-----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, PY8U4d+T2YI4y5Qhn8Q49dFmz2WSAgsr97iEaxwBWBA5bEQPF9+pwIQTIkBMmhrw QAdwWtVUw8x7riKBldM+5g== 0000757011-97-000006.txt : 19970401 0000757011-97-000006.hdr.sgml : 19970401 ACCESSION NUMBER: 0000757011-97-000006 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970331 SROS: CSX SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: USG CORP CENTRAL INDEX KEY: 0000757011 STANDARD INDUSTRIAL CLASSIFICATION: CONCRETE GYPSUM PLASTER PRODUCTS [3270] IRS NUMBER: 363329400 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08864 FILM NUMBER: 97569503 BUSINESS ADDRESS: STREET 1: 125 S FRANKLIN ST STREET 2: DEPT. 188 CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3126064000 11-K 1 ANNUAL REPORT 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 15(d) of the Securities Exchange - ------- Act of 1934 (Fee required) For the fiscal year ended December 31, 1996. 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 1-8864. A. Full title of the Plan: USG CORPORATION INVESTMENT PLAN (Formerly USG CORPORATION INVESTMENT PLAN FOR SALARIED EMPLOYEES) B. Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office: USG CORPORATION, 125 SOUTH FRANKLIN STREET, CHICAGO, ILLINOIS 60606 REQUIRED INFORMATION Financial Statements: Plan financial statements and schedules prepared in accordance with the financial reporting requirements of ERISA attached hereto, including a Consent of Independent Public Auditors with respect to Form S-8 for 1996. Pursuant to the requirements of the Securities and Exchange Act of 1934, the members of the Pension and Investment Committee administering the Plan have duly caused this annual report to be signed by the undersigned thereunto duly authorized. USG CORPORATION INVESTMENT PLAN By: /s/ Harold E. Pendexter. Jr. -------------------------------- H. E. Pendexter, Jr. Member of Pension and Investment Committee Date: March 18, 1997 USG CORPORATION INVESTMENT PLAN REPORT ON AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES YEARS ENDED DECEMBER 31, 1996 AND 1995 TABLE OF CONTENTS PAGE
INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS: Statement of Net Assets Available for Plan Benefits 2 Statement of Changes in Net Assets Available for Plan Benefits 4 Notes to Financial Statements 6 SUPPLEMENTAL SCHEDULES: I. Schedule of Investments Held at Year End 12 II. Schedule of Reportable Transactions 13
MEMBER OF THE MEMBER OF THE ILLINOIS CPA AMERICAN INSTITUTE SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS Hill, Taylor LLC CERTIFIED PUBLIC ACCOUNTANTS 116 South Michigan Avenue - 11th Floor Chicago, Illinois 60603 312-332-4964 Fax: 312-332-0181 INDEPENDENT AUDITORS' REPORT PENSION AND INVESTMENT COMMITTEE USG CORPORATION We have audited the accompanying statement of net assets available for plan benefits of the USG Corporation Investment Plan as of December 31, 1996 and 1995, and the related statement of changes in net assets available for plan 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 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, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan as of December 31, 1996 and 1995, and the changes in net assets available for plan benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of investments held at year end as of December 31, 1996, and reportable transactions for the year ended December 31, 1996, are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 and are not a required part of the basic financial statements. 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. /s/ Hill, Taylor LLC - -------------------- March 11, 1997 STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 AND 1995
1996 ------------------------------------------------------------------------------------ USG COMMON FIXED GOVERNMENT EQUITY STOCK INCOME INVESTMENT INDEX BALANCED FUND FUND FUND FUND FUND ------------- ------------- ------------ ------------- ------------- ASSETS: Investments at Market $ 19,185,797 $122,884,255 $ 4,666,089 $ 32,485,092 $ 12,295,698 Receivables: Employer contributions receivable -- 7,960,213 -- -- -- Employee loans receivable -- -- -- -- -- Interest and dividend receivable 70 195,452 20,227 5 25 Pending transactions from participants' elections for transfers between funds or forfeitures -- -- 111,679 431,678 194,274 ------------- ------------- ------------- ------------- ------------ Total Receivables 70 8,155,665 131,906 431,683 194,299 ------------- ------------- ------------- ------------- ------------ Total Assets 19,185,867 131,039,920 4,797,995 32,916,775 12,489,997 ------------- ------------- ------------- ------------- ------------ LIABILITIES: Pending transactions from participants' elections for transfers between funds or forfeitures 554,236 1,422,440 -- -- -- ------------- ------------ ------------ ------------ ------------ Total Liabilities 554,236 1,422,440 -- -- -- ------------- ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 18,631,631 $129,617,480 $ 4,797,995 $ 32,916,775 $ 12,489,997 ============ ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 AND 1995
