<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended..................December 31, 1998
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from..................to...............
Commission file number ..........................................
A. FMC EMPLOYEES' THRIFT AND STOCK PURCHASE PLAN
(Full title of the Plan)
B. FMC CORPORATION
200 East Randolph Drive, Chicago, Illinois 60601
(Name and Address of Issuer)
SIGNATURES
----------
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, FMC Corporation, as Plan Administrator, has duly caused this annual
report to be signed on its behalf by the undersigned thereunto duly
authorized.
FMC EMPLOYEES' THRIFT AND
STOCK PURCHASE PLAN
By /s/ Steven H. Shapiro
-----------------------------
Associate General Counsel and
Assistant Secretary
Dated: June 25, 1999
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Page(s)
------
<S> <C>
Independent Auditors' Report................................................ 1
Statement of Net Assets Available for Plan Benefits
with Fund Information - December 31, 1998.................................. 2
Statement of Net Assets Available for Plan Benefits
with Fund Information - December 31, 1997.................................. 3
Statement of Changes in Net Assets Available for Plan Benefits
with Fund Information - Year ended December 31, 1998....................... 4
Statement of Changes in Net Assets Available for Plan Benefits
with Fund Information - Year ended December 31, 1997....................... 5
Notes to Financial Statements............................................... 6-11
Schedule
--------
Item 27a - Schedule of Assets Held for Investment Purposes............ 1 12
Item 27d - Schedule of 5% Reportable Transactions..................... 2 13
</TABLE>
<PAGE>
Independent Auditors' Report
----------------------------
The Employee Welfare Benefits Plan
Committee of FMC Corporation:
We have audited the accompanying statements of net assets available for plan
benefits of FMC Employees' Thrift and Stock Purchase Plan (the Plan) as of
December 31, 1998 and December 31, 1997, and the related statements of changes
in net assets available for plan benefits for the year ended December 31, 1998
and for the nine month period ended December 31, 1997. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of FMC
Employees' Thrift and Stock Purchase Plan as of December 31, 1998 and December
31, 1997, and the changes in net assets available for plan benefits for the year
ended December 31, 1998 and the nine month period ended December 31,1997 in
conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes and reportable 5% transactions are presented for
the purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The fund information in
the statements of net assets available for plan benefits and the statements of
changes in net assets available for plan benefits is presented for purposes of
additional analysis rather than to present the net assets available for plan
benefits and the changes in net assets available for plan benefits of each fund.
The supplemental schedules and fund information have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ KPMG LLP
Chicago, Illinois
June 25, 1999
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Statement of Net Assets Available for Benefits with Fund Information
December 31,1998
(In thousands)
<TABLE>
<CAPTION>
===============================================================================================================================
FMC Stable Mutual Fidelity
Stock Loan Value Clipper Qualified (Z) Sequoia Puritan
Fund Fund Fund Fund Fund Fund Fund
- -------------------------------------------------------------------------------------------------------------------------------
Assets
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investments at fair value $ 297,618 - 142,804 24,832 16,524 49,477 9,123
- -------------------------------------------------------------------------------------------------------------------------------
Total investments 297,618 - 142,804 24,832 16,524 49,477 9,123
- --------------------------------------------------------------------------------------------------------------------------------
Receivables:
Participants' loans - 21,664 - - - - -
Employee contributions 203 - 56 13 9 29 6
Employer contributions 187 - - - - - -
- --------------------------------------------------------------------------------------------------------------------------------
Total receivables 390 21,664 56 13 9 29 6
- --------------------------------------------------------------------------------------------------------------------------------
Net assets available for
Plan Benefits $ 298,008 21,664 142,860 24,845 16,533 49,506 9,129
================================================================================================================================
<CAPTION>
================================================================================================================================
Retirement
Fidelity Low Government U.S.
