SEC Filing Html Data
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 - For the fiscal year ended December 31, 1999
Commission file number 1-13905
COMPX INTERNATIONAL INC.
-----------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 57-0981653
- ------------------------------- --------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
16825 Northchase Drive, Suite 1200, Houston, TX 77060
- ----------------------------------------------- --------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (281) 423-3377
--------------------
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
Class A common stock New York Stock Exchange
($.01 par value per share)
Securities registered pursuant to Section 12(g) of the Act:
None.
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days. Yes X No
As of February 29, 2000, 6,148,580 shares of Class A common stock were
outstanding. The aggregate market value of the 5.8 million shares of voting
stock held by nonaffiliates of Valhi, Inc. as of such date approximated $108
million.
Documents incorporated by reference
The information required by Part III is incorporated by reference from the
Registrant's definitive proxy statement to be filed with the Commission pursuant
to Regulation 14A not later than 120 days after the end of the fiscal year
covered by this report.
The undersigned Registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-K for the
year ended December 31, 1999 as set forth below and in the pages attached
hereto:
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
Exhibit No. 99.1, Annual Report of the National Cabinet Lock, Inc.
Contributory Retirement Plan (Form 11-K) for the year ended December
31, 1999 (filed as an amendment to the Registrant's Annual Report on
Form 10-K for the year ended December 31, 1999).
Exhibit No. 99.2, Annual Report of The 401(k) Plan of the Fort Lock
Corporation (Form 11-K) for the year ended December 31, 1999 (filed as
an amendment to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1999).
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
COMPX INTERNATIONAL INC.
-----------------------------
(Registrant)
Dated: June 15, 2000 By: /s/ Todd W. Strange
---------------------
Todd W. Strange
Vice President
and Controller (Principal
Accounting Officer)
Exhibit 99.1
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, 1999
Commission file number 1-13905
-------
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
NATIONAL CABINET LOCK, INC.
CONTRIBUTORY RETIREMENT PLAN
200 Old Mill Road
Mauldin, South Carolina 29662
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
COMPX INTERNATIONAL INC.
16825 Northchase Drive, Suite 1200
Houston, Texas 77060-2544
NATIONAL CABINET LOCK, INC.
CONTRIBUTORY RETIREMENT PLAN
INDEX
Page
Signature Page 2
Financial Statements and Supplemental Schedules
with Report of Independent Accountants 3 - 9
Exhibit I - Consent of Independent Accountants
SIGNATURE
Pursuant to the requirements of the Securities Act of 1934, the
Administrator has duly caused this Annual Report to be signed by the undersigned
thereunto duly authorized.
NATIONAL CABINET LOCK, INC.
CONTRIBUTORY RETIREMENT PLAN
By: ADMINISTRATIVE COMMITTEE OF THE
NATIONAL CABINET LOCK, INC.
CONTRIBUTORY RETIREMENT PLAN
By: /s/ Keith A. Johnson
-------------------------------------
Keith A. Johnson
Committee Member
June 15, 2000
NATIONAL CABINET LOCK, INC. CONTRIBUTORY
RETIREMENT PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
December 31, 1999
with
REPORT OF INDEPENDENT ACCOUNTANTS
NATIONAL CABINET LOCK, INC. CONTRIBUTORY RETIREMENT PLAN
Index of Financial Statements and Supplemental Schedules
Page
Report of Independent Accountants 2
Financial Statements
Statements of Net Assets Available for Benefits -
December 31, 1998 and 1999 3
Statement of Changes in Net Assets Available for Benefits -
Year ended December 31, 1999 4
Notes to Financial Statements 5-8
Supplemental Schedules
Schedule H - Schedule of Assets Held for Investment Purposes -
December 31, 1999 9
Report of Independent Accountants
To the Administrative Committee of
National Cabinet Lock, Inc. Contributory Retirement Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of National Cabinet Lock, Inc. Contributory Retirement Plan (the "Plan") at
December 31, 1998 and 1999 and the changes in net assets available for benefits
for the year ended December 31, 1999 in conformity with accounting principles
generally accepted in the United States. 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 of these statements in accordance with auditing standards generally
accepted in the United States which 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, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of 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 schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audits 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.
