-----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, K7Alth1V64/aCw/1qMWW0vB6GWix1OzTxS56w8rU+rKXbp2di1J3+6rN/XVKf+CK +34JhrKFtm+9KHURXgH01A== 0000779334-96-000015.txt : 19960629 0000779334-96-000015.hdr.sgml : 19960629 ACCESSION NUMBER: 0000779334-96-000015 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960627 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BIRMINGHAM STEEL CORP CENTRAL INDEX KEY: 0000779334 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 133213634 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09820 FILM NUMBER: 96587013 BUSINESS ADDRESS: STREET 1: 1000 URBAN CENTER PARKWAY STREET 2: SUITE 300 CITY: BIRMINGHAM STATE: AL ZIP: 35242 BUSINESS PHONE: 2059701255 MAIL ADDRESS: STREET 1: P.O. BOX 1208 CITY: BIRMINGHAM STATE: AL ZIP: 35201-1208 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 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995 BIRMINGHAM STEEL CORPORATION 401(k) PLAN (Full Title of the Plan) BIRMINGHAM STEEL CORPORATION 1000 URBAN CENTER DRIVE SUITE 300 BIRMINGHAM, AL 35242 (Name of issuer of the securities held pursuant to the Plan and the address of its principal executive office) Birmingham Steel Corporation 401(k) Plan Financial Statements and Supplemental Schedules Years ended December 31, 1995 and 1994 with Report of Independent Auditors - ----------------------------------------------------- Report of Independent Auditors The Employee Benefits Committee Birmingham Steel Corporation 401(k) Plan We have audited the accompanying statements of net assets available for benefits of the Birmingham Steel Corporation 401(k) Plan as of December 31, 1995 and 1994, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 1995 and 1994, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment purposes as of December 31, 1995, and reportable transactions for the year then ended, 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 our audit of the 1995 basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the 1995 basic financial statements taken as a whole. May 17, 1996 Birmingham Steel Corporation 401(k) Plan Statements of Net Assets Available for Benefits December 31 1995 1994 ------------ ------------ Assets Investments $ 37,826,468 $ 23,868,507 Receivables: Employer contributions 986,361 2,429,811 Employee contributions 454,599 626,888 Employee loans 2,924,907 2,046,534 Accrued interest 7,596 3,568 ------------ ------------ 4,373,463 5,106,801 Cash and cash equivalents 11,306 1,659 ------------ ------------ 42,211,257 28,976,967 Liabilities Benefit claims payable (73,007) - ------------ ------------ Net assets available for benefits $ 42,138,230 $ 28,976,967 ============ ============ See accompanying notes. Birmingham Steel Corporation 401(k) Plan Statements of Changes in Net Assets Available for Benefits Year ended December 31 1995 1994 ------------ ------------ Additions to net assets attributed to: Investment income: Net appreciation (depreciation) in fair value of investments $ 1,092,051 $ (1,561,304) Interest 2,332,877 1,397,196 Dividends 89,431 45,364 ------------ ------------ 3,514,359 (118,744) Contributions: Employer 3,087,805 2,429,811 Employee 5,204,219 3,433,974 ------------ ------------ 8,292,024 5,863,785 Transfer of assets from related plan 6,363,232 - ------------ ------------ 18,169,615 5,745,041 Deduction from net assets attributed to: Payments to participants (5,008,352) (1,639,253) ------------ ------------ Net increase 13,161,263 4,105,788 Net assets available for benefits: Beginning of year 28,976,967 24,871,179 ------------ ------------ End of year $ 42,138,230 $ 28,976,967 ============ ============ See accompanying notes. 