-----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, ULTJvkMs4qUb4I3i27dA909vMQ06llCxt86vA6IYiXA3ykXqUPSBbrKiS7lEc/p6 MLffE8z+0qrEMISgEVYSVA== 0000072162-97-000007.txt : 19970624 0000072162-97-000007.hdr.sgml : 19970624 ACCESSION NUMBER: 0000072162-97-000007 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970623 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NL INDUSTRIES INC CENTRAL INDEX KEY: 0000072162 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INORGANIC CHEMICALS [2810] IRS NUMBER: 135267260 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 001-00640 FILM NUMBER: 97628327 BUSINESS ADDRESS: STREET 1: TWO GREENSPOINT PLAZA STREET 2: 16825 NORTHCHASE DRIVE SUITE 1200 CITY: HOUSTON STATE: TX ZIP: 77060-2544 BUSINESS PHONE: 7134233300 MAIL ADDRESS: STREET 1: TWO GREENSPOINT PLAZA STREET 2: 16825 NORTHCHASE DR., SUITE 1200 CITY: HOUSTON STATE: TX ZIP: 77060-2544 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL LEAD CO DATE OF NAME CHANGE: 19710520 10-K405/A 1 NL IND. 10-K/A-1 - AMENDMENT NO. 1 - FORM 11-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K / A-1 |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 - For the fiscal year ended December 31, 1996 OR |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-640 NL INDUSTRIES, INC. (Exact name of registrant as specified in its charter) New Jersey 13-5267260 - ------------------------------- ------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 16825 Northchase Drive, Suite 1200, Houston, Texas 77060-2544 - -------------------------------------------------- ------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (281) 423-3300 Securities registered pursuant to Section 12(b) of the Act: Name of each exchange on Title of each class which registered - ------------------------------ ------------------------ Common stock ($.125 par value) New York Stock Exchange Pacific Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. |X| As of March 20, 1997, 51,144,014 shares of common stock were outstanding. The aggregate market value of the 13,662,324 shares of voting stock held by nonaffiliates as of such date approximated $149 million. Documents incorporated by reference: The information required by Part III is incorporated by reference from the Registrant's definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this report. The undersigned Registrant hereby amends the following items, financial statements, exhibits or other portions of its Annual Report on Form 10-K for the year ended December 31, 1996 as set forth below and in the pages attached hereto: Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K. Exhibit No. 99.1, Annual Report of NL Industries, Inc. Retirement Savings Plan on Form 11-K for the year ended December 31, 1996 (filed as an amendment to the Registrant's Annual Report on Form 10-K for the year ended December 31, 1996). Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. NL INDUSTRIES, INC. (Registrant) Dated: June 20, 1997 By: /s/ Dennis G. Newkirk --------------------- Dennis G. Newkirk Vice President and Controller EX-99.1 2 FORM 11-K NL IND., INC. RETIREMENT SAV. PLAN-1996 Exhibit 99.1 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 |X| Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 - for the year ended December 31, 1996 OR |_| Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commission file number 1-640 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: NL INDUSTRIES, INC. 16825 Northchase Drive, Suite 1200 Houston, Texas 77060-2544 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN INDEX Page Signature Page 2 Financial Statements and Supplemental Schedules with Report of Independent Accountants F-1 to F-16 Exhibit 1 - Consent of Independent Accountants - 1 - SIGNATURE Pursuant to the requirements of the Securities Act of 1934, the Administrator has duly caused this Annual Report to be signed by the undersigned thereunto duly authorized. NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN By: NL INDUSTRIES, INC. PENSION AND EMPLOYEE BENEFITS COMMITTEE, Administrator of NL Industries, Inc. Retirement Savings Plan By: /s/ Edward J. Zadzora Edward J. Zadzora Chairman June 20, 1997 - 2 - NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN FINANCIAL STATEMENTS, FUND INFORMATION AND SUPPLEMENTAL SCHEDULES WITH REPORT OF INDEPENDENT ACCOUNTANTS December 31, 1996 NL INDUSTRIES INC. RETIREMENT SAVINGS PLAN INDEX Page Report of Independent Accountants F-2 Financial Statements: Statements of Net Assets Available for Benefits, with Fund Information - December 31, 1995 and 1996 F-3 to F-5 Statements of Changes in Net Assets Available for Benefits, with Fund Information - Years ended December 31, 1995 and 1996 F-6 to F-8 Notes to Financial Statements F-9 to F-14 Supplemental Schedules: Item 27a - Schedule of Assets Held for Investment Purposes - December 31, 1996 F-15 Item 27d - Schedule of Reportable Transactions - Year ended December 31, 1996 F-16 All other schedules are omitted because they are not applicable or not required. F-1 REPORT OF INDEPENDENT ACCOUNTANTS To the Pension and Employee Benefits Committee of NL Industries, Inc.: We have audited the accompanying statements of net assets available for benefits of the NL Industries, Inc. Retirement Savings Plan as of December 31, 1995 and 1996, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of NL's Pension and Employee Benefits Committee. 