-----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, HZEAo9JnfjseMUOjFaib+RSjosJch0dpBTTFb7l5lzaJidJDam6RfBgsjGi+62me WyaLySA3XfprXlkQmJqPMA== 0000950152-04-004909.txt : 20040625 0000950152-04-004909.hdr.sgml : 20040625 20040625155043 ACCESSION NUMBER: 0000950152-04-004909 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20031231 FILED AS OF DATE: 20040625 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HAWK CORP CENTRAL INDEX KEY: 0000849240 STANDARD INDUSTRIAL CLASSIFICATION: AIRCRAFT PART & AUXILIARY EQUIPMENT, NEC [3728] IRS NUMBER: 341608156 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13797 FILM NUMBER: 04882200 BUSINESS ADDRESS: STREET 1: 200 PUBLIC SQ. STREET 2: STE 1500 CITY: CLEVELAND STATE: OH ZIP: 44114 BUSINESS PHONE: 2168613553 MAIL ADDRESS: STREET 1: 200 PUBLIC SQUARE STREET 2: STE 1500 CITY: CLEVELAND STATE: OH ZIP: 44114-2301 FORMER COMPANY: FORMER CONFORMED NAME: HAWK GROUP OF COMPANIES INC DATE OF NAME CHANGE: 19950417 11-K 1 l08046ae11vk.txt HAWK CORP 11-K/HELSEL EMPLOYEES' SAVINGS & INVSTMT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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 FISCAL YEAR ENDED DECEMBER 31, 2003 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _____________ TO ___________ COMMISSION FILE NUMBER: 333-68583 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Helsel Employees' Savings and Investment Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Hawk Corporation 200 Public Square, Suite 1500 Cleveland, Ohio 44114 AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE Helsel Employees' Savings and Investment Plan December 31, 2003 and 2002 and Year Ended December 31, 2003 with Reports of Independent Registered Public Accounting Firms Helsel Employees' Savings and Investment Plan Financial Statements and Supplemental Schedule December 31, 2003 and 2002 and Year Ended December 31, 2003 TABLE OF CONTENTS Reports of Independent Registered Public Accounting Firms.............. 1 Audited Financial Statements Statements of Net Assets Available for Benefits ..................... 3 Statement of Changes in Net Assets Available for Benefits ........... 4 Notes to Financial Statements........................................ 5 Supplemental Schedule Schedule H, Line 4i--Schedule of Assets (Held at End of Year)........ 11
Report of Independent Registered Public Accounting Firm Plan Administrator Helsel Employees' Savings and Investment Plan We have audited the accompanying statement of net assets available for benefits of the Helsel Employees' Savings and Investment Plan (the Plan) as of December 31, 2003, and the related statement of changes in net assets available for benefits for the year ended December 31, 2003. 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 audit. We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States of America). 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 audit provides 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, 2003, and the changes in its net assets available for benefits for the year ended December 31, 2003, in conformity with accounting principles generally accepted in the United States of America. Our audit was performed for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental schedule of the Plan is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ Grant Thornton LLP Cleveland, Ohio June 15, 2004 1 Report of Independent Registered Public Accounting Firm Plan Administrator Helsel Employees' Savings and Investment Plan We have audited the accompanying statement of net assets available for benefits of the Helsel Employees' Savings and Investment Plan as of December 31, 2002. This financial statement is the responsibility of the Plan's management. Our responsibility is to express an opinion on this financial statement based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion. In our opinion, the financial statement referred to above presents fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2002, in conformity with U.S. generally accepted accounting principles. /s/ Ernst & Young LLP Cleveland, Ohio June 13, 2003 2 Helsel Employees' Savings and Investment Plan Statements of Net Assets Available for Benefits
