-----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, SS4CTuqLi2quRY6dFmlr5Phz1SGlSJjkaUXzHdyH+BwnvvyIpc9XCyy74+XQp4E8 lUF6n5HjG8ICtp2ot9VNTA== 0000041499-96-000008.txt : 19960629 0000041499-96-000008.hdr.sgml : 19960629 ACCESSION NUMBER: 0000041499-96-000008 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960627 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: GILLETTE CO CENTRAL INDEX KEY: 0000041499 STANDARD INDUSTRIAL CLASSIFICATION: CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420] IRS NUMBER: 041366970 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-00922 FILM NUMBER: 96586547 BUSINESS ADDRESS: STREET 1: PRUDENTIAL TOWER BLDG CITY: BOSTON STATE: MA ZIP: 02199 BUSINESS PHONE: 6174217000 MAIL ADDRESS: STREET 1: PRUDENTIAL TOWER BLDG CITY: BOSTON STATE: MA ZIP: 02199 FORMER COMPANY: FORMER CONFORMED NAME: GILLETTE SAFETY RAZOR CO DATE OF NAME CHANGE: 19660911 11-K 1 FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1995 Registration number 33-63707 A. Full title of the plan: PARKER PEN 401(K) PLAN B. Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office: The Gillette Company Prudential Tower Building Boston, MA 02199 Financial Statements of Parker Pen 401(k) Plan The following audited financial statements with independent auditors' report thereon are enclosed with this report: 1. Statements of Net Assets Available for Plan Benefits as of December 31, 1995 and 1994. 2. Statements of Changes in Net Assets Available for Plan Benefits for each of the years in the three-year period ended December 31, 1995. Exhibit 23.2 Independent Auditor's Consent SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Advisory Committee has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Parker Pen 401(k) Plan By THOMAS F. SKELLY Thomas F. Skelly Date: June 25, 1996 EX-23 2 CONSENT OF EXPERT Exhibit 23.2 CONSENT OF INDEPENDENT AUDITORS The Savings Plan Committee The Gillette Company Employees' Savings Plan: We consent to the incorporation by reference in registration statements No. 33-63707 on Form S-8 of the Parker Pen 401(k)Plan of our report dated May 16 1996, relating to the statements of assets available for plan benefits of Parker Pen 401(k) Plan as of December 31, 1995 and 1994, and the related statements of changes in assets available for plan benefits for the years then ended, which report appears in the December 31, 1995 annual report on Form 11-K of Parker Pen 401(k) Plan. KPMG PEAT MARWICK LLP KPMG Peat Marwick LLP Milwaukee, Wisconsin June 26, 1996 EX-99.B12 3 FINANCIAL STATEMENTS THE PARKER PEN 401(k) PLAN Financial Statements and Schedules December 31, 1995 and 1994 (With Independent Auditors' Report Thereon) THE PARKER PEN 401(k) PLAN
TABLE OF CONTENTS =================================================================================================================== =================================================================================================================== Page(s) - ------------------------------------------------------------------------------------------------------------------- Independent Auditors' Report .......................................... 1 Statements of Assets Available for Plan Benefits, December 31, 1995 and 1994 ........................................ 2 Statements of Changes in Assets Available for Plan Benefits, Years ended December 31, 1995 and 1994 ............................ 3 Notes to Financial Statements ......................................... 4-9 Schedule 1 - Item 27a, Schedule of Assets Held for Investment Purposes, December 31, 1995 ................................................. 10 Schedule 2- Item 27d, Schedule of Reportable Transactions, Year ended December 31, 1995 ...................................... 11 Note: Supplemental schedules required by the Employee Retirement Income Security Act of 1974, as amended (ERISA), that have not been included are not applicable.
