houston, Texas 77027 (713) 961-4600 2 INDEPENDENT AUDITORS' REPORT The Benefits Committee Quanex Corporation Houston, Texas Re: Nichols-Homeshield 401(k) Savings Plan - Davenport We have audited the accompanying statements of net assets available for benefits of the Nichols-Homeshield 401(k) Savings Plan - Davenport (the "Plan") as of December 31, 1995 and 1994, and the related statements of changes in net assets available for benefits for the years then ended. 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 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, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1995 and 1994, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules of (1) investments as of December 31, 1995 and (2) 5% reportable transactions for the year ended December 31, 1995 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. These schedules are the responsibility of the Plan's management. Such schedules have been subjected to the auditing procedures applied in our audit of the basic 1995 financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/ DELOITTE & TOUCHE LLP - ------------------------- DELOITTE & TOUCHE LLP May 3, 1996 3 QUANEX CORPORATION NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN - DAVENPORT STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, ------------------------------ 1995 1994 ---------- ------------ Assets: Investments at fair value - Mutual fund assets: Fidelity Puritan Fund $ 51,298 $ 16,831 Fidelity Magellan Fund 1,434,825 931,561 Fidelity Contrafund 711,513 440,914 Fidelity Growth and Income Fund 1,755,359 1,191,953 Fidelity Overseas Fund 88,561 120,696 Fidelity Balanced Fund 614,803 435,903 Fidelity Government Money Market Fund 2,820,968 2,445,663 Quanex Corporation common stock 103,640 59,346 Common/commingled trust 20,374 11,024 ----------- ---------- 7,601,341 5,653,891 Participant loans 490,166 360,335 ----------- ---------- Total 8,091,507 6,014,226 ----------- ---------- Employee contributions receivable 60,444 65,704 Employer contributions receivable 45,130 56,361 ----------- ---------- Total 105,574 122,065 ----------- ---------- Net assets available for benefits $8,197,081 $6,136,291 =========== ==========
See notes to financial statements. 4 QUANEX CORPORATION NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN - DAVENPORT STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
December 31, ------------------------------ 1995 1994 ---------- ---------- Investment income: Interest and dividends $ 397,598 $ 233,942 Net appreciation (depreciation) in fair value of investments 763,389 (187,861) ---------- ---------- Total 1,160,987 46,081 ---------- ---------- Contributions: Employer 519,252 547,881 Less forfeitures 10,999 3,144 ---------- ---------- 508,253 544,737 Employee 554,454 594,047 ---------- ---------- Total 1,062,707 1,138,784 ---------- --------- Interest on participant loans 33,277 25,430 ---------- ---------- Total additions 2,256,971 1,210,295 ---------- ---------- Benefit payments 194,297 357,557 Administrative fees 1,884 1,259 ---------- ---------- Total deductions 196,181 358,816 ---------- ---------- Increase in net assets available for benefits 2,060,790 851,479 Net assets available for benefits: Beginning of year 6,136,291 5,284,812 ---------- ---------- End of year $8,197,081 $6,136,291 ========== ==========
See notes to financial statements. 5 QUANEX CORPORATION NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN - DAVENPORT NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1995 AND 1994 A. DESCRIPTION OF THE PLAN The following description of the Nichols-Homeshield 401(k) Savings Plan - Davenport (the "Plan") is provided for general information purposes only. Participants should refer to the Plan document for more complete information. 1. General. The Plan, sponsored by Quanex Corporation (the "Company"), was established on October 1, 1987 and was amended and restated in its entirety in January 1993. The Plan is a defined contribution plan, which covers substantially all union hourly employees of the Davenport, Iowa facility. The Plan permits eligible employees to elect a deferral of compensation under Section 401(k) of the Internal Revenue Code ("IRC"). The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The assets of the Plan are held in trust by Fidelity Management Trust Company ("Fidelity" or the "Trustee"). The Benefits Committee (the "Committee"), appointed by the Company's Board of Directors, serves as the Plan administrator. 2. Contributions. Participants may contribute to the Plan by electing salary deferrals between 1% and 15% of compensation as defined by the Plan agreement. Participants may also contribute in half percentages. Company contributions are made based on a percentage of the employee's compensation for each individual with at least 1,000 hours of employment service. 3. Participant Accounts. Each participant's account is credited with the participant's contribution, the employer's contribution, and the participant's pro rata share of investment earnings. Investment earnings allocations are based upon individual participant account balances as of the end of the period in which the income was earned. 