UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A No. 1
(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, 1997
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 1-4329
COOPER TIRE & RUBBER COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 34-4297750
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Lima and Western Avenues, Findlay, Ohio 45840
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (419) 423-1321
Securities registered pursuant to Section 12(b) of the Act:
(Name of each exchange on
(Title of each class) which registered)
Common Stock, $1 par per share New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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 (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes (X) No ( )
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. (X)
State the aggregate market value of the voting stock held by non-
affiliates of the registrant (computed by reference to the closing price
on the Composite Tape for securities listed on the New York Stock
Exchange as of March 9, 1998). $1,855,838,060
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
(Class) (Outstanding at March 9, 1998)
Common Stock, $1 par per share 78,762,358
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference and
the Part of the Form 10-K into which the document is incorporated:
Proxy statement dated March 24, 1998 - Part III
EXHIBIT INDEX appears on the following two pages
<PAGE>
INDEX TO FINANCIAL STATEMENTS, SCHEDULES AND EXHIBITS
(As amended June 19, 1998 to file financial statements and supplemental
schedules for the employee benefit plans identified below as exhibits (99))
Page(s)
FINANCIAL STATEMENTS: Reference
---------
Consolidated Statements of Income for the years
ended December 31, 1997, 1996 and 1995
Consolidated Balance Sheets at December 31, 1997 and 1996
Consolidated Statements of Stockholders' Equity for the
years ended December 31, 1997, 1996 and 1995
Consolidated Statements of Cash Flows for the years
ended December 31, 1997, 1996 and 1995
Notes to Consolidated Financial Statements
Report of Independent Auditors
SUPPLEMENTARY INFORMATION:
Quarterly Financial Data (Unaudited)
FINANCIAL STATEMENT SCHEDULES:
II Valuation and qualifying accounts
EXHIBITS:
(3) Certificate of Incorporation and Bylaws
(i) Certificate of Incorporation, as restated and filed with
the Secretary of State of Delaware on May 17, 1993, is
incorporated herein by reference from Exhibit 3(i) of the
Company's Form 10-Q for the quarter ended June 30, 1993
(ii) Bylaws, as amended May 5, 1987, are incorporated herein
by reference from Exhibit 19 of the Company's Form 10-Q
for the quarter ended June 30, 1987
(4) Rights agreement dated as of May 27, 1988 between the Company
and KeyCorp Shareholder Services, Inc., as Rights Agent, is
incorporated herein by reference from Exhibit 1 to the Company's
Form 8-A dated June 3, 1988.
(10) Description of management contracts, compensatory plans,
contracts, or arrangements is incorporated herein by reference
from pages 6 through 12, 25 and 26 of the Company's Proxy
Statement dated March 24, 1998.
The following related documents are incorporated by reference:
a) 1981 Incentive Stock Option Plan - Form S-8
Registration Statement No. 2-77400, Exhibit 15(a)
b) 1986 Incentive Stock Option Plan - Form S-8
Registration Statement No. 33-5483, Exhibit 4(a)
c) Thrift and Profit Sharing Plan - Form S-8
Registration Statement No. 2-58577, Post-Effective
Amendment No. 6, Exhibit 4
d) 1991 Stock Option Plan for Non-Employee Directors -
Form S-8 Registration Statement No. 33-47980 and
Appendix to the Company's Proxy Statement dated
March 26, 1991
e) 1996 Stock Option Plan - Form S-8 Registration Statement No.
333-09619 and Appendix to the Company's Proxy Statement dated
March 26, 1996
(12) Computation of Ratio of Earnings to Fixed Charges
(continued)
<PAGE>
(13) Annual report to security holders, Form 10-Q or quarterly
report to security holders
(23) Consent of Independent Auditors
(24) Powers of Attorney
(27) Financial Data Schedule
(99) Undertakings of the Company
Financial statements and schedules of the Cooper Tire &
Rubber Company Thrift and Profit Sharing Plan for the
fiscal year ended December 31, 1997 1-16
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (Texarkana) for the
fiscal year ended December 31, 1997 17-30
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (Auburn) for the
fiscal year ended December 31, 1997 31-44
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (Findlay) for the
fiscal year ended December 31, 1997 45-58
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (El Dorado) for the
fiscal year ended December 31, 1997 59-72
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (Bowling Green - Hose)
for the fiscal year ended December 31, 1997 73-86
Financial statements and schedules of the Cooper Tire &
Rubber Company Pre-Tax Savings Plan (Bowling Green - Sealing)
for the fiscal year ended December 31, 1997 87-100
All other schedules have been omitted since the required information is
not present or not present in amounts sufficient to require submission
of the schedules, or because the information required is included in the
financial statements or the notes thereto.
<PAGE>
SIGNATURES
Registrant has duly caused this Form 10-K/A No. 1 to be signed on
its behalf by the undersigned, thereunto duly authorized.
