<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] Annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934
(No fee required, effective October 7, 1996)
For the fiscal year ended DECEMBER 31, 1999
--------------------------------------------------
Or
[ ] Transition report pursuant to Section 15(d) of the Securities Exchange
Act of 1934
(No fee required)
For the transition period from to
------------------- --------------------
Commission file number 1-12317
-----------------------------------------------------
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
-------------------------------------------------
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office
NATIONAL-OILWELL, INC.
----------------------------------------------------------------------------
10000 RICHMOND AVENUE
----------------------------------------------------------------------------
4th FLOOR
----------------------------------------------------------------------------
HOUSTON, TEXAS 77042-4200
----------------------------------------------------------------------------
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4. The National-Oilwell Retirement and Thrift Plan (the Plan) is subject
to the requirements of the Employee Retirement Income Security Act of
1974 (ERISA). Attached hereto is a copy of the most recent financial
statements and schedules of the Plan prepared in accordance with the
financial reporting requirements of ERISA.
<PAGE> 3
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
FINANCIAL STATEMENTS AND SCHEDULES
DECEMBER 31, 1999
TABLE OF CONTENTS
<TABLE>
<S> <C>
Report of Independent Auditors....................................................................................4
Audited Financial Statements
Statement of Net Assets Available for Benefits...........................................................5
Statement of Changes in Net Assets Available for Benefits................................................6
Notes to Financial Statements............................................................................7
Supplemental Schedule
Schedule H, Line 4(i)--Schedule of Assets Held for Investment Purposes at
End of Year........................................................................................12
Signature........................................................................................................13
Exhibit Index
Exhibit 23.1--Consent of Independent Certified Public Accountants.......................................14
</TABLE>
<PAGE> 4
REPORT OF INDEPENDENT AUDITORS
The Benefit Plan Administrative Committee
National-Oilwell Retirement and Thrift Plan
We have audited the accompanying statements of net assets available for benefits
of National-Oilwell Retirement and Thrift Plan as of December 31, 1999 and 1998,
and the related statement of changes in net assets available for benefits for
the year ended December 31, 1999. 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. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 1999 and 1998, and the changes in its net assets available for
benefits for the year ended December 31, 1999, in conformity with accounting
principles generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedule of
assets held for investment purposes at end of year as of December 31, 1999, is
presented for purposes 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 our 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.
/s/ Ernst & Young LLP
May 25, 2000
-4-
<PAGE> 5
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
DECEMBER 31
1999 1998
------------------------
<S> <C> <C>
ASSETS
Cash $ 908 $ 5,531
Receivables:
Employer contributions 33,208 1,189,087
Participant contributions 48,134 317,109
Accrued income 290,433 636,009
------------------------
Total receivables 371,775 2,142,205
Investments (Note 3) 85,816,741 74,291,751
------------------------
Total assets 86,189,424 76,439,487
LIABILITIES
Other 903 3,299
------------------------
Total liabilities 903 3,299
========================
Net assets available for benefits $86,188,521 $76,436,188
========================
</TABLE>
See accompanying notes.
-5-
<PAGE> 6
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year ended December 31, 1999
<TABLE>
<S> <C>
Additions:
Employer contributions $ 2,978,905
Participant contributions 3,499,545
Participant rollovers 808,835
Interest and dividends 1,108,381
Net appreciation in fair value of investments (Note 3) 14,693,007
-----------
Total additions 23,088,673
Deductions:
Benefits paid to participants 14,246,116
Administrative expenses 82,287
-----------
Total deductions 14,328,403
Other changes in net assets:
Net transfers to/from other qualified plans (Note 1) 992,063
-----------
Net increase 9,752,333
Net assets available for benefits at:
Beginning of year 76,436,188
-----------
End of year $86,188,521
===========
</TABLE>
See accompanying notes.
-6-
<PAGE> 7
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. DESCRIPTION OF PLAN
The following description of the National-Oilwell Retirement and Thrift Plan
(the "Plan") is provided for general information only. Participants should refer
to the Summary Plan Description for a more complete description of the Plan's
provisions, a copy of which is available from National-Oilwell, L.P. (the
"Company").