4. Investment Options. Participants may direct allocations of their contributions to the following funds: Government Money Market Fund - composed of short-term government obligations. Balanced Fund - invested and reinvested in common and preferred stocks and bonds. Growth and Income Fund - invested and reinvested in equity and debt securities of foreign and domestic companies. Magellan Fund - invested and reinvested in equity and debt securities of foreign and domestic companies. Contrafund - invested and reinvested in equities of foreign and domestic companies. Overseas Fund - invested and reinvested in foreign securities. Common/Commingled Trust - invested and reinvested in investment contracts issued by insurance companies, banks and other financial institutions. Puritan Fund - invested and reinvested in common and preferred stocks and bonds. Quanex Corporation Common Stock - invested and reinvested exclusively in the common stock of Quanex Corporation. 6 5. Vesting. Participants are immediately vested in their contributions and earnings thereon. Vesting in the employer contribution is based on years of credited service. A participant is 20% vested for each year of credited service and fully vested after five years. If a participant terminates employment prior to becoming fully vested, the nonvested portion of the employer contributions are immediately forfeited by the participant and utilized to reduce future employer contributions. 6. Payment of Benefits. The Plan is intended for long-term savings but provides for early withdrawals and loan arrangements under certain conditions. In accordance with the IRC, upon termination of service, a participant may elect to receive a lump-sum distribution equal to the total amount of vested benefits in his or her account. 7. Loans. Loans may be granted to a participant of the Plan at the Committee's discretion. Any loan authorized by the Committee shall be subject to a term not to exceed five years. The Committee may agree to a longer term (up to seven years) only if the proceeds of the loan are to be used for the purchase of a dwelling. The loans bear a reasonable rate of interest established by the Committee. Interest on the loan is allocated to the borrower's participant account. B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. Accounting Basis. The financial statements of the Plan are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles. 2. Administrative Expenses. Administrative expenses of the Plan are paid by the Company. Loan set up fees and carrying fees are paid by the participant. 3. Investment Valuation. The Plan recognizes net appreciation or depreciation in the fair value of its investments. Investments are reflected at fair value in the financial statements. Fair value of mutual fund assets is determined using a quoted net asset value. Fair value for Quanex Corporation common stock, which is listed on the New York Stock Exchange, is determined using the last recorded sales price. 4. Payment of Benefits. Benefit payments are recorded when paid. As of December 31, 1995 and 1994, net assets available for benefits included benefits of $5,270 and $0, respectively, due to participants who have withdrawn from participation in the Plan. C. PLAN TERMINATION Although it has not expressed any intention to do so, the Company has the right under the Plan to terminate the Plan at any time subject to the provisions set forth in ERISA. In the event of plan termination, the assets held by the Trustee under the Plan will be valued and fully vested, and each participant will be entitled to distributions respecting his or her account. D. FEDERAL INCOME TAX STATUS Management of the Company, the plan administrator, and the Plan's legal counsel are of the opinion that the Plan is qualified under Sections 401(a) and 401(k) and exempt from federal income tax under Section 501(a) of the Internal Revenue Code. The Plan received a favorable letter of tax determination from the Internal Revenue Service dated June 18, 1993 as to the tax-exempt status of the Plan. 7 E. RELATED PARTY TRANSACTIONS During the years ended December 31, 1995 and 1994, the Plan purchased shares of Quanex Corporation common stock, as shown below: 1995 1994 ---- ---- Shares Cost Shares Cost ------ -------- ------ ------- 6,171 $130,522 2,594 $58,983 During the year ended December 31, 1995, the Plan sold 3,416 shares of Quanex Corporation common stock valued at $75,227 (cost $73,665). During the years ended December 31, 1995 and 1994, the Plan purchased shares of Fidelity mutual fund assets, as shown below: 1995 1994 ---- ---- Shares Cost Shares Cost --------- ---------- --------- ---------- 1,229,689 $2,945,250 1,454,728 $2,668,351 During the years ended December 31, 1995 and 1994, the Plan sold 828,604 and 589,033 shares of Fidelity mutual fund assets valued at $1,825,834 and $1,824,022 (cost $1,761,256 and $1,771,152), respectively. During the years ended December 31, 1995 and 1994, the Plan purchased shares of Fidelity Common/Commingled Trust, as shown below: 1995 1994 ---- ---- Shares Cost Shares Cost ------ ------ ------ ------- 9,350 $9,350 11,024 $11,024 8 F. SUPPLEMENTAL FUND INFORMATION Contributions, benefit payments and investment income by fund were as follows for the years ended December 31:
