<PAGE> 1
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1999
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to ________
Commission file number 1-7006
BRUSH ENGINEERED MATERIALS INC.
SAVINGS AND INVESTMENT PLAN
(FORMERLY BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN)
(Full Title of the Plan)
BRUSH WELLMAN INC.
17876 St. Clair Avenue
Cleveland, Ohio 44110
(Name of issuer of the securities held
pursuant to the plan and the address
of its principal executive office.)
<PAGE> 2
SIGNATURE
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
thereunto duly authorized.
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN
By /s/ Michael C. Hasychak
------------------------------------------
Michael C. Hasychak
Vice President, Treasurer and Secretary
Brush Wellman Inc.
Date: June 28, 2000
<PAGE> 3
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN
<TABLE>
<CAPTION>
REQUIRED INFORMATION
--------------------
Page No.
<S> <C>
Reports of Independent Auditors 1-2
Statements of Net Assets Available for Benefits -
December 31, 1999 and December 31, 1998 3
Statement of Changes in Net Assets Available for
Benefits - Year Ended December 31, 1999 4
Notes to Financial Statements 5-10
Schedules required to be filed under ERISA
a. Schedule H, Line 4i - Schedule of Assets held for Investment
Purposes at End of Year 11
b. Schedule H, Line 4j - Schedule of Reportable Transactions 12
Exhibits
23.1 Consent of Ernst & Young, Independent Auditors 13
23.2 Consent of Mills, Potoczak & Company, Independent Auditors 14
</TABLE>
<PAGE> 4
Report of Independent Auditors
Plan Administrator
Brush Wellman Inc. Savings and Investment Plan
We have audited the accompanying statement of net assets available for benefits
of the Brush Wellman Inc. Savings and Investment Plan as of December 31, 1999,
and the related statement of changes in net assets available for benefits for
the year 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 audit.
We conducted our audit 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 audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 1999, and the changes in its net assets available for benefits for
the year then ended, in conformity with accounting principles generally accepted
in the United States.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedules of assets
held for investment purposes at end of year as of December 31, 1999, and
reportable transactions for the year then ended, are presented for purposes of
additional analysis and are not a required part of the financial statements but
are 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. These supplemental schedules are the responsibility of the
Plan's management. The supplemental schedules have been subjected to the
auditing procedures applied in our audit of the financial statements and, in our
opinion, are fairly stated in all material respects in relation to the financial
statements taken as a whole.
/s/ Ernst & Young LLP
Cleveland, Ohio
June 22, 2000
1
<PAGE> 5
Report of Independent Auditors
------------------------------
Administrative Committee of
Brush Wellman Inc. Savings
and Investment Plan
We have audited the financial statements of Brush Wellman Inc.
Savings and Investment Plan listed in the Annual Report on Form 11-K as of and
for the year ended December 31, 1998. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements listed in the Annual
Report on Form 11-K present fairly, in all material respects, the net assets
available for benefits of Brush Wellman Inc. Savings and Investment Plan as of
December 31, 1998 and the changes in its net assets available for benefits for
the year ended December 31, 1998 in conformity with generally accepted
accounting principles.
Our audit was made for the purpose of forming an opinion on
the financial statements taken as a whole. The accompanying supplemental
schedules of assets held for investment purposes as of December 31, 1998 and
reportable transactions for the year ended December 31, 1998 are presented for
purposes of complying with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974, and are not a required part of the financial statements. The supplemental
schedules have been subjected to the auditing procedures applied in our audit of
the financial statements and, in our opinion, are fairly stated in all material
respects in relation to the financial statements taken as a whole.
MILLS, POTOCZAK & COMPANY
June 1, 1999
2
<PAGE> 6
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
DECEMBER 31
1999 1998
---------------------- ----------------------
<S> <C> <C>
ASSETS
Cash $ 1,012 -
Investments 125,850,633 107,905,592
Contribution receivables:
Employer 81,157 77,771
Participants 243,050 232,743
---------------------- ----------------------
Total contribution receivables 324,207 310,514
---------------------- ----------------------
Dividends receivable 153,453 145,944
Interest receivable 82,370 81,755
Pending sales 53,908 -
---------------------- ----------------------
NET ASSETS AVAILABLE FOR BENEFITS $126,465,583 $108,443,805
====================== ======================
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 7
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT 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 $8,659,207
Interest and dividends 8,490,096
---------------------
17,149,303
Contributions:
Participants 7,081,092
Employer 2,361,179
---------------------
9,442,271
---------------------
Total additions 26,591,574
DEDUCTIONS
Benefits paid directly to participants 8,569,796
---------------------
Net increase 18,021,778
Net assets available for benefits:
Beginning of year 108,443,805
---------------------
End of year $126,465,583
=====================
See accompanying notes to financial statements.
4
<PAGE> 8
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
AND YEAR ENDED DECEMBER 31, 1999
NOTE A - DESCRIPTION OF THE PLAN
The following description of the Brush Wellman Inc. Savings and Investment Plan
(Plan) provides only general information. Participants should refer to the
Summary Plan Description for a more complete description of the Plan's
provisions.