DECEMBER 31, 2003 2002 ---------- ---------- ASSETS Investments, at fair value: Pooled separate accounts $1,798,300 $1,478,431 Hawk Corporation common stock 12,879 4,219 Guaranteed Income Fund, at contract value 898,422 692,794 Participant loans 181,590 141,029 ---------- ---------- 2,891,191 2,316,473 Contributions receivable: Employer 347,038 977 Employee 5,719 3,535 ---------- ---------- 352,757 4,512 ---------- ---------- NET ASSETS AVAILABLE FOR BENEFITS $3,243,948 $2,320,985 ========== ==========
See notes to financial statements. 3 Helsel Employees' Savings and Investment Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 2003 Additions: Interest income $ 35,379 Contributions: Employer 439,194 Employee 285,249 Employee rollovers 94,781 ---------- 819,224 ---------- Total additions 854,603 Deductions: Benefit payments 218,394 Fees and expenses 1,844 ---------- Total deductions 220,238 Net realized and unrealized appreciation in fair value of investments 288,598 ---------- Net increase 922,963 Net assets available for benefits at beginning of year 2,320,985 ---------- NET ASSETS AVAILABLE FOR BENEFITS AT END OF YEAR $3,243,948 ==========
See notes to financial statements. 4 Helsel Employees' Savings and Investment Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF PLAN The following description of the Helsel Employees' Savings and Investment Plan (the Plan) provides only general information. Participants should refer to the summary plan description or Plan agreement for a more complete description of the Plan's provisions. GENERAL The Plan is a defined contribution plan with a cash or deferred arrangement provision established by Helsel, Inc. (the Company and Plan Sponsor) effective as of January 1, 1985, covering all non-union employees of the Company who have completed ninety days of service (sixty days of service prior to a July 1, 2003 Plan amendment that changed the eligibility requirement). The Company is a wholly owned subsidiary of Hawk Corporation. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). CONTRIBUTIONS Participants may elect to contribute 1% to 50% (1% to 15% prior to a July 1, 2003 plan amendment that changed the contribution percentage) of their pretax compensation to the Plan subject to maximum limitations set by the Internal Revenue Code. Participants may also contribute amounts representing distributions from other qualified plans, commonly referred to as rollover contributions. The Plan Sponsor makes a matching contribution equal to 50% of the participant's contribution up to 4% of the participant's compensation. The Plan allows for discretionary contributions by the Plan Sponsor. The Plan Sponsor made discretionary contributions of $345,434 and $0, respectively, for the 2003 and 2002 Plan years. Effective January 1, 2003 the Plan was amended such that forfeited balances of terminated participants' nonvested accounts are used to reduce future Company contributions. At December 31, 2003, the balance of such forfeitures eligible to reduce future employer contributions was $396. Employer contributions for the year ended December 31, 2003 were reduced by $4,233. Prior to January 1, 2003, forfeited balances were allocated back to participant's accounts under the same manner as discretionary contributions. Forfeitures available to allocate back to participant's accounts amounted to $7,818 at December 31, 2002. 5 Helsel Employees' Savings and Investment Plan Notes to Financial Statements--Continued December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF PLAN--CONTINUED PARTICIPANT ACCOUNTS Each participant's account is credited with the participant's contributions and allocations of (a) the Plan Sponsor's contributions and (b) Plan net earnings. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. VESTING AND DISTRIBUTION Participants are immediately vested in their contributions plus actual earnings thereon. Vesting of Plan Sponsor contributions plus actual earnings thereon is based upon years of continuous service. A participant is 100% vested after five years of credited service based on a graded vesting schedule. Distributions from a participant's account are limited to termination of employment, death, retirement or proven hardship. INVESTMENT OPTIONS The Plan's funds are primarily held in a group annuity contract issued by Connecticut General Life Insurance Company (CIGNA). Upon enrollment in the Plan, a participant may direct Plan Sponsor and employee contributions to any of the investment fund options offered by the Plan, including the Hawk Corporation common stock. Participants may change their investment options and transfer funds between investment options daily. PARTICIPANT