1 Independent Auditors' Report The Savings Plan Committee of The Gillette Company Employees' Savings Plan: We have audited the financial statements and supplemental schedules of The Parker Pen 401(k) Plan as of December 31, 1995 and 1994 and for the years then ended, as listed in the accompanying table of contents. These financial statements and schedules are the responsibility of the Plan's management. 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 and schedules 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 assets available for plan benefits of The Parker Pen 401(k) Plan as of December 31, 1995 and 1994, and the changes in assets available for plan benefits for the years then ended 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 as of December 31, 1995 and 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. The supplemental schedules 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. KPMG Peat Marwick LLP May 16, 1996 THE PARKER PEN 401(k) PLAN Statements of Assets Available for Plan Benefits December 31, 1995 and 1994
1995 1994 Assets: Investments at fair value (note 3): Guaranteed Investment Contract Fund ...... $3,193,135 3,440,078 Balanced Fund ............................ 1,706,131 1,614,224 Equity Fund .............................. 3,882,421 2,811,905 Payment Reserve Account .................. 250,774 214,673 --------- --------- Total investments ................................ 9,032,461 8,080,880 Contributions receivable: Employer ................................. 37,961 29,550 Employee ................................. 119,715 87,119 Accrued investment income ........................ 20,557 21,850 --------- --------- Total assets available for plan benefits ......... 9,210,694 8,219,399 See accompanying notes to financial statements.
THE PARKER PEN 401(k) PLAN Statements of Changes in Assets Available for Plan Benefits Years ended December 31, 1995 and 1994
1995 1994 Additions: Contributions: Employer $ 321,083 323,891 Employee 965,794 948,793 --------- --------- 1,286,877 1,272,684 Investment income (note 3): Interest and dividends, net of trustee fees 605,637 383,336 Net unrealized appreciation (depreciation) in fair value of investments and realized gain (loss) on sale of investments 509,344 (255,140) --------- --------- Total additions 2,401,858 1,400,880 Deductions: Withdrawals and distributions to participants 803,856 312,752 Transfer of assets to Gillette Company Employees' Savings Plan (note 7) 606,707 - --------- --------- Total deductions 1,410,563 312,752 Increase (decrease) in assets available for plan benefits 991,295 1,088,128 Assets available for plan benefits: Balance at beginning of year 8,219,399 7,131,271 --------- --------- Balance at end of year $ 9,210,694 8,219,399 ========= ========= See accompanying notes to financial statements.
THE PARKER PEN 401(k) PLAN Notes to Financial Statements December 31, 1995 and 1994 ================================================================================ 1 (1) Description of the Plan The following brief description of The Parker Pen 401(k) Plan (the "Plan") is provided for general information purposes only. Participants should refer to the Plan agreement for more complete information. (a) General The Plan became effective on July 1, 1988 and is a contributory defined contribution plan covering all eligible employees of Parker Pen USA Limited (the "Company") who have attained one-half year of service. The Plan was amended July 1, 1989 to allow participation in the Plan by eligible persons covered by the Parker Retirement Plan for Machinists. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). (b) Contributions Participants may elect to contribute in whole percentage increments up to 17% of their annual compensation. The Company will make a matching contribution on behalf of a participant equal to 50% of the participant's contribution to a maximum of 6% of annual compensation. (c) Investment Alternatives Participants had the right to elect the investment vehicle for their contributions and the Company matching contributions. Participants could invest in one or a combination of the following funds: Guaranteed Investment Contract (GIC) Fund - consists of insurance annuity contracts with three to five year maturities which pay a stated rate of return. Balanced Fund - invests equal amounts in fixed income securities and common stock and other equity investments. Equity Fund - invests in common stock and other equity investments. In anticipation of the change in sponsorship and administration of the Plan described in note 7, all investments held in the Guaranteed Investment Contract Fund, Balanced Fund and Equity Fund were sold and invested in the One Group Prime Money Market Fund as of December 29, 1995. The participants will have the right to elect new investment vehicles for their balance, their future contributions and the Company matching contributions. See note 7. Participants may invest in