COOPER TIRE & RUBBER COMPANY
PATRICK W. ROONEY, Chairman of the Board, President, Chief
Executive Officer and Director
(Principal Executive Officer)
J. ALEC REINHARDT, Executive Vice President and Director
(Principal Financial Officer)
JOHN FAHL, Vice President and Director
EILEEN B. WHITE, Corporate Controller
(Principal Accounting Officer)
ARTHUR H. ARONSON, Director
EDSEL D. DUNFORD, Director
DEBORAH M. FRETZ, Director
DENNIS J. GORMLEY, Director
JOHN F. MEIER, Director
BYRON O. POND, Director
JOHN H. SHUEY, Director
By /s/ Stan C. Kaiman
--------------------------------
STAN C. KAIMAN, Attorney-in-fact
Date: June 19, 1998
--------------
<PAGE>
EXHIBIT (23)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statements (Form S-8 Nos. 2-58577, 33-35071, 33-47979, 33-47981, 33-
47982, 33-52499, and 33-52505) of Cooper Tire & Rubber Company
pertaining to the Company's Thrift and Profit Sharing Plan, the Pre-Tax
Savings Plan (Texarkana), the Pre-Tax Savings Plan (Auburn), the Pre-Tax
Savings Plan (Findlay), the Pre-Tax Savings Plan (El Dorado), the Pre-
Tax Savings Plan (Bowling Green - Hose) and the Pre-Tax Savings Plan
(Bowling Green - Sealing), respectively, of our reports dated May 5,
1998 with respect to the financial statements and schedules of the
Cooper Tire & Rubber Company Thrift and Profit Sharing Plan, the Cooper
Tire & Rubber Company Pre-Tax Savings Plan (Texarkana), the Cooper Tire
& Rubber Company Pre-Tax Savings Plan (Auburn), the Cooper Tire & Rubber
Company Pre-Tax Savings Plan (Findlay), the Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado), the Cooper Tire & Rubber Company Pre-
Tax Savings Plan (Bowling Green - Hose), and the Cooper Tire & Rubber
Company Pre-Tax Savings Plan (Bowling Green - Sealing) included in
Amendment No. 1 to the Annual Report (Form 10-K) of Cooper Tire & Rubber
Company for the year ended December 31, 1997.
/s/ Ernst & Young LLP
---------------------
ERNST & YOUNG LLP
Toledo, Ohio
June 19, 1998
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 13
Item 27d - Schedule of Reportable Transactions 14
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
1
<PAGE>
Report of Independent Auditors
Thrift and Profit Sharing Plan Committee
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Thrift and Profit Sharing
Plan as of December 31, 1997 and 1996, and the related statements of
changes in assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Thrift and Profit Sharing Plan at
December 31, 1997 and 1996, and the changes in its assets available for
plan benefits for the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
2
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
------------ ------------
<S> <C> <C>
Assets
Investments (Notes 4 and 5):
Value of interest in Pooled Fund $271,917,956 $231,005,924
Confederation Fund (Note 2) - 8,096,483
Cooper Tire & Rubber Company common stock 5,745,968 4,444,382
Washington Mutual Investors Fund 331,025 18,464
Investment Company of America 20,679 15,987
----------- -----------
278,015,628 243,581,240
Short-term investment 162,402 223,263
----------- -----------
278,178,030 243,804,503
Cash 5,108,412 2,990,614
Employer contribution receivable 3,654,337 3,140,072
----------- -----------
Assets available for plan benefits $286,940,779 $249,935,189
=========== ===========
<FN>
See accompanying notes.
</TABLE>
2
3
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $ 11,784,022 $ 10,850,899
Employer (gross amount before
reduction for forfeitures) 8,568,810 7,820,247
Less forfeitures arising from withdrawals (206,362) (180,000)
----------- -----------
Net employer contributions 8,362,448 7,640,247
----------- -----------
20,146,470 18,491,146
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 49,701,339 (25,873,081)
Net appreciation in fair value of
Cooper Tire & Rubber Company
common stock (Note 5) 357,002 383,377
Dividends 29,094 68,368
Interest 904,965 7,258
----------- -----------
50,992,400 (25,414,078)
----------- -----------
Total additions 71,138,870 (6,922,932)
Participants' withdrawals (34,133,280) (36,817,103)
----------- -----------
Increase (decrease) in assets available for
plan benefits during the year 37,005,590 (43,740,035)
Assets available for plan benefits
at beginning of year 249,935,189 293,675,224
----------- -----------
Assets available for plan
benefits at end of year $286,940,779 $249,935,189
=========== ===========
<FN>
See accompanying notes.
</TABLE>
3
4
<PAGE>
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Thrift and Profit Sharing Plan (Plan),
is a defined contribution plan administered by a Plan Committee
appointed by the plan sponsor, Cooper Tire & Rubber Company (the
Company). Participation in the Plan is voluntary and any salaried
employee of the Company is eligible to participate in the Plan if he or
she has completed one year of continuous credited service. At December
31, 1997, 4,637 participants had designated investment of contributions
in one or more investment options of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides the following:
- After-tax dollar (ATD) contributions may be made in one percent
multiples of participant's compensation up to sixteen percent.
- Pre-tax dollar qualifier (PDQ) contributions may be made in one
percent multiples of participant's compensation up to fifteen
percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan.
- In no event shall the aggregate of a participant's contributions
exceed sixteen percent of participant's compensation.
- The Company will contribute to the Plan each year from current or
accumulated earnings an amount equal to the lesser of:
(a) the aggregate of all ATD and PDQ contributions which represent up
to six percent of each participant's compensation, less any
forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
5
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
The Company's contributions are allocated to each participant's account
in proportion to his or her ATD contributions and PDQ contributions up
to an aggregate of six percent of the participant's compensation for
each year. The Company contribution to a participant's account becomes
vested after five years of continuous credited service; thereafter,
Company contributions become vested when made. In addition,
participants will have a fully vested right to the Company's
contributions upon termination from the Plan due to retirement, total
and permanent disability, or death and shall be eligible to receive the
Company's contribution for that year as if he or she had not terminated
participation. Earnings attributed to Company contributions allocated
to a participant's account and those attributed to a participant's
contributions are vested immediately.
The Plan provides for total or partial withdrawal of a participant's
account. Except for the unvested portion of Company contributions, a
participant may withdraw the total of his or her ATD contributions and
Company contributions at any time. No amounts may be withdrawn by a
participant from PDQ contributions prior to termination of employment or
plan termination unless the participant has either attained the age of
59 1/2, becomes totally and permanently disabled, or is able to
demonstrate financial hardship. Partial withdrawals may be made twice
in any calendar year. However, all withdrawals relating to PDQ
contributions are subject to the IRC and regulations thereunder.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
The Company has reserved the right to amend, modify, suspend or
terminate the Plan at any time by action of its Board of Directors.