1996 ------------------------------------------------------------------------- FORFEITURE INVESTMENT GROWTH CASH PLAN FUND ACCOUNT LOANS TOTAL ------------- ------------- ------------- ------------- ASSETS: Investments at Market $ 20,394,899 $ 154,061 $ -- $212,065,891 Receivables: Employer contributions receivable -- (114,318) -- 7,845,895 Employee loans receivable -- -- 7,840,092 7,840,092 Interest and dividend receivable 3 704 -- 216,486 Pending transactions from participants' elections for transfers between funds or forfeitures 1,271,645 29,143 -- 2,038,419 ------------ ----------- ------------ ------------ Total Receivables 1,271,648 (84,471) 7,840,092 17,940,892 ------------ ----------- ------------ ------------ Total Assets 21,666,547 69,590 7,840,092 230,006,783 ------------ ----------- ------------ ------------ LIABILITIES: Pending transactions from participants' elections for transfers between funds or forfeitures -- -- 697,912 2,674,588 ------------ ------------ ------------ ------------ Total Liabilities -- -- 697,912 2,674,588 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 21,666,547 $ 69,590 $ 7,142,180 $227,332,195 ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 AND 1995
1995 ------------------------------------------------------------------------------------ USG COMMON FIXED GOVERNMENT EQUITY STOCK INCOME INVESTMENT INDEX BALANCED FUND FUND FUND FUND FUND ------------- ------------ ------------ ----------- ------------ ASSETS: Investments at Market $ 15,965,324 $121,017,261 $ 4,490,474 $ 21,878,533 $ 8,292,660 Receivables: Employer contributions receivable -- 5,506,150 -- -- -- Employee loans receivable -- -- -- -- -- Employee contributions receivable 6,807 15,719 1,449 6,411 4,737 Interest and dividend receivable 98 215,820 20,761 2 27 Pending transactions from participants' elections for transfers between funds or forfeitures -- -- -- 956,988 852,825 ------------ ------------ ----------- ----------- ------------ Total Receivables 6,905 5,737,689 22,210 963,401 857,589 ------------ ------------ ----------- ----------- ------------ Total Assets 15,972,229 126,754,950 4,512,684 22,841,934 9,150,249 ------------ ------------ ----------- ----------- ------------ LIABILITIES: Pending transactions from participants' elections for transfers between funds or forfeitures 214,573 2,794,811 124,186 -- -- ------------ ------------ ------------ ------------ ------------ Total Liabilities 214,573 2,794,811 124,186 -- -- ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 15,757,656 $123,960,139 $ 4,388,498 $ 22,841,934 $ 9,150,249 ============ ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 AND 1995
1995 --------------------------------------------------------------------------- FORFEITURE INVESTMENT GROWTH CASH PLAN FUND ACCOUNT LOANS TOTAL ------------ ------------ ------------ ------------ ASSETS: Investments at Market $ 11,173,418 $ 56,911 $ -- $ 182,874,581 Receivables: Employer contributions receivable -- -- -- 5,506,150 Employee loans receivable -- -- 5,447,027 5,447,027 Employee contributions receivable 6,863 -- -- 41,986 Interest and dividend receivable 1 281 -- 236,990 Pending transactions from participants' elections for transfers between funds or forfeitures 1,303,996 33,690 904,717 4,052,216 ------------ ------------ ------------ ------------ Total Receivables 1,310,860 33,971 6,351,744 15,284,369 ------------ ------------ ------------ ------------ Total Assets 12,484,278 90,882 6,351,744 198,158,950 ------------ ------------ ------------ ------------ LIABILITIES: Pending transactions from participants' elections for transfers between funds or forfeitures -- -- -- 3,133,570 ------------ ------------ ------------ ------------ Total Liabilities -- -- -- 3,133,570 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 12,484,278 $ 90,882 $ 6,351,744 $195,025,380 ============ ============ ============ ============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS YEARS ENDED DECEMBER 31, 1996 AND 1995