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 NL's Pension and Employee Benefits Committee, 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 net assets available for benefits of the NL Industries, Inc. Retirement Savings Plan as of December 31, 1995 and 1996, and the changes in net assets available for 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, as listed on the accompanying index, are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The fund information in the statements of net assets available for benefits and the statements of changes in net assets available for benefits is presented for purposes of additional analysis rather than to present the net assets available for benefits and changes in net assets available for benefits of each fund. The supplemental schedules and fund information have been subjected to the auditing procedures applied in the audit 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. COOPERS & LYBRAND L.L.P. Houston, Texas June 12, 1997 F-2 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION December 31, 1995
Fund Information --------------------------------------------------------------------- ML Federal ML Capital ML Basic ML Retirement ML Global Securities Fund, Value Preservation Holdings, Trust Inc. Fund Trust Inc. ---------- ---------- --------- ------------- --------- Investments at fair value: Common stock ........... $ -- $ -- $ -- $ -- $ -- Other securities ....... 635,644 4,182,517 2,290,572 24,364,863 726,896 Employer contributions receivable .............. 22,516 143,211 148,455 289,062 59,397 Cash ..................... -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Net assets available for plan benefits ......... $ 658,160 $ 4,325,728 $ 2,439,027 $24,653,925 $ 786,293 =========== =========== =========== =========== =========== Fund Information ------------------------------------ Common Stock Funds ------------------------- Dresser/ Cash NL Tremont Fund Total ----------- ----------- --------- ----------- Investments at fair value: Common stock ........... $ 2,966,120 $ 392,019 $ -- $ 3,358,139 Other securities ....... -- -- -- 32,200,492 Employer contributions receivable .............. 96,019 -- -- 758,660 Cash ..................... -- -- 4,029 4,029 ----------- ----------- ----------- ----------- Net assets available for plan benefits ......... $ 3,062,139 $ 392,019 $ 4,029 $36,321,320 =========== =========== =========== ===========
F-3 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION (CONTINUED) December 31, 1996
Fund Information -------------------------------------------------- AIM MFS Emerging Templeton International AIM Value Growth Fund World Fund Equity Fund Fund ----------- ---------- ------------- --------- Investments at fair value: Common stock .................. $ -- $ -- $ -- $ -- Other securities .............. 1,053,576 476,472 405,674 725,427 Employer contributions receivable 51,737 34,693 23,202 33,185 Cash ............................ -- -- -- -- ---------- ---------- ---------- ---------- Net assets available for plan benefits ..................... $1,105,313 $ 511,165 $ 428,876 $ 758,612 ========== ========== ========== ========== Fund Information ----------------------------------------- ML Global MFS Government ML Equity Allocation Securities Fund Index Trust Fund, Inc. --------------- ----------- ----------- Investments at fair value: Common stock .................. $ -- $ -- $ -- Other securities .............. 215,693 346,379 477,894 Employer contributions receivable 11,014 21,451 25,031 Cash ............................ -- -- -- ---------- ---------- ---------- Net assets available for plan benefits ...................... $ 226,707 $ 367,830 $ 502,925 ========== ========== ==========
F-4 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION (CONTINUED) December 31, 1996 (Continued)
Fund Information (Continued) --------------------------------------------------------------------- ML Federal ML Capital ML Basic ML Retirement ML Global Securities Fund, Value Preservation Holdings, Trust Inc. Fund Trust Inc. ---------- ----------- ----------- ------------- ----------- Investments at fair value: Common stock ........... $ -- $ -- $ -- $ -- $ -- Other securities ....... 645,236 4,531,774 3,057,100 22,758,005 601,585 Employer contributions receivable .............. 15,144 110,550 107,977 235,826 -- Cash ..................... -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Net assets available for plan benefits ......... $ 660,380 $ 4,642,324 $ 3,165,077 $22,993,831 $ 601,585 =========== =========== =========== =========== =========== Fund Information (Continued) ------------------------------------ Common Stock Funds ------------------------- Dresser/ Cash NL Tremont Fund Total ----------- ----------- --------- ----------- Investments at fair value: Common stock ........... $ 2,388,253 $ 491,385 $ -- $ 2,879,638 Other securities ....... -- -- -- 35,294,815 Employer contributions receivable .............. 46,967 -- -- 716,777 Cash ..................... -- -- 5,608 5,608 ----------- ----------- ----------- ----------- Net assets available for plan benefits ......... $ 2,435,220 $ 491,385 $ 5,608 $38,896,838 =========== =========== =========== ===========