Upon termination of the Plan, or upon the complete discontinuance of
Company contributions under the Plan, the rights of each participant to
the assets then held for his or her account under the Plan shall be
nonforfeitable.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
5
6
<PAGE>
2. Significant Accounting Policies (continued)
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PDQ contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
The Plan of Rehabilitation for Confederation Life became final on
November 13, 1996. On March 12, 1997, the Company was notified the
Rehabilitator had determined a fair value of the Confederation Life
contracts held by the Thrift Plan was equal to 109.26% of the August,
1994 contract value. This adjustment was made by the Trustee effective
March 31, 1997. On or about June 2, 1997, the total value of the
Confederation Life account was unfrozen and rolled into the Cash with
Interest Fund.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
6
<PAGE> 7
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
(continued)
7
8
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
(continued)
8
9
<PAGE>
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
(continued)
9
10
<PAGE>
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $271,917,956 at
December 31, 1997 and $231,005,924 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 91.6% 93.1%
Cash with Interest Fund 94.4% 95.6%
The Investment Company of America Fund 84.5% 84.6%
The Washington Mutual Investors Fund 87.9% 89.9%
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company Pooled Fund
is as follows:
<CAPTION>
Year ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
(continued)
10
11
<PAGE>
<TABLE>
<CAPTION>
Year Ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $49,701,339 for the
year ended December 31, 1997 and a net investment loss of $25,873,081 for the
year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each Pooled
Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
12
13
<PAGE>
Schedules
14
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Employer Identification #34-4297750; Plan #005
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 235,732 $5,012,996 $5,745,968
Washington Mutual Investors Fund 10,907 286,593 331,025
Investment Company of America 732 17,351 20,679
--------- ---------
$5,316,940 $6,097,672
========= =========
Short-term investment:
*Armada Government Portfolio Fund 162,403 $ 162,403 $ 162,403
========= =========
<FN>
* Party-in-interest
</TABLE>
13
15
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Thrift and Profit Sharing Plan
Employer Identification #34-4297750; Plan #005
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $8,068,480 $8,055,647 $8,055,647 $ -
Cooper Tire & Rubber
Company common stock 8,069,468 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
14
16
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
17
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Texarkana) as of December 31, 1997 and 1996, and the related statements
of changes in assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (Texarkana) at
December 31, 1997 and 1996, and the changes in its assets available for
plan benefits for the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
18
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $11,197,324 $8,261,977
Cooper Tire & Rubber Company common stock 158,974 148,622
---------- ---------
11,356,298 8,410,599
Short-term investment 1,706 1,434
---------- ---------
11,358,004 8,412,033
Cash 173,654 95,515
Employer contribution receivable 91,811 112,596
---------- ---------
Assets available for plan benefits $11,623,469 $8,620,144
========== =========
<FN>
See accompanying notes.
</TABLE>
2
19
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $ 1,767,097 $1,907,977
Employer 238,769 264,020
---------- ---------
2,005,866 2,171,997
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 2,025,254 (1,110,919)
Net (depreciation) appreciation in fair
value of Cooper Tire & Rubber Company
common stock (3,347) 18,432
Dividends 1,494 1,271
Interest 316 210
---------- ---------
2,023,717 (1,091,006)
---------- ---------
Total additions 4,029,583 1,080,991
Participants' withdrawals (1,026,258) (800,142)
---------- ---------
Increase in assets available for
plan benefits during the year 3,003,325 80,849
Assets available for plan benefits
at beginning of year 8,620,144 8,339,295
---------- ---------
Assets available for plan
benefits at end of year $11,623,469 $8,620,144
========== =========
<FN>
See accompanying notes.
</TABLE>
3
20
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (Texarkana)
(Plan), as amended and restated, is a defined contribution plan
administered by a Plan Committee appointed by the plan sponsor, Cooper
Tire & Rubber Company (the Company). Participation in the Plan is
voluntary and any employee of the Company eligible for membership in
Local Union #752, United Steelworkers of America AFL-CIO/CLC (Union) is
eligible to participate in the Plan if he or she has completed thirty
days of continuous credited service. At December 31, 1997, 884
participants had designated investment of contributions in one or more
investment options of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
21
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until March 5, 1999. Thereafter it shall renew
itself for yearly periods unless written notice is given by the Company
or the Union that it is desired to terminate or amend the Plan. The
Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
22
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
23
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
(continued)
7
24
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
25
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $11,197,324 at
December 31, 1997 and $8,261,977 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as
follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 4.1% 3.8%
Cash with Interest Fund 2.8% 2.3%
The Investment Company of America Fund 2.7% 3.1%
The Washington Mutual Investors Fund 4.3% 2.9%
(continued)
9
26
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company
Pooled Fund is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $2,025,254 for
the year ended December 31, 1997 and a net investment loss of $1,110,919
for the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
27
<PAGE>
Schedules
28
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Employer Identification #34-4297750; Plan #012
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 6,522 $146,924 $158,974
======= =======
Short-term investment:
*Armada Government Portfolio Fund 1,706 $ 1,706 $ 1,706
======= =======
<FN>
* Party-in-interest
</TABLE>
11
29
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Texarkana)
Employer Identification #34-4297750; Plan #012
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $260,936 $260,664 $260,664 $ -
Cooper Tire & Rubber
Company common stock 261,074 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
30
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
31
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Auburn) as of December 31, 1997 and 1996, and the related statements of
changes in assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (Auburn) at
December 31, 1997 and 1996, and the changes in its assets available for
plan benefits for the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
32
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $1,391,753 $849,375
Cooper Tire & Rubber Company common stock 30,591 28,218
--------- -------
1,422,344 877,593
Short-term investment 351 732
--------- -------
1,422,695 878,325
Cash 33,005 14,533
Employer contribution receivable 26,459 17,804
--------- -------
Assets available for plan benefits $1,482,159 $910,662
========= =======
<FN>
See accompanying notes.