GENERAL
The Plan is a defined contribution plan which covers certain eligible employees
of Brush Wellman Inc. (Company and Plan Administrator). The Plan is subject to
the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
CONTRIBUTIONS
The Plan provides for basic contributions on behalf of employees up to 6% of
their earnings through either salary reduction or employee after-tax
contributions. Basic contributions are matched by the Company at the rate of 50%
of such contributions. The rate at which such basic contributions are matched by
the Company may be decreased or increased (up to 100%) by action of the
Company's Board of Directors.
An employee who makes basic contributions of 6% of earnings may also make
supplemental contributions of up to 9% of earnings which are not matched by
Company contributions and which may be made in any combination of salary
reduction and/or after-tax contributions.
An employee's contributions made to the Plan on a salary reduction basis may not
exceed certain maximum amounts. The maximum amount was $10,000 in 1999.
Participants may direct that their basic, supplemental and transfer
contributions (as described in the Plan) be invested in one or more of the
following: Growth Fund, International Fund, Income Fund, S&P 500 Index Fund,
Asset Allocation Fund, Fixed Income Fund, Money Market Fund and the Company
Stock Fund in increments of 1%. All Company matching contributions are invested
in the Company Stock Fund except with respect to Participants age 55 or older
who may transfer such contributions to other investment funds.
PAYSOP FEATURE
The Plan, as originally adopted, included a Payroll Stock Ownership Plan
(PAYSOP) feature that applied through 1986. Under the PAYSOP, the Company made
contributions based upon a percentage of payroll and was afforded an additional
credit against federal income tax up to the amount allowable by the Internal
Revenue Code. The PAYSOP contribution by the Company, which could be in Common
Stock of the Company or cash used to purchase Common Stock of the Company, was a
percentage of the compensation paid to all employees who made salary reduction
contributions to the Plan at any time during the year and who were members of
the Plan as of the last pay period of
5
<PAGE> 9
Brush Wellman Inc.
Savings and Investment Plan
Notes to Financial Statements - Continued
such year. The shares of Common Stock of the Company contributed or purchased
were allocated equally to all eligible participants.
VESTING
All employee and Company matching contributions are fully vested at all times.
PARTICIPANT LOANS
A participant may borrow funds from his account, excluding his interest in the
PAYSOP Fund, provided such loan is secured by the participant's interest in his
account and evidenced by a promissory note executed by the participant.
PAYMENT OF BENEFITS
At retirement, death or other termination, a participant (or his death
beneficiary) is eligible to receive a distribution of all employee, Company
matching and PAYSOP contributions credited to the employee's account plus or
minus any net gain or loss thereon.
The value of distributions and withdrawals is based on the value of a
participant's account on the valuation date immediately preceding the date of
distribution or withdrawal and is deducted from the participant's account as of
such valuation date.
Distribution to a participant or a person designated by the participant as his
death beneficiary is made under one of the following methods as elected by the
participant:
(i) Lump sum payment in cash; or
(ii) Lump sum payment in cash, except that a participant's interest in
the Company Stock Fund and the PAYSOP Fund will be paid in full shares of Common
Stock of the Company, with any fractional shares being paid in cash.
INSURANCE POLICIES
Prior to June 1, 1989, participants who were employees of Williams Advanced
Materials Inc. could have directed a portion of their contributions to be used
to purchase insurance policies that were excluded from the former Williams
Advanced Materials Inc. Savings and Investment Plan assets. Life insurance
policies on the lives of participants, purchased under the former Williams
Advanced Materials Inc. Savings and Investment Plan prior to July 1, 1989, may
continue to be held.
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.
6
<PAGE> 10
Brush Wellman Inc.
Savings and Investment Plan
Notes to Financial Statements - Continued
NOTE B - SUMMARY OF ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan have been prepared on the accrual basis of
accounting.
INVESTMENT VALUATION
Investments are stated at fair value. Investment in securities traded on
national securities exchanges are valued at the latest reported closing price.
Investment in participant units of the Northern Trust Short-Term Investment Fund
and the Employee Benefits Money Market Fund are stated at fair value as
determined by the Trustee. The participant loans are valued at their outstanding
balances, which approximate fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest
and dividend income is recorded on the accrual basis.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates that affect the
amounts reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.
RECLASSIFICATION
Certain amounts in the 1998 financial statements have been reclassified to
conform to the 1999 presentation.
7
<PAGE> 11
Brush Wellman Inc.