LOANS Effective July 1, 2003, new loans are no longer permitted from the Plan. Participant loans outstanding at that date will continue to be repaid on the same payment schedule. Prior to that date, participants were permitted to borrow from their fund accounts up to the lesser of $50,000 or 50% of their vested balance. Loan terms ranged from 1 to 5 years. Loans outstanding at December 31, 2003 are secured by the balance in the participant's account and bear interest at a fixed rate commensurate with local prevailing rates at the time of application (ranging from 5.25% to 10.25% at December 31, 2003). The remaining principal and interest is paid ratably through monthly payroll deductions. 6 Helsel Employees' Savings and Investment Plan Notes to Financial Statements--Continued December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF PLAN--CONTINUED PAYMENT OF BENEFITS In the case of normal retirement, death, permanent disability or termination prior to retirement, a participant may elect to receive the payout of his or her vested account balance in the form of installments, an annuity or a lump sum. EXPENSES The Plan Sponsor pays substantially all costs of Plan administration. Brokers' fees are reflected in the net investment return in each participant's account. 2. SUMMARY OF ACCOUNTING POLICIES INVESTMENT VALUATION -- GUARANTEED INCOME FUND The Plan has entered into an investment contract, the Guaranteed Income Fund (Fund), with CIGNA. CIGNA maintains the contributions to this Fund in a general account, which is credited with earnings on the underlying investments and charged for participant withdrawals and administrative expenses. Investments in the Guaranteed Income Fund are included in the financial statements at contract value, as determined by CIGNA, which approximates fair value. Contract value represents contributions made under the contract, plus earnings and transfers in, less participant withdrawals, administrative expenses and transfers out. Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment at contract value. However, CIGNA has the right to defer certain disbursements (excluding retirement, termination, and death or disability disbursements) or transfers from the Fund when total amounts disbursed from the pool in a given calendar year exceed 10% of the total assets in that pool on January 1 of that year. There are no reserves against contract value for credit risk of the contract issuer or otherwise. The average yield and crediting interest rates were approximately 3.0% and 4.4% for 2003 and 2002, respectively. The crediting interest rate is based on a formula agreed upon with the issuer, based on the yields of the underlying investments and considering factors such as projected investment earnings, the current interest environment, investment expenses, and a profit and risk component. The rate may never be less than 0% nor may it be reduced by more than 2.10% during any calendar year. Interest rates are declared in advance and guaranteed for six month periods. 7 Helsel Employees' Savings and Investment Plan Notes to Financial Statements--Continued December 31, 2003 and 2002 and Year Ended December 31, 2003 2. SUMMARY OF ACCOUNTING POLICIES - CONTINUED INVESTMENT VALUATION -- ALL OTHER INVESTMENTS All other investments are stated at fair value as determined by CIGNA on the last business day of the Plan year. All investments of the Plan are fully participant-directed. Participant loans are valued at their outstanding balance, which approximates fair value. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. 3. INVESTMENTS During 2003, the Plan's investments (including investments purchased, sold as well as held during the year) appreciated in fair value as follows:
NET REALIZED AND UNREALIZED APPRECIATION IN FAIR VALUE OF INVESTMENTS -------------- Pooled separate accounts $ 285,321 Hawk Corporation common stock 3,277 ----------- $ 288,598 ===========
8 Helsel Employees' Savings and Investment Plan Notes to Financial Statements--Continued December 31, 2003 and 2002 and Year Ended December 31, 2003 3. INVESTMENTS - CONTINUED The fair value of individual investments that represent 5% or more of the Plan's net assets are as follows:
DECEMBER 31 2003 2002 ----------- ----------- Guaranteed Income Fund $ 898,422 $ 692,794 CIGNA Lifetime 30 Fund 180,007 143,116 CIGNA Lifetime 40 Fund 480,857 299,251 CIGNA Lifetime 50 Fund 655,899 580,020 Participant Loans 181,590 141,029
