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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
X Annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 (Fee Required)
For the fiscal year ended: June 30, 2000
OR
_ Transition report pursuant to Section 15(d) of the Securities Exchange
Act of 1934 (No Fee Required)
For the transition period from:
Commission file number 0-5888
A. Full title of the Plan and the address of the Plan, if different from
that of the issuer named below:
Amended and Restated Waxman Industries, Inc.
Profit Sharing & 401(K) Retirement Plan
B. Name of issuer of the Securities held pursuant to the Plan and the
address of its principal executive office:
Waxman Industries, Inc.
24460 Aurora Road
Bedford Heights, Ohio 44146
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AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
FINANCIAL STATEMENTS
AS OF JUNE 30, 2000 AND 1999
TOGETHER WITH REPORT OF
INDEPENDENT PUBLIC ACCOUNTANTS
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of
Waxman Industries, Inc.:
We have audited the accompanying statements of net assets available for plan
benefits of the Amended and Restated Waxman Industries, Inc. Profit Sharing &
401(K) Retirement Plan (the Plan) as of June 30, 2000 and 1999, and the related
statement of changes in net assets available for plan benefits for the year
ended June 30, 2000, as listed in the accompanying index. These financial
statements and the schedule referred to below are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements and schedule 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 the Plan's 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 plan benefits as of June 30,
2000 and 1999, and the changes in net assets available for plan benefits for the
year ended June 30, 2000, 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 supplemental schedule of assets held
for investment purposes as of June 30, 2000 (Schedule I), 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 Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. 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.
Cleveland, Ohio,
December 13, 2000.
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AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
INDEX
JUNE 30, 2000 AND 1999
Statements of Net Assets Available for Plan Benefits as of June 30, 2000 and
1999
Statement of Changes in Net Assets Available for Plan Benefits for the Year
Ended June 30, 2000
Notes to Financial Statements
Schedule I - Item 4i - Schedule of Assets Held for Investment
Purposes as of June 30, 2000
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AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF AS OF
JUNE 30, 2000 JUNE 30, 1999
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Assets:
Investments $1,776,393 $1,784,269
Participant Loans 35,702 30,199
Receivable:
Participant 25,916 -
Employer 9,048 -
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Net assets available for plan benefits $1,847,059 $1,814,468
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The accompanying notes to financial statements are an integral part of these
statements.
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AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
YEAR ENDED
JUNE 30, 2000
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Additions:
Additions to net assets attributed to:
Investment income $17,568
Net appreciation in fair value of investments: 20,177
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37,745
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Contributions:
Participant 260,702
Employer 90,025
Rollover 14,918
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365,645
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Total additions 403,390
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Deductions:
Deductions from net assets attributed to:
Benefits paid to participants 370,069
Administrative expenses 730
---------
Total deductions 370,799
---------
Net increase 32,591
Net assets available for plan benefits:
Beginning of year 1,814,468
---------
End of year $1,847,059
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The accompanying notes to financial statements are an integral part of this
statement.
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AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2000 AND 1999
1. SUMMARY OF PLAN:
------------------
The following description of the Amended and Restated Waxman Industries, Inc.
(the Company) Profit Sharing & 401(k) Retirement Plan (the Plan) provides only
general information. Participants should refer to the plan agreement for a more
comprehensive description of the Plan's provisions.
GENERAL
The Plan is a defined contribution profit sharing plan. It is subject to the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
TRUSTEE AND CUSTODIAN
The trustee and the custodian of the Plan are a committee designated by Waxman
Industries, Inc. and Aetna Life Insurance and Annuity Company (Aetna),
respectively. The Plan's custodian maintains all records of investment
transactions and determines the valuation of the investment portfolio.
ELIGIBILITY
Certain employees of the Company and its subsidiaries are eligible to
participate in the Plan provided they are at least 21 years of age and have
completed three months of service with the Company, as defined in the plan
agreement.
PARTICIPANT AND EMPLOYER CONTRIBUTIONS
Participants may defer up to 15% of their pretax compensation by making
contributions to the Plan, subject to certain limitations. Participants may
direct the allocation of their contributions to various investment options.
Participants have the option to transfer cumulative balances, except those
relating to prior Company contributions, between investment options.
The Company may make discretionary matching contributions to the Plan.
Currently, the match is $.50 per every $1.00 contributed by the participant,
with the maximum Company match being 4% of the participant's annual
compensation, as defined in the plan agreement. The amount of the Company
contributions made to the Plan is limited by the Internal Revenue Code and is
determined at the discretion of the Board of Directors of the Company. Company
contributions are allocated to the accounts of eligible participants, on a
monthly basis, as established in Section 3.01 of the Plan.
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PARTICIPANT ACCOUNTS AND VESTING
The Plan provides for the establishment and maintenance of several accounts for
each participant which represent, in total, the participant's equity in the net
assets of the Plan. The individual participant accounts distinguish funds
attributable to participant deferral contributions and Company contributions
made on the participant's behalf. Participant accounts are credited with the
participant's allocation of investment earnings and are charged with the
participant's allocation of transaction costs. Allocations are based on the
ratio of the participant's balance in the fund to the total fund balance.