Savings and Investment Plan
Notes to Financial Statements - Continued
NOTE C - INVESTMENTS
During 1999, the Plan's investments (including investments purchased, sold as
well as held during the year) appreciated (depreciated) in fair value as
determined by quoted market prices as follows:
<TABLE>
<CAPTION>
Net Realized
and Unrealized
Appreciation
(Depreciation) in
Fair Value of
Investments
------------------
<S> <C>
Common Stock $ (729,199)
Shares of registered investment companies 9,388,406
------------------
$ 8,659,207
==================
</TABLE>
Investments that represent 5% or more of fair value of the Plan's net assets are
as follows:
<TABLE>
<CAPTION>
December 31
1999 1998
----------------- ------------------
<S> <C> <C>
Janus Fund $32,515,635 $19,412,400
Templeton Foreign Fund 9,294,065 6,375,796
PFAMCO Equity Income Fund 9,533,826 10,031,657
Northern Trust Collective Stock
Index Fund 21,996,415 18,079,379
Vanguard Asset Allocation Fund 11,538,097 12,128,529
PIMCO Total Return Fund 7,451,147 8,968,991
Northern Trust Short-Term
Investment Fund 8,715,248 7,845,440
Brush Wellman Inc. Common Stock* 21,398,614 21,301,889
</TABLE>
*Nonparticipant-directed
8
<PAGE> 12
Brush Wellman Inc.
Savings and Investment Plan
Notes to Financial Statements - Continued
NOTE D - NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of changes in
net assets related to the nonparticipant-directed investments is as follows:
<TABLE>
<CAPTION>
December 31,
1999 1998
----------------- ------------------
<S> <C> <C>
Net assets:
Brush Wellman Inc. Common Stock $21,398,614 $21,301,889
Employee Benefits Money Market Fund 18,971 54,656
Contribution receivables:
Employer 81,157 77,771
Participants 14,694 20,814
Income receivable 153,453 146,479
Pending sales 53,908 -
----------------- ------------------
$21,720,797 $21,601,609
================= ==================
</TABLE>
<TABLE>
<CAPTION>
Year Ended
Dec. 31, 1999
------------------
<S> <C>
Changes in net assets:
Contributions $ 2,852,804
Interest 7,413
Dividends 605,370
Net realized and unrealized depreciation in fair value (729,199)
Distributions to participants (1,068,304)
Transfers to participant-directed investments (1,548,896)
------------------
$ 119,188
==================
</TABLE>
9
<PAGE> 13
Brush Wellman Inc.
Savings and Investment Plan
Notes to Financial Statements - Continued
NOTE E - INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated November 30, 1995, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (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 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.
NOTE F - TRANSACTIONS WITH PARTIES-IN-INTEREST
All legal, accounting, and administrative expenses of the Plan are paid by the
Company. Other than as described above or pursuant to the trust agreement, the
Plan did not have any agreements or transactions with parties-in-interest.
NOTE G - SUBSEQUENT EVENT
Effective May 16, 2000, through a merger, Brush Wellman Inc. became a
wholly-owned subsidiary of a holding company, Brush Engineered Materials Inc.
Accordingly, Amendment Number 10 to the Brush Wellman Inc. Savings and
Investment Plan was adopted effective May 16, 2000 and it changed the name of
the Plan to "The Brush Engineered Materials Savings and Investment Plan". The
merger resulted in the reorganization of the Company's capital stock and
corporate structure. The merger did not change the operation of the Plan.
10
<PAGE> 14
BRUSH WELLMAN INC.
SAVINGS AND INVESTMENT PLAN
EIN-34-0119320 PLAN NUMBER - 003
SCHEDULE H, LINE 4i
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
DECEMBER 31, 1999
<TABLE>
<CAPTION>
DESCRIPTION CURRENT
IDENTITY OF ISSUE OF INVESTMENT COST VALUE
----------------- ------------- ---- -----
<S> <C> <C> <C>
Brush Wellman Inc. Common Stock * 1,260,779 shares $24,220,202 $21,398,614
Janus Fund 738,153 shares 32,515,635
Templeton Foreign Fund 828,348 shares 9,294,065
PFAMCO Equity Income Fund 880,316 shares 9,533,826
Northern Trust Collective Stock Index Fund * 910,448 shares 21,996,415
Vanguard Asset Allocation Fund 484,794 shares 11,538,097
PIMCO Total Return Fund 752,641 shares 7,451,147
Northern Trust Short-Term Investment Fund * Bank Common/
Collective Trust 8,715,248
Employee Benefits Money Market Fund * Bank Common/
Collective Trust 18,971
Participant Promissory Notes * 5.11% to 10.55%
with maturity dates
through 2014 3,388,615
-------------------
$125,850,633
===================
</TABLE>
* Party-in-interest to the Plan.
11
<PAGE> 15
BRUSH WELLMAN INC. SAVINGS AND INVESTMENT PLAN
EIN 34-0119320 PLAN NUMBER - 003
SCHEDULE H, LINE 4j - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
CURRENT VALUE
OF ASSET ON
DESCRIPTION PURCHASE SELLING COST OF TRANSACTION NET GAIN
IDENTITY OF PARTY INVOLVED OF ASSET PRICE PRICE ASSET DATE OR (LOSS)
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CATEGORY (III) - SERIES OF TRANSACTIONS
IN EXCESS OF 5%
Brush Wellman Inc. Common Stock *
Purchases $4,052,970 - $4,052,970 $4,052,970 -
Sales - 2,860,805 3,490,422 2,860,805 (629,617)
There were no category (i), (ii) or (iv) reportable transactions during 1999.
* Party-in-interest to the Plan.
</TABLE>
12