1996 ------------------------------------------------------------------------------ COMMON FIXED GOVERNMENT EQUITY STOCK INCOME INVESTMENT INDEX BALANCED FUND FUND FUND FUND FUND ------------- -------------- ----------- ------------- ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, beginning of year $15,757,656 $123,960,139 $4,388,498 $22,841,934 $9,150,249 ------------- -------------- ----------- ------------- ------------- ADD (DEDUCT): Corporation contributions --- 11,859,525 --- --- --- Employee contributions 2,142,189 8,635,407 507,642 3,073,532 1,462,446 ------------- -------------- ----------- ------------- ------------- 2,142,189 20,494,932 507,642 3,073,532 1,462,446 ------------- -------------- ----------- ------------- ------------- Income from investments: Dividend income --- --- --- 600,693 384,991 Interest income 1,698 7,325,085 234,013 665 1,296 Realized gain (loss) on sale of investments (2,078,354) --- --- 808,159 1,015,612 Unrealized appreciation for the year 4,338,774 --- --- 4,260,634 114,503 ------------- -------------- ----------- ------------- ------------- 2,262,118 7,325,085 234,013 5,670,151 1,516,402 ------------- -------------- ----------- ------------- ------------- Benefit payments and participant withdrawals (996,138) (13,205,907) (315,855) (2,036,392) (994,371) Participants' elections for transfers between funds or forfeitures (813,112) (7,691,826) (35,878) 3,198,440 1,357,547 Net fund transactions 278,918 (1,264,943) 19,575 169,110 (2,276) due to loans Administrative expenses --- --- --- --- --- ------------- -------------- ----------- ------------- ------------- Net increase in assets during the year 2,873,975 5,657,341 409,497 10,074,841 3,339,748 ------------- -------------- ----------- ------------- ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, end of year $18,631,631 $129,617,480 $4,797,995 $32,916,775 $12,489,997 ============= ============== =========== ============= =============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS YEARS ENDED DECEMBER 31, 1996 AND 1995 1996 --------------------------------------------------------- FORFEITURE INVESTMENT GROWTH CASH PLAN FUND ACCOUNT LOANS TOTAL ------------- --------- ------------ -------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, beginning of year $12,484,278 $90,882 $6,351,744 $195,025,380 ------------- --------- ------------ -------------- ADD (DEDUCT): Corporation contributions --- (206,658) --- 11,652,867 Employee contributions 2,652,956 --- --- 18,474,172 ------------- --------- ------------ -------------- 2,652,956 (206,658) --- 30,127,039 ------------- --------- ------------ -------------- Income from investments: Dividend income 148,113 --- --- 1,133,797 Interest income 679 4,083 490,824 8,058,343 Realized gain (loss) on sale of investments 755,115 --- 1 500,533 Unrealized appreciation for the year 2,651,167 (1) (1) 11,365,076 ------------- --------- ------------ -------------- 3,555,074 4,082 490,824 21,057,749 ------------- --------- ------------ -------------- Benefit payments and participant withdrawals (954,476) 250 (339,239) (18,842,128) Participants' elections for transfers between funds or forfeitures 3,767,950 216,879 --- --- Net fund transactions 160,765 --- 638,851 --- due to loans Administrative expenses --- (35,845) --- (35,845) ------------- --------- ------------ -------------- Net increase in assets during the year 9,182,269 (21,292) 790,436 32,306,815 ------------- --------- ------------ -------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, end of year $21,666,547 $69,590 $7,142,180 $227,332,195 ============= ========= ============ ==============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS YEARS ENDED DECEMBER 31, 1996 AND 1995
1995 ------------------------------------------------------------------------------------------- USG COMMON FIXED GOVERNMENT EQUITY STOCK INCOME INVESTMENT INDEX BALANCED FUND FUND FUND FUND FUND ------------- -------------- ------------ ------------- ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, beginning of year $ 8,956,154 $ 114,852,726 $ 4,042,546 $ 13,911,850 $ 5,771,470 ------------- ------------- ------------- ------------- ------------- ADD (DEDUCT): Corporation contributions -- 8,031,143 -- -- -- Employee contributions 1,926,937 8,776,541 553,605 2,152,522 1,277,618 ------------- ------------- ------------- ------------- ------------- 1,926,937 16,807,684 553,605 2,152,522 1,277,618 ------------- ------------- ------------- ------------- ------------- Income from investments: Dividend income -- -- -- 451,179 220,314 Interest income 2,411 7,209,145 248,810 315 486 Realized gain (loss) on sale of investments (245,236) -- -- 175,248 206,491 Unrealized depreciation for the year 5,496,461 -- -- 