SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
| x | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] |
For the Fiscal Year ended February 28, 2002
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT [NO FEE REQUIRED] |
Commission File No. 0-2733
A. Full title of the plan and the address of the plan,
if different from that of the issuer named below.
AZZ INCORPORATED EMPLOYEE
BENEFIT PLAN & TRUST
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
AZZ incorporated
1300 South University Drive
Suite 200
Fort Worth, TX 76107
AZZ INCORPORATED EMPLOYEE BENEFIT PLAN & TRUST
FORM 11-K FOR THE YEAR ENDED FEBRUARY 28, 2002
TABLE OF CONTENTS
| 1 | ||
| FINANCIAL STATEMENTS |
||
| Statements of Net Assets Available for Benefits at February 28, 2002 and February 28, 2001 |
2 | |
| 3 | ||
| 4 | ||
| 10 | ||
| Item 27a—Schedule of Assets Held for Investment Purposes at February 28, 2002 |
11 | |
| 12 | ||
| 12 | ||
Page 2 of 3
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the persons who administer the AZZ incorporated Employee Benefit Plan & Trust have duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized.
| AZZ incorporated Employee Benefit Plan & Trust | ||
| By | /s/ David H. Dingus | |
| David H. Dingus | ||
| Administrative Committee Member | ||
| By | /s/ Dana L. Perry | |
| Dana L. Perry | ||
| Administrative Committee Member | ||
| Date: July 23, 2004 | ||
Page 3 of 3
AZZ incorporated
Employee Benefit Plan & Trust
Financial Statements
and Supplemental Schedule
Years Ended February 28, 2002 and 2001
with Report of Independent Auditors
AZZ incorporated Employee Benefit Plan & Trust
Financial Statements and Supplemental Schedule
Years Ended February 28, 2002 and 2001
Table of Contents
| 1 | ||
| Financial Statements: |
||
| 2 | ||
| 3 | ||
| 4 | ||
| Form 5500, Schedule H, Line 4i – Schedule of Assets Held for Investment Purposes |
11 | |
| Note: | All other schedules required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted since they are either not applicable or the information required therein has been included in the financial statements or notes thereto. |
REPORT OF INDEPENDENT AUDITORS
Plan Administrator
AZZ incorporated Employee Benefit Plan & Trust
We have audited the accompanying statements of net assets available for benefits of the AZZ incorporated Employee Benefit Plan & Trust as of February 28, 2002 and 2001, 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 auditing standards generally accepted in the 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 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 AZZ incorporated Employee Benefit Plan & Trust as of February 28, 2002 and 2001, and the changes in its net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes 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 information is the responsibility of the Plan’s management. The supplemental information has 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.
Fort Worth, Texas
September 13, 2002
AZZ incorporated Employee Benefit Plan & Trust
Statements of Net Assets Available for Benefits
| February 28, 2002 |
February 28, 2001 | |||||
| Assets |
||||||
| Investments, at fair value: |
||||||
| Shares of registered investment companies: |
||||||
| Mutual funds |
$ | 9,093,413 | $ | 7,581,056 | ||
| Common stocks |
488,074 | 753,122 | ||||
| Short-term investments |
212,385 | 251,311 | ||||
| Total investments |
9,793,872 | 8,585,489 | ||||
| Receivables: |
||||||
| Employer contributions |
844,372 | 965,725 | ||||
| Participant contributions |
48,353 | 29,648 | ||||
| Total receivables |
892,725 | 995,373 | ||||
| Total assets |
10,686,597 | 9,580,862 | ||||
| Liabilities |
||||||
| Excess contributions payable |
50,633 | 26,475 | ||||
| Net Assets Available for Benefits |
$ | 10,635,964 | $ | 9,554,387 | ||
See accompanying notes.