1995 1994 --------- ---------- Employee Contributions: Fidelity Puritan Fund $ 8,238 $ 1,750 Fidelity Magellan Fund 88,077 115,775 Fidelity Contrafund 44,752 81,248 Fidelity Growth and Income Fund 127,054 135,098 Fidelity Overseas Fund 20,838 14,284 Fidelity Balanced Fund 61,072 64,857 Fidelity Government Money Market Fund 182,325 151,552 Fidelity Short-Intermediate Government Fund - 23,518 Quanex Corporation common stock 14,350 5,190 Common/commingled trust 7,748 775 --------- ---------- $ 554,454 $ 594,047 ========= ========== 1995 1994 --------- --------- Employer Contributions: Fidelity Puritan Fund $ 3,814 $ 1,249 Fidelity Magellan Fund 85,071 91,005 Fidelity Contrafund 52,740 57,904 Fidelity Growth and Income Fund 111,238 115,970 Fidelity Overseas Fund 11,723 10,355 Fidelity Balanced Fund 57,963 62,531 Fidelity Government Money Market Fund 179,518 180,248 Fidelity Short-Intermediate Government Fund - 23,150 Quanex Corporation common stock 5,457 1,950 Common/commingled trust 729 375 --------- --------- $ 508,253 $ 544,737
========= ========= 9
1995 1994 ---------- ---------- Benefit payments: Fidelity Puritan Fund $ 0 $ 57 Fidelity Magellan Fund 28,971 22,884 Fidelity Contrafund 16,482 11,336 Fidelity Growth and Income Fund 9,760 25,282 Fidelity Overseas Fund 13,092 408 Fidelity Balanced Fund 7,498 12,142 Fidelity Government Money Market Fund 118,494 271,384 Fidelity Short-Intermediate Government Fund 0 13,826 Quanex Corporation common stock 0 201 Common/commingled trust 0 37 ---------- ---------- $ 194,297 $ 357,557 ========== ========== 1995 1994 ---------- ---------- Investment income: Fidelity Puritan Fund $ 6,041 $ (23) Fidelity Magellan Fund 321,280 (15,704) Fidelity Contrafund 161,934 (4,936) Fidelity Growth and Income Fund 441,618 23,575 Fidelity Overseas Fund 12,960 (73) Fidelity Balanced Fund 72,510 (22,803) Fidelity Government Money 0 Market Fund 152,296 80,180 Fidelity Short-Intermediate Government Fund 0 (14,823) Quanex Corporation common stock (8,540) 408 Common/commingled trust 888 280 ---------- ---------- $1,160,987 $ 46,081 ========== ==========
10 Item 27a - Schedule of Assets Held for Investment Purposes EIN: 38-1872178; PN 016 QUANEX CORPORATION NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN - DAVENPORT SUPPLEMENTAL SCHEDULE OF INVESTMENTS DECEMBER 31, 1995
Shares/ Current Par Value Cost Value ---------- ---------- ----------- Mutual Fund Assets - Fidelity Investments: Contrafund* 18,714 $ 611,013 $ 711,513 Government Money Market Fund* 2,820,968 2,820,968 2,820,968 Puritan Fund* 3,016 48,384 51,298 Growth and Income Fund* 64,893 1,434,276 1,755,359 Magellan* 16,688 1,221,174 1,434,825 Overseas Fund* 3,046 84,812 88,561 Balanced Fund* 45,474 592,589 614,803 ---------- ----------- Total Mutual Fund Assets 6,813,216 7,477,327 Quanex Corporation Common Stock* 5,349 115,840 103,640 Common/Commingled Trust* 20,374 20,374 20,374 Participant loans (bearing interest rates from 7.85% to 11%) 490,166 490,166 ---------- ----------- Total investments $7,439,596 $ 8,091,507 ========== ===========
* Party-in-Interest 11 Item 27d - Schedule of Reportable (5%) Transactions EIN 38-1872178; PN 016 NICHOLS-HOMESHIELD 401(k) SAVINGS PLAN - DAVENPORT SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995 Series of Transactions
Current Total Number of Total Number Value on Net Purchases During Purchase of Sales During Selling Cost of Transaction Gain Description Plan Year Price Plan Year Price Asset Date (Loss) - ----------------------- ---------------- -------- --------------- --------- -------- ----------- ------- Magellan Fund 53 $505,906 35 $250,440 $235,441 $250,440 $14,999 Contrafund 49 314,396 31 150,182 135,051 150,182 15,131 Growth & Income Fund 54 468,985 36 262,424 234,292 262,424 28,132 Overseas Fund 31 195,006 14 238,067 230,726 238,067 7,341 Balanced Fund 50 263,895 29 133,587 134,615 133,587 (1,028) Government Money Market Fund 67 1,166,388 50 791,084 791,084 791,084 0
12 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. Nichols-Homeshield 401(k) Savings Plan - Davenport Date June 24, 1996 /s/ JOSEPH K. PEERY ----------------------------- --------------------------------------- Joseph K. Peery, Benefits Committee 13 INDEX TO EXHIBITS 23.1 Independent Auditor's Consent EX-23.1 2 INDEPENDENT AUDITOR'S CONSENT 1 EXHIBIT 23.1 INDEPENDENT AUDITOR'S CONSENT We consent to the incorporation by reference in Registration Statement No. 33-54081 of Quanex Corporation on Form S-8 of our report dated May 3, 1996 appearing in the Annual Report of Form 11-K of the Nichols - Homeshield 401(k) Savings Plan-Davenport for the year ended December 31, 1995. /s/ DELOITTE & TOUCHE LLP - ---------------------------- Deloitte & Touche LLP Houston, Texas June 24, 1996 -----END PRIVACY-ENHANCED MESSAGE-----