</TABLE>
2
33
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $ 342,846 $258,687
Employer 54,762 46,975
--------- -------
397,608 305,662
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 228,535 (60,566)
Net (depreciation) appreciation in fair
value of Cooper Tire & Rubber Company
common stock (367) 2,504
Dividends 286 198
Interest 64 30
--------- -------
228,518 (57,834)
--------- -------
Total additions 626,126 247,828
Participants' withdrawals (54,629) (84,409)
--------- -------
Increase in assets available for
plan benefits during the year 571,497 163,419
Assets available for plan benefits
at beginning of year 910,662 747,243
--------- -------
Assets available for plan
benefits at end of year $1,482,159 $910,662
========= =======
<FN>
See accompanying notes.
</TABLE>
3
34
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (Auburn) (Plan),
as amended and restated, is a defined contribution plan administered by
a Plan Committee appointed by the plan sponsor, Cooper Tire & Rubber
Company (the Company). Participation in the Plan is voluntary and any
employee of the Company eligible for membership in Local Union #634,
United Steelworkers of America AFL-CIO/CLC (Union) is eligible to
participate in the Plan if he or she has completed thirty days of
continuous credited service. At December 31, 1997, 230 participants had
designated investment of contributions in one or more investment options
of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
35
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until December 5, 2000. Thereafter it shall
renew itself for yearly periods unless written notice is given by the
Company or the Union that it is desired to terminate or amend the Plan.
The Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
36
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
37
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
Matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
Matures April 19, 1999 1,085,983
(continued)
7
38
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
39
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $1,391,753 at
December 31, 1997 and $849,375 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as
follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 0.4% 0.3%
Cash with Interest Fund 0.4% 0.3%
The Investment Company of America Fund 1.0% 1.0%
The Washington Mutual Investors Fund 0.6% 0.4%
(continued)
9
40
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company
Pooled Fund is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $228,535 for the
year ended December 31, 1997 and a net investment loss of $60,566 for
the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
41
<PAGE>
Schedules
42
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Employer Identification #34-4297750; Plan #009
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 1,255 $28,273 $30,591
====== ======
Short-term investment:
*Armada Government Portfolio Fund 351 $ 351 $ 351
====== ======
<FN>
* Party-in-interest
</TABLE>
11
43
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Auburn)
Employer Identification #34-4297750; Plan #009
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $48,023 $48,404 $48,404 $ -
Cooper Tire & Rubber
Company common stock 47,739 901 924 (23)
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
44
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
45
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Findlay) as of December 31, 1997 and 1996, and the related statements
of changes in assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (Findlay) at
December 31, 1997 and 1996, and the changes in its assets available for
plan benefits for the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
46
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $10,700,422 $6,824,999
Cooper Tire & Rubber Company common stock 164,873 135,844
---------- ---------
10,865,295 6,960,843
Short-term investment 1,633 996
---------- ---------
10,866,928 6,961,839
Cash 314,183 142,974
Employer contribution receivable 145,345 134,794
---------- ---------
Assets available for plan benefits $11,326,456 $7,239,607
========== =========
<FN>
See accompanying notes.
</TABLE>
2
47
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $ 2,407,236 $2,228,008
Employer 297,746 272,696
---------- ---------
2,704,982 2,500,704
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 1,859,458 (370,247)
Net (depreciation) appreciation in fair
value of Cooper Tire & Rubber Company
common stock (2,389) 9,210
Dividends 1,416 800
Interest 317 193
---------- ---------
1,858,802 (360,044)
--------- ---------
Total additions 4,563,784 2,140,660
Participants' withdrawals (476,935) (220,833)
---------- ---------
Increase in assets available for
plan benefits during the year 4,086,849 1,919,827
Assets available for plan benefits
at beginning of year 7,239,607 5,319,780
---------- ---------
Assets available for plan
benefits at end of year $11,326,456 $7,239,607
========== =========
<FN>
See accompanying notes.
</TABLE>
3
48
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (Findlay) (Plan),
as amended and restated, is a defined contribution plan administered by
a Plan Committee appointed by the plan sponsor, Cooper Tire & Rubber
Company (the Company). Participation in the Plan is voluntary and any
employee of the Company eligible for membership in Local Union #207,
United Steelworkers of America AFL-CIO/CLC (Union) is eligible to
participate in the Plan if he or she has completed thirty days of
continuous credited service. At December 31, 1997, 675 participants had
designated investment of contributions in one or more investment options
of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
49
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until October 31, 2000. Thereafter it shall
renew itself for yearly periods unless written notice is given by the
Company or the Union that it is desired to terminate or amend the Plan.
The Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
50
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
51
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
(continued)
7
52
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
53
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $10,700,422 at
December 31, 1997 and $6,824,999 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 3.2% 2.4%
Cash with Interest Fund 1.8% 1.4%
The Investment Company of America Fund 10.0% 10.0%
The Washington Mutual Investors Fund 6.1% 5.8%
(continued)
9
54
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company Pooled Fund
is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $1,859,458 for
the year ended December 31, 1997 and a net investment loss of $370,247
for the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
55
<PAGE>
Schedules
56
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Employer Identification #34-4297750; Plan #014
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 6,764 $152,377 $164,873
======= =======
Short-term investment:
*Armada Government Portfolio Fund 1,633 $ 1,633 $ 1,633
======= =======
<FN>
* Party-in-interest
</TABLE>
11
57
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Findlay)
Employer Identification #34-4297750; Plan #014
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $288,485 $287,848 $287,848 $ -
Cooper Tire & Rubber
Company common stock 288,274 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
58
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
59
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (El
Dorado) as of December 31, 1997 and 1996, and the related statements of
changes in assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (El Dorado) at
December 31, 1997 and 1996, and the changes in its assets available for
plan benefits for the years then ended, in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
60
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $535,669 $394,428
Cooper Tire & Rubber Company common stock 13,504 12,994
------- -------
549,173 407,422
Short-term investment 195 153
------- -------
549,368 407,575
Cash 7,769 6,515
Employer contribution receivable 8,196 9,295
------- -------
Assets available for plan benefits $565,333 $423,385
======= =======
<FN>
See accompanying notes.