Participants are immediately vested in the value of their contributions plus
earnings thereon. Participants vest in Company contributions plus earnings
thereon ratably over five years of service and are fully vested after five years
of service, as defined.
DISTRIBUTION OF BENEFITS
Distributions to participants generally commence at age 60, or earlier in cases
of death or disability. The form of payment is designated by the participant.
Earlier distributions of vested benefits may be made for participants who leave
the Company prior to retirement.
PARTICIPANT LOANS
Participants may borrow from their accounts a maximum amount equal to the lesser
of $50,000 or 50 percent of their vested account balance. Loan terms range from
one to five years or up to twenty-five years for the purchase of a primary
residence. Loans are secured by the balance in the participant's account and
bear interest at a rate commensurate with local prevailing rates, as determined
quarterly by the Plan's administrator, plus one percent. Interest rates on loans
outstanding as of June 30, 2000 are between 8.5% and 9.5%. Principal and
interest payments on participant loans are paid ratably through monthly payroll
deductions.
FORFEITURES
Forfeitures are used to reduce the contributions of the Company or to pay the
administrative expenses of the Plan, at the Company's discretion. In the current
year, forfeitures amounted to $8,696. The balance of unused Forfeitures is $
25,754. These funds will be used to reduce administrative expenses or reduce the
employee match contribution.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company may amend or
terminate the Plan at its discretion, subject to applicable Internal Revenue
Service and ERISA regulations. The rights of all participants to benefits
accrued prior to any such termination are nonforfeitable.
INVESTMENT OPTIONS
Investment options as of June 30, 2000 include the following:
AETNA FIXED ACCOUNT
Aetna Fixed Account is invested in interest-bearing contracts or other
arrangements issued by life insurance companies or other financial institutions.
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AETNA SERIES MONEY MARKET FUND
Aetna Series Money Market Fund is invested in high-quality money market
instruments.
AETNA ASCENT FUND
Aetna Ascent Fund is invested primarily in equity securities with some
fixed-income securities with the objective of capital appreciation.
AETNA CROSSROADS FUND
Aetna Crossroads Fund is invested primarily in equity securities with some
fixed-income securities with the objective of income and capital appreciation
(realized and unrealized).
AETNA LEGACY FUND
Aetna Legacy Fund is invested primarily in fixed-income securities with some
equity securities with the objective of providing a consistent return with
preservation of capital.
AETNA INDEX PLUS LARGE CAP FUND
Aetna Index Plus Large Cap Fund is invested in large cap equity securities with
the objective of outperforming the S&P 500.
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND
Fidelity Advisor Growth Opportunities Fund is invested primarily in common
stocks and securities convertible into common stocks.
NEUBERGER & BERMAN GENESIS TRUST
Neuberger & Berman Genesis Trust is invested primarily in common stocks of
companies with small market capitalizations with the objective of capital
appreciation.
NEUBERGER & BERMAN GUARDIAN TRUST
Neuberger & Berman Guardian Trust is invested primarily in common stocks of
long-established, high-quality companies.
NEUBERGER & BERMAN FOCUS TRUST
Neuberger & Berman Focus Trust is invested primarily in value-oriented common
stocks, selected from 13 multi-industry sectors of the economy, with no more
than 6 sectors selected which are believed to be undervalued.
TEMPLETON FOREIGN FUND
Templeton Foreign Fund is invested primarily in equity securities and debt
obligations of companies and governments located outside the United States with
the objective of long-term capital growth.
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JANUS WORLDWIDE FUND
Janus Worldwide Fund is invested primarily in common stocks on a worldwide basis
in companies and organizations of any size, regardless of country of
organization or place of principal business activity with the objective of long
term growth of capital.
JANUS FLEXIBLE INCOME FUND
Janus Flexible Income Fund is invested primarily in a wide variety of income-
producing securities such as corporate bonds and notes, government securities,
preferred stocks, income-producing common stocks and debt securities that are
convertible or exchangeable into equity securities.
WAXMAN INDUSTRIES, INC. COMMON STOCK
Waxman Industries, Inc. Common Stock is invested only in common stock of the
Company.
The following investment options make up 5% or greater of the total net assets
available for plan benefits as of June 30, 2000:
Aetna Fixed Account $ 262,732
Aetna Ascent Fund $ 170,729
Aetna Crossroads Fund $ 200,666
Aetna Index Plus Large Cap Fund $ 344,280
Aetna Series Money Market Fund $ 97,115
Neuberger & Berman Genesis Trust $ 106,461
Fidelity Advisor Growth Opportunities Fund $ 218,918
Templeton Foreign Fund $ 119,726
During the year ended June 30, 2000, the Plan's investment options appreciated
(depreciated) in value, as follows:
Aetna Series Money Market Fund 4,476
Aetna Ascent Fund 9,561
Aetna Crossroads Fund 11,167
Aetna Legacy Fund 1,331
Aetna Index Plus Large Cap Fund 29,556
Fidelity Advisor Growth Opportunities Fund (17,991)
Neuberger & Berman Genesis Trust 14,238
Neuberger & Berman Guardian Trust (6,053)
Neuberger & Berman Focus Trust 4,794
Templeton Foreign Fund 11,805
Janus Worldwide Fund 6,560
Janus Flexible Income Fund 35
Waxman Industries, Inc. Common Stock (49,302)
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$ 20,177
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
---------------------------------------------
BASIS OF ACCOUNTING
The accompanying financial statements are prepared on the accrual basis of
accounting.