PricewaterhouseCoopers LLP
May 26, 2000
NATIONAL CABINET LOCK, INC. CONTRIBUTORY RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 1998 and 1999
1998 1999
---- ----
Assets:
Investments at fair value .................. $10,053,598 $13,624,943
Contributions receivable:
Employer ................................... 343,182 377,261
Participant ................................ -- 4,639
----------- -----------
Net assets available for benefits ........ $10,396,780 $14,006,843
=========== ===========
NATIONAL CABINET LOCK, INC. CONTRIBUTORY RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year ended December 31, 1999
Additions:
Investment income:
Net appreciation in fair value
of investments .......................................... $ 2,352,929
Interest and dividends ................................... 1,180,467
-----------
3,533,396
Contributions:
Employer ................................................. 377,261
Participants ............................................. 524,356
-----------
901,617
Total additions ........................................ 4,435,013
-----------
Deductions:
Benefits to participants ................................... 823,702
Administrative expenses .................................... 1,248
-----------
Total deductions ....................................... 824,950
-----------
Net increase in net assets available for benefits ............ 3,610,063
Net assets available for benefits:
Beginning of year .......................................... 10,396,780
-----------
End of year ................................................ $14,006,843
===========
NATIONAL CABINET LOCK, INC. CONTRIBUTORY RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
Note 1 - Description of Plan and significant accounting policies:
General. The following description of the National Cabinet Lock, Inc.
Contributory Retirement Plan (the "Plan"), provides only general information.
Participants should refer to the Plan agreement for a more complete description
of the Plan's provisions.
The Plan is a defined contribution plan which covers eligible salaried
and hourly U.S. employees of CompX International, Inc. (the "Employer").
Employees are eligible to participate in the Plan as of the first entry date, as
defined, concurrent with or next following the completion of one year of
employment and attaining 20 years of age. The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA").
The Employer is a 64%-owned subsidiary of Valhi, Inc. Valhi is a
93%-owned subsidiary of Contran Corporation. Substantially all of Contran's
outstanding voting stock is held either by trusts established for the benefit of
certain children and grandchildren of Harold C. Simmons, of which Mr. Simmons is
sole trustee, or by Mr. Simmons directly. Mr. Simmons, Chairman of the Board and
Chief Executive Officer of each of Contran and Valhi, may be deemed to control
each of such companies and the Employer.
Contributions. The Plan permits participants to defer 1% to 15% of their
pre-tax annual compensation as contributions, not to exceed a deferral of
$10,000 in 1999 (subject to adjustment in future years), through payroll
deductions. The Employer's contribution is based upon a profit-sharing formula
and the Employer's profit, as defined, during the Plan year. The Employer's
contribution is allocated to participants' accounts on a percentage or matching
basis relative to the participants' contributions for the year. The Employer's
contribution is reduced, as provided by the Plan, by nonvested amounts forfeited
by participants who withdraw from the Plan. At December 31, 1998 and 1999,
unallocated forfeited nonvested accounts were $6,407 and $12,601 respectively.
For the years ended December 31, 1998 and 1999 there were no forfeitures
allocated to participant accounts.
Vesting and benefits. Salary deferrals (including earnings thereon) are
immediately vested while Employer contributions (including earnings thereon)
vest at the rate of 20% per year of service, as defined.
Upon termination of employment, retirement, death or disability, a
participant (or beneficiary, if applicable) may elect to receive either (i) a
lump sum amount equal to the vested value of the participant's accounts or (ii)
installments over a period of not more than 30 years. With the consent of the
Plan administrators, participants can borrow amounts from their vested account
balances, subject to certain limitations under the Plan.
Participants' accounts. Participants can direct the Plan administrator
to invest, in 1% increments, their account balance in publicly-traded registered
investment companies or pooled funds administered by Putnam Investments or in
CompX International Inc. common stock. Below are the investment fund options
available to participants:
Putnam Voyager Fund (trading symbol PVOYX) - Aggressively seeks capital
appreciation. Invests primarily in common stocks.
Putnam Vista Fund (PVISX) - Seeks capital appreciation. Invests
primarily in common stocks.
Putnam OTC and Emerging Growth Fund (POEGX) - Seeks capital
appreciation. Invests primarily in common stocks of small- to
medium-sized "emerging growth" companies traded in the over-the-counter
("OTC") market.
Putnam Global Growth Fund (PEQUX) - Seeks capital appreciation. Invests
primarily in U.S. and international common stocks.
The George Putnam Fund of Boston (PGEOX) - Seeks to provide a balanced
investment which will produce both capital growth and current income.