Blue Chip Priced Diversified Money Equity Harsco
Growth Stock International Market Index Stock
Fund Fund Fund Fund Pool Fund Total
================================================================================================================================
Assets
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investments at fair value 21,865 4,358 3,525 4,291 17,016 204 $ 591,637
- --------------------------------------------------------------------------------------------------------------------------------
Total investments 21,865 4,358 3,525 4,291 17,016 204 591,637
- --------------------------------------------------------------------------------------------------------------------------------
Receivables:
Participants' loans - - - - - - 21,664
Employee contributions 25 6 4 5 8 - 364
Employer contributions - - - - - - 187
- --------------------------------------------------------------------------------------------------------------------------------
Total receivables 25 6 4 5 8 - 22,215
- --------------------------------------------------------------------------------------------------------------------------------
Net assets available for
Plan Benefits 21,890 4,364 3,529 4,296 17,024 204 $ 613,852
================================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Statement of Net Assets Available for Benefits with Fund Information
December 31,1997
(In thousands)
<TABLE>
<CAPTION>
==================================================================================================================================
FMC Stable Mutual
Stock Loan Value Clipper Qualified (Z) Sequoia
Fund Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Assets
- ----------------------------------------------------------------------------------------------------------------------------------
Investments at fair value $ 345,584 - 145,506 21,884 19,400 29,491
- ----------------------------------------------------------------------------------------------------------------------------------
Total investments 345,584 - 145,506 21,884 19,400 29,491
- ----------------------------------------------------------------------------------------------------------------------------------
Receivables:
Participants' loans - 23,000 - - - -
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets available for
Plan Benefits $ 345,584 23,000 145,506 21,884 19,400 29,491
==================================================================================================================================
<CAPTION>
==================================================================================================================================
Retirement
Fidelity Low Government U.S.
Fidelity Blue Chip Priced Diversified Money Equity Harsco
Puritan Growth Stock International Market Index Stock
Fund Fund Fund Fund Fund Pool Fund Total
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Assets
- -----------------------------------------------------------------------------------------------------------------------------------
Investments at fair value 6,595 12,489 4,356 2,809 3,902 14,790 284 $ 607,090
- -----------------------------------------------------------------------------------------------------------------------------------
Total investments 6,595 12,489 4,356 2,809 3,902 14,790 284 607,090
- -----------------------------------------------------------------------------------------------------------------------------------
Receivables:
Participants' loans - - - - - - - 23,000
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets available for
Plan Benefits 6,595 12,489 4,356 2,809 3,902 14,790 284 $ 630,090
===================================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Statement of Changes in Net Assets Available for Benefits with Fund Information
Year ended December 31, 1998
(In thousands)
<TABLE>
<CAPTION>
===================================================================================================================================
FMC Stable Mutual
Stock Loan Value Clipper Qualified(Z) Sequoia
Fund Fund Fund Fund Fund Fund
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments $ (56,819) - - (21) (1,517) 9,026
Interest and dividend income 1,058 - 9,817 4,149 1,703 2,501
Contributions - employees 19,003 - 3,665 1,907 1,397 3,581
Contributions - employer 16,440 - (87) - - -
Loan repayments 6,145 (9,322) 1,521 275 242 477
- -----------------------------------------------------------------------------------------------------------------------------------
Total additions (14,173) (9,322) 14,916 6,310 1,825 15,585
- -----------------------------------------------------------------------------------------------------------------------------------
Deductions:
Distributions to participants 23,989 1,000 14,492 2,179 1,690 4,051
Expenses 225 - 102 19 7 14
Loans issued 4,692 (8,715) 2,006 328 274 576
- -----------------------------------------------------------------------------------------------------------------------------------
Total deductions 28,906 (7,715) 16,600 2,526 1,971 4,641
- -----------------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes (43,079) (1,607) (1,684) 3,784 (146) 10,944