See accompanying notes to financial statements. F-5 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION Year ended December 31, 1995
Fund Information --------------------------------------------------------------------------- ML Federal ML Capital ML Basic ML Retirement ML Global Securities Fund, Value Preservation Holdings, Trust Inc. Fund Trust Inc. ---------- ------------ ------------ ------------- ------------ Investment income: Dividend income: Dresser Corporation ............... $ -- $ -- $ -- $ -- $ -- Other ............................. 30,096 428,859 101,067 -- 38,299 Interest income ..................... -- -- -- 1,518,710 -- ------------ ------------ ------------ ------------ ------------ Total investment income ............. 30,096 428,859 101,067 1,518,710 38,299 ------------ ------------ ------------ ------------ ------------ Net appreciation (depreciation) in the fair value of investments ........ 30,007 591,021 420,509 -- 58,011 ------------ ------------ ------------ ------------ ------------ Contributions: Participants ........................ 51,497 238,841 192,109 544,341 91,965 Employer ............................ 22,516 143,211 148,455 289,062 59,397 ------------ ------------ ------------ ------------ ------------ Total contributions ................. 74,013 382,052 340,564 833,403 151,362 ------------ ------------ ------------ ------------ ------------ Total income and contributions ...................... 134,116 1,401,932 862,140 2,352,113 247,672 ------------ ------------ ------------ ------------ ------------ Net interfund transfers ............... 198,320 27,097 139,605 (893,413) 27,659 ------------ ------------ ------------ ------------ ------------ Distributions: Benefit payments .................... 12,096 281,081 69,324 2,615,395 67,623 Less forfeitures .................... (182) (494) (815) (2,135) (631) ------------ ------------ ------------ ------------ ------------ Total distributions ................. 11,914 280,587 68,509 2,613,260 66,992 ------------ ------------ ------------ ------------ ------------ Net change in net assets available for plan benefits .......... 320,522 1,148,442 933,236 (1,154,560) 208,339 Net assets available for plan benefits: Beginning of year ................... 337,638 3,177,286 1,505,791 25,808,485 577,954 ------------ ------------ ------------ ------------ ------------ End of year ......................... $ 658,160 $ 4,325,728 $ 2,439,027 $ 24,653,925 $ 786,293 ============ ============ ============ ============ ============ Fund Information -------------------------------------------- Common Stock Funds ---------------------------- Dresser/ Cash NL Tremont Fund Total ----------- ------------ ------------ ------------ Investment income: Dividend income: Dresser Corporation ............... $ -- $ 9,868 $ -- $ 9,868 Other ............................. -- -- -- 598,321 Interest income ..................... -- -- 1,705 1,520,415 ------------ ------------ ------------ ------------ Total investment income ............. -- 9,868 1,705 2,128,604 ------------ ------------ ------------ ------------ Net appreciation (depreciation) in the fair value of investments ........ (167,245) 90,951 -- 1,023,254 ------------ ------------ ------------ ------------ Contributions: Participants ........................ 160,265 -- -- 1,279,018 Employer ............................ 96,019 -- -- 758,660 ------------ ------------ ------------ ------------ Total contributions ................. 256,284 -- -- 2,037,678 ------------ ------------ ------------ ------------ Total income and contributions ...................... 89,039 100,819 1,705 5,189,536 ------------ ------------ ------------ ------------ Net interfund transfers ............... 512,367 (11,635) -- -- ------------ ------------ ------------ ------------ Distributions: Benefit payments .................... 107,149 23,074 -- 3,175,742 Less forfeitures .................... (229) -- -- (4,486) ------------ ------------ ------------ ------------ Total distributions ................. 106,920 23,074 -- 3,171,256 ------------ ------------ ------------ ------------ Net change in net assets available for plan benefits .......... 494,486 66,110 1,705 2,018,280 Net assets available for plan benefits: Beginning of year ................... 2,567,653 325,909 2,324 34,303,040 ------------ ------------ ------------ ------------ End of year ......................... $ 3,062,139 $ 392,019 $ 4,029 $ 36,321,320 ============ ============ ============ ============
F-6 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION (CONTINUED) Year ended December 31, 1996