Invests in a diversified group of stocks and bonds.
Putnam High Yield Advantage Fund (PHYIX) - Seeks high current income.
Invests primarily in high-yielding, lower-rated fixed income
securities.
Putnam Diversified Income Fund (PDINX)- Seeks high current income
consistent with preservation of capital. Invests primarily in U.S.
government, high-yield and international fixed securities.
Putnam Stable Value Fund - This pooled fund seeks stable principal and
relatively high current income. Invests primarily in high-quality
fixed-income investments.
Company Stock Fund - Invests in CompX International Inc. common stock.
*Putnam Asset Allocation Fund (PAEAX) - Growth Portfolio - Seeks
capital appreciation. Invests in both stocks and bonds.
*Putnam Asset Allocation Fund (PAEBX) - Balanced Portfolio - Seeks
total return. Invests in both stocks and bonds.
*Putnam S&P 500 Index Fund - Seeks to mirror the performance and
composition of Standard & Poor's 500 Composite Index.
*Equity Income Fund (PEYAX) - seeks to provide current income by
investing primarily in Diversified Portfolio of income producing equity
securities.
*Putnam International Growth Fund (PDUSX) - Seeks capital appreciation.
Invests in growth and value stocks outside of the United States.
*Putnam Asset Allocation Fund (PAECX) - Conservative Portfolio - Seeks
total return with preservation of capital. Invests in both stocks and
bonds.
*First available to participants February 1, 1999.
The above fund descriptions provide only general information.
Participants should refer to the Prospectus of each fund for a more complete
description.
In addition to the Putnam Funds, a "Loan Fund" is maintained to account
for loans to participants, as permitted by the Plan. These loans, with interest
rates ranging from 7.0% to 10.0%, mature through 2009.
Plan termination. The Employer has the right under the Plan to
discontinue its contributions at any time and to terminate the Plan, in
compliance with the provisions of ERISA. In the event the Plan is terminated,
the accounts of all participants will become fully vested.
Basis of accounting. The financial statements of the Plan are prepared
in accordance with accounting principles generally accepted in the United
States. Valuation of investments is more fully described in Note 2.
Financial Statement Presentation. On September 15, 1999, the American
Institute of Certified Public Accountants issued Statement of Position 99-3,
Accounting for and Reporting of Certain Defined Contribution Plan Investments
and Other Disclosure Matters ("SOP 99-3") which, among other things, eliminated
previous requirements for defined contribution plans to present plan investments
by general type for investment programs. SOP 99-3 is effective for financial
statements for Plan years ending after December 15, 1999. Accordingly, the Plan
has adopted SOP 99-3 and the accompanying financial statements do not include
details of the Plan's participant-directed investment programs.
Management estimates. The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets,
liabilities, and changes therein, and disclosure of contingent assets and
liabilities. Actual results may, in some instances, differ from previously
estimated amounts.
Risk and uncertainties. The Plan provides for various investment options
in a variety of stocks, bonds, fixed income securities, mutual funds, and other
investment securities. Investment securities are exposed to various risks, such
as interest rate, market, and credit risks. Due to the level of risk associated
with certain investment securities, it is at least reasonably possible that
changes in the values of investment securities will occur in the near term and
that such changes could materially affect participants' account balances and the
amounts reported in the Plan's statement of net assets available for benefits.
Expenses of administering the Plan. The Plan provides that the Employer
will generally reimburse the Plan for administrative expenses paid by the Plan.
The Employer paid a significant portion of the 1999 administrative expenses.
Tax status. The Plan has been notified by the Internal Revenue Service
that it is a qualified plan under Section 401(a) and Section 401(k) of the
Internal Revenue Code, and is therefore exempt from federal income taxes under
provisions of Section 501(a) of the Code.
Note 2 - Investments:
General. The assets of the Plan are held and the related investment
transactions are executed by Putnam Fiduciary Trust Company as trustee (the
"Trustee") of the National Cabinet Lock, Inc. Master 401(k) Plan Trust (the
"Trust"). The Trust invests in publicly-traded registered investment companies
or pooled funds administered by Putnam Investments and CompX International, Inc.
common stock (see Note 1). The Plan's investments are stated at fair value based
on quoted market prices and net appreciation (depreciation) for the year is
reflected in the Plan's statement of changes in net assets available for plan
benefits. The net appreciation (depreciation) consists of realized gains or
losses and unrealized appreciation or depreciation on investments.