Interfund transfers, net (5,148) - (2,732) (896) (2,748) 8,854
Net tranferred in (Note 4) 651 271 1,770 73 27 217
- -----------------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) (47,576) (1,336) (2,646) 2,961 (2,867) 20,015
Net assets available for benefits at
beginning of period 345,584 23,000 145,506 21,884 19,400 29,491
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits at
end of period $ 298,008 21,664 142,860 24,845 16,533 49,506
===================================================================================================================================
<CAPTION>
=======================================================================================================================
Retirement
Fidelity Low Government
Fidelity Blue Chip Priced Diversified Money
Puritan Growth Stock International Market
Fund Fund Fund Fund Fund
--------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments 262 4,254 (367) 262 -
Interest and dividend income 933 901 390 142 222
Contributions - employees 675 2,001 696 494 471
Contributions - employer - - - - -
Loan repayments 80 269 74 57 42
- -----------------------------------------------------------------------------------------------------------------------
Total additions 1,950 7,425 793 955 735
- -----------------------------------------------------------------------------------------------------------------------
Deductions:
Distributions to participants 1,602 1,382 328 280 1,219
Expenses 5 13 4 2 4
Loans issued 111 314 74 97 43
- -----------------------------------------------------------------------------------------------------------------------
Total deductions 1,718 1,709 406 379 1,266
- -----------------------------------------------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes 232 5,716 387 576 (531)
Interfund transfers, net 2,173 913 (649) 87 739
Net tranferred in (Note 4) 129 2,772 270 57 186
- -----------------------------------------------------------------------------------------------------------------------
Net additions (deductions) 2,534 9,401 8 720 394
Net assets available for benefits at
beginning of period 6,595 12,489 4,356 2,809 3,902
- -----------------------------------------------------------------------------------------------------------------------
Net assets available for benefits at
end of period 9,129 21,890 4,364 3,529 4,296
======================================================================================================================
<CAPTION>
==============================================================================
U.S.
Equity Harsco
Index Stock
Pool Fund Total
------------------------------------
<S> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments 3,958 (78) $ (41,040)
Interest and dividend income 25 - 21,841
Contributions - employees 1,046 - 34,936
Contributions - employer - - 16,353
Loan repayments 140 - -
- ------------------------------------------------------------------------------
Total additions 5,169 (78) 32,090
- ------------------------------------------------------------------------------
Deductions:
Distributions to participants 2,280 - 54,492
Expenses 8 - 403
Loans issued 200 - -
- ------------------------------------------------------------------------------
Total deductions 2,488 - 54,895
- ------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes 2,681 (78) (22,805)
Interfund transfers, net (591) (2) -
Net tranferred in (Note 4) 144 - 6,567
- ------------------------------------------------------------------------------
Net additions (deductions) 2,234 (80) (16,238)
Net assets available for benefits at
beginning of period 14,790 284 630,090
- ------------------------------------------------------------------------------
Net assets available for benefits at
end of period 17,024 204 $ 613,852
==============================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Statement of Changes in Net Assets Available for Benefits with Fund Information
Nine months ended December 31, 1997
(In thousands)
<TABLE>
<CAPTION>
==========================================================================================================================
FMC Fixed Stable
Stock Income Equity Loan Value
Fund Fund Fund Fund Fund
-------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments $ 51,546 (1,118) 5,852 - -
Interest and dividend income 670 2,174 3 362 6,468
Contributions - employees 14,468 316 1,113 - 2,985
Contributions - employer 11,756 - - - 371
Loan repayments 3,425 - - (4,859) 846
- --------------------------------------------------------------------------------------------------------------------------
Total additions 81,865 1,372 6,968 (4,497) 10,670
- --------------------------------------------------------------------------------------------------------------------------
Deductions:
Distributions to participants 23,474 5,178 1,093 458 14,156
Expenses 2 - - - -
Loans issued 3,757 - - (6,763) 1,826
- --------------------------------------------------------------------------------------------------------------------------
Total deductions 27,233 5,178 1,093 (6,305) 15,982