1. Description of the Plan General The Birmingham Steel Corporation 401(k) Plan (formerly the Birmingham Steel Corporation Non-Union Employees' 401(k) Plan) (the "Plan"), is a defined contribution plan established effective as of August 15, 1984. Effective January 1, 1995, the American Steel and Wire Corporation Savings and Retirement Plan was merged into the Plan. In connection with the merger, the Plan was restated to allow participation by qualifying employees of American Steel and Wire. Net assets of $6,363,232 were transferred into the Plan as a result of the merger. The following description of the Plan provides only general information. Participants should refer to the Summary Plan Description for a more complete description of the Plan's provisions. Participation The Plan covers substantially all employees of Birmingham Steel Corporation and its affiliated companies (collectively, the Company). During 1994, employees could begin Plan participation at the earlier of the January 1 or July 1 following employment. Effective January 1, 1995, employees may begin participation in the Plan at the earlier of the January 1, April 1, July 1, or October 1 following employment. Company Contributions Company contributions to the Plan are accrued in the period in which they become obligations of the Company. In 1995 and 1994, the Company contributed to each participant's account an amount equal to the sum of (a) 5% of each participant's compensation up to $10,000; plus (b) the lesser of: (i) the amount of each active participant's employee contributions, or (ii) 3% of each participant's eligible compensation. The Company may, from time to time, change the method of determining its contribution. Employee Contributions During 1994, participants could make employee contributions to the Plan by electing to reduce their gross pay in an amount which is not less than one percent or more than ten percent of annual compensation, subject to certain limitations. Effective January 1, 1995, participants may make employee contributions to the Plan by electing to reduce their gross pay in an amount which is not less than one percent or more than fifteen percent of annual compensation, subject to certain limitations. Participant Accounts The Plan provides for the establishment of an employee account and an employer account for each participating employee. Each participant's account is credited with the participant's contributions and an allocation of the Company's contribution and plan earnings. Generally, employer contributions are allocated to participants' accounts at the time of payment, rather than at the time such contributions are recorded in the Plan's financial statements. Allocations of employer contributions are based on eligible annual compensation as defined in the Plan agreement. Benefit payments to participants are based upon vested balances in the employee and employer accounts at the date of benefit determination. Vesting Participants are immediately vested in their employee account including allocated earnings thereon. Vesting in their employer account is based on years of continuous service. Service for vesting begins with the participant's employment date, but not prior to July 1, 1980. During 1994, participants are fully vested at the earlier of death, disability, reaching normal retirement age or in accordance with the following schedule: Years of Vested Service Interest - --------------------------------------------------------------------------- Less than 3 0% 3 20% 4 40% 5 60% 6 80% 7 or more 100% Effective January 1, 1995 on a retroactive basis, participants become fully vested at the earlier of death, disability, reaching normal retirement age or in accordance with the following schedule: Years of Vested Service Interest - --------------------------------------------------------------------------- Less than 1 0% 1 20% 2 40% 3 60% 4 80% 5 or more 100% Forfeitures Forfeitures of participants' non-vested interest in Company contributions, and allocated earnings thereon, may be used to offset the annual Company contributions to the Plan. There were no forfeitures used to reduce the Company's contribution in 1994. Forfeitures of approximately $150,000 were used to offset Company contributions in 1995. Payment of Benefits Upon termination of service, participants may receive either (a) a single sum payment, or (b) annual or more frequent periodic installments over a period of the lesser of thirty years or the joint life expectancy of the participant and his beneficiary (where applicable), as determined by the Employee Benefits Committee (the Committee). Investment Programs During 1994, the Plan allowed participants to direct the investment of their accounts by selecting among four investment alternatives: - A fund comprised primarily of the common stock of the Company; - A managed