4,933,282 961,587 ------------- ------------- ------------- ------------- ------------- 5,253,636 7,209,145 248,810 5,560,024 1,388,878 ------------- ------------- ------------- ------------- ------------- Benefit payments and participant withdrawals (342,218) (8,469,035) (259,936) (760,126) (201,243) Participants' elections for transfers between funds or forfeitures (71,044) (4,924,839) (208,328) 1,937,298 804,570 Withdrawals from funds 34,191 (1,515,542) 11,801 40,366 108,956 due to loans ------------- ------------- ------------- ------------- ------------- Net increase (decrease) in assets during the year 6,801,502 9,107,413 345,952 8,930,084 3,378,779 ------------- ------------- ------------- ------------- ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, end of year $ 15,757,656 $ 123,960,139 $ 4,388,498 $ 22,841,934 $ 9,150,249 ============= ============= ============= ============= =============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS YEARS ENDED DECEMBER 31, 1996 AND 1995
1995 --------------------------------------------------------- FORFEITURE INVESTMENT GROWTH CASH PLAN FUND ACCOUNT LOANS TOTAL ------------- --------- ------------ ------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, beginning of year $5,948,930 $17,735 $4,876,708 $158,378,119 ------------- --------- ------------ -------------- ADD (DEDUCT): Corporation contributions --- --- --- 8,031,143 Employee contributions 1,757,974 --- --- 16,445,197 ------------- --------- ------------ -------------- 1,757,974 --- --- 24,476,340 ------------- --------- ------------ -------------- Income from investments: Dividend income 103,477 --- --- 774,970 Interest income 250 2,120 439,088 7,902,625 Realized gain (loss) on sale of investments 379,254 --- --- 515,757 Unrealized depreciation for the year 2,038,294 --- --- 13,429,624 ------------- --------- ------------ -------------- 2,521,275 2,120 439,088 22,622,976 ------------- --------- ------------ -------------- Benefit payments and participant withdrawals (222,736) --- (196,761) (10,452,055) Participants' elections for transfers between funds or forfeitures 2,391,316 71,027 --- --- Withdrawals from funds 87,519 --- 1,232,709 --- due to loans ------------- --------- ------------ -------------- Net increase (decrease) in assets during the year 6,535,348 73,147 1,475,036 36,647,261 ------------- --------- ------------ -------------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, end of year $12,484,278 $90,882 $6,351,744 $195,025,380 ============= ========= ============ ==============
The accompanying notes to financial statements are an integral part of these statements. USG CORPORATION INVESTMENT PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 1. DESCRIPTION OF THE PLAN The USG Corporation Investment Plan, also known as the USG Corporation Investment Plan for Salaried Employees prior to January 1, 1989 ("The Plan"), was approved by the stockholders of the Corporation on May 11, 1977, and became effective on July 1, 1977. On January 2, 1989, the Plan was amended and completely restated effective as of January 1, 1989 ("restated Plan"). The amendment and restatement incorporates all prior amendments to the Plan and makes changes to reflect the merger of the USG Corporation Savings Plan for Hourly Employees effective January 1, 1989, and to change the name of the Plan to the USG Corporation Investment Plan. The Plan was established to provide a means for eligible hourly and salaried employees to participate in the earnings of the Corporation, to build a supplemental retirement fund and to provide additional disability and death benefits. The Plan provides, among other things, that participants may contribute up to 9% of their annual compensation to the Plan during the year effective January 1, 1989, 15% from October 1, 1985 to December 31, 1988 and 12% prior to October 15, 1985. The amount of distributions to be made upon withdrawal from the Plan is dependent upon the participant's and the Corporation's contributions. The Plan requires completion of five years of credited service in order to be 100% vested in the Corporation contribution. Employee contributions are always 100% vested. In addition, the Plan contains provisions under which the entire amount credited to a participant's account is distributable upon a participant's retirement, disability, or death. Employee contributions are invested by the Trustee in any one or a combination of six funds: (a) common stock of USG Corporation (USG Common Stock Fund), (b) United States Government obligations (Government Investment Fund), (c) other obligations