one or a combination of the following funds: Retirement Government Money Market Portfolio - invests in obligations issued or guaranteed as to principal and interest by the U.S. government, its agencies or instrumentalities, and in repurchase agreements secured by these obligations. Fixed Income Fund - invests in high quality short and intermediate term investment contracts, issued by insurance companies and banks and short term money market instruments and other debt obligations for liquidity. Fidelity Intermediate Bond Fund - invests primarily in investment-grade fixed-income obligation rated Baa or better by Moody's or BBB or better by Standard & Poor's, including corporate bonds, mortgage securities, bank obligation and U.S. government and agency securities. The Fund's dollar-weighted average maturity ranges between three and ten years. Fidelity Balanced Fund - invests in investment grade or higher bonds and other high-yielding securities, including common and preferred stocks. At least 25% of the fund's assets are always invested in fixed income senior securities. Fidelity U.S. Equity Index Portfolio - invests in common stocks and seeks investment results that correspond to the total return performance of the S&P 500 Index. Fidelity Magellan Fund - invests in the stocks of both well-known and lesser-known companies with potentially above average growth potential and a correspondingly higher level of risk. Securities may be of foreign and domestic companies. Fidelity Growth Company Fund - invests primarily in common stocks and securities convertible into common stocks. It may invest in companies of any size with above-average growth potential though growth is most often sought in smaller, less well known companies in emerging areas of the economy. Gillette Company Stock Fund - invests in The Gillette Company common stock. A small portion of the Fund may be invested in short term liquid investments to satisfy the Fund's cash needs. The Plan also maintains a Payment Reserve Account which is used to temporarily hold funds designated for distribution to participants and to account for participant loans outstanding. ================================================================================ THE PARKER PEN 401(k) PLAN ================================================================================ Notes to Financial Statements ================================================================================ 1 (d) Vesting Participants immediately vest in their voluntary contributions and actual earnings thereon. Vesting in company contributions is 25% per year with full vesting after four years of service, upon attainment of age 65, or termination of employment due to death or disability. Nonvested Company contributions will be forfeited by participants who terminate employment and will be used to reduce future Company matching contributions. (e) Payment of Benefits The vested portion of a participant's account is distributable in the form of a lump sum payment at the later of normal retirement age or termination of service, but in no event may payment be delayed after attainment of age 70-1/2. (2) Summary of Significant Accounting Policies (a) Basis of Presentation The accompanying financial statements present the assets available for plan benefits and the changes in those assets on the accrual basis. (b) Valuation of Investments The Plan's investments consist of units of participation, representing an interest in the underlying assets of a commingled trust fund maintained by Bank One Wisconsin Trust Company, N.A., the trustee of the Plan. The trust's assets are valued based on the fair value of the underlying assets of each of the investment funds. The trust's investments in securities (equity and debt securities) traded on a national securities exchange are valued at the last reported sales price on the last business day of the year; securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the price as of the close of the previous business day. Money market funds held by the trust are valued at cost which approximates fair value. Guaranteed investment contracts are carried at contract value, which represents contributions received plus interest less withdrawals and contract charges and approximates fair value. Purchases and sales of securities are reflected on a trade-date basis. Participant loans are valued at the principal balance of the loan outstanding and are reflected in the Payment Reserve Account on the statement of assets available for plan benefits. (c) Investment Income Dividend income is recorded on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. (d) Administrative Expenses Except for fees paid to the trustee for investment management, which amounted to $24,950 and $11,184 for the years ended December 31, 1995 and 1994, respectively, expenses incurred in the administration of the Plan are paid directly by the Company and are not reflected within these financial statements. (e) Use of Estimates Management of the Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period to prepare these financial statements in conformity with general accepted accounting principles. Actual results could differ from those estimates. (3) Investments The Plan's investments are held by its trustee, Bank One Wisconsin Trust Company, N.A. The fair value of investments held by the trustee in each Fund at December 31, 1995 and 1994 are summarized as follows:
=================================================================================================================== 1995 Guaranteed Investment Payment Contract Balanced Equity Reserve Fund Fund Fund Account Total - ------------------------------------------------------------------------------------------------------------------- The One Group Prime Money Market Fund $ 3,193,135 1,706,131 3,882,421 - 8,781,687 Notes receivable-participants - - - 250,774 250,774 - ------------------------------------------------------------------------------------------------------------------- $ 3,193,135 1,706,131 3,882,421 250,774 9,032,461
=================================================================================================================== 1994 Guaranteed Investment Payment Contract Balanced Equity Reserve Fund Fund Fund Account Total - ------------------------------------------------------------------------------------------------------------------- Cash $ 243 31 30 255 559 The One Group's Funds: Prime Money Market 91,380 58,971 84,358 - 234,709 Government Bond - 416,066 - - 416,066 Income Bond - 407,480 - - 407,480 International Equity Index - 79,655 392,377 - 472,032 Disciplined Value - 201,454 800,542 - 1,001,996 Large Company Growth - 134,961 356,597 - 491,558 Large Company Value - 133,618 456,932 - 590,550 Small Company Growth - 181,988 721,069 - 903,057 Commingled Funds Guaranteed Investment Contracts 3,348,455 - - - 3,348,455 Notes receivable-participants - - - 214,418 214,418 - ------------------------------------------------------------------------------------------------------------------- $ 3,440,078 1,614,224 2,811,905 214,673 8,080,880 ===================================================================================================================
A summary of the activity in each of the funds for the year ended December 31, 1995 is as follows:
=================================================================================================================== Year ended December 31, 1995 Guaranteed Investment Payment Contract Balanced Equity Reserve Fund Fund Fund Account Total - ------------------------------------------------------------------------------------------------------------------- Additions: Contributions: Employer $ 127,594 71,676 121,813 - 321,083 Employee 382,171 211,779 371,844 - 965,794 Interest and dividends, net of trustee fees 207,923 128,758 240,779 28,177 605,637 Net unrealized appreciation (depreciation) in fair value of investments and realized gain (loss) on sale of investments 3 168,259 341,082 - 509,344 - ------------------------------------------------------------------------------------------------------------------- Net additions 717,691 580,472 1,075,518 28,177 2,401,858 Deductions: Withdrawals and distributions to participants - - - 803,856 803,856 Transfers 767,394 347,792 (270,752) (844,434) - Transfer of assets to Gillette Company Employees' Savings Plan 208,457 146,027 221,063 31,160 606,707 - ------------------------------------------------------------------------------------------------------------------- Net deductions 975,851 493,819 (49,689) (9,418) 1,410,563 - ------------------------------------------------------------------------------------------------------------------- Net increase(decrease) (258,160) 86,653 1,125,207 37,595 991,295 Assets available for benefits: Beginning of year 3,489,103 1,653,949 2,863,168 213,179 8,219,399 - ------------------------------------------------------------------------------------------------------------------- End of year $ 3,230,943 1,740,602 3,988,375 250,774 9,210,694 ===================================================================================================================
(4) Tax Status The Plan obtained its latest determination letter on February 14, 1995, in which the Internal Revenue Service stated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. (5) Party-In-Interest Transactions The Plan Administrator may direct the trustee to make loans available to all Plan participants. Such loans may not exceed the lesser of $50,000 or 50% of the participant's vested account balance subject to a $1,000 minimum. The interest rate on the loan shall be one percent plus the prime rate of interest in effect at the time the loan is processed. A participant must make a payment of principal and interest to the plan on at least a quarterly basis. The maximum term for repayment of a loan is five years. All transactions involving investments