guaranteed investment contract (GIC) fund which invests in fixed income securities; - A basic value fund composed primarily of common stocks; - A capital fund composed of stocks and bonds; During 1995, the Plan added the following two investment options in addition to those listed above: - A special value fund composed of stocks and bonds; and - A global allocation fund composed primarily of common stocks and fixed income securities of both domestic and foreign companies. Except for the Birmingham Steel Corporation stock fund, the investment funds are managed by the trustee of the Plan, Merrill Lynch Trust Company, or by an affiliate of the trustee (hereinafter referred to as the Trustee). All assets held in the investment funds, including Birmingham Steel Corporation common stock, were purchased in the open market and are held by the Trustee. Loans The Plan allows Participants to borrow up to one-half of their total vested account balance up to a maximum of $50,000. Loans may be repaid over terms up to five years (fifteen years for loans used to purchase residential property) and include a reasonable rate of interest. 2. Summary of Accounting Policies Investments Investments in common stock and mutual funds are stated at their quoted market values. Other investments are stated at cost, which approximates market values. Investment transactions are recorded as of the trade date. Cost of common stock and mutual fund shares is determined by the specific identification method. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Concentration of Credit Risk At December 31, 1995, approximately 9% of the Plan's assets are invested in the common stock of the Company and approximately 82% of such assets are comprised of investments in mutual funds managed by the Trustee. The six investment options offered to participants are designed to provide each participant the opportunity to diversify the investment of their accounts. Although the Committee has no involvement in the investment transactions of the mutual funds, the Committee periodically monitors the investment performance of the funds and may, pursuant to the provisions of the Plan agreement, elect to change the Plan's investment programs and/or the trustee at any time. At December 31, 1995, approximately 5% of the Company's labor force is employed under a collective bargaining agreement. 3. Investments Investments that represent 5% or more of the Plan's net assets available for benefits at December 31, 1995 and 1994 are as follows: 1995 ---------------------------------------------- Name of Issuer and Title Shares Market Value Cost - ------------------------------------------------------------------------------- Birmingham Steel Corporation common stock 250,871 $ 3,731,712 $ 4,938,477 Merrill Lynch Retirement Preservation Trust 19,438,272 19,438,272 19,438,272 Merrill Lynch Basic Value Fund 240,717 6,814,699 5,584,200 Merrill Lynch Capital Fund 243,902 7,451,220 6,735,218 1994 ---------------------------------------------- Name of Issuer and Title Shares Market Value Cost - ------------------------------------------------------------------------------- Birmingham Steel Corporation common stock 190,821 $ 3,816,425 $ 4,010,607 Merrill Lynch Retirement Preservation Trust 12,615,375 12,615,375 12,615,375 Merrill Lynch Basic Value Fund 157,113 3,511,486 3,340,400 Merrill Lynch Capital Fund 152,732 3,925,221 4,059,560 Net (depreciation) appreciation in fair value of investments for the years ended December 31, 1995 and 1994, including securities sold during the year, was as follows: 1995 1994 ----------------------------- Birmingham Steel Corporation common stock $(1,146,101) $(1,059,514) Mutual funds 2,238,152 (501,790) ----------------------------- $ 1,092,051 $(1,561,304) ============================= 4. Investment Programs Net assets available for benefits and changes in net assets available for benefits at December 31, 1995 and 1994, and for the years then ended, for each of the Plan's investment programs are as follows:
Stock GIC Basic Capital Special Global Loan Fund Fund Fund Fund Fund Fund Fund Total ---------- ----------- ---------- ---------- --------- ---------- ------------ ------------ December 31, 1995 Investments $3,731,712 $19,438,272 $6,814,699 $7,451,220 $ 138,112 $ 252,453 $ - $37,826,468 Receivables: Employer contributions 69,089 612,836 136,969 140,518 10,782 16,167 - 986,361 Employee contributions 39,600 254,628 72,533 76,190 4,684 6,964 - 454,599 Employee loans - - - - - - 2,924,907 2,924,907 Accrued interest - 7,596 - - - - - 7,596 ---------- ----------- ---------- ---------- --------- ---------- ------------ ------------ 108,689 875,060 209,502 216,708 15,466 23,131 2,924,907 4,373,463 Cash and cash equivalents 11,306 - - - - - - 11,306 Benefits payable (5,716) (39,012) (10,956) (11,475) (186) (288) (5,374) (73,007) ---------- ----------- ---------- ---------- --------- ---------- ------------ ------------ Net assets available for benefits $3,845,991 $20,274,320 $7,013,245 $7,656,453 $ 153,392 $ 275,296 $2,919,533 $42,138,230 ========== =========== ========== ========== ========= ========== ============ ============
Stock GIC Basic Capital Loan Fund Fund Fund Fund Fund Total ---------- ----------- ---------- ---------- ----------- ----------- December 31, 1994 Investments $3,816,425 $12,615,375 $3,511,486 $3,925,221 $ - $23,868,507 Receivables: Employer contributions 225,024 1,458,054 334,860 411,873 - 2,429,811 Employee contributions 59,501 352,608 95,685 119,094 - 626,888 Employee loans - - - - 2,046,534 2,046,534 Accrued interest - 3,568 - - - 3,568 ---------- ----------- ---------- ---------- ----------- ----------- 284,525 1,814,230 430,545 530,967 2,046,534 5,106,801 Cash and cash equivalents 1,659 - - - - 1,659 ---------- ----------- ---------- ---------- ----------- ----------- Net assets available for benefits $4,102,609 $14,429,605 $3,942,031 $4,456,188 $2,046,534 $28,976,967 ========== =========== ========== ========== ========== ===========
Stock GIC Basic Capital Special Global Loan Fund Fund Fund Fund Fund Fund Fund Total ---------- ----------- ---------- ---------- ---------- ---------- ---------- ------------ Net assets available for benefits as of December 31, 1993 $3,379,252 $12,309,793 $3,571,249 $4,045,560 $ - $ - $1,565,325 $ 24,871,179 Investment income (loss) (1,013,236) 691,819 72,170 38,141 - - 92,362 (118,744) Contributions 533,331 3,325,939 914,866 1,089,649 - - - 5,863,785 Fund transfers 1,245,783 (896,595) (411,007) (452,860) - - 514,679 - Payments to participants (42,521) (1,001,351) (205,247) (264,302) - - (125,832) (1,639,253) Net assets available for benefits as of ---------- ----------- ---------- ---------- ---------- ---------- ----------- ------------ December 31, 1994 4,102,609 14,429,605 3,942,031 4,456,188 - - 2,046,534 28,976,967 Investment income (loss) (1,056,670) 1,086,270 1,562,321 1,712,192 13,592 31,686 164,968 3,514,359 Contributions 587,714 4,545,158 1,357,054 1,516,476 98,996 186,626 - 8,292,024 Fund transfers 604,442 (1,409,639) (177,106) (224,685) 53,545 76,739 1,076,704 - Payments to participants (392,104) (2,676,325) (751,584) (787,170) (12,741) (19,755) (368,673) (5,008,352) Transfers from AS&W - 4,299,251 1,080,529 983,452 - - - 6,363,232 Net assets available for benefits as of ---------- ----------- ---------- ---------- ---------- ---------- ---------- ------------ December 31, 1995 $3,845,991 $20,274,320 $7,013,245 $7,656,453 $ 153,392 $ 275,296 $2,919,533 $ 42,138,230 ========== =========== ========== ========== ========== ========== ========== ============
5. Income Tax Status The Plan has received a favorable determination letter from the Internal Revenue Service approving its exemption from federal income taxes under the provisions of Internal Revenue Code (IRC) Section 501(a) as a qualified plan under IRC Section 401(a). Once qualified, the Plan is required to operate in conformity with the IRC to retain its qualified status. The Committee is not aware of any course of action or series of events that have occurred that might adversely affect the Plan's qualified status. 