Fund Information ------------------------------------------------------- AIM MFS Emerging Templeton International AIM Value Growth Fund World Fund Equity Fund Fund ------------ ---------- ------------- ----------- Investment income: Dividend income: NL Industries, Inc. ............... $ -- $ -- $ -- $ -- Dresser Corporation ............... -- -- -- -- Other ............................. 12,370 31,535 10,357 34,248 Interest income ..................... -- -- -- -- ----------- ----------- ----------- ----------- Total investment income ............. 12,370 31,535 10,357 34,248 ----------- ----------- ----------- ----------- Net appreciation (depreciation) in the fair value of investments ............ (20,966) 10,822 20,990 38,049 ----------- ----------- ----------- ----------- Contributions: Participants ........................ 66,794 41,172 36,106 50,186 Employer ............................ 51,737 34,693 23,202 33,185 ----------- ----------- ----------- ----------- Total contributions ................. 118,531 75,865 59,308 83,371 ----------- ----------- ----------- ----------- Total income and contributions ...... 109,935 118,222 90,655 155,668 ----------- ----------- ----------- ----------- Net interfund transfers ............... 1,001,104 393,871 338,741 606,950 ----------- ----------- ----------- ----------- Distributions: Benefit payments .................... 5,726 928 520 4,006 Less forfeitures .................... -- -- -- -- ----------- ----------- ----------- ----------- Total distributions ................. 5,726 928 520 4,006 ----------- ----------- ----------- ----------- Net change in net assets available for plan benefits ........................ 1,105,313 511,165 428,876 758,612 Net assets available for plan benefits: Beginning of year ................... -- -- -- -- ----------- ----------- ----------- ----------- End of year ......................... $ 1,105,313 $ 511,165 $ 428,876 $ 758,612 =========== =========== =========== =========== Fund Information ----------------------------------------- ML Global MFS Government ML Equity Allocation Securities Fund Index Trust Fund, Inc. --------------- ----------- ------------ Investment income: Dividend income: NL Industries, Inc. ............... $ -- $ -- $ -- Dresser Corporation ............... -- -- -- Other ............................. 7,284 -- 39,571 Interest income ..................... -- -- -- ----------- ----------- ----------- Total investment income ............. 7,284 -- 39,571 ----------- ----------- ----------- Net appreciation (depreciation) in the fair value of investments ............ 4,759 37,376 (3,987) ----------- ----------- ----------- Contributions: Participants ........................ 22,970 30,581 30,082 Employer ............................ 11,014 21,451 25,031 ----------- ----------- ----------- Total contributions ................. 33,984 52,032 55,113 ----------- ----------- ----------- Total income and contributions ...... 46,027 89,408 90,697 ----------- ----------- ----------- Net interfund transfers ............... 181,284 282,463 413,140 ----------- ----------- ----------- Distributions: Benefit payments .................... 604 4,041 912 Less forfeitures .................... -- -- -- ----------- ----------- ----------- Total distributions ................. 604 4,041 912 ----------- ----------- ----------- Net change in net assets available for plan benefits ........................ 226,707 367,830 502,925 Net assets available for plan benefits: Beginning of year ................... -- -- -- ----------- ----------- ----------- End of year ......................... $ 226,707 $ 367,830 $ 502,925 =========== =========== ===========
F-7 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION (CONTINUED) Year ended December 31, 1996 (Continued)
Fund Information (Continued) --------------------------------------------------------------------------- ML Federal ML Capital ML Basic ML Retirement ML Global Securities Fund, Value Preservation Holdings, Trust Inc. Fund Trust Inc. ---------- ------------ ------------ ------------- ------------ Investment income: Dividend income: NL Industries, Inc. ............... $ -- $ -- $ -- $ -- $ -- Dresser Corporation ............... -- -- -- -- -- Other ............................. 43,822 433,519 207,450 -- 36,615 Interest income ..................... -- -- -- 1,416,181 -- ------------ ------------ ------------ ------------ ------------ Total investment income ............. 43,822 433,519 207,450 1,416,181 36,615 ------------ ------------ ------------ ------------ ------------ Net appreciation (depreciation) in the fair value of investments ........ (13,887) 75,626 235,047 -- 51,115 ------------ ------------ ------------ ------------ ------------ Contributions: Participants ........................ 44,756 265,066 267,891 423,904 44,852 Employer ............................ 15,144 110,550 107,977 235,826 -- ------------ ------------ ------------ ------------ ------------ Total contributions ................. 59,900 375,616 375,868 659,730 44,852 ------------ ------------ ------------ ------------ ------------ Total income and contributions ...................... 89,835 884,761 818,365 2,075,911 132,582 ------------ ------------ ------------ ------------ ------------ Net interfund transfers ............... (52,291) (280,470) (46,618) (1,865,472) (310,057) ------------ ------------ ------------ ------------ ------------ Distributions: Benefit payments .................... 35,324 287,695 45,697 1,874,490 7,233 Less forfeitures .................... -- -- -- (3,957) -- ------------ ------------ ------------ ------------ ------------ Total distributions ................. 