The following presents investments that represent 5 percent or more of
the Plan's net assets at year end:
December 31,
1998 1999
---- ----
Putnam Investments Voyager Fund .............. $3,379,426 $4,474,486
Putnam Investments Vista Fund ................ $2,830,550 $3,305,917
Putnam Investments Stable Value
(pooled fund) ............................... $ 978,239 $2,466,267
Putnam Investments Diversified
Income Fund ................................. $ 903,961 $ 777,536
Putnam Investments The George Putnam
Fund of Boston ............................. $1,074,041 $ 699,005
NATIONAL CABINET LOCK, INC. CONTRIBUTORY RETIREMENT PLAN
SCHEDULE H - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1999
Fair
Cost value
*Putnam Funds:
Voyager Fund ..................................... $2,493,695 $4,474,486
Vista Fund ....................................... 2,022,335 3,305,917
OTC and Emerging Growth Fund ..................... 201,635 370,054
Global Growth Fund ............................... 323,179 508,947
George Putnam Fund ............................... 750,324 699,005
High Yield Advantage Fund ........................ 109,814 101,088
Diversified Income Fund .......................... 854,876 777,536
Stable Value Fund ................................ 2,466,267 2,466,267
Asset Allocation Fund - Growth Portfolio ......... 8,367 8,981
Asset Allocation Fund - Balanced Portfolio ....... 85,447 88,778
S&P 500 Index Fund ............................... 34,543 38,838
Equity Income Fund ............................... 107,213 89,696
International Growth Fund ........................ 14,697 17,176
Asset Allocation Fund - Conservative Portfolio ... 16,896 16,999
*CompX International Inc. common stock ............. 140,712 145,540
*Loans to participants, mature through 2009 ........ - 515,635
----------- -----------
$9,630,000 $13,624,943
=========== ===========
* party in interest
EXHIBIT I
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-56163) of CompX International Inc. of our report
dated May 26, 2000, relating to the financial statements of the National Cabinet
Lock, Inc. Contributory Retirement Plan, which appears in this Form 11-K.
PricewaterhouseCoopers LLP
Dallas, Texas
June 15, 2000
Exhibit 99.2
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, 1999
Commission file number 1-13905
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A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
THE 401(K) PLAN OF THE FORT LOCK CORPORATION
3000 North River Road
River Grove, Illinois 60171
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
COMPX INTERNATIONAL INC.
16825 Northchase Drive, Suite 1200
Houston, Texas 77060-2544
THE 401(K) PLAN OF THE FORT LOCK CORPORATION
INDEX
Page
Signature Page 2
Financial Statements and Supplemental Schedules
with Report of Independent Accountants 3 - 10
Exhibit I - Consent of Independent Accountants
SIGNATURE
Pursuant to the requirements of the Securities Act of 1934, the
Administrator has duly caused this Annual Report to be signed by the undersigned
thereunto duly authorized.
THE 401(K) PLAN OF THE FORT LOCK CORPORATION
By: ADMINISTRATIVE COMMITTEE OF
THE 401(K) PLAN OF THE FORT LOCK CORPORATION
By: /s/ Keith A. Johnson
-------------------------------------
Keith A. Johnson
Committee Member
June 15, 2000
THE 401(k) PLAN OF THE
FORT LOCK CORPORATION
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
December 31, 1999
with
REPORT OF INDEPENDENT ACCOUNTANTS
THE 401(k) PLAN OF THE FORT LOCK CORPORATION
Index of Financial Statements and Supplemental Schedules
Page
Report of Independent Accountants 2
Financial Statements
Statements of Net Assets Available for Benefits -
December 31, 1998 and 1999 3
Statement of Changes in Net Assets Available for Benefits -
Year ended December 31, 1999 4
Notes to Financial Statements 5-9
Supplemental Schedules
Schedule H - Schedule of Assets Held for Investment Purposes -
December 31, 1999 10
Report of Independent Accountants
To the Administrative Committee of
The 401(k) Plan of the Fort Lock Corporation
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of The 401(k) Plan of the Fort Lock Corporation (the "Plan") at December 31,
1998 and 1999 and the changes in net assets available for benefits for the year
ended December 31, 1999 in conformity with accounting principles generally
accepted in the United States. 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 of these
statements in accordance with auditing standards generally accepted in the
United States which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of 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 schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audits 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.