6. Transactions with Parties-In-Interest During the years ended December 31, 1995 and 1994, the Plan received $89,431 and $45,364, respectively, in cash dividends on common stock of the Company held by the Plan. The Trustee executed all investment transactions for the years ended December 31, 1995 and 1994. The Company has paid all administrative expenses of the Plan, including legal, accounting and trustee fees. 7. Plan Termination Although management has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of the Employee Retirement Income Securities Act of 1974. In the event of Plan termination, participants will become 100% vested in their accounts in accordance with the provisions of the Plan. 8. Accounts of Terminated Employees Under the provisions of the Plan, the individual accounts of terminated employees may remain in the Plan until a break in service, as defined, occurs. The accounts of such employees share in the allocation of investment income but are not allocated a share of annual Company contributions. Once such employees experience a break in service, the vested portion of their accounts will be paid in accordance with the provisions of the Plan. At December 31, 1995 and 1994, approximately $194,000 and $420,000 of the net assets of the Plan were allocated to terminated employees. These amounts are included in net assets available for benefits in the accompanying financial statements, however, they are reported as liabilities in the Plan's Form 5500. 9. Sale of the Bolt Division In March 1995, the Company divested its Bolt division. Accordingly, participants who were employees of the Bolt division became 100% vested. Distributions to such individuals have been included in benefit payments. Birmingham Steel Corporation 401(k) Plan Item 27a - Schedule of Assets Held for Investment Purposes December 31, 1995 Number of Cost Basis Current Value Shares or of Investment of Investment Principal at End of at End of Name of Issuer and Title Amount Period Period - ---------------------------------------------------------------------------- Investments: Birmingham Steel Corporation common stock* 250,871 $ 4,938,477 $ 3,731,712 Merrill Lynch Retirement Preservation Trust* 19,438,272 19,438,272 19,438,272 Merrill Lynch Basic Value Fund* 240,717 5,584,200 6,814,699 Merrill Lynch Capital Fund* 243,902 6,735,218 7,451,220 Merrill Lynch Special Value Fund * 8,077 130,242 138,112 Merrill Lynch Global Allocation Fund * 18,188 243,475 252,453 Employee loans to be repaid over terms up to five years (fifteen years for loans used to purchase residential property) and include a reasonable rate of interest 2,924,907 2,924,907 ------------ ------------ $ 39,994,791 $ 40,751,375 ============ ============ * Indicates party-in-interest to the Plan. Birmingham Steel Corporation 401(k) Plan Item 27d - Schedule of Reportable Transactions Year ended December 31, 1995
Current Value Number of of Asset on Number of Shares or Purchase Selling Cost Transaction Net Gain Name of Issuer and Title Transactions Face Value Price Price of Asset Date (Loss) ------------ ------------ ----------- ---------- ----------- ------------- --------- - ------------------------------- Birmingham Steel Corporation common stock Purchases 221 109,552 $ 1,784,082 $ - $ - $1,784,082 $ - Sales 112 49,502 - 722,694 856,212 722,694 (133,518) Merrill Lynch Retirement Preservation Trust Purchases 413 12,163,476 12,163,476 - - 12,163,476 - Sales 280 5,340,579 - 5,340,579 5,340,579 5,340,579 - Merrill Lynch Basic Value Fund Purchases 244 140,362 3,499,656 - - 3,499,656 - Sales 180 56,758 - 1,457,643 1,255,856 1,457,643 201,787 Merrill Lynch Capital Fund Purchases 252 139,720 3,988,050 - - 3,988,050 - Sales 188 48,550 - 1,418,050 1,312,392 1,418,050 105,658
Consent of Ernst & Young, LLP, Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-23563) pertaining to the Birmingham Steel Corporation 401(k) Plan of our report dated May 17, 1996, with respect to the financial statements and schedules of the Birmingham Steel Corporation 401(k) Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1995. Ernst & Young, LLP ------------------ Ernst & Young, LLP Birmingham, Alabama June 26, 1996 SIGNATURES THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1923, the trustee (or other persons who administer the Plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Date: June 27, 1996 BIRMINGHAM STEEL CORPORATION 401(K) PLAN by: Birmingham Steel Corporation James S. Rogers II --------------------------------- James S. Rogers II-Member of the Employee Benefits Committee of the Plan and Vice President, Human Resources -----END PRIVACY-ENHANCED MESSAGE-----