- --------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes 54,632 (3,806) 5,875 1,808 (5,312)
Interfund transfers, net (15,239) (162,156) (53,707) 722 152,605
Net tranferred in (out) (Note 4) (126,157) (55,986) (15,990) (8,169) (1,787)
- --------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) (86,764) (221,948) (63,822) (5,639) 145,506
Net assets available for benefits at
beginning of period 432,348 221,948 63,822 28,639 -
- --------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits at
end of period $ 345,584 - - 23,000 145,506
==========================================================================================================================
<CAPTION>
============================================================================================================================
Fidelity
Mutual Fidelity Blue Chip
Clipper Qualified(Z) Sequoia Puritan Growth
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments (27) 378 4,762 (15) 505
Interest and dividend income 2,796 2,018 247 448 582
Contributions - employees 1,144 1,173 1,437 782 1,102
Contributions - employer - - - - -
Loan repayments 109 99 120 28 74
- ----------------------------------------------------------------------------------------------------------------------------
Total additions 4,022 3,668 6,566 1,243 2,263
- ----------------------------------------------------------------------------------------------------------------------------
Deductions:
Distributions to participants 1,349 1,343 1,578 175 593
Expenses 1 - - - -
Loans issued 198 197 232 78 199
- ----------------------------------------------------------------------------------------------------------------------------
Total deductions 1,548 1,540 1,810 253 792
- ----------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes 2,474 2,128 4,756 990 1,471
Interfund transfers, net 19,651 17,629 25,262 3,615 3,695
Net tranferred in (out) (Note 4) (241) (357) (527) 1,990 7,323
- ----------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) 21,884 19,400 29,491 6,595 12,489
Net assets available for benefits at
beginning of period - - - - -
- ----------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits at
end of period
21,884 19,400 29,491 6,595 12,489
============================================================================================================================
<CAPTION>
============================================================================================================================
Retirement
Low Government U.S.
Priced Diversified Money Equity Harsco
Stock International Market Index Stock
Fund Fund Fund Pool Fund Total
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Net appreciation (depreciation) in
fair value of investments 7 (90) - 1,832 60 $ 63,692
Interest and dividend income 220 104 123 14 - 16,229
Contributions - employees 469 346 483 811 269 26,898
Contributions - employer - - - - - 12,127
Loan repayments 22 29 34 73 - -
- --------------------------------------------------------------------------------------------------------------------------------
Total additions 718 389 640 2,730 329 118,946
- --------------------------------------------------------------------------------------------------------------------------------
Deductions:
Distributions to participants 23 45 875 598 43 50,981
Expenses 2 - - - - 5
Loans issued 31 43 54 147 1 -
- --------------------------------------------------------------------------------------------------------------------------------
Total deductions 56 88 929 745 44 50,986
- --------------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) prior to
interfund transfers and other changes 662 301 (289) 1,985 285 67,960
Interfund transfers, net 3,614 1,401 739 2,090 79 -
Net tranferred in (out) (Note 4) 80 1,107 3,452 10,715 (80) (184,627)
- --------------------------------------------------------------------------------------------------------------------------------
Net additions (deductions) 4,356 2,809 3,902 14,790 284 (116,667)
Net assets available for benefits at
beginning of period - - - - - 746,757
- --------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits at
end of period
4,356 2,809 3,902 14,790 284 $630,090
================================================================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
(1) Description of the Plan
The following description of the FMC Employees' Thrift and Stock Purchase
Plan (the Plan) provides only general information. Participants should
refer to the Plan text for a more complete description of the Plan's
provisions.
(a) General
The Plan is a qualified salary-reduction plan under Section 401(k) of the
Internal Revenue Code, which covers all full-time employees of FMC
Corporation (the Company) (other than employees who generally reside or
work outside of the United States and employees covered by certain
collective bargaining agreements). Such employees are eligible to
participate in the Plan immediately upon commencement of their employment
with the Company. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended (ERISA). The Plan is
administered by the FMC Employee Welfare Benefits Plan Committee.