2
AZZ incorporated Employee Benefit Plan & Trust
Statements of Changes in Net Assets Available for Benefits
| Year Ended February 28, |
||||||||
| 2002 |
2001 |
|||||||
| Additions to Net Assets: |
||||||||
| Investment income: |
||||||||
| Interest and dividend income |
$ | 301,731 | $ | 511,474 | ||||
| Net realized and unrealized gains (losses) |
(762,640 | ) | (223,538 | ) | ||||
| Total investment income (loss) |
(460,909 | ) | 287,936 | |||||
| Contributions: |
||||||||
| Employer |
1,461,363 | 1,368,455 | ||||||
| Participants |
1,059,414 | 856,217 | ||||||
| Rollovers |
3,347 | 227,577 | ||||||
| Total contributions |
2,524,124 | 2,452,249 | ||||||
| Total additions |
2,063,215 | 2,740,185 | ||||||
| Deductions from Net Assets: |
||||||||
| Benefits paid to participants |
981,638 | 492,785 | ||||||
| Net increase in net assets available for benefits |
1,081,577 | 2,247,400 | ||||||
| Net Assets Available for Benefits: |
||||||||
| Beginning of year |
9,554,387 | 7,306,987 | ||||||
| End of year |
$ | 10,635,964 | $ | 9,554,387 | ||||
See accompanying notes.
3
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements
February 28, 2002
A. Description of the Plan
The following description of the AZZ incorporated Employee Benefit Plan & Trust, formerly the Aztec Manufacturing Co. Employee Benefit Plan & Trust (the “Plan”) provides only general information. The Plan is sponsored by AZZ incorporated, formerly Aztec Manufacturing Co. (the “Company”). Participants should refer to the Plan Agreement or Summary Plan Description for a more complete description of the Plan’s provisions.
General
The Plan is a defined contribution plan covering substantially all full-time employees of the Company and its affiliates who have completed one year of service and attained eighteen years of age. Entry dates into the Plan are no later than the earlier of (a) six months after such eligibility requirements are met, or (b) the first day of the first Plan year after such requirements are met.
The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”).
Effective December 1, 1999, the Plan sponsor adopted the MFS Fund Distributors, Inc. Non-Standardized 401(k) Profit Sharing Plan and Trust and appointed First Nebraska Trust Company as the non-discretionary trustee of the trust established under the Plan. Effective upon such adoption, participants are allowed to make tax-deferred contributions to the Plan and to change their investment options at any time.
Contributions
Participants may elect to contribute from 1% to 12% of their eligible compensation, subject to Internal Revenue Service limitations. The Company provides discretionary matching contributions equal to a percentage of participant contributions as determined annually by the Company’s board of directors. Additionally, the Company may contribute discretionary profit sharing amounts to the Plan as determined each year by the Company’s board of directors. Maximum contributions may not exceed the lesser of (a) $30,000, or (b) 25% of the participant’s compensation for the year. To be eligible to receive matching contributions and profit sharing contributions, participants must be actively employed on the last day of the Plan year and must have completed 1,000 hours of service.
Participants may elect to commence voluntary contributions or modify the amount of voluntary contributions made on March 1, June 1, September 1 and December 1 of each year.
Participant Accounts
A separate account is maintained for each participant and is credited with the participant’s contributions, the Company’s contributions and actual earnings thereon as well as forfeitures of terminated participants’ non-vested accounts.
4
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements (continued)
A. Description of the Plan - continued
Forfeited Accounts
Forfeited balances of terminated participants’ non-vested accounts are reallocated among remaining participants in the proportion that each participant’s compensation for the year bears to the total compensation of all participants for the year. Approximately $166,000 and $78,000 of forfeitures were allocated to remaining participants during fiscal 2002 and 2001, respectively. At February 28, 2002, net assets available for benefits include approximately $83,000 of unallocated forfeitures that will be allocated among remaining participants in fiscal 2003.