35,324 287,695 45,697 1,870,533 7,233 ------------ ------------ ------------ ------------ ------------ Net change in net assets available for plan benefits .......... 2,220 316,596 726,050 (1,660,094) (184,708) Net assets available for plan benefits: Beginning of year ................... 658,160 4,325,728 2,439,027 24,653,925 786,293 ------------ ------------ ------------ ------------ ------------ End of year ......................... $ 660,380 $ 4,642,324 $ 3,165,077 $ 22,993,831 $ 601,585 ============ ============ ============ ============ ============ Fund Information (Continued) -------------------------------------------- Common Stock Funds ---------------------------- Dresser/ Cash NL Tremont Fund Total ----------- ------------ ------------ ------------ Investment income: Dividend income: NL Industries, Inc. ............... $ 68,389 $ -- $ -- $ 68,389 Dresser Corporation ............... -- 8,595 -- 8,595 Other ............................. -- -- -- 856,771 Interest income ..................... -- -- 1,579 1,417,760 ------------ ------------ ------------ ------------ Total investment income ............. 68,389 8,595 1,579 2,351,515 ------------ ------------ ------------ ------------ Net appreciation (depreciation) in the fair value of investments ........ (180,690) 142,421 -- 396,675 ------------ ------------ ------------ ------------ Contributions: Participants ........................ 138,757 -- -- 1,463,117 Employer ............................ 46,967 -- -- 716,777 ------------ ------------ ------------ ------------ Total contributions ................. 185,724 -- -- 2,179,894 ------------ ------------ ------------ ------------ Total income and contributions ...................... 73,423 151,016 1,579 4,928,084 ------------ ------------ ------------ ------------ Net interfund transfers ............... (621,540) (41,105) -- -- ------------ ------------ ------------ ------------ Distributions: Benefit payments .................... 78,802 10,545 -- 2,356,523 Less forfeitures .................... -- -- -- (3,957) ------------ ------------ ------------ ------------ Total distributions ................. 78,802 10,545 -- 2,352,566 ------------ ------------ ------------ ------------ Net change in net assets available for plan benefits .......... (626,919) 99,366 1,579 2,575,518 Net assets available for plan benefits: Beginning of year ................... 3,062,139 392,019 4,029 36,321,320 ------------ ------------ ------------ ------------ End of year ......................... $ 2,435,220 $ 491,385 $ 5,608 $ 38,896,838 ============ ============ ============ ============
See accompanying notes to financial statements. F-8 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS Note 1 - Summary of significant accounting policies: The financial statements of the NL Industries, Inc. Retirement Savings Plan formerly the "Savings Plan for Employees of NL Industries, Inc.") (the "Plan") have been prepared in accordance with generally accepted accounting principles. The following is a summary of the significant accounting policies followed by the Plan. Investments Investments are recorded at fair value based upon the quoted market price reported on the last trading day of the period for those securities listed on a national securities exchange. Listed securities for which no sale was reported on that date are valued at the mean between the last reported bid and ask prices. Short-term investments are stated at fair value. Purchases and sales of investments are reflected on a trade-date basis. Gains or losses on sales of securities are based on average cost. The Plan presents in the statements of changes in net assets available for plan benefits the net appreciation (depreciation) in the fair value of its investments which consists of the realized gains or losses and the unrealized appreciation (depreciation) on those investments. Contributions Contributions from employees are recorded in the period the employer makes payroll deductions from Plan participants. Employer contributions are accrued at the end of each year and are received in the subsequent year. Investment income Income from investments is recorded as earned on an accrual basis. Dividend income is recorded at the ex-dividend date. Termination of Plan Although it has not expressed any intent to do so, NL Industries, Inc. has the right under the Plan to discontinue contributions and to terminate the Plan at any time subject to penalties set forth in the Employee Retirement Income Security Act of 1974 ("ERISA"). In the event of such a discontinuance or termination of the Plan, the net assets of the Plan would be allocated to the Plan participants as prescribed by the Plan document, ERISA, and the Internal Revenue Code. F-9 Note 2 - Plan description: The Plan's principal objective is to provide eligible employees of NL Industries, Inc. and its Subsidiaries (the "Company") with a convenient way to save on a regular and long-term basis. The majority of the Company's U.S. employees are eligible to voluntarily participate in the Plan after six months of employment. At December 31, 1996 there were 222 active participants and 656 total participants. Participants