(b) Contributions
Participants may elect to have their annual compensation reduced by up to
$10,000, subject to adjustments to reflect changes in the cost of living,
but not by more than 15% of their total compensation in the aggregate.
The aggregate amount of such reductions is contributed to the Plan trust
on a pretax basis. Participants may also elect to make after-tax
contributions, either as an alternative to pretax contributions, or in
addition to the maximum pretax contributions of $10,000 (but not more
than 15% of their total compensation in the aggregate). The Company makes
matching contributions ranging from 15% to 100% of the portion of those
contributions not in excess of 5% of each participant's compensation
(Basic Contribution), regardless of the $10,000 limit on pretax
contributions. At December 31, 1998, 10,583 current and former employees
participated in the Plan.
(c) Trust Agreement
Effective June 1, 1997, the Company and Fidelity Management Trust Company
(the Trustee) established a trust (the Trust) for investment purposes as
part of the Plan. The Trust replaced a predecessor trust established with
Citibank, N. A. (Citibank). At the same time, the Trustee also became the
Plan's record keeper. In addition, the Plan's fiscal year-end was changed
from March 31 to December 31 for compliance and financial reporting
purposes.
Prior to June 1, 1997, Citibank was the trustee of the FMC Corporation
Salaried Employees' Master Trust (the Master Trust) for the collective
investment of the assets of the predecessor trust and the trusts
associated with two other 401(k) plans of an affiliate of the Company.
These three trusts participated in the Master Trust until May 31, 1997 at
which time the Master Trust was dissolved and the Plan's share of the
assets in the Master Trust were transferred to the Trust (see note 2(d)).
6
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
(d) Investment options
Upon enrollment in the Plan, a participant may direct his or her
contributions in 1% increments in any of the following investment
options:
1) FMC Stock Fund - Funds are invested in common stock of FMC
Corporation.
2) Stable Value Fund - Funds are invested in investment contracts
offered by insurance companies and other approved financial
institutions. From January 1, 1998 through December 31, 1998 the
guaranteed effective annual yield was approximately 6.99% and from
June 1, 1997 through December 31, 1997 the guaranteed effective
annual yield was approximately 7.2%.
3) Clipper Fund - Funds are invested in common stocks which are
considered undervalued by the fund manager and in long-term bonds.
4) Mutual Qualified (Z) Fund - Funds are invested primarily in common
and preferred stocks which are considered undervalued by the fund
manager.
5) Sequoia Fund - Fund investments are concentrated in a relatively
small number of mostly U.S. - headquartered companies with long-term
growth potential.
6) Fidelity Puritan Fund - Funds are invested in high-yielding U.S. and
foreign securities, including those in emerging markets.
7) Fidelity Blue Chip Growth Fund - Funds are invested primarily in
common stocks of well-known and established companies.
8) Low-Priced Stock Fund - Funds are heavily invested in undervalued
stocks or out-of-favor stocks.
9) Diversified International Fund - Funds are invested primarily in
stocks of companies located outside the U.S. that are included in
the Morgan Stanley EAFE Index.
10) Retirement Government Money Market Fund - Funds are invested in
short-term obligations of the U.S. Government or its agencies.
11) U.S. Equity Index Pool Fund - Funds are invested primarily in
common stocks of the 500 companies that comprise the S&P 500.
7
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
Prior to June 1, 1997 within the Master Trust, Citibank and the Company had
established an FMC Stock Fund, a Fixed Income Fund, an Equity Fund, and a
Harsco Stock Fund. The FMC Stock Fund consisted of shares of the common
stock of the Company. The Fixed Income Fund consisted of investments in
contracts with banks and insurance companies which guarantee repayment of
principal with interest at a fixed or fixed minimum rate for a specified
period of time. The Fixed Income Fund was authorized to include (1)
securities issued or guaranteed by the U.S. Government, or any of its
agencies or instrumentalities; and (2) short-term, interest-bearing debt
obligations pending investment in guaranteed income contracts or government
securities. For the period from April 1, 1997 through May 31, 1997, the
guaranteed effective annual yield was approximately 7.2%. The Equity Fund
consisted of shares of mutual funds registered under the Investment Company
Act of 1940. The Master Trust also included a Harsco Stock Fund consisting
of common shares of Harsco Corporation. The Harsco Stock Fund was not
available as an investment election to Plan participants, nor was it
included in the Master Trust investments in which the Plan's predecessor
trust had an interest (See note 2(d).)