</TABLE>
2
61
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $148,260 $134,107
Employer 20,715 22,554
------- -------
168,975 156,661
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 83,578 (23,146)
Net (depreciation) appreciation in fair
value of Cooper Tire & Rubber Company
common stock (246) 1,263
Dividends 129 96
Interest 28 15
------- -------
83,489 (21,772)
------- -------
Total additions 252,464 134,889
Participants' withdrawals (110,516) (52,072)
------- -------
Increase in assets available for
plan benefits during the year 141,948 82,817
Assets available for plan benefits
at beginning of year 423,385 340,568
------- -------
Assets available for plan
benefits at end of year $565,333 $423,385
======= =======
<FN>
See accompanying notes.
</TABLE>
3
62
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (El Dorado)
(Plan), as amended and restated, is a defined contribution plan
administered by a Plan Committee appointed by the plan sponsor, Cooper
Tire & Rubber Company (the Company). Participation in the Plan is
voluntary and any employee of the Company eligible for membership in
Local Union #769, United Steelworkers of America AFL-CIO/CLC (Union) is
eligible to participate in the Plan if he or she has completed thirty
days of continuous credited service. At December 31, 1997, 128
participants had designated investment of contributions in one or more
investment options of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
63
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until April 27, 2000. Thereafter it shall renew
itself for yearly periods unless written notice is given by the Company
or the Union that it is desired to terminate or amend the Plan. The
Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
64
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
65
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
(continued)
7
66
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
67
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $535,669 at December 31,
1997 and $394,428 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 0.2% 0.1%
Cash with Interest Fund 0.3% 0.2%
The Investment Company of America Fund 0.1% 0.2%
The Washington Mutual Investors Fund 0.1% 0.2%
(continued)
9
68
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company Pooled Fund
is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $83,578 for the
year ended December 31, 1997 and a net investment loss of $23,146 for
the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
69
<PAGE>
Schedules
70
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Employer Identification #34-4297750; Plan #013
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 554 $12,480 $13,504
====== ======
Short-term investment:
*Armada Government Portfolio Fund 195 $ 195 $ 195
====== ======
<FN>
* Party-in-interest
</TABLE>
11
71
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (El Dorado)
Employer Identification #34-4297750; Plan #013
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $21,935 $21,893 $21,893 $ -
Cooper Tire & Rubber
Company common stock 21,927 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
72
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
73
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Bowling Green - Hose) as of December 31, 1997 and 1996, and the related
statements of changes in assets available for plan benefits for the
years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (Bowling Green
- - Hose) at December 31, 1997 and 1996, and the changes in its assets
available for plan benefits for the years then ended, in conformity with
generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
74
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $880,991 $467,363
Cooper Tire & Rubber Company common stock 27,056 26,031
------- -------
908,047 493,394
Short-term investment 1,168 -
------- -------
909,215 493,394
Cash 25,321 9,336
Employer contribution receivable 20,363 18,769
------- -------
Assets available for plan benefits $954,899 $521,499
======= =======
<FN>
See accompanying notes.
</TABLE>
2
75
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $281,293 $246,085
Employer 45,400 45,288
------- -------
326,693 291,373
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 146,971 (19,262)
Net (depreciation) appreciation in fair
value of Cooper Tire & Rubber Company
common stock (446) 1,439
Dividends 259 148
Interest 56 21
------- -------
146,840 (17,654)
------- -------
Total additions 473,533 273,719
Participants' withdrawals (40,133) (27,970)
------- -------
Increase in assets available for
plan benefits during the year 433,400 245,749
Assets available for plan benefits
at beginning of year 521,499 275,750
------- -------
Assets available for plan
benefits at end of year $954,899 $521,499
======= =======
<FN>
See accompanying notes.
</TABLE>
3
76
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (Bowling Green -
Hose) (Plan), as amended and restated, is a defined contribution plan
administered by a Plan Committee appointed by the plan sponsor, Cooper
Tire & Rubber Company (the Company). Participation in the Plan is
voluntary and any employee of the Company eligible for membership in
Local Union #1152, United Steelworkers of America AFL-CIO/CLC (Union) is
eligible to participate in the Plan if he or she has completed thirty
days of continuous credited service. At December 31, 1997, 238
participants had designated investment of contributions in one or more
investment options of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
77
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until April 30, 2001. Thereafter it shall renew
itself for yearly periods unless written notice is given by the Company
or the Union that it is desired to terminate or amend the Plan. The
Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
78
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
79
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
(continued)
7
80
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
81
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $880,991 at December 31,
1997 and $467,363 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 0.3% 0.2%
Cash with Interest Fund 0.2% 0.1%
The Investment Company of America Fund 0.8% 0.6%
The Washington Mutual Investors Fund 0.5% 0.5%
(continued)
9
82
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company Pooled Fund
is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $146,971 for the
year ended December 31, 1997 and a net investment loss of $19,262 for
the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
83
<PAGE>
Schedules
84
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Employer Identification #34-4297750; Plan #017
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 1,110 $25,005 $27,056
====== ======
Short-term investment:
*Armada Government Portfolio Fund 1,168 $ 1,168 $ 1,168
====== ======
<FN>
* Party-in-interest
</TABLE>
11
85
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Hose)
Employer Identification #34-4297750; Plan #017
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $41,690 $41,368 $41,368 $ -
Cooper Tire & Rubber
Company common stock 42,997 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
86
<PAGE>
EXHIBIT (99)
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Financial Statements and Schedules
Years ended December 31, 1997 and 1996
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Assets Available for Plan Benefits 2
Statements of Changes in Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Item 27a - Schedule of Assets Held for Investment Purposes 11
Item 27d - Schedule of Reportable Transactions 12
A schedule of party-in-interest transactions has not
been presented because there were no party-in-
interest transactions which are prohibited by
ERISA Section 406 and for which there is no
statutory or administrative exemption.