currently employed by the Company ("Active Participants") may make basic contributions of between 1% and 8% of their eligible compensation. Basic contributions may consist of a combination of pre-tax and after-tax earnings. Generally, pre-tax contributions are excluded from the employee's taxable income until they are distributed. Eligible employees that have elected to make the maximum basic contribution of 8% may also make a supplemental pre-tax or after-tax contribution of between 1% and 4% of their eligible compensation. In accordance with the Tax Reform Act of 1986, participants are limited in the amount of salary reduction contributions which they may make to the Plan under Section 402(g) of the Internal Revenue Code ($9,500 annual maximum for 1996). Highly compensated participants may be required to adjust the amount of their contributions in order to permit the Plan to satisfy the nondiscrimination requirements of Sections 401(k) and 401(m) of the Internal Revenue Code. The Company contributes a discretionary amount of matching contributions, determined annually, based upon the attainment of certain operating income target levels approved by the Management, Development and Compensation Committee of the Board of Directors of the Company. The employer match applies only to the employee's basic contributions. On March 31, 1996, the defined benefit plan for salaried employees of NL Industries, Inc. was amended and the pension benefits frozen for the majority of the Company's U.S. employees. Effective April 1, 1996, every employee who is eligible to participate in the Plan will receive an annual contribution into their investment account of 3% of their eligible compensation, subject to IRS limitations on eligible compensation, which currently is $150,000. The Company will make this contribution for each eligible employee regardless of whether the employee elects to otherwise participate in the Plan. This contribution is in addition to the Company's discretionary matching contribution described above. Employer contributions are fully vested upon death, retirement, or disability, as provided in the Plan. A participant with less than three years of service is 0% vested in employer contributions, 50% vested following three years of service, 75% vested following four years of service and fully vested in all employer contributions following five years of service. Forfeitures of employer contributions may occur if a participant terminates employment prior to the full vesting period or if a participant or beneficiary, to whom a distribution is payable, cannot be located within five years of the date on which such distribution became payable. Amounts forfeited are used in the following order: (i) to restore the accounts of reemployed participants, (ii) to restore the accounts of participants or beneficiaries who apply for forfeited benefits, and (iii) to reduce employer contributions. F-10 Merrill Lynch Trust Company ("Merrill Lynch" or "ML") serves as trustee for the Plan. Employees may elect to have their own contributions invested in one or more funds, whose investment objectives are as follows: Number of participants at December 31, ---------------- 1995 1996 ---- ---- Merrill Lynch Retirement Preservation Trust - managed 381 368 with the objective of providing preservation of capital, liquidity and current income through investments primarily in Guaranteed Investment Contracts. Merrill Lynch Basic Value Fund, Inc. - Class A Shares - 141 163 managed with the objective of seeking capital appreciation and, secondarily, income. Merrill Lynch Federal Securities Trust - Class D Shares - 85 82 managed with the objective of seeking a high current return through investments in U.S. government and government agency securities. Merrill Lynch Capital Fund, Inc. - Class A Shares - 189 184 managed with the objective of seeking the highest total investment return consistent with prudent risk, investing in equity, debt and convertible securities. Merrill Lynch Global Holdings, Inc. - Class A Shares - 77 59 managed with the objective of seeking the highest total investment return consistent with prudent risk through world-wide investment in an internationally diversified portfolio of securities. NL Stock Fund - invested in NL common stock. 530 500 Effective April 1, 1996, seven additional mutual fund investments became available to participants. MFS Emerging Growth Fund - Class A Shares - managed with - 104 the objective of providing long-term growth of capital by investing primarily in common stocks of small and medium- sized companies that are early in their life cycle but which have the potential to become major enterprises. Templeton World Fund - Class I Shares - managed with the - 78 objective of seeking long-term capital growth by investing in securities of companies or governments located throughout the world. The fund's portfolio is invested in securities of both U.S. and foreign issuers. F-11 Number of participants at December 31, ----------------- 1995 1996 ---- ---- AIM International Equity Fund - Class A Shares - managed - 70 with the objective of seeking long-term return of capital by investing in a diversified portfolio of international equity securities. AIM