PricewaterhouseCoopers LLP
May 26, 2000
THE 401(k) PLAN OF THE FORT LOCK CORPORATION
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 1998 and 1999
1998 1999
---- ----
Assets:
Investments at fair value ...................... $1,375,584 $2,019,618
Contribution receivable:
Employer ..................................... 3,766 245,606
Participant .................................. 24,189 --
---------- ----------
Net assets available for benefits .......... $1,403,539 $2,265,224
========== ==========
THE 401(k) PLAN OF THE FORT LOCK CORPORATION
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year ended December 31, 1999
Additions:
Investment income:
Net appreciation in fair value
of investments ........................................... $ 215,414
Interest and dividends .................................... 120,458
----------
335,872
Contributions:
Employer .................................................. 245,606
Participants .............................................. 367,356
----------
612,962
Total additions ......................................... 948,834
Deductions:
Benefits to participants .................................... 86,845
Administrative expenses ..................................... 304
----------
Total deductions ........................................ 87,149
----------
Net increase in net assets available for benefits ............. 861,685
Net assets available for benefits:
Beginning of year ........................................... 1,403,539
----------
End of year ................................................. $2,265,224
==========
THE 401(k) PLAN OF THE FORT LOCK CORPORATION
NOTES TO FINANCIAL STATEMENTS
Note 1 - Description of Plan and significant accounting policies:
General. The following description of The 401(k) Plan of the Fort Lock
Corporation (the "Plan"), provides only general information. Participants should
refer to the Plan agreement for a more complete description of the Plan's
provisions.
The Plan is a defined contribution plan which covers eligible salaried
and hourly U.S. employees of Fort Lock Corporation (the "Employer"). Employees
are eligible to participate in the Plan as of the first entry date, as defined,
concurrent with or next following the completion of one year of employment and
attaining 20 years of age. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
The Employer is a 100% wholly-owned subsidiary of CompX International
Inc., which is a 64%-owned subsidiary of Valhi, Inc. Valhi is a 93%-owned
subsidiary of Contran Corporation. Substantially all of Contran's outstanding
voting stock is held either by trusts established for the benefit of certain
children and grandchildren of Harold C. Simmons, of which Mr. Simmons is sole
trustee, or by Mr. Simmons directly. Mr. Simmons, Chairman of the Board and
Chief Executive Officer of each of Contran and Valhi, may be deemed to control
each of such companies and the Employer.
Contributions. The Plan permits participants to defer 1% to 15% of their
pre-tax annual compensation as contributions, not to exceed a deferral of
$10,000 in 1999 (subject to adjustment in future years), through payroll
deductions. The Employer's contribution is based upon a profit-sharing formula
and the Employer's profit, as defined, during the Plan year. Prior to February
1, 1999, the Plan provided for a discretionary Employer match that was
determined by the Company prior to the beginning of the Plan year and could not
exceed 1.25% of compensation (as defined in the Plan). The Employer's
contribution is allocated to participants' accounts on a percentage or matching
basis relative to the participants' contributions for the year. The Employer's
contribution is reduced, as provided by the Plan, by nonvested amounts forfeited
by participants who withdraw from the Plan. At December 31, 1998 and 1999,
unallocated forfeited nonvested accounts were $2,312 and $5,126 respectively.
For the years ended December 31, 1998 and 1999 there were no forfeitures
allocated to participant accounts.
Vesting and benefits. Salary deferrals (including earnings thereon) are
immediately vested while Employer contributions (including earnings thereon)
vest at the rate of 20% per year of service, as defined.
Upon termination of employment, retirement, death or disability, a
participant (or beneficiary, if applicable) may elect to receive either (i) a
lump sum amount equal to the vested value of the participant's accounts or (ii)
installments over a period of not more than 30 years. With the consent of the
Plan administrators, participants can borrow amounts from their vested account
balances, subject to certain limitations under the Plan.
Participants' accounts. Prior to February 25, 1999, participants could
direct the Plan administrator to invest, in 5% increments (minimum 10%
investment), their account balances in pooled funds administered by
Massachusetts Mutual Life Insurance Company ("MassMutual"). Balances in the
MassMutual funds were liquidated on February 25, 2000 and transferred to the
Putnam funds described below. The MassMutual investment options were:
Balanced Fund. Money invested in common stocks, publicly-traded bonds
and cash. The percentage invested in these assets will very according to market
conditions to enhance returns and minimize risk.
