-----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, P9z2fs6Of5K9gvU41UWmI30JR8q1FhQpveIW7MEqw1ipbvg+9UyWI1iBaX8+QPwh 9UfxcEo7kSZJNeaR2swZ/g== 0000950152-04-004912.txt : 20040625 0000950152-04-004912.hdr.sgml : 20040625 20040625161738 ACCESSION NUMBER: 0000950152-04-004912 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: 04882374 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 l08048ae11vk.txt HAWK CORPORATION | FORM 11-K 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: Hawk Corporation 401(k) Savings and Retirement 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 Hawk Corporation 401(k) Savings and Retirement Plan December 31, 2003 and 2002 and Year Ended December 31, 2003 with Reports of Independent Registered Public Accounting Firms Hawk Corporation 401(k) Savings and Retirement Plan Audited Financial Statements 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
Report of Independent Registered Public Accounting Firm Plan Administrator Hawk Corporation 401(k) Savings and Retirement Plan We have audited the accompanying statement of net assets available for benefits of the Hawk Corporation 401(k) Savings and Retirement 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. /s/ Grant Thornton LLP Cleveland, Ohio June 15, 2004 1 Report of Independent Registered Public Accounting Firm Plan Administrator Hawk Corporation 401(k) Savings and Retirement Plan We have audited the accompanying statement of net assets available for benefits of the Hawk Corporation 401(k) Savings and Retirement 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 Hawk Corporation 401(k) Savings and Retirement Plan Statements of Net Assets Available for Benefits
DECEMBER 31, 2003 2002 -------- ---------- ASSETS Investments, at fair value: Pooled separate accounts $ - $1,011,606 Hawk Corporation common stock - 52,833 Guaranteed Income Fund, at contract value - 300,731 Participant loans - 62,886 --------- ---------- - 1,428,056 Contributions receivable: Employer - 2,954 Employee - 8,817 --------- ---------- - 11,771 --------- ---------- NET ASSETS AVAILABLE FOR BENEFITS $ - $1,439,827 ========= ==========
See notes to financial statements. 3 Hawk Corporation 401(k) Savings and Retirement Plan Statement of Changes in Net Assets Available for Benefits Year Ended December 31, 2003 Additions: Interest income $ 13,346 Contributions: Employer 92,637 Employee 274,488 Employee rollovers 48,797 ----------- 415,922 ----------- Total additions 429,268 Deductions: Benefit payments 128,251 Fees and expenses 1,069 ----------- Total deductions 129,320 Net realized and unrealized appreciation in fair value of investments 374,804 Transfer of net assets to the Friction Products Co. Profit Sharing Plan (see Note 7) (2,114,579) ----------- Net decrease (1,439,827) Net assets available for benefits at beginning of year 1,439,827 ----------- NET ASSETS AVAILABLE FOR BENEFITS AT END OF YEAR $ - ===========
4 See notes to financial statements. Hawk Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF THE PLAN The following description of the Hawk Corporation 401(k) Savings and Retirement 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 was established January 1, 1999 as a defined contribution plan. The participating employer of the Hawk Corporation 401(k) Savings and Retirement Plan is Allegheny Clearfield, Inc. (the Company and Plan Sponsor). The Plan covers all non-union employees of the Company who have completed ninety days of service (six months of service prior to a July 1, 2003 Plan amendment that changed the eligibility requirement), as defined. 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 Company makes a matching contribution equal to 50% of the participant's contributions up to 4% of the participant's compensation, as defined. The Plan also provides that the Plan Sponsor may make additional discretionary contributions. The Plan Sponsor did not make a discretionary contribution for the 2003 or 2002 Plan years. Forfeitures are used to reduce future Plan Sponsor contributions. At December 31, 2003 and 2002, there were no forfeitures available to reduce future contributions. Plan Sponsor contributions for the year ended December 31, 2003 and 2002 are net of $1,344 and $19,855 in forfeitures, respectively. 5 Hawk Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF THE 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 DISTRIBUTIONS Participants are immediately vested in their contributions plus actual earnings thereon. On December 23, 2003, all active participants in Plan became 100% vested in all Plan Sponsor discretionary and matching contributions plus actual earnings thereon. Prior to that date, vesting of Plan Sponsor contributions plus actual earnings thereon was based upon years of continuous service. A participant was 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 Prior to the Plan merger (see Note 7), the Plan's funds were 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 Participants may borrow from their fund accounts up to the lesser of $50,000 or 50% of their vested balance attributable to employee pre-tax, employer matching and rollover contributions. Loan terms range from 1 to 5 years. 6 Hawk Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 1. DESCRIPTION OF THE PLAN -- CONTINUED The loans are secured by the balance in the participant's account. The loans bear interest at a fixed rate commensurate with local prevailing rates at the time of application. Principal and interest is paid ratably through monthly payroll deductions. 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 lump sum. EXPENSES The Plan Sponsor pays substantially all costs of Plan administration. Brokers' fees are reflected in the 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. 7 Hawk Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 2. SUMMARY OF ACCOUNTING POLICIES -- CONTINUED 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. 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. All participant loans were transferred to the Friction Products Co. Profit Sharing Plan during December 2003 (see Note 7). Prior to the transfer, participant loans were valued at their outstanding balance, which approximated 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 $ 334,654 Hawk Corporation common stock 40,150 ----------- $ 374,804 ===========
8 Hawk Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 and 2002 and Year Ended December 31, 2003 3. INVESTMENTS -- CONTINUED The fair value of individual investments that represented 5% or more of the Plan's net assets at December 31, 2002 are as follows: Janus Fund $354,677 Guaranteed Income Fund 300,731 S&P 500 Index Fund 206,827 Janus Worldwide Fund 132,245 CIGNA Lifetime 40 Fund 76,247
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. 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. 7. PLAN MERGER In December 2003, the Plan merged with, and all of its net assets were transferred, on a participant account basis, into the Friction Products Co. Profit Sharing Plan (Merged Plan). Effective January 1, 2004, the Merged Plan was renamed the Hawk Corporation 401(k) Retirement Plan (Successor Plan). Effective January 1, 2004, the participants of the Merged Plan became participants in, and subject to the provisions of the Successor Plan. 9 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. Hawk Corporation 401(k) Savings and Retirement Plan Date: June 25, 2004 By: /s/ Thomas A. Gilbride ---------------------- Thomas A. Gilbride Plan Administrator 10 EX-23.1 2 l08048aexv23w1.txt EXHIBIT 23.1 EXHIBIT 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We have issued our report dated June 15, 2004, accompanying the financial statements included in the Annual Report of the Hawk Corporation 401(k) Savings and Retirement 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 11 EX-23.2 3 l08048aexv23w2.txt EXHIBIT 23.2 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 Hawk Corporation 401(k) Savings and Retirement Plan of our report dated June 13, 2003, with respect to the financial statement of the Hawk Corporation 401(k) Savings and Retirement 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 12 -----END PRIVACY-ENHANCED MESSAGE-----