87
<PAGE>
Report of Independent Auditors
Pre-Tax Savings Plan Committee
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
We have audited the accompanying statements of assets available for plan
benefits of the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Bowling Green - Sealing) as of December 31, 1997 and 1996, and the
related statements of changes in assets available for plan benefits for
the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits
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 assets available for plan benefits
of the Cooper Tire & Rubber Company Pre-Tax Savings Plan (Bowling Green
- - Sealing) at December 31, 1997 and 1996, and the changes in its assets
available for plan benefits for the years then ended, in conformity with
generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying schedules
of assets held for investment purposes as of December 31, 1997 and
reportable transactions for the year then ended, 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 basic
financial statements. The schedules have been subjected to the auditing
procedures applied in our audit of the 1997 financial statements and, in
our opinion, are fairly stated in all material respects in relation to
the 1997 basic financial statements taken as a whole.
May 5, 1998
1
88
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Statements of Assets Available for Plan Benefits
<CAPTION>
December 31
1997 1996
---------- ----------
<S> <C> <C>
Assets
Investments:
Value of interest in Pooled Fund (Note 4) $800,061 $329,039
Cooper Tire & Rubber Company common stock 28,836 12,979
------- -------
828,897 342,018
Short-term investment 220 138
------- -------
829,117 342,156
Cash 26,702 8,518
Employer contribution receivable 30,119 13,881
------- -------
Assets available for plan benefits $885,938 $364,555
======= =======
<FN>
See accompanying notes.
</TABLE>
2
89
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Statements of Changes in Assets Available for Plan Benefits
<CAPTION>
Year ended December 31
1997 1996
---------- ----------
<S> <C> <C>
Additions:
Cash contributions:
Participants $401,926 $171,169
Employer 56,789 27,145
------- -------
458,715 198,314
Investment income (loss):
Net gain (loss) from Pooled Fund (Note 4) 114,027 (11,408)
Net appreciation in fair value of
Cooper Tire & Rubber Company
common stock 736 875
Dividends 171 81
Interest 41 13
------- -------
114,975 (10,439)
------- -------
Total additions 573,690 187,875
Participants' withdrawals ( 52,307) (10,487)
------- -------
Increase in assets available for
plan benefits during the year 521,383 177,388
Assets available for plan benefits
at beginning of year 364,555 187,167
------- -------
Assets available for plan
benefits at end of year $885,938 $364,555
======= =======
<FN>
See accompanying notes.
</TABLE>
3
90
<PAGE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Notes to Financial Statements
December 31, 1997 and 1996
1. Summary of Plan
The Cooper Tire & Rubber Company Pre-Tax Savings Plan (Bowling Green -
Sealing) (Plan), as amended and restated, is a defined contribution plan
administered by a Plan Committee appointed by the plan sponsor, Cooper
Tire & Rubber Company (the Company). Participation in the Plan is
voluntary and any employee of the Company eligible for membership in
Local Union #1042, United Steelworkers of America AFL-CIO/CLC (Union) is
eligible to participate in the Plan if he or she has completed thirty
days of continuous credited service. At December 31, 1997, 246
participants had designated investment of contributions in one or more
investment options of the Plan, which are as follows:
1) Cooper Tire & Rubber Company common stock.
2) Mutual funds managed by the American Funds Group, a subsidiary
of Capital Group Incorporated:
a) The Investment Company of America Fund - managed to provide
long-term growth of capital and income, placing greater
emphasis on future dividends than on current income.
b) The Washington Mutual Investors Fund - managed to provide
current income and opportunity for capital growth through the
selection of common stocks.
3) Cash with interest - contributions are placed in investment
contracts with a diversified group of insurance companies, banks,
and other financial institutions. This option may also include
alternative investment contracts which are backed by high quality
fixed income assets. All contracts have specific individual terms
including interest rate and maturity date. Interest rates on
contracts generally reset on a monthly or quarterly basis.
The Plan provides that Pre-Tax Savings Plan (PSP) contributions may be
made in one percent multiples of a participant's compensation up to
fifteen percent, subject to Internal Revenue Code (IRC) limits on annual
contributions to the Plan. The amount of contribution may be changed
every thirty days.
The Plan provides that the Company will contribute to the Plan each year
from current or accumulated earnings an amount equal to the lesser of:
(a) 25% of PSP contributions which represent up to four percent of
each participant's compensation, less any forfeitures, or
(b) an amount equal to fifteen percent of the Company's current year
pre-tax earnings, exclusive of any deductions for contributions
to the Plan, in excess of ten percent of the stockholders' equity
of the Company at the beginning of the year.
4
91
<PAGE>
1. Summary of Plan (continued)
The Company's Board of Directors, at its discretion, may waive the
limitation in (b) and contribute from current or accumulated earnings an
amount not to exceed the limitation in (a). Administrative expenses of
the Plan are paid by the Company.
Investment options for future contributions may be changed daily.
Reallocation of balances may be made among the investment options daily.
Directions given by participants to the Plan trustee concerning the
voting of common stock are confidential.
No amounts may be withdrawn by a participant from PSP contributions
prior to termination of employment unless the participant has either
attained age 59 1/2, becomes totally and permanently disabled, or is
able to demonstrate financial hardship. Hardship withdrawals by
participants not yet attaining 59 1/2 years of age are limited to PSP
contributions and are subject to the IRC and regulations thereunder.
Participants are fully vested in their contributions and earnings
thereon.
The Plan shall continue until October 31, 2000. Thereafter it shall
renew itself for yearly periods unless written notice is given by the
Company or the Union that it is desired to terminate or amend the Plan.
The Company has reserved the right to amend the Plan at any time if such
amendment is necessary to enable the Plan to meet the requirements of
the IRC or the requirements of any governmental authority. If the Plan
terminates, and a successor plan is not adopted, all assets will be
distributed to participants in a lump sum.
