11-K 1 moly11k01.txt MOLYCORP 2001 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 11-K Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 (Mark One) [X] Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2001 Or [ ] Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the transition period from to ------------ -------------- Commission file number 1-8483 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: MOLYCORP, INC. 401(K) RETIREMENT SAVINGS PLAN B. Name of issuer of the securities held pursuant to the Plan and the address of its principal executive office: Unocal Corporation, 2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245 MOLYCORP, INC. 401(k) RETIREMENT SAVINGS PLAN INDEX TO FINANCIAL STATEMENTS The following financial statements reflect the status of the Molycorp, Inc. 401(k) Retirement Savings Plan as of December 31, 2001 and 2000, and the results of its transactions for each of the years then ended. Page Number Report of Independent Accountants 1 Financial Statements: Statements of Net Assets Available for Benefits at December 31, 2001 and 2000 2 Statements of Changes in Net Assets Available for Benefits for the years ended December 31, 2001 and 2000 2 Notes to Financial Statements 3-6 Supplemental Schedules*: Schedule of Assets Held for Investment Purposes at December 31, 2001 8 Exhibit Index 9 * Supplemental schedules required by the Employee Retirement Income Security Act of 1974 that are omitted are not applicable to the Molycorp, Inc. 401(k) Retirement Savings Plan. REPORT OF INDEPENDENT ACCOUNTANTS To the Administrative Committee of the Molycorp, Inc. 401(k) Retirement Savings Plan: In our opinion, the accompanying statements of net assets available for benefits and the related statements of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Molycorp, Inc. 401(k) Retirement Savings Plan (the "Plan") at December 31, 2001 and 2000, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. 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 auditing standards generally accepted in the United States of America which require that we plan and perform the audits 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 our opinion. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes at December 31, 2001 is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is 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. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP Los Angeles, California May 24, 2002 -1- Molycorp, Inc. 401(k) Retirement Savings Plan Statements of Net Assets Available for Benefits December 31, 2001 2000 -------------------------------------------------------------------------------- Investments at fair value $142,670 $128,303 -------------- --------------- Net assets available for benefits $142,670 $128,303 ============== =============== Molycorp, Inc. 401(k) Retirement Savings Plan Statements of Changes in Net Assets Available for Benefits Year Ended December 31, 2001 2000 -------------------------------------------------------------------------------- Additions: Additions to (deductions from) net assets attributed to: Investment income (loss) Net depreciation in fair value of investments (10,505) $ (8,110) Interest 3,604 3,953 Dividends 230 118 ---------- --------- Total investment loss (6,671) (4,039) Participant contributions 37,347 36,263 ---------- --------- Total additions 30,676 32,224 ---------- --------- Deductions: Participant withdrawals & distributions 16,309 6,288 ---------- --------- Total deductions 16,309 6,288 ---------- --------- Net increase 14,367 25,936 ---------- --------- Net assets available for benefits: Beginning of year 128,303 102,367 ---------- --------- End of year $142,670 $128,303 ========== ========= See accompanying notes to financial statements. -2- NOTES TO FINANCIAL STATEMENTS NOTE 1 - DESCRIPTION OF THE PLAN General The Molycorp, Inc. 401(k) Retirement Savings Plan (the "Plan") is sponsored by Molycorp, Inc. (the "Company"), an indirect wholly owned subsidiary of Unocal Corporation. The Plan provides for voluntary pre-tax contributions by participants, who are employees represented by collective bargaining agents at certain facilities operated by the Company. The Plan's trustee and administrator is Putnam Fiduciary Trust Company (the "Trustee"). Each participant is allowed to choose how funds are invested from a range of investment fund options made available through Putnam investments and Unocal Corporation common stock. The Plan is subject to certain provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") as a defined contribution plan. The Plan booklet dated December 1, 1996 constitutes part of a prospectus covering securities that have been registered under the Securities Act of 1933. The December 1, 1996 booklet can be referenced for other information about the Plan. A restated Plan document dated September 1, 2001, was adopted in late 2001 to document modifications subsequent to the January 1, 2001 Plan document. Participation Collective bargaining unit employees at the Company's Questa and York facilities became eligible to participate in the Plan as of January 1, 1991 if at least six months of service were completed prior to January 1, 1991. Otherwise, participants become eligible to participate in the Plan upon completion of six months of service. Contributions Voluntary participant contributions to the Plan are made on a pre-tax basis and cannot exceed 15 percent of a participant's base pay. The pre-tax contributions are also known as 401(k) contributions. Contributions cannot exceed the amount prescribed by law and cannot be calculated on an amount of base pay in excess of the amount allowed by law. The Plan does not allow for employer contributions. Participant Accounts Each participant's account is credited with the participant's contributions and increased or decreased by the respective investment earnings or losses of the individual investments as governed by the participant's investment selections. Vesting Participants are always 100 percent vested in participant contributions and in the dividends and interest on those contributions. -3- Payment of Benefits On termination of employment or at such time that participants become eligible to receive benefits, participants may elect to receive their account balances or defer their distributions until a later date, but no later than 60 days after the end of the plan year in which the latest of the