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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, 1994
Commission File No. 1-10697
NON-QUALIFIED STOCK PURCHASE PLAN
OF COMMERCIAL INTERTECH CORP.
COMMERCIAL INTERTECH CORP.
1775 Logan Avenue
Youngstown, Ohio 44505
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Audited Financial Statements
NON-QUALIFIED STOCK PURCHASE PLAN
OF COMMERCIAL INTERTECH CORP.
Years Ended December 31, 1994, 1993, and 1992
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Non-Qualified Stock Purchase Plan of Commercial Intertech Corp.
Audited Financial Statements
Years Ended December 31, 1994, 1993, and 1992
CONTENTS
<TABLE>
<S> <C>
REQUIRED INFORMATION
Report of Independent Auditors..................................... 1
Statements of Net Assets--December 31, 1994 and December 31, 1993.. 2
Statements of Changes in Net Assets--Years Ended December 31, 1994,
1993, and 1992.................................................. 3
Notes to Financial Statements...................................... 4
EXHIBITS
Consent of Independent Auditors.................................... 8
</TABLE>
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Report of Independent Auditors
Administrative Committee
Non-Qualified Stock Purchase Plan
of Commercial Intertech Corp.
We have audited the accompanying statements of net assets of the Non-Qualified
Stock Purchase Plan of Commercial Intertech Corp. as of December 31, 1994 and
1993, and the related statements of changes in net assets for each of the three
years in the period ended December 31, 1994. 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 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 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 of the Non-Qualified Stock Purchase Plan
of Commercial Intertech Corp. at December 31, 1994 and 1993, and the changes in
its net assets for each of the three years in the period ended December 31,
1994, in conformity with generally accepted accounting principles.
Ernst & Young LLP
Cleveland, Ohio
March 24, 1995
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<TABLE>
Non-Qualified Stock Purchase Plan of Commerical Intetech Corp.
Statements of Net Assets
<CAPTION>
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------------------- --------------------------------------
COMMERICAL COMMERICAL
INTERTECH INTERTECH
CORP. CORP.
MONEY COMMON MONEY COMMON
MARKET STOCK MARKET STOCK
FUND FUND TOTAL FUND FUND TOTAL
-------------------------------------- --------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Cash $ 1,959 $ 1,959 $ 3,248 $ 3,248
Company contributions receivable $ 6,412 7,655 14,067 $ 3,736 4,492 8,228
Employee contributions receivable 14,014 19,046 33,060 7,855 11,118 18,973
Accrued interest receivable 900 900 404 404
-------------------------------------- --------------------------------------
21,326 28,660 49,986 11,995 18,858 30,853
Investments:
Money Market Fund 210,889 210,889 175,068 175,068
Commerical Intertech Corp.
common stock 318,730 318,730 255,450 255,450
-------------------------------------- --------------------------------------
210,889 318,730 529,619 175,068 255,450 430,518
-------------------------------------- --------------------------------------
232,215 347,390 579,605 187,063 274,308 461,371
LIABILITIES
Distributions payable to participants (232,215) (337,709) (569,924) (187,063) (268,008) (455,071)
Payable to Company (9,503) (9,503) (6,024) (6,024)
Other liabilities (178) (178) (276) (276)
-------------------------------------- --------------------------------------
(232,215) (347,390) (579,605) (187,063) (274,308) (461,371)
-------------------------------------- --------------------------------------
NET ASSETS $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
====================================== ======================================
</TABLE>
See notes to financial statements.
2
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<TABLE>
Non-Qualified Stock Purchase Plan of Commerical Intetech Corp.
Statements of Changes in Net Assets
<CAPTION>
FOR THE YEAR ENDED
------------------------------------------------------------------------------------------------------
DECEMBER 31, 1994 DECEMBER 31, 1993 DECEMBER 31, 1992
-------------------------------- -------------------------------- --------------------------------
COMMERICAL COMMERICAL COMMERICAL
INTERTECH INTERTECH INTERTECH
CORP. CORP. CORP.