No material amounts of withdrawals by participants, initiated on or
before December 31, 1997 or 1996, were pending.
2. Significant Accounting Policies
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of (1) additions and deductions
during the reporting period, and (2) assets and liabilities, as well as
disclosure of contingent assets and liabilities, at the date of the
financial statements. Actual results could differ from those estimates.
Investments
The Plan's investments are held by National City Bank as trustee under
an agreement which directs the trustee to invest participants'
contributions based on their investment elections. PSP contributions
and income not yet invested in the options selected by the participant
due to the "transaction period" as defined by the Plan, are invested in
cash with interest investments.
Investments in common stock of Cooper Tire & Rubber Company (Company)
are stated at quoted market values as determined on the last business
day of the Plan year. Short-term investments are stated at cost which
approximates fair value.
Certain investments of the Plan are combined with similar assets of the
other defined contribution plans sponsored by the Company. The combined
investments (Pooled Fund) are held by National City Bank as trustee and
are valued at their fair value as determined by the trustee, except for
fully benefit responsive investment contracts which are valued at
contract value. At December 31, 1997 and 1996, the contract value of
these contracts approximates fair value.
5
92
<PAGE>
2. Significant Accounting Policies (continued)
Contributions
Contributions are recorded when the Company makes payroll deductions for
Plan participants, and are invested in any of four investment options at
the participant's election.
Contributions from the Company are accrued in the period in which they
become obligations of the Company and may be in the form of cash,
treasury stock or authorized but unissued common stock of the Company.
Company contributions are invested in common stock of the Company until
the contributions become vested after which they are invested as
directed by the participant. The Company contribution to a
participant's account becomes vested after five years of continuous
credited service; thereafter, Company contributions become vested when
made.
Forfeitures
Forfeitures occur when an employee elects a withdrawal from current year
or unvested contributions or is terminated, voluntarily or
involuntarily, before being fully vested. Forfeitures are used to
reduce the Company obligation.
3. Income Tax Status
The Internal Revenue Service ruled September 9, 1996 that the Plan
qualifies under Section 401(a) of the IRC and, therefore, the related
trust is not subject to tax under present income tax law. Once
qualified, the Plan is required to operate in conformity with the IRC
and the Employee Retirement Income Security Act of 1974 to maintain its
qualification. The Plan Committee is not aware of any course of action
or series of events that have occurred that might adversely affect the
Plan's qualified status.
4. Value of interest in Pooled Fund
<TABLE>
The assets of the Cooper Tire & Rubber Company Pooled Fund are as
follows:
<CAPTION>
December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 1,214,344 $(1,863,178) $(1,153,143) $ 1,315,449
Cooper Tire & Rubber
Company Common Stock 185,112,135
Mutual funds:
The Investment Company
of America Fund 18,542,498
The Washington Mutual
Investors Fund 28,034,543
Cash with Interest Fund:
(continued)
6
93
<PAGE>
*Allstate Life Insurance
Company - 6.23% contract;
matures August 16, 2004 8,589,106
New York Life Insurance
Company - 7.65% contract;
matures September 20, 2000 7,513,568
*John Hancock Mutual Life
Insurance Company - 6.42%
contract; matures May 1,
2007 7,197,589
Provident Life and Accident
Insurance Company - 5.75%
contract; matures
January 30, 1998 6,593,931
*Continental Assurance Company
6.06% contract; matures
January 1, 1998 3,862,569
*Allstate Life Insurance
Company - 5.95% contract;
matures February 18, 2002 3,303,020
*Allmerica Financial Life
Insurance Company - 6.81%
contract; matures
November 15, 2004 3,259,691
*Peoples Security Life -
6.89% contract; matures
June 25, 2004 3,026,927
*Caisse Des Depots (CDC) BRIC -
6.15% contract; matures
September 25, 2000 2,987,570
*Peoples Security Life -
6.08% contract; matures
April 15, 1999 1,997,156
United of Omaha Life
Insurance - 6.41% contract;
matures August 2, 2000 1,995,770
*Peoples Security Life -
6.60% contract; matures
August 25, 2004 1,979,747
*Peoples Security Life -
6.78% contract; matures
March 15, 2002 1,952,166
*Peoples Security Life -
5.29% contract; matures
December 17, 2001 1,721,801
*Caisse Des Depots (CDC) BRIC -
5.80%contract; matures
December 16, 2002 1,550,256
*Peoples Security Life -
6.17% contract; matures
July 16, 2001 1,487,592
*Caisse Des Depots (CDC) BRIC -
5.86% contract; matures
May 31, 2000 1,445,881
*Peoples Security Life -
6.94% contract; matures
January 26, 2004 1,299,224
Commonwealth Life Insurance
Company - 3.66% contract;
matures April 15, 1999 1,269,427
New York Life Insurance
Company - 7.65% contract;
matures April 19, 1999 1,085,983
(continued)
7
94
<PAGE>
*Peoples Security Life -
5.40% contract; matures
January 18, 2000 859,422
*Peoples Security Life -
5.80% contract; matures
December 31, 1999 654,404
*Peoples Security Life -
5.24% contract; matures
April 15, 1998 589,726
----------- ---------- ---------- ----------
Total assets $186,326,479 $64,359,348 $17,389,355 $29,349,992
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $ 3,920,716 $ 2,549,491 $ 131,992 $ 77,455
Cooper Tire & Rubber
Company Common Stock 154,672,046
Mutual funds:
The Investment Company
of America Fund 11,216,964
The Washington Mutual
Investors Fund 16,458,231
Cash with Interest Fund:
New York Life Insurance
Company - 7.65% annuity