All employees contributing to the Plan prior to June 1, 1997 were entitled
to elect to have Citibank invest their contributions: (i) entirely in the
FMC Stock Fund, (ii) entirely in the Fixed Income Fund, (iii) entirely in
the Equity Fund, or (iv) in two or more of those funds in increments of
25%. A participant's investment election could be changed prospectively for
any plan year. In addition, a participant who had attained age 55 could
elect to have all or part (in increments of 25%) of the accumulated balance
of the participant's FMC Stock, Fixed Income, and Equity Funds attributable
to the participant's contributions transferred among those funds.
All Company contributions to the Plan are invested by the Trustee in the
FMC Stock Fund and are credited to the respective accounts of the employees
participating in the Plan.
(e) Vesting
Participants are immediately vested in their elective contributions plus
actual earnings thereon. Vesting in the Company's contributions and related
earnings is based on years of service. A participant is 100% vested after
five years of service.
(f) Payment of Benefits
On termination of service or attainment of age 59-1/2, any participant may
elect to immediately receive a lump sum distribution equal to the vested
interest of his or her account. Participants aged 55 or older or whose
accounts are valued at not less than $5,000 may, upon termination, elect to
defer their lump sum distribution or receive annual installments over a
ten-year period. If a participant is not fully vested in the Company's
contributions to his or her account on the date of termination of his or
her employment, the non-vested portion is forfeited. Such forfeitures
reduce future Company contributions to the Plan.
8
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
(g) Expenses
The compensation and expenses of the Trustee are paid by the Company. All
other expenses of the Plan may be paid by the Trustee out of the assets of
the Plan and constitute a charge upon the respective investment funds or
upon the individual participants' accounts as provided in the Plan.
(h) Withdrawals and Loans
The Plan allows participants to make hardship cash withdrawals (subject to
income taxation and IRS penalties) of some or all of their vested account
balances. Eligible participants may also receive money from the Plan in the
form of loans. The minimum that may be borrowed is $1,000. The maximum that
may be borrowed is the lesser of $50,000, as adjusted, or 50% of the
participant's vested account balance. Loans must be repaid over 60 months
with interest at the announced Stable Income Fund rate or some other
reasonable rate as determined by the Company. Participant loans outstanding
as of December 31, 1998 and December 31, 1997, which are reported in the
Loan Fund, were $21,664,000 and $23,000,000, respectively.
(i) Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of the Plan and ERISA. In the
event of plan termination, participants will become 100% vested in their
account balances.
(2) Summary of Significant Accounting Policies
The following are the significant accounting policies followed by the Plan:
(a) Basis of Accounting
The Plan's financial statements are prepared on the accrual basis of
accounting.
(b) Investment Transactions
Security transactions are recorded in the financial statements on a
settlement-date basis, which does not differ materially from a trade-date
basis.
(c) Valuation of Investments
Quoted or estimated market prices are used to value investments except for
certain contracts with banks and insurance companies which guarantee
repayment of principal with interest at a fixed or fixed minimum rate for a
specified period of time. These contracts are valued at contract value
which approximates market value.
9
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
(d) Investments and Basis of Allocation
Investments at fair value which represent 5% or more of the Plan's assets
available for benefits are separately identified below:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
December 31,
-------------------------------------------
1998 1997
(in thousands)
<S> <C> <C>
FMC Stock Fund $297,618 $345,584
Stable Value Fund 142,804 145,506
Sequoia Fund 49,477 -
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
During 1998 and the nine months