MONEY COMMON MONEY COMMON MONEY COMMON
MARKET STOCK MARKET STOCK MARKET STOCK
FUND FUND TOTAL FUND FUND TOTAL FUND FUND TOTAL
-------------------------------- -------------------------------- --------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Contributions:
Company $ 71,552 $ 90,754 $162,306 $ 58,805 $ 78,688 $137,493 $ 52,327 $ 99,104 $151,431
Employee 156,231 221,601 377,832 125,604 195,689 321,293 111,450 174,332 285,782
-------------------------------- -------------------------------- --------------------------------
227,783 312,355 540,138 184,409 274,377 458,786 163,777 273,436 437,213
Net investment income:
Interest and dividends 4,432 4,449 8,881 2,654 4,641 7,295 2,541 5,150 7,691
Other expenses (859) (859) (2,186) (2,186) (3,039) (3,039)
-------------------------------- -------------------------------- --------------------------------
4,432 3,590 8,022 2,654 2,455 5,109 2,541 2,111 4,652
Realized (loss) gain on
distribution (8,302) (8,302) 16,502 16,502 6,601 6,601
Unrealized appreciation
(depreciation) in
aggregate current value
of investments 35,141 35,141 (27,799) (27,799) 10,912 10,912
(Increase) decrease in
company payable (3,479) (3,479) 3,861 3,861 (9,608) (9,608)
-------------------------------- -------------------------------- --------------------------------
Net assets available for
distribution 232,215 339,305 571,520 187,063 269,396 456,459 166,318 283,452 449,770
Distribution to
participants 232,215 339,305 571,520 187,063 269,396 456,459 166,318 283,452 449,770
-------------------------------- -------------------------------- --------------------------------
Net change in net assets 0 0 0 0 0 0 0 0 0
Net assets at beginning
of year 0 0 0 0 0 0 0 0 0
-------------------------------- -------------------------------- --------------------------------
NET ASSETS AT END OF YEAR $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
================================ ================================ ================================
</TABLE>
See notes to financial statements.
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Non-Qualified Stock Purchase Plan of Commercial Intertech Corp.
Notes to Financial Statements
Years Ended December 31, 1994, 1993, and 1992
A. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting records of the Non-Qualified Stock Purchase Plan of Commercial
Intertech Corp. (the "Plan") are maintained on the accrual basis.
VALUATION OF INVESTMENTS
Investments are stated at the closing sale price on the last business day of
the year. Investments consist of common shares of Commercial Intertech Corp.
(the "Company" or "CIC") and Money Market Fund shares. Generally, purchases of
Company shares are made on the open market; however, purchases may also be
made directly from the Company's treasury.
PLAN DISTRIBUTIONS
Distributions payable to participants represent the value of participants'
accounts in the Money Market Fund and the number of shares of stock allocated
to participant's accounts times the year end market price per share for the
Common Stock Fund. Realized gains/losses on distributions are calculated based
on historical costs.
B. DESCRIPTION OF THE PLAN
The Plan provides investment opportunities for eligible employees, including
the opportunity to acquire stock of the Company. Eligible employees include
all employees of Commercial Intertech Corp. and its domestic subsidiaries with
a base salary in excess of $45,000, and employees, as designated by the
Compensation Committee of the Board of Directors, of foreign subsidiaries of
the Company. Participants may elect to contribute up to 15% of their eligible
compensation. The Company will make a contribution to each participant's
account equal to 50% of the participant's contributions, up to a maximum of 3%
of the participant's eligible compensation.
Eligible compensation is defined as base wage or salary in excess of $45,000
for employees of the Company and its domestic subsidiaries. For employees of
foreign subsidiaries of the Company, eligible compensation consists of base
wage or salary.
4
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Non-Qualified Stock Purchase Plan of Commercial Intertech Corp.
Notes to Financial Statements--Continued
B. DESCRIPTION OF THE PLAN--CONTINUED
Participants may elect to contribute to either the Commercial Intertech Corp.
Common Stock Fund or the Money Market Fund. Employee and Company contributions
are allocated directly to each participant's account and vest immediately.
Effective January 1, 1994, the Plan was amended such that for the Stock Fund,
the monthly allocation of shares to a participant's account will be based on
the proportion that the participant's contributions and employer contributions
for that participant bears to such contributions of all participants who
participate in the Commercial Intertech Common Stock Fund. Prior to January 1,
1994, Stock Fund contributions were converted to shares each month using the
average daily stock price for that month. Investment income is allocated
proportionally to each participant's account.
At the beginning of each Plan year, participants may change deduction
percentages or investment funds, suspend contributions, or withdraw from the
Plan.
Distributions are made after the end of each Plan year. Money Market Fund
participants receive the full value of their accounts as of the Plan year end.
Stock Fund distributions are made in whole shares of stock, while fractional
shares less than one-half are forfeited and used as a credit toward future
Company contributions. Distribution of a participant's account is required as
soon as practical after the end of the month in which the participant
terminates employment for any reason, including death, disability, retirement,
discharge or otherwise.
In 1994, 59 employees participated in the Money Market Fund and 113 employees
participated in the Common Stock Fund. In 1993, 56 employees participated in
the Money Market Fund and 104 employees participated in the Common Stock Fund.