Value Fund - Class A Shares - managed with the - 90 objective of achieving long-term growth of capital by investing primarily in equity securities judged to be undervalued relative to appraisals of the current or projected earnings of the companies issuing the securities, or relative to current market values of assets owned by the companies issuing the securities or relative to the equity market generally. Income is a secondary objective. MFS Government Securities Fund - Class A Shares - managed - 49 with the objective of providing current income and preservation of principal by investing in Government Securities and by investing in obligations that are fully collateralized or otherwise fully secured by Government Securities. Merrill Lynch Equity Index Trust - managed with the - 67 objective of approximating the total return of the Standard & Poor's 500 Composite Stock Index. This index is a means to measure the performance of a broad base of large U.S. corporations. Merrill Lynch Global Allocation Fund, Inc. - Class A - 75 Shares - managed with the objective of seeking a high total investment return, consistent with the prudent risk, through a fully-managed investment policy utilizing United States and foreign equity, debt and money market securities the combination of which will be varied from time to time both with respect to types of securities and markets in response to changing market and economic trends. In addition to the funds listed above, the Dresser/Tremont Stock Fund holds investments in Dresser Industries for 50 participants and Tremont Corporation common stock for 43 participants. Contributions or transfers into the Dresser/Tremont Stock Fund are no longer allowed. On March 31, 1996, investments in the Merrill Lynch Global Holdings fund were frozen and only transfers out of this fund are permitted. Prior to March 31, 1996, employee contributions to the fund were permitted; however, no employer matching contributions were made in 1996 to this fund. F-12 Prior to the investment in securities of a type consistent with the objectives of any fund, cash may be temporarily invested in securities with maturities of less than one year issued or guaranteed by the U.S. government or any agency or instrumentality thereof or deposited in a bank savings account. Interfund transfers may be made daily, except that only one transfer per participant per quarter may affect amounts in the NL Stock Fund. Only one transfer is permitted out of the Dresser/Tremont Stock Fund which must be a transfer of the total value of the participant's account in that fund. Distributions to employees may occur during active service or upon termination and under prescribed circumstances, may be in the form of lump sums, installments, annuities or combinations thereof or employer securities. The Company bears the responsibility of all administrative expenses of the Plan. Note 3 - Investments: The historical cost and fair value of each of the investments at December 31, 1995 and 1996 were as follows:
1995 1996 ------------------------- ------------------------- Historical Historical Fund description cost Fair value cost Fair value - ---------------- ----------- ----------- ----------- ----------- Merrill Lynch Retirement Preservation Trust .................................. $24,364,863 $24,364,863 $22,758,005 $22,758,005 Merrill Lynch Basic Value Fund, Inc. - Class A Shares ......................... 1,886,249 2,290,572 2,564,065 3,057,100 Merrill Lynch Federal Securities Trust - Class D Shares ......................... 626,884 635,644 648,231 645,236 Merrill Lynch Capital Fund, Inc. - Class A Shares ......................... 3,671,102 4,182,517 4,043,712 4,531,774 Merrill Lynch Global Holdings, Inc. - Class A Shares ......................... 685,081 726,896 550,799 601,585 MFS Emerging Growth Fund - Class A Shares -- -- 1,059,235 1,053,576 Templeton World Fund - Class I Shares ... -- -- 465,233 476,472 AIM International Equity Fund - Class A Shares ................................. -- -- 386,506 405,674 AIM Value Fund - Class A Shares ......... -- -- 686,839 725,427 MFS Government Securities Fund - Class A Shares ................................. -- -- 210,926 215,693 Merrill Lynch Equity Index Trust ........ -- -- 309,021 346,379 Merrill Lynch Global Allocation Fund, Inc. - Class A Shares .................. -- -- 481,896 477,894 NL Stock Fund ........................... 2,986,130 2,966,120 2,790,711 2,388,253 Dresser/Tremont Stock Fund: Dresser Common Stock .................. 145,727 339,796 138,847 392,719 Tremont Common Stock .................. 25,816 52,223 22,601 98,666 ----------- ----------- ----------- ----------- $34,391,852 $35,558,631 $37,116,627 $38,174,453 =========== =========== =========== ===========