GENERAL
The Plan was established effective April 1, 1987 for the benefit of the
employees of the Company. The Plan is a defined contribution plan covering
substantially all domestic employees who have completed at least six months of
service. The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
CONTRIBUTIONS
Participants may make both pretax and after-tax contributions to the Plan. The
maximum a participant can contribute (both pretax and after-tax combined) is 14%
of compensation, and the minimum is 1%. At its discretion, the Company may match
a portion of the participant's contribution. For 1999, the Company elected to
match 25% of the first 6% of each participant's contribution. The Company may
also make an additional discretionary matching contribution as of the end of
each Plan year, which is determined by the Company's financial performance
during the Plan year. For 1999, no additional discretionary match was made. The
Company made two other types of discretionary contributions to the Plan in 1999.
The first type of contribution, the Employer Retirement Contribution, is
allocated to participants' accounts based on their years of service. The second
discretionary contribution, the Employer Medical Savings Contribution ("MSA"),
was established to accumulate assets for payment of medical insurance premiums
after retirement, and is allocated to the participants' accounts based on years
of service. Each participant may direct the trustee to invest both the
participant's and the Company's contributions in one or more investment options.
NET TRANSFERS TO/FROM OTHER QUALIFIED PLANS
Effective December 1, 1999, the Dupre Supply Company, Inc. 401(k) Plan was
merged into the Plan as a result of the acquisition of the Dupre Supply Company,
Inc. in July 1999. Assets of approximately $1.896 million were transferred to
the Plan as a result of this merger. Certain participants from the Black Warrior
and Hiland divisions transferred balances to other qualified plans due to the
sale of those divisions.
-7-
<PAGE> 8
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN (CONTINUED)
VESTING
Participants are immediately vested in participant and employer contributions
and the related earnings which have been credited to their accounts.
BENEFIT PAYMENTS
The Plan pays lump-sum benefits on retirement, disability, death, or termination
of employment. In-service withdrawals, subject to certain rules and
restrictions, may also be made from all but the retirement and MSA account
balances.
PARTICIPANT LOANS
The Plan includes a loan provision that permits participants to borrow up to the
lesser of $50,000 or 50% of the total value of their Plan assets. The loans are
payable in principal installments plus interest at prime plus 1% through payroll
deductions and are due in one-to five-year terms. The loans are considered
individually directed accounts which do not affect the assets of the other Plan
participants.
ADMINISTRATIVE EXPENSES
Certain administrative expenses are paid from the Plan's assets. All other Plan
expenses are paid by the Company.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue contributions at any time and to terminate the
Plan subject to the provisions of ERISA. Participants would be 100% vested in
their accounts in any event.
2. SUMMARY OF ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accompanying financial statements of the Plan have been prepared on the
accrual basis of accounting in accordance with accounting principles generally
accepted in the United States. Benefit payments to participants are recorded
upon distribution.
-8-
<PAGE> 9
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
2. SUMMARY OF ACCOUNTING POLICIES (CONTINUED)
INVESTMENT VALUATION
Short-term investments are stated at cost, which approximates fair value.
Investments in corporate common stock and mutual funds are stated at fair value,
based on quotations obtained from national securities exchanges. Investments in
common collective funds are based on quoted market values as determined by
American Express based on the fair value of the underlying investments. The
investment contracts with insurance companies are fully benefit-responsive and,
therefore, are recorded at contract value which approximates fair value.
Contract value represents contributions made under the contract plus interest at
the contract rate less funds used to pay benefits and expenses. Participant
loans are stated at cost, which approximates fair value.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
that affect the reported amounts in the financial statements and accompanying
notes and schedule. Actual results could differ from those estimates.
RECLASSIFICATION
Certain prior year amounts have been reclassified to conform to the current year
presentation.