Core Equity Fund. Money invested mostly in common stocks.
Guaranteed Interest Fund. Money invested in MassMutual's general
portfolio. This money will receive a rate of interest set by MassMutual at the
start of the year.
Small Company Fund. Money invested mostly in common stocks of
corporations with small market capitalization.
Effective February 1, 1999 participants could no longer invest in the
above four options, but could direct the Plan administrator to invest, in 1%
increments, their account balance in publicly-traded registered investment
companies or pooled funds administered by Putnam Investments or in CompX
International Inc. common stock. Below are the investment fund options available
to participants beginning February 1, 1999:
Putnam Voyager Fund (trading symbol PVOYX) - Aggressively seeks capital
appreciation. Invests primarily in common stocks.
Putnam Vista Fund (PVISX) - Seeks capital appreciation. Invests
primarily in common stocks.
Putnam OTC and Emerging Growth Fund (POEGX) - Seeks capital
appreciation. Invests primarily in common stocks of small- to
medium-sized "emerging growth" companies traded in the over-the-counter
("OTC") market.
Putnam Global Growth Fund (PEQUX) - Seeks capital appreciation. Invests
primarily in U.S. and international common stocks.
The George Putnam Fund of Boston (PGEOX) - Seeks to provide a balanced
investment which will produce both capital growth and current income.
Invests in a diversified group of stocks and bonds.
Putnam High Yield Advantage Fund (PHYIX) - Seeks high current income.
Invests primarily in high-yielding, lower-rated fixed income
securities.
Putnam Diversified Income Fund (PDINX)- Seeks high current income
consistent with preservation of capital. Invests primarily in U.S.
government, high-yield and international fixed securities.
Putnam Stable Value Fund - This pooled fund seeks stable principal and
relatively high current income. Invests primarily in high-quality
fixed-income investments.
Putnam Asset Allocation Fund (PAEAX) - Growth Portfolio - Seeks capital
appreciation. Invests in both stocks and bonds.
Putnam Asset Allocation Fund (PAEBX) - Balanced Portfolio - Seeks total
return. Invests in both stocks and bonds.
Putnam S&P 500 Index Fund - Seeks to mirror the performance and
composition of Standard & Poor's 500 Composite Index.
Putnam International Growth Fund (PDVSX) - Seeks capital appreciation.
Invests in growth and value stocks outside of the United States.
Equity Income Fund (PEYAX) - Seeks to provide current income by
investing primarily in Diversified Portfolio of income - producing
equity securities.
Putnam Asset Allocation Fund (PAECX) - Conservative Portfolio - Seeks
total return with preservation of capital. Invests in both stocks and
bonds.
Company Stock Fund - Invests in CompX International Inc. common stock.
The above fund descriptions provide only general information.
Participants should refer to the Prospectus of each fund for a more complete
description.
In addition to the Putnam Funds or MassMutual funds prior to February
25, 1999, a "Loan Fund" is maintained to account for loans to participants, as
permitted by the Plan. These loans, with interest rates ranging from 8.75% to
10.5%, mature through 2005.
Plan termination. The Employer has the right under the Plan to
discontinue its contributions at any time and to terminate the Plan, in
compliance with the provisions of ERISA. In the event the Plan is terminated,
the accounts of all participants will become fully vested.
Basis of accounting. The financial statements of the Plan are prepared
in accordance with accounting principles generally accepted in the United
States. Valuation of investments is more fully described in Note 2.
Financial Statement Presentation. On September 15, 1999, the American
Institute of Certified Public Accountants issued Statement of Position 99-3,
Accounting for and Reporting of Certain Defined Contribution Plan Investments
and Other Disclosure Matters ("SOP 99-3") which, among other things, eliminated
previous requirements for defined contribution plans to present plan investments
by general type for investment programs. SOP 99-3 is effective for financial
statements for Plan years ending after December 15, 1999. Accordingly, the Plan
has adopted SOP 99-3 and the accompanying financial statements do not include
details of the Plan's participant-directed investment programs.
Management estimates. The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets,
liabilities, and changes therein, and disclosure of contingent assets and
liabilities. Actual results may, in some instances, differ from previously
estimated amounts.