providing a fixed rate of interest (Fixed Income Fund), (d) an equity index fund which provides investment results that are designed to correspond to the performance of publicly traded common stocks, as represented by the Standard & Poor's 500 Composite Stock Price Index (Equity Index Fund), (e) a balanced fund which invests in several broadly diversified asset classes, including domestic and foreign common stock and bonds, preferred stocks and cash (Balanced Fund), or (f) a growth fund which invests primarily in equity securities of large market capitalization companies with earnings that are expected to grow at an above-average rate, but may be further diversified by investment of a small portion of the assets in domestic bonds, foreign common stocks and bonds, and cash (Growth Fund). Participants may elect to have their contributions invested in 5% increments in any fund and can change their investment election each quarter. In order to change their investment options, transfer their prior accumulated account to another investment option, increase or decrease the percent of contributions, and to make requests for withdrawals, participants are required to provide notice by the 15th day of the last month of any quarter. At December 31, 1996 and 1995, the Fixed Income Fund was primarily composed of an investment in group annuity contracts maintained by Metropolitan Life Insurance Co., Provident Life Insurance Co., John Hancock Mutual Life Insurance Co. and SunAmerica Life Insurance Co. The Equity Index Fund was invested in the Vanguard Institutional Index Fund. As of December 31, 1996 and 1995, the Balanced Fund was invested in the Fidelity Puritan Fund and the Growth Fund was invested in the IDS New Dimensions Fund. Corporation contributions, whether made in cash or stock, are initially invested in the Fixed Income Fund. If the Trustee is unable to invest any contributions immediately, the funds are temporarily invested in collective investment funds and any earnings in the fund are credited to the participants' accounts. The sixth amendment to the Plan was adopted in 1993 which provides that the Corporation makes formula matching contributions for each plan year commencing after December 31, 1992, if at least 80% of the consolidated earnings goal of the Corporation has been met for that plan year. For each calendar quarter commencing after December 31, 1993, the Corporation will also make quarterly matching contributions in an amount equal to 25% of each eligible participant's basic contributions made during that calendar quarter not in excess of 4% of his or her earnings for that calendar quarter. This amendment also established a balanced fund and a growth fund which increased the investment options under the Plan to six. In addition, provisions for loans to participants were established by this amendment. The ninth amendment effective January 1, 1996, changed the quarterly matching contribution to 25% on basic contributions not in excess of 6%. The tenth amendment adopted by the Plan provides that effective January 1, 1997, participants may elect to make pre-tax basic contributions to the Plan from 1% to 15% of earnings during the plan year. The Plan may limit the basic contributions of highly compensated participants' contributions to less than 15% of their earnings in any plan year in order to comply with IRC Sections 401(k) and 415 limitations. Under the tenth amendment, effective July 1, 1997, Corporation formula matching contributions will be allocated to the participants based on their investment election for new contributions not in excess of 9% of their earnings during that year. The Plan funds are administered under the terms of a Trust agreement with The Northern Trust Company. The Trust agreement provides, among other things, that the Trustee shall keep account of all investments, receipts and disbursements and other transactions and shall provide annually a report setting forth such transactions and the status of the funds at the end of the period. The Plan is administered by the Pension and Investment Committee, which consists of three or more members appointed by the Board of Directors of USG Corporation. Administrative expenses of the Plan, except for charges such as brokerage fees and expenses related to group annuity contracts, are paid by the Corporation. At December 31, 1996 and 1995, there were approximately 9,991 and 10,723 participants in the Plan, respectively. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The amounts in the accompanying statements were accumulated from the reports of the Trustee (Note 1). The statements are prepared on the accrual basis of accounting. Contributions to the Plan are made throughout the year and adjustments are made to the statements to accrue for the portion of annual contributions unpaid at year-end. All investments of the Plan are valued at market. Unrealized appreciation (depreciation) of investments of the Plan represents the change between years in the difference between the market value and cost of the investments. Realized gains or losses on the sale of investments are calculated based upon the historical average cost of the investments. Market value and cost are equal for the group annuity contract and short-term investments. The preparation of financial statements in conformity with generally accepted accounting principles requires the plan administrator to make estimates and assumptions that effect certain reported amounts and disclosures. Accordingly, actual results may differ from those estimates. Metropolitan Life Insurance Co., Provident Life Insurance Co., John Hancock Mutual Life Insurance Co. and SunAmerica Life Insurance Co. group annuity contracts earned guaranteed interest at rates varying from 5.75% to 7.20% at December 31, 1996. The rates for 1995 ranged from 5.75% to 7.76%. The Insurance contract earnings are calculated net of administrative fees. For the USG Common Stock Fund, cost was $53,327,934 and $54,917,273 as of December 31, 1996 and 1995, respectively. For the Equity Index Fund, the amount by which market value exceeded cost was $9,201,443 at December 31, 1996, and $4,940,810 at December 31, 1995. For the Balanced Fund, market value exceeded cost by $686,560 at December 31, 1996, and $572,057 at December 31, 1995. For the Growth Fund, market value was $4,204,977 above cost at December 31, 1996 and $1,553,811 at December 31, 1995. Pending transactions from participants' elections for transfers between funds represent the fourth quarter transfers between funds that were elected by participants but have not been executed by the Trustee before year-end as well as withdrawals from participants' accounts to make loans to them. In order to present the proper balance of net assets in each fund at year-end, a receivable and payable were used to record such pending transactions and the net amount of transfers in or out for each fund during the year was presented in participants' elections for transfers between funds on the accompanying statement of changes in net assets available for plan benefits. 3. TAX STATUS The Plan, as amended and restated, effective January 1, 1989, meets the requirements of Section 401 (a) of the Internal Revenue Code and, accordingly, its income is exempt from Federal income tax under Section 501 (a). Employer contributions and the income of the Plan are not taxable to the participants until distributions are made. 4. EMPLOYER CONTRIBUTIONS The Corporation will make a formula matching contribution with respect to each eligible participant only if at least 80% of the Corporation's consolidated earnings goal is met. The Corporation formula matching contribution schedule was changed for the 1995 Plan year. Beginning January 1, 1995, each 1% increase in goal attainment from 80% to 100% of goal results in a corresponding 1.5% increase in the profit sharing match, starting at a 10% match with the attainment of 80% of earnings goal. Each 1% increase in goal attainment from 100% to 140% of goal will result in a 1% increase in the profit sharing match, starting from a 40% match with attainment of 100% of goal earnings. And each 1% increase in goal attainment above 140% results in a 2% increase in the profit sharing match, starting from 80% matching with attainment of 140% of goal earnings. Employer contribution amounts forfeited by terminated employees are applied as a credit against future Corporate contributions or used to pay fees of the plan and are held in the Forfeiture Cash Account. 5. DISTRIBUTION ON TERMINATION OF THE PLAN In the event of any termination of the Plan, the account balances of all affected participants shall become non-forfeitable. 6. INVESTMENTS The following is a summary of the Plan's investments as well as the net realized and unrealized appreciation (depreciation) for 1996 and 1995:
December 31, 1996 DECEMBER 31, 1995 ------------------------- ---------------------- INVESTMENTS AT FAIR VALUE NET NET DETERMINED BY APPRECIATION APPRECIATION QUOTED MARKET FAIR (DEPRECIATION) FAIR (DEPRECIATION) PRICE: VALUE IN FAIR VALUE VALUE IN FAIR VALUE USG Common Stock $19,120,158 $ 2,260,420 $15,913,830 $ 5,251,225 Vanguard Index Trust 32,478,696 5,068,792 21,879,768 5,108,530 Fidelity Puritan Fund 12,256,681 1,130,115 8,263,417 1,168,078 IDS New Dimension Fund 20,388,050 3,406,282 11,173,930 2,417,548 ----------- ------------ ----------- ------------ SUB-TOTAL 84,243,585 11,865,609 57,230,945 13,945,381 INVESTMENTS AT FAIR VALUE DETERMINED BY OTHER THAN QUOTED MARKET PRICE: Mortgages, Notes, Contracts 79,511,775 --- 79,041,920 --- Collective Short-Term Investment Fund 48,310,531 --- 46,601,716 --- ------------ ------------ ------------ ------------ SUB-TOTAL 127,822,306 --- 125,643,636 --- ------------ ------------ ------------ ------------ TOTAL INVESTMENTS $212,065,891 $ 11,865,609 $182,874,581 $ 13,945,381 ============ ============= ============ ============
At December 31, 1996 and 1995, the following investments exceeded 5% of the net assets available for the Plan benefits:
1996 1995 ------------ -------- USG Corporation Common Stock $19,120,158 $15,913,830 Metropolitan Life Insurance Company, GAC 13908 16,141,476 15,057,347 Provident Life Insurance Company, GAC 627-05701 23,754,071 22,233,313 John Hancock Mutual Life Insurance Company, GAC 8396 - 10,031,727 John Hancock Mutual Life Insurance Company, GAC 6317 - 31,719,533 SunAmerica Life Insurance Company, GAC 6317 20,630,854 - Vanguard Index Trust 32,478,696 21,879,768 IDS New Dimension Fund 20,388,050 11,173,930 Fidelity Puritan Fund 12,256,681 - Collective Short Term Investment Fund 48,310,531 46,601,716
7. PARTICIPANT LOANS Effective October 1, 1993, a participant can obtain a loan from the Plan. Under the Plan's loan provisions, the maximum loan allowable is one half of a participant's vested account balance or $50,000, whichever is less. The minimum loan amount is $1,000. Additional amounts can be taken in $100 increments. The Plan restricts the participant to one outstanding loan at a time. The loan can be repaid by the participant over a five year period, or sooner, in full, with interest at the prime rate. Default on a loan by a participant will be treated as a hardship withdrawal and will be subject to IRS penalties. SCHEDULE I USG CORPORATION INVESTMENT PLAN
PRINCIPAL AMOUNT/NUMBER OF FAIR SHARES COST VALUE ------- ---------- ----------- COMMON STOCK USG Corporation 564,449 $ 53,327,934 $ 19,120,158 Vanguard Index Trust 471,663 23,277,253 32,478,696 IDS New Dimension Fund 984,454 16,183,073 20,388,050 Fidelity Puritan Fund 710,944 11,570,121 12,256,681 -------- ----------- ------------ TOTAL COMMON STOCKS 104,358,381 84,243,585 ----------- ------------ CONTRACTS Metropolitan Life Insurance Company, GAC 13908 $16,141,476 16,141,476 16,141,476 Provident Life Insurance Company, GAC 627-05701 $23,754,071 23,754,071 23,754,071 John Hancock Mutual Life Insurance Company, GAC 8396 $10,599,522 10,599,522 10,599,522 John Hancock Mutual Life Insurance Company, GAC 6317 $ 8,385,852 8,385,852 8,385,852 SunAmerica Life Insurance Company, GAC 4653 $20,630,854 20,630,854 20,630,854 ----------- ----------- ----------- TOTAL CONTRACTS $79,511,775 79,511,775 79,511,775 ----------- ----------- ----------- SHORT-TERM INVESTMENTS Collective Government Short-Term Investment Fund $ 4,666,089 4,666,089 4,666,089 Collective Short-Term Investment Fund $43,644,442 43,644,442 43,644,442 ----------- ------------ ------------ TOTAL SHORT-TERM INVESTMENTS $48,310,531 48,310,531 48,310,531 ----------- ------------ ------------ TOTAL INVESTMENTS $232,180,687 $212,065,891 ============ ============
USG CORPORATION INVESTMENT PLAN SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1996 SERIES OF TRANSACTIONS IN THE SAME SECURITY:
TOTAL COST TOTAL CURRENT DESCRIPTION OF NUMBER OF OF NUMBER OF VALUE OF SECURITY PURCHASES ASSET SALES SALES -------- --------- ----- ----- ----- Collective Short-term Investment Fund 354 $54,377,720 205 $52,845,058 SunAmerica Life Insurance GAC 4653 7 20,633,772 0 - John Hancock Mutual Life Insurance, GAC 6317 12 1,147,655 2 24,481,337
EX-23 2 AUDITOR'S CONSENT CONSENT OF INDEPENDENT PUBLIC AUDITORS WITH RESPECT TO FORM S-8 As independent public auditors, we hereby consent to the incorporation by reference of our report, dated March 11, 1997, appearing in the USG Corporation Investment Plan Annual Report on Form 11-K for the year ended December 31, 1996, into USG Corporation's previously filed Registration Statements No.2-94787, 33-63554 and 33-9948 on Form S-8. It should be noted that we have not examined any financial statements of the Investment Plan subsequent to December 31, 1996, or performed any audit procedures subsequent to the date of our report. /s/ Hill, Taylor LLC - -------------------- Chicago, Illinois March 11, 1997 -----END PRIVACY-ENHANCED MESSAGE-----