Investment Options
Effective December 1, 1999, participants may direct their contributions in any of the following investment options, with the exception of AZZ incorporated common stock for which participants may only hold or sell existing shares:
Mutual Funds:
| • | MFS Bond Fund A – Seeks current income consistent with prudent investment risk. The fund normally invests at least 65% of assets in convertible and non-convertible debt, preferred stocks, U.S. government debt, and commercial paper. It may invest no more than 20% of assets in debt rated below investment-grade. The fund may also hold up to 10% of assets in common stocks acquired through conversion of other securities. |
| • | Massachusetts Investors Trust Fund A – Seeks current income and long-term growth of capital and income. The fund invests primarily in common stocks and convertibles, emphasizing securities that management considers to be of high or improving quality. It may invest up to 20% of assets in foreign securities; this limit does not apply to ADRs. The fund may also invest a portion of assets in debt securities and cash equivalents. |
| • | MFS Total Return Fund A – Seeks income; opportunity for growth of capital and income is secondary. The fund generally maintains 40% to 75% of assets in equity securities. It typically invests the balance in debt securities, including up to 20% of assets in debt rated below BB. The fund may invest in foreign securities, including Brady Bonds. |
| • | MFS Capital Opportunities Fund A – Seeks capital appreciation. Current income is incidental. The fund invests primarily in common stocks. It may also hold fixed-income securities, but it may not invest more that 15% of assets in debt rated below BBB. The fund may invest up to 35% of assets in foreign securities that are not traded on a U.S. exchange, including emerging-markets issues; it may also invest in ADRs. |
5
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements (continued)
A. Description of the Plan - continued
| • | MFS Global Equity Fund A – Seeks capital appreciation. The fund invests in equities issued by foreign and domestic companies. It may invest up to 50% of assets in securities of U.S. or Canadian issuers. The fund may also invest in securities issued by companies in emerging markets. The fund may engage in options on securities and stock indexes. |
Common Stocks:
| • | AZZ incorporated common stock – Funds are invested solely in common stock of AZZ incorporated (NYSE: AZZ). |
Short-term Investments:
| • | MFS Money Market Fund – Seeks a high level of current income as is consistent with preservation of capital and liquidity. The fund invests at least 80% of its assets in U.S. government securities, repurchase agreements, certificates of deposit, commercial paper or other short-term obligations. The fund may also invest 20% of its total assets in U.S. dollar-denominated securities of foreign issuers. |
Vesting
The participants’ voluntary contributions to the Plan plus actual earnings or losses thereon are fully vested at all times. The participant’s share of matching contributions and profit sharing contributions and earnings and losses thereon vest in accordance with the following schedule:
| Years of Service |
Vesting Percentage |
||
| Less than 1 year |
0 | % | |
| 1 year |
20 | % | |
| 2 years |
40 | % | |
| 3 years |
60 | % | |
| 4 years |
80 | % | |
| 5 years |
100 | % |
Participants will vest 100% upon attainment of age 65, or in the event of death or disability while in the employment of the Company.
6
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements (continued)
A. Description of the Plan - continued
Participant Withdrawals
On termination of service, if a participant’s vested benefits are less than $5,000, the benefit is payable in a lump sum. If the vested benefit is greater than $5,000, the participant may elect to receive either a lump-sum amount or annual installments over a period not to exceed the life expectancy of the participant and the participant’s beneficiary. Prior to termination of service, a participant may elect to receive all or any portion of their accrued benefit if the participant has participated in the Plan at least seven years and is 100% vested.
B. Summary of Significant Accounting Policies
The financial statements of the Plan are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America
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. Accordingly, actual results may differ from these estimates.
Investment Valuation
Investments in mutual funds are stated at fair value using quoted prices in an active market, which represent the net asset values of shares held by the Plan at year end. The investments in AZZ incorporated common stock are valued at the closing price on the New York Stock Exchange. Amounts invested on a short-term basis are in highly liquid assets; the fair value and cost basis of these invested funds are equal. Purchases and sales of securities are recorded on the trade dates. Gains or losses on sales of securities are calculated using the average cost of the securities sold. Interest income is recorded on the accrual basis.
All investments, earnings thereon, and uninvested cash were held by MFS Fund Distributors, Inc. under a trust agreement. The Plan’s investments are generally subject to market or credit risks customarily associated with debt and equity investments.