Risk and uncertainties. The Plan provides for various investment options
in a variety of stocks, bonds, fixed income securities, mutual funds, and other
investment securities. Investment securities are exposed to various risks, such
as interest rate, market, and credit risks. Due to the level of risk associated
with certain investment securities, it is at least reasonably possible that
changes in the values of investment securities will occur in the near term and
that such changes could materially affect participants' account balances and the
amounts reported in the Plan's statement of net assets available for benefits.
Expenses of administering the Plan. The Plan provides that the Employer
will generally reimburse the Plan for administrative expenses paid by the Plan.
The Employer paid a significant portion of the 1999 administrative expenses.
Tax status. The Plan has been notified by the Internal Revenue Service
that it is a qualified plan under Section 401(a) and Section 401(k) of the
Internal Revenue Code (the "Code"), and is therefore exempt from federal income
taxes under provisions of Section 501(a) of the Code. The Plan has been amended
and restated (effective February 1, 1999) since receiving the determination
letter. However, the Plan administrator believes that the Plan is designed and
is currently being operated in compliance with applicable requirements of the
Code.
Note 2 - Investments:
General. The assets of the Plan were held and the related investment
transactions were executed by MassMutual during the year of 1998 and until
February 1999. Starting in February 1999 the assets of the plan were transferred
to Putnam Fiduciary Trust Company as trustee (the "Trustee") of the Fort Lock
Corporation Master 401(k) Plan Trust (the "Trust"). The related transactions are
now executed by Putnam Fiduciary Trust Company. The Trust invests in
publicly-traded registered investment companies or pooled funds administered by
Putnam Investments and CompX International, Inc. common stock (see Note 1). The
Plan's investments are stated at fair value based on quoted market prices and
net appreciation (depreciation) for the year is reflected in the Plan's
statement of changes in net assets available for plan benefits. The net
appreciation (depreciation) consists of realized gains or losses and unrealized
appreciation or depreciation on investments.
The following presents investments that represent 5 percent or more of
the Plan's net assets at year end:
December 31,
1998 1999
---- ----
Putnam Investments Voyager Fund .................. $ -- $175,318
Putnam Investments OTC and Emerging
Growth Fund ..................................... $ -- $385,783
Putnam Investments The George Putnam
Fund of Boston .................................. $ -- $115,888
Putnam Investments Stable Value Fund
(pooled fund) ................................... $ -- $574,578
Putnam Investments S&P 500 Index Fund
(pooled fund) ................................... $ -- $292,234
Putnam Investments Equity Income Fund ............ $ -- $304,659
Massachusetts Mutual Funds Company
Guaranteed Interest Fund ........................ $510,129 $ --
Massachusetts Mutual Funds Company
Balanced Fund (pooled fund) ..................... $130,740 $ --
Massachusetts Mutual Funds Company
Core Equity Fund (pooled fund) .................. $398,174 $ --
Massachusetts Mutual Fund Company
Small Company Fund (pooled fund) ................ $268,275 $ --
THE 401(k) PLAN OF THE FORT LOCK CORPORATION
SCHEDULE H - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1999
Fair
Cost value
*Putnam Funds:
Voyager Fund ................................... $ 140,067 $ 175,318
Vista Fund ..................................... 34,566 41,810
OTC and Emerging Growth Fund ................... 192,558 385,783
Global Growth Fund ............................. 12,372 16,267
George Putnam Fund ............................. 126,517 115,888
High Yield Advantage Fund ...................... 650 652
Diversified Income Fund ........................ 11,892 11,640
Stable Value Fund .............................. 570,006 574,578
Asset Allocation Fund - Growth Portfolio ....... 1,161 1,211
Asset Allocation Fund - Balanced Portfolio ..... 2,049 2,110
S&P 500 Index Fund ............................. 263,931 292,234
International Growth Fund ...................... 18,036 25,496
Equity Income Fund ............................. 337,681 304,659
*CompX International Inc. common stock ........... 7,369 8,747
*Loans to participants mature through 2005 ....... - 63,225
---------- ----------
$1,718,855 $2,019,618
========== ==========
*party in interest
EXHIBIT I
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-74821) of CompX International Inc. of our report
dated May 26, 2000, relating to the financial statements of The 401(k) Plan of
the Fort Lock Corporation, which appears in this Form 11-K.
PricewaterhouseCoopers LLP
Dallas, Texas
June 15, 2000