following occurs: April 1 after the close of the calendar year in which the participant attains age 70 1/2, or two years after the participant's employment terminates. If a participant continues to work after age 70 1/2, distribution of a portion of the participant's account balance is required by April 1 of the calendar year following the calendar year in which the participant attains age 70 1/2. Federal Income Tax Status In June 2002, the Company received a ruling, from the Internal Revenue Service, that subject to the adoption of certain technical amendments, the Plan meets the requirements of Section 401(a) of the Internal Revenue Code (the "Code") of 1986, as amended, and that the Trust established thereunder is entitled to exemption under the provisions of the Code; therefore, the Plan is not required to pay any federal income taxes. Contributions to and earnings on Plan accounts will not be taxable to participants prior to withdrawal from the Plan. Withdrawals from the Plan are generally subject to federal income tax. Also, in-service withdrawals and withdrawals following termination of employment prior to retirement may be subject to an additional 10 percent federal penalty tax. Plan Termination The Company expects to continue the Plan indefinitely, but, as future conditions cannot be foreseen, the Company may at any time or from time to time amend or terminate the Plan in whole or in part, subject to the requirements of ERISA and other applicable laws. An amendment may affect present, as well as future participants, but may not diminish the account of any participant existing on the effective date of such amendment. The Company has no present intent to terminate the Plan. NOTE 2 - Summary of Significant Accounting Policies Basis of Accounting The accompanying financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America. In addition, the following accounting policies are applied: a. Purchases and sales of securities are recorded on a trade-date basis. b. Dividends are recorded on an ex-dividend date basis. c. Interest income is recorded on the accrual basis. d. Benefits are recorded when paid. The Plan presents in the statements of changes in net assets available for benefits the net appreciation (depreciation) in the fair value of its investments which consist of the realized gains or losses and the unrealized appreciation (depreciation) on those investments. -4- Valuation of Investments The Plan's investments are stated at fair value. Shares of registered investment companies are valued at the net asset value of shares held by the Plan at year-end. Shares of Unocal common stock are valued at the closing price as reported for the New York Stock Exchange Composite Transactions at December 31, 2001 and 2000. Investments in common trust funds are valued based on information provided by the Plan's investment custodian. The financial statements of the common trust funds are audited annually by independent accountants. Use of Estimates in Preparation of the Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of additions to and deductions from net assets during the reporting periods. Actual results could differ from those estimates. NOTE 3 - Investments The following investments represent 5 percent or more of the Plan's net assets: December 31, 2001 2000 ------------------------------------------------------------------------------ Putnam Money Market Fund 97,114 and 75,501 shares, respectively $ 97,114 $ 75,501 Putnam New Opportunities Fund 418 and 330 shares, respectively 17,528 19,773 Putnam S&P 500 Index Fund 363 and 484 shares, respectively 10,109 15,320 Putnam International Growth Fund 487 and 361 shares, respectively 9,718 8,952 Unocal Common Stock 21 and 153 shares, respectively 744 5,903 The Plan's investments appreciated (depreciated) in value as follows: December 31, 2001 2000 ----------------------------- Mutual funds ($8,804) ($7,915) Common or collective trust (902) (975) Common stock (799) 780 ------------ ------------- ($10,505) ($8,110) ============ ============= -5- NOTE 4 - Parties-in-interest Certain of the Plan's investments are shares of mutual funds managed by the Trustee, as defined by the Plan Agreement. Therefore, these transactions qualify as party-in-interest transactions for which a statutory exemption exists. Unocal Corporation, which also qualifies as a party-in-interest, absorbs substantially all of the administrative expenses of the Plan, which were nominal for the years ended December 31, 2001 and 2000. Such transactions with the Company qualify for a statutory exemption. -6- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Committee appointed by the Board of Directors of the Company to administer the Plan has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. MOLYCORP, INC. 401(k) RETIREMENT SAVINGS PLAN Date: June 28, 2002 By: /s/ Roger T. Inabu ---------------------------------- Roger T. Inabu Comptroller, Molycorp, Inc. -7-
Molycorp, Inc. 401(k) Retirement Savings Plan Schedule of Assets Held for Investment Purposes At December 31, 2001 (a) (b) (c) (d) (e) Identity of Issuer, Description of Investment, Borrower, Lessor Including Maturity Date, Rate of or Similar Party Interest, Collateral, Par, or Maturity Value Cost Current Value ------------------------------------------------------------------------------------------------------------------------------ * Unocal Corporation Unocal Corporation Common Stock $ 744 21 shares ** Putnam Investments Putnam Money Market Fund 97,114 97,114 shares ** Putnam Investments Putnam New Opportunities Mutual Fund 17,528 418 shares ** Putnam Investments Putnam S&P 500 Index Fund 10,109 363 shares ** Putnam Investments Putnam International Growth Fund 9,718 487 shares ** Putnam Investments The Putnam Bond Index Fund 4,190 352 shares ** Putnam Investments Putnam Voyager Fund 1,450 82 shares ** Vanguard Group The Vanguard Windsor II Fund 467 18 shares ** Putnam Investments George Putnam Fund of Boston 1,350 80 shares ------------------ Total assets held for investment purposes $ 142,670 ================== * Parent of the Sponsor and employer and, therefore, a party-in-interest for which a statuory exemption exists. ** Trustee for the Plan and, therefore, a party-in-interest for which a statuory exemption exists. The Vanguard Windsor II Fund is also available through Putnam Investments.
-8- UNOCAL CORPORATION EXHIBIT INDEX Exhibit 23 Consent of PricewaterhouseCoopers LLP -9-