in the four funds administered by the trustee are considered party-in-interest transactions. These transactions are not, however, considered prohibited transactions under Section 408(b) of the ERISA regulations. (6) Plan Termination Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions set forth in ERISA. In the event of Plan termination, participants will become fully vested in their accounts. (7) Plan Transfers On September 18, 1995, the Company's Board of Directors approved a change in Trustees of the Plan from the Trustee to Fidelity Management Trust Company (Successor Trustee) effective January 1, 1996. During 1995, the account balances of certain participants ($606,707) were transferred into The Gillette Company (parent company of Parker Pen USA Limited) Employees' Savings Plan (Gillette Plan). These participants are now participating in the Gillette Plan. The account balances of all remaining non-bargaining unit participants of the Plan totaling $3,806,039 were transferred to the Gillette Plan on January 2, 1996 along with their payment reserve account balances which totaled $141,374. As of January 1, 1996 the Gillette Company will assume sponsorship and administration of the Plan which will be redesigned to replicate the investment options, including Gillette common stock, and administrative features of the Gillette Plan (see note 1c). THE PARKER PEN 401(k) PLAN Schedule 1 - Item 27a - Schedule of Assets Held for Investment Purposes December 31, 1995 (c) (b) Description of investment Identity of issuer, including maturity date, (e) borrower, lessor rate of interest, collateral (d) Current (a) or similar party par or maturity value Cost value - -------------------------------------------------------------------------------- * Bank One Wisconsin 8,781,687 shares, The One Group Trust Company, N.A. Prime Money Market Fund $8,781,687 8,781,687 * Notes receivable-participants 250,774 250,774 Total investments $9,032,461 9,032,461 Cost refers to historical cost. * Denotes party-in-interest See accompanying independent auditors' report. THE PARKER PEN 401(k) PLAN Schedule 2 - Item 27d - Schedule of Reportable Transactions Year ended December 31, 1995
(h) (f) Current (a) (b) Expense value of Identity of Description of asset (include (c) (d) (e) incurred (g) asset on (i) party interest rate and maturity Purchase Selling Lease with Cost of transaction Net gain involved in case of a loan) price price rental transaction asset date or (loss) - ------------------------------------------------------------------------------------------------------------------------------------ Bank One Wisconsin Commingled Funds Guaranteed Trust Company, N.A. Investment Contracts $ 522,643 - - - 522,643 522,643 - Bank One Wisconsin Commingled Funds Guaranteed Trust Company, N.A. Investment Contracts - 3,871,100 - - 3,871,097 3,871,100 3 Bank One Wisconsin The One Group Disciplined Trust Company, N.A. Value Fund 152,060 - - - 152,060 152,060 - Bank One Wisconsin The One Group Disciplined Trust Company, N.A. Value Fund - 1,272,607 - - 1,147,930 1,272,607 124,677 Bank One Wisconsin The One Group Government Trust Company, N.A. Bond Fund 26,982 - - - 26,982 26,982 - Bank One Wisconsin The One Group Government Trust Company, N.A. Bond Fund - 484,024 - - 481,360 484,024 2,664 Bank One Wisconsin The One Group Income Trust Company, N.A. Bond Fund 28,257 - - - 28,257 28,257 - Bank One Wisconsin The One Group Income Trust Company, N.A. Bond Fund - 471,139 - - 477,679 471,139 (6,540) Bank One Wisconsin The One Group International Trust Company, N.A. Equity Index Fund 64,639 - - - 64,639 64,639 - Bank One Wisconsin The One Group International Trust Company, N.A. Equity Index Fund - 582,760 - - 551,057 582,760 31,703 Bank One Wisconsin The One Group Large Trust Company, N.A. Company Growth Fund 325,531 - - - 325,531 325,531 - Bank One Wisconsin The One Group Large Trust Company, N.A. Company Growth Fund - 971,100 - - 800,201 971,100 170,899 Bank One Wisconsin The One Group Large Trust Company, N.A. Company Value Fund 554,890 - - - 554,890 554,890 - Bank One Wisconsin The One Group Large Trust Company, N.A. Company Value Fund - 1,196,096 - - 1,189,374 1,196,096 6,722 Bank One Wisconsin The One Group Prime Trust Company, N.A. Money Market Fund 10,743,418 - - - 10,743,418 10,743,418 - Bank One Wisconsin The One Group Prime Trust Company, N.A. Money Market Fund - 2,196,440 - - 2,196,440 2,196,440 - Bank One Wisconsin The One Group Small Trust Company, N.A. Company Growth Fund 99,871 - - - 99,871 99,871 - Bank One Wisconsin The One Group Small Trust Company, N.A. Company Growth Fund - 1,063,528 - - 924,433 1,063,528 139,095 Note: The above data represents a series of transactions where the aggregate amount exceeds five percent of the fair value of the Plan assets as of the beginning of the Plan year. Cost refers to historical cost. See accompanying independent auditors' report.
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