F-13 At June 12, 1997, the market value of the shares of NL, Dresser and Tremont stock held at December 31, 1996 was $3,047,076, $443,393 and $118,807 respectively. Concentration of credit risk During 1995 and the first quarter of 1996, the Plan's assets were invested principally with investment funds managed by Merrill Lynch and common stock of NL, Dresser and Tremont. Beginning April 1, 1996 seven new funds were added including two that are managed by Merrill Lynch. Each of the other five funds are managed by either i) Massachusetts Financial Services ("MFS"), ii) AIM Advisors, Inc., or iii) Templeton Global Advisors Limited. At December 31, 1996, 85% of the Plan's investments were managed by Merrill Lynch. Note 4 - Related party transactions: The NL Stock Fund and the Dresser/Tremont Stock Fund invest in the common stock of NL and Tremont. The activity of these securities for the years ended December 31, 1995 and 1996 was as follows:
Sales and distributions, Realized Purchases at cost gain --------- -------------- -------- Year ended December 31, 1995: NL common stock .................... $958,290 $251,364 $ 57,786 Tremont common stock ............... -- 2,829 1,519 Year ended December 31, 1996: NL common stock .................... $554,224 $749,643 $201,758 Tremont common stock ............... -- 3,215 8,893
Note 5 - Tax status: The Plan, as amended in 1994, is designed to constitute a qualified trust under Sections 401(a) and 401(k) of the Internal Revenue Code of 1986, as amended (the "Code"); as such the Plan is exempt from federal income tax, and amounts contributed by the Company will not be taxed to the participant until the participant receives a distribution from the Plan. The Plan has received a favorable determination as of September 1995, indicating it is a "Qualified Plan" under the requirements of Sections 401(a) and 401(k) of the Code and is qualified for favorable tax treatment. The Company intends to file an application with the Internal Revenue Service for a determination of the qualified status of the Plan under Section 401(a) of the Code for all amendments made to the Plan since the last determination letter. F-14 SUPPLEMENTAL SCHEDULES NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES December 31, 1996 Employer Identification No. 13-5267260 Plan No. 003
Cost Fair value ----------- ----------- Merrill Lynch Retirement Preservation Trust $22,758,005 $22,758,005 Merrill Lynch Basic Value Fund, Inc. - Class A shares 2,564,065 3,057,100 Merrill Lynch Federal Securities Trust - Class D Shares 648,231 645,236 Merrill Lynch Capital Fund, Inc. - Class A shares 4,043,712 4,531,774 Merrill Lynch Global Holdings, Inc. - Class A shares 550,799 601,585 MFS Emerging Growth Fund - Class A Shares 1,059,235 1,053,576 Templeton World Fund - Class I Shares 465,233 476,472 AIM International Equity Fund - Class A Shares 386,506 405,674 AIM Value Fund - Class A Shares 686,839 725,427 MFS Government Securities Fund - Class A Shares 210,926 215,693 Merrill Lynch Equity Index Trust 309,021 346,379 Merrill Lynch Global Allocation Fund, Inc.- Class A Shares 481,896 477,894 * NL Stock Fund - Common Stock 2,790,711 2,388,253 Dresser/Tremont Stock Fund - Common Stock: Dresser Industries 138,847 392,719 * Tremont Corporation 22,601 98,666 ----------- ----------- $37,116,627 $38,174,453 =========== ===========
Note: Cost is determined based on historical cost. Gains and losses on sales of investments are calculated based on average cost. * Investment in a "Party-in-interest" entity, as defined by ERISA. F-15 NL INDUSTRIES, INC. RETIREMENT SAVINGS PLAN ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS Year ended December 31, 1996 Employer Identification No. 13-5267260 Plan No. 003
Fair value of asset on Number of Purchase Selling Cost of transaction Net gain Description of Asset Transactions price price asset date (loss) - -------------------- ------------ ---------- ---------- ------- ----------- -------- Merrill Lynch Retirement Preservation Trust: Purchases ................ 136 $3,209,340 $ -- $3,209,340 $3,209,340 $ -- Sales .................... 131 -- 4,816,180 4,816,180 4,816,180 -- Merrill Lynch Capital Fund Inc. - Class A Shares Purchases ................ 80 1,234,657 -- 1,234,657 1,234,657 -- Sales .................... 79 -- 961,025 862,047 961,025 98,978 Merrill Lynch Basic Value Fund, Inc. - Class A Shares Purchases ................ 85 1,387,579 -- 1,387,579 1,387,579 -- Sales .................... 50 -- 853,095 706,759 853,095 146,336
F-16 EXHIBIT I CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the: (i) Registration Statement No. 2-98713 on Form S-8 and related Prospectus with respect to the 1985 Long Term Performance Incentive Plan of NL Industries, Inc.; (ii) Registration Statement No. 33-25913 on Form S-8 and related Prospectus with respect to the Savings Plan for Employees of NL Industries, Inc.; (iii) Registration Statement No. 33-29287 on Form S-8 and related Prospectus, as amended, with respect to the 1989 Long Term Performance Incentive Plan of NL Industries, Inc.; and (iv) Registration Statement No. 33-48145 on Form S-8 and related Prospectus with respect to the 1992 Non-Employee Director Stock Option Plan of NL Industries, Inc. of our report which is dated June 12, 1997, on our audits of the statements of net assets available for benefits of the NL Industries, Inc. Retirement Savings Plan as of December 31, 1995 and 1996 and the related statements of changes in net assets available for benefits for the years then ended, which report is included in this Annual Report on Form 11-K. Coopers & Lybrand L.L.P. Houston, Texas June 20, 1997 -----END PRIVACY-ENHANCED MESSAGE-----