In 1992, 50 employees participated in the Money Market Fund and 92 employees
participated in the Common Stock Fund.
The Plan is administered by a five member committee appointed by the
Compensation Committee of the Board of Directors of the Company. The Company
has the sole right to appoint the Trustee, and to terminate the Plan at any
time, subject to Plan provisions. Administrative expenses that are not paid by
the Company, in its sole discretion, will be paid by the Plan.
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Non-Qualified Stock Purchase Plan of Commercial Intertech Corp.
Notes to Financial Statements--Continued
B. DESCRIPTION OF THE PLAN--CONTINUED
Effective January 1, 1995, the Plan was amended as follows:
1. To limit eligible salary employees of the Company and its domestic
subsidiaries to those employees with a salary in excess of
$150,000 (as adjusted in accordance with Section 401(a)(17) of the
Internal Revenue Code).
2. To limit eligible compensation, for salary employees of the Company
and its domestic subsidiaries, to salary in excess of $150,000 (as
adjusted in accordance with Section 401(a)(17) of the Internal
Revenue Code).
The amendment does not effect foreign participants.
The foregoing description of the Plan provides only general information.
Additional information may be obtained from the Plan administrative committee.
C. INCOME TAX STATUS
The Plan maintains its assets in a trust which is not a qualified trust under
Section 401(a) of the Internal Revenue Code. As such, the trust is a taxable
trust under Subchapter J of the Internal Revenue Code and is taxable on
undistributed earnings. Participants are taxed on matching Company
contributions and earnings distributed by the trust.
Since the trust distributed all earnings during 1994, 1993, and 1992, it has no
federal income tax liability for such years.
D. TRANSACTIONS WITH PARTIES-IN-INTEREST
The Plan purchased shares of common stock of Commercial Intertech Corp. during
the years ended December 31, 1994, 1993, and 1992. The Plan received dividends
of $4,449, $4,641, and $5,150 on this stock during 1994, 1993, and 1992,
respectively.
6
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<TABLE>
Non-Qualified Stock Purchase Plan of Commercial Intertech Corp.
Notes to Financial Statements--Continued
E. INVESTMENTS
<CAPTION>
INVESTMENTS DISTRIBUTED
DURING THE YEAR ENDED
IDENTITY OF ISSUE ---------------------------------------
BORROWER, LESSOR DESCRIPTION OF CURRENT AGGREGATE AGGREGATE
OR SIMILAR PARTY INVESTMENT COST VALUE COST PROCEEDS GAIN (LOSS)
--------------------------------- ---------------------- ---------- ----------- ---------- --------- -------------
<S> <C> <C> <C> <C> <C> <C>
DECEMBER 31, 1994
Commercial Intertech Common
Stock Fund:
*Commercial Intertech Corp. **17,113 common shares
$18.625 per share $293,389 $318,730 $277,906 $269,604 $(8,302)
Money Market Fund:
Federated Investors Inc. trust
for U.S. Treasury Obligations **210,889 shares 210,889 210,889 187,063 187,063 0
-------- --------
$504,278 $529,619
======== ========
DECEMBER 31, 1993
Commercial Intertech Common
Stock Fund:
*Commercial Intertech Corp. **13,100 common shares
$19.50 per share $265,250 $255,450 $268,338 $284,840 $16,502
Money Market Fund:
Federated Investors Inc. trust
for U.S. Treasury Obligations **175,068 shares 175,068 175,068 175,068 175,068 0
-------- --------
$440,318 $430,518
======== ========
<FN>
*Party-in-interest
**Individual investment that comprises five percent or more of the Plan's
assets. The fair value of the Plan's investment in Commercial Intertech
Corp. common stock (including shares bought and distributed, as well as
held during the year) appreciated $35,141 in 1994, depreciated $27,799 in
1993 and appreciated $10,912 in 1992.
</TABLE>
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EXHIBIT I
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 33-25795) pertaining to the Non-Qualified Stock Purchase Plan of
Commercial Intertech Corp. and in the related Prospectus of our report dated
March 24, 1995, with respect to the financial statements of the Non-Qualified
Stock Purchase Plan of Commercial Intertech Corp. included in this Annual
Report (Form 11-K) for the year ended December 31, 1994.
Ernst & Young LLP
Cleveland, Ohio
March 24. 1995
8
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the plan) have duly caused this
annual report to be signed by the undersigned thereunto duly authorized.
Date: March 28, 1995 Non-Qualified Stock Purchase Plan
of Commercial Intertech Corp.
By: James M. Donchess
------------------------------------
James M. Donchess
Corporate Attorney, Benefits