4. PLAN TERMINATION The Plan Sponsor has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100% vested in their accounts and all participant account balances would be distributed based upon the value of the participant's account balance on the termination date. 5. INCOME TAX STATUS The Plan has received an opinion letter from the Internal Revenue Service dated February 6, 2002, stating that the written form of the underlying prototype plan document is qualified under Section 401 (a) of the Internal Revenue Code (the Code), and that any employer adopting this form of a plan will be considered to have a plan qualified under Section 401 (a) of the Code. Therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan is qualified and the related trust is tax exempt. 6. TRANSACTIONS WITH PARTIES-IN-INTEREST Transactions with parties-in-interest consist of purchases and sales of CIGNA sponsored funds. Such transactions are exempt from being prohibited transactions. 9 Helsel Employees' Savings and Investment Plan Notes to Financial Statements--Continued December 31, 2003 and 2002 and Year Ended December 31, 2003 7. SUBSEQUENT EVENT Effective April 1, 2004, the Plan was merged with, and all of its net assets transferred on a participant account basis, into the Hawk Corporation 401(k) Retirement Plan (Successor Plan), at which time the participants in the Plan became participants in, and subject to the provisions of the Successor Plan. In addition, each active participant in the Plan became 100% vested in all Plan Sponsor contributions plus actual earnings thereon on the date of the merger to the extent they were not fully vested prior to that date. 10 Helsel Employees' Savings and Investment Plan Employer Identification Number: 35-1957561 Plan Number: 002 Schedule H, Line 4i--Schedule of Assets (Held at End of Year) December 31, 2003
Identity of Issue, Borrower, Current Lessor, or Similar Party/Description of Investment Value -------------------------------------------------- -------------- * Connecticut General Life Insurance Company--Group Annuity Contract: Guaranteed Income Fund $ 898,422 CIGNA Lifetime 20 Fund 29,643 CIGNA Lifetime 30 Fund 180,007 CIGNA Lifetime 40 Fund 480,857 CIGNA Lifetime 50 Fund 655,899 CIGNA Lifetime 60 Fund 107,797 State Street Global Advisors Intermediate Bond Fund 32,915 S&P 500 Index Fund 82,722 Large Cap Value/John A. Levin & Co. Fund 39,578 Mid Cap Value/Wellington Management Fund 4,387 Mid Cap Growth/Artisan Partners Fund 22,137 Small Cap Value/Perkins, Wolf, McDonnell Fund 7,095 Small Cap Growth/TimesSquare Fund 5,510 Janus Fund 85,492 Janus Worldwide Fund 56,401 White Oak Growth Stock Fund 7,860 Hawk Corporation common stock 12,879 * Participant Loans (interest rates of 5.25% to 10.50%) 181,590 -------------- $ 2,891,191 ==============
* Represents a party-in-interest to the Plan. 11 INDEX TO EXHIBITS 23.1 Consent of Grant Thornton LLP 23.2 Consent of Ernst & Young LLP SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Helsel Employees' Savings and Investment Plan Date: June 25, 2004 By: /s/ Thomas A. Gilbride ---------------------- Thomas A. Gilbride Plan Administrator EX-23.1 2 l08046aexv23w1.txt EX-23.1 CONSENT OF INDEPENDENT PUBLIC ACCTG FIRM EXHIBIT 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We have issued our report dated June 15, 2004, accompanying the financial statements and supplemental schedule included in the Annual Report of the Helsel Employees' Savings and Investment Plan on Form 11-K for the year ended December 31, 2003. We hereby consent to the incorporation by reference of said report in the Post-Effective Amendment No. 2 to the Registration Statement of Hawk Corporation Form S-8 (File No. 333-68583, effective June 23, 2004). /s/ GRANT THORNTON LLP Cleveland, Ohio June 25, 2004 EX-23.2 3 l08046aexv23w2.txt EX-23.2 CONSENT - INDPNDT REGISTERED ACCTG FIRM EXHIBIT 23.2 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the incorporation by reference in Post-effective Amendment No. 2 to the Registration Statement (Form S-8 No. 333-68583) pertaining to the Helsel Employees' Savings and Investment Plan of our report dated June 13, 2003, with respect to the financial statement of the Helsel Employees' Savings and Investment Plan as of December 31, 2002 included in this Annual Report (Form 11-K) for the year ended December 31, 2003. /s/ ERNST & YOUNG LLP Cleveland, Ohio June 25, 2004 -----END PRIVACY-ENHANCED MESSAGE-----