-9-
<PAGE> 10
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
3. INVESTMENTS
Individual investments that represent 5% or more of the Plan's net assets are as
follows:
<TABLE>
<CAPTION>
DECEMBER 31
1999 1998
------------------------
<S> <C> <C>
AET Equity Index II Fund $10,349,140 $ 8,333,986
AIM Balanced Fund 6,171,870 6,335,471
AXP Growth Fund 19,977,626 16,239,532
Janus Worldwide Fund 9,350,806 5,574,061
AET Income II Fund 21,702,131 14,442,585
Kentucky Commonwealth Life Insurance Company
(GAC# ADA00804FR) 4,522,272 4,315,492
Connecticut General Life Insurance Company
(GIC #25198) - 5,655,553
During 1999, the Plan's investments (including investments bought, sold, and
held during the year) appreciated in value as follows:
Common stock $ 943,610
Common collective funds 3,422,077
Mutual funds 10,327,320
-----------
$14,693,007
===========
</TABLE>
During 1999, Plan assets included a guaranteed investment contract with
Connecticut General Life Insurance Company ("CIGNA"), a group annuity contract
with Kentucky Commonwealth Life Insurance Company ("Kentucky Commonwealth"), and
a group annuity contract with New York Life Insurance Company ("New York Life").
Withdrawals of the funds' assets not in compliance with the contracts are
subject to certain penalties.
-10-
<PAGE> 11
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
3. INVESTMENTS (CONTINUED)
The insurance companies maintain deposits in funds to which interest is added.
The rates in effect for the years ended December 31, 1999 and 1998 are as
follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31 MATURITY
1999 1998 DATE
------------------------------------- -------------------------
<S> <C> <C> <C>
CIGNA 6.07% 6.07% December 31, 1999
New York Life 6.10% 6.10% December 31, 1999
Kentucky Commonwealth 6.41% 6.41% January 2, 2001
</TABLE>
All rates are fixed through maturity.
4. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated September 18, 1997, stating that the Plan is qualified under Section
401(a) of the Internal Revenue Code (the "IRC") and, therefore, the related
trust is exempt from taxation. Once qualified, the Plan is required to operate
in conformity with the IRC to maintain its qualification. The Plan has been
amended and restated since receiving the determination. However, the Benefit
Plan Administrative Committee believes the Plan continues to operate in
compliance with the applicable requirements of the IRC and, therefore, believes
that the Plan is qualified and the related trust is tax exempt.
-11-
<PAGE> 12
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
SCHEDULE H, LINE 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AT END OF YEAR
December 31, 1999
EIN: 76-0488987 PN: 001
<TABLE>
<CAPTION>
IDENTITY OF ISSUE, BORROWER, CURRENT
LESSOR, OR SIMILAR PARTY DESCRIPTION OF INVESTMENT VALUE
-----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Kentucky Commonwealth Life Group Annuity Contract
Insurance Company #ADA00804FR $ 4,522,272
*American Express Trust Company AET Money Market I Fund 165,679
*National-Oilwell, Inc. 242,618 shares of common stock 3,806,070
*American Express Trust Company AET Equity Index II Fund 10,349,140
*American Express Trust Company AXP Bond Fund 1,681,881
*American Express Trust Company AIM Balanced Fund 6,171,870
*American Express Trust Company Barron Asset Fund 2,752,578
*American Express Trust Company AXP Growth Fund 19,977,626
*American Express Trust Company AXP Blue Chip Advantage Fund 3,596,919
*American Express Trust Company Janus Worldwide Fund 9,350,806
*American Express Trust Company AET Income II Fund 21,702,131
*Participant loans Various maturities and interest rates
ranging from 8.750% to 10.823% 1,739,769
-----------
$85,816,741
===========
</TABLE>
*Party-in-interest
-12-
<PAGE> 13
SIGNATURE
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.
NATIONAL-OILWELL RETIREMENT AND THRIFT PLAN
June 14, 2000 /s/ Daniel L. Molinaro
-------------------------------- --------------------------------------------
Date Daniel L. Molinaro
Treasurer for National-Oilwell, Inc. and
National-Oilwell Benefits Plan
Administrative Committee Member
-13-
<PAGE> 14
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------ -----------
23.1 Consent of Independent Auditors