Contributions
Contributions from the participants and the employer are accrued in the period in which they are deducted in accordance with salary deferral agreements and as they become obligations of the Company, as determined by the Plan’s administrator.
7
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements (continued)
B. Summary of Significant Accounting Policies - continued
Payment of Benefits
Benefits are recorded when paid.
Plan Expenses
Employees of the Company perform certain administrative functions with no compensation from the Plan. The Company or the Plan pays administrative expenses of the Plan. Administrative expenses paid by the Plan are properly reflected in the accompanying statements of changes in net assets available for benefits.
C. Investments
At February 28, individual investments that represent 5% or more of the fair value of net assets available for benefits are as follows:
| 2002 |
2001 | |||||
| MFS Bond Fund A |
$ | 4,078,869 | $ | 3,219,000 | ||
| Massachusetts Investors Trust Fund A |
1,606,454 | 1,501,937 | ||||
| MFS Global Equity Fund A |
1,511,857 | 1,418,606 | ||||
| MFS Capital Opportunities Fund A |
1,384,835 | 1,257,439 | ||||
| MFS Total Return Fund A |
511,398 | — | ||||
| AZZ incorporated common stock |
488,074 | 753,122 | ||||
D. Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits, at February 28, per the financial statements to the Form 5500:
| 2002 |
2001 |
|||||||
| Net assets available for benefits per the financial statements |
$ | 10,635,964 | $ | 9,554,387 | ||||
| Amounts allocated to withdrawing participants |
(10,930 | ) | (9,779 | ) | ||||
| Net assets available for benefits per the Form 5500 |
$ | 10,625,034 | $ | 9,544,608 | ||||
8
AZZ incorporated Employee Benefit Plan & Trust
Notes to Financial Statements (continued)
D. Reconciliation of Financial Statements to Form 5500 - continued
The following is a reconciliation of benefits paid to participants per the financial statements to the Form 5500:
| 2002 |
2001 | ||||||
| Benefits paid to participants per the financial statements |
$ | 981,638 | $ | 492,785 | |||
| Amounts allocated to withdrawing participants |
10,930 | 9,779 | |||||
| Prior year allocations to withdrawing participants reported as payments on the current year financial statements |
(9,779 | ) | — | ||||
| Benefits paid to participants per the Form 5500 |
$ | 982,789 | $ | 502,564 | |||
Amounts allocated to withdrawing participants are recorded on the Form 5500 for benefit claims that have been processed and approved for payment prior to the Plan’s year end but not yet paid as of that date.
E. Plan Termination
Although it 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 ERISA. In the event of plan termination, participants will become 100% vested in their accounts.
F. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service dated August 24, 1994, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the “Code”), and 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 sponsor, on December 1, 1999, adopted the MFS Fund Distributors, Inc. Non-Standardized 401(k) Profit Sharing Plan and Trust and is in the process of filing for a determination letter. 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.
9
10
AZZ incorporated Employee Benefit Plan & Trust
Form 5500, Schedule H, Line 4i – Schedule of Assets Held For Investment Purposes
February 28, 2002
Plan: 001
EIN: 75-0948250
| (a) |
(b) Identity of Issue |
(c) Description of Investments |
(d) Cost |
(e) Fair Value | ||||||
| * |
MFS | MFS Bond Fund A |
$ | — | $ | 4,078,869 | ||||
| * |
MFS | Massachusetts Investors Trust Fund A |
— | 1,606,454 | ||||||
| * |
MFS | MFS Total Return Fund A |
— | 511,398 | ||||||
| * |
MFS | MFS Capital Opportunities Fund A |
— | 1,384,835 | ||||||
| * |
MFS | MFS Global Equity Fund A |
— | 1,511,857 | ||||||
| * |
AZZ incorporated | AZZ incorporated common stock |
— | 488,074 | ||||||
| * |
MFS | MFS Money Market Fund |
— | 212,385 | ||||||
| $ | — | $ | 9,793,872 | |||||||
| * | Indicates a party-in-interest to the Plan. |
11