contract; matures
January 4, 2000 6,979,869
John Hancock Mutual Life
Insurance Company - 8.47%
annuity contract; matures
October 31, 1997 6,754,591
Provident Life and Accident
Insurance Company - 5.75%
annuity contract; matures
January 30, 1998 6,235,476
*Provident Life and Accident
Insurance Company - 6.17%
annuity contract; matures
August 15, 2000 4,973,573
Principal Mutual Life Insurance
Insurance Company - 4.93%
annuity contract; matures
July 31, 1997 4,211,797
*Allstate Life Insurance
Company - 5.43% annuity
contract; matures
February 18, 2002 3,124,695
*Allmerica Financial Life
Insurance Company - 6.69%
contract, matures
November 15, 2004 3,054,620
(continued)
8
95
<PAGE>
*Caisse Des Depots (CDC) BRIC -
6.15% annuity contract;
matures September 25, 2000 2,987,598
*John Hancock Mutual Life
Insurance Company - 6.35%
annuity contract; matures
May 1, 2007 2,500,000
Commonwealth Life Insurance
Company - 3.66% annuity
contract; matures
August 1, 1998 2,449,214
*Peoples Security Life -
5.29% annuity contract
BDA-00217TR-3; matures
December 17, 2001 2,401,106
*Caisse Des Depots (CDC) BRIC -
5.80% annuity contract;
matures May 31, 2000 2,260,633
New York Life Insurance
Company - 7.65% annuity
contract; matures
July 31, 1998 2,010,797
*Peoples Security Life -
6.08% annuity contract
BDA-00217TR-1; matures
December 15, 1999 1,998,773
*Peoples Security Life -
5.36% annuity contract
BDA-00217TR-2; matures
September 15, 1998 1,998,062
United of Omaha Life
Insurance Company -
variable rate annuity
contract; matures
August 2, 2000 1,995,680
*Peoples Security Life -
5.43% annuity contract
BDA-00217TR-4; matures
December 15, 1999 1,671,599
*Peoples Security Life -
6.17% annuity contract
BDA-00217TR-5; matures
August 15, 2001 1,498,125
----------- ---------- ---------- ----------
Total assets $158,592,762 $61,655,699 $11,348,956 $16,535,686
=========== ========== ========== ==========
<FN>
* Collateralized or synthetic guaranteed investment contract.
</TABLE>
The average yield of the Cash with Interest Fund for the years ended
December 31, 1997 and 1996 was 6.7% and 6.3%, respectively.
The value of the Plan's interest in the Pooled Fund is $800,061 at December 31,
1997 and $329,039 at December 31, 1996.
The Plan's interest in the Pooled Fund's assets at December 31 is as follows:
1997 1996
---- ----
Cooper Tire & Rubber Company Common Stock Fund 0.2% 0.1%
Cash with Interest Fund 0.1% 0.1%
The Investment Company of America Fund 0.9% 0.5%
The Washington Mutual Investors Fund 0.5% 0.3%
(continued)
9
96
<PAGE>
<TABLE>
The net investment gain (loss) of the Cooper Tire & Rubber Company Pooled Fund
is as follows:
<CAPTION>
Year Ended December 31, 1997
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 113,940 $3,882,280 $ 30,033 $ 33,468
Dividends 2,704,175 1,804,968 2,222,234
Net realized and
unrealized gain 38,049,952 1,573,724 3,744,388
---------- --------- --------- ---------
Net investment gain $40,868,067 $3,882,280 $3,408,725 $6,000,090
========== ========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31, 1996
-------------------------------------------------
Cooper Tire The The
& Rubber Cash Investment Washington
Company with Company of Mutual
Common Interest America Investors
Stock Fund Fund Fund Fund
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
Interest $ 107,783 $3,754,969 $ 21,998 $ 22,910
Dividends 2,492,409 672,816 1,182,597
Net realized and
unrealized gain(loss) (38,694,302) 1,167,742 1,802,447
----------- --------- --------- ---------
Net investment gain(loss) $(36,094,110) $3,754,969 $1,862,556 $3,007,954
========== ========= ========= =========
</TABLE>
The Plan's net investment gain from the Pooled Fund is $114,027 for the
year ended December 31, 1997 and a net investment loss of $11,408 for
the year ended December 31, 1996.
The net investment gain or loss of the Pooled Fund is allocated to each
participating plan based on the percentage of that Plan's units in each
Pooled Fund category.
5. Year 2000 Issue (unaudited)
The Plan Sponsor has developed and initiated its plans to address the
possible exposures related to the impact of the Year 2000 on its systems
and computer equipment. Key financial information and operational
systems have been assessed and detailed plans have been implemented to
address modifications required by December 31, 1999. The Plan Sponsor
expects these modifications to be completed and tested by that time.
The Plan Sponsor has also initiated communications with the Plan's
Trustee to ensure it has appropriate plans to resolve Year 2000 issues
where failure of its systems could adversely affect the Plan's
operations.
10
97
<PAGE>
Schedules
98
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Employer Identification #34-4297750; Plan #016
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1997
<CAPTION>
Shares, Cost (Plus
Units, or Accrued Fair
Description Face Amount Interest) Value
----------- ----------- ---------- --------
<S> <C> <C> <C>
*Cooper Tire & Rubber
Company common stock 1,183 $26,650 $28,836
====== ======
Short-term investment:
*Armada Government Portfolio Fund 220 $ 220 $ 220
====== ======
<FN>
* Party-in-interest
</TABLE>
11
99
<PAGE>
<TABLE>
Cooper Tire & Rubber Company
Pre-Tax Savings Plan (Bowling Green - Sealing)
Employer Identification #34-4297750; Plan #016
Item 27d - Schedule of Reportable Transactions
Year Ended December 31, 1997
<CAPTION>
Sales
-----------------------------
Cost (Plus
Cost of Accrued Gain/
Description of Assets Purchases Proceeds Interest) (Loss)
- ---------------------- --------- -------- --------- --------
<S> <C> <C> <C> <C>
Armada Government
Portfolio Fund $40,685 $40,603 $40,603 $ -
Cooper Tire & Rubber
Company common stock 40,661 - - -
<FN>
Note: The purchase and selling price for each reportable transaction
represents its fair value at the time of acquisition or disposition.
</TABLE>
12
100