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USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires the Plan's management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of additions and deductions
during the reporting period. Actual results could differ from those estimates.
ADMINISTRATIVE EXPENSES
Fees of the custodian, legal counsel and auditors of the Plan are paid by the
Company and thus are not reflected in the accompanying financial statements.
Costs specific to various investment transactions are paid directly by the Plan
and are reflected in the accompanying statement of changes in net assets
available for plan benefits.
INVESTMENTS
The investments of the Plan are maintained by Aetna. Except for the Aetna Fixed
Account (Note 3), investments are valued at their market values in the
accompanying financial statements. In general, market values are estimated by
Aetna based on market conditions and the characteristics of the funds' holdings,
such as quality ratings, quotations obtained from national securities exchanges,
brokerage houses or other investment authorities. The investment vehicles are
credited with actual earnings on the underlying investments and charged for
distributions and transaction costs on a daily basis. As a result, the records
of Aetna are based solely on the market values of the investments. Therefore,
the accompanying statement of changes in net assets available for plan benefits
does not reflect separate accounting for unrealized appreciation or depreciation
of investments, investment earnings and realized gains or losses.
3. INVESTMENT CONTRACTS:
-----------------------
The Aetna Fixed Account invests in investment contracts that are fully
benefit-responsive. In accordance with the American Institute of Certified
Public Accountants' Statement of Position 94-4, " Reporting of Investment
Contracts Held by Health and Welfare Benefit Plans and Defined Contribution
Pension Plans," the Plan values these investment contracts at contract value. As
of June 30, 2000, the contract value of these investment contracts approximates
fair value. The average yield for the investment contracts was 5.61% for the
period from July 1, 1999 to June 30, 2000 and the crediting interest rate as of
June 30, 2000 was 5.60%.
4. TAX STATUS:
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The Plan obtained its latest determination letter on November 21, 1996, in which
the Internal Revenue Service stated that the Plan, as amended and restated, was
in compliance with the applicable requirements of the Internal Revenue Code to
qualify for tax exempt status.
The Plan's management believes that the Plan is currently designed and being
operated in compliance with the applicable requirements of the Internal Revenue
Code and that the Plan was qualified and the related trust was tax exempt as of
June 30, 2000. Accordingly, income taxes have not been provided in the
accompanying financial statements. Annually, informational returns are prepared
and filed with the Internal Revenue Service.
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5. INFORMATION CERTIFIED BY THE CUSTODIAN:
-----------------------------------------
Information on investments held and their market/contract values, as presented
in the accompanying statements of net assets available for plan benefits, and on
interest income and investment depreciation, as presented in the accompanying
statement of changes in net assets available for plan benefits, has been
certified by the custodian as being accurate and complete.
6. PARTY-IN-INTEREST TRANSACTIONS:
---------------------------------
There were no prohibited transactions with a party in interest, as defined by
ERISA.
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SCHEDULE I
AMENDED AND RESTATED WAXMAN INDUSTRIES, INC.
PROFIT SHARING & 401(K) RETIREMENT PLAN
ITEM 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
JUNE 30, 2000
EMPLOYER IDENTIFICATION NUMBER: 34-0899894
PLAN NUMBER: 001
<TABLE>
<CAPTION>
IDENTITY OF MARKET/
ISSUER DESCRIPTION OF INVESTMENT CONTRACT VALUE
------------------------ -------------------------------------------------------------------------- ------------------
<S> <C> <C>
Waxman 184,324 shares of Waxman Industries, Inc. Common
Industries:* Stock $46,366
Aetna: * Aetna Fixed Account 262,732
Aetna Series Money Market Fund 97,115
Aetna Ascent Fund 170,729
Aetna Crossroads Fund 200,666
Aetna Legacy Fund 25,977
Aetna Index Plus Large Cap Fund 344,280
Fidelity Advisor Growth Opportunities Fund 218,918
Neuberger & Berman Genesis Trust 106,461
Neuberger & Berman Guardian Trust 65,616
Neuberger & Berman Focus Trust 35,352
Templeton Foreign Fund 119,726
Janus Worldwide Fund 78,361
Janus Flexible Income Fund 4,094
Participant
Loans: * Participant Loans (8.5% to 9.5% interest rates) 35,702
----------
$1,812,095
==========
</TABLE>
* Indicates a party in interest
The accompanying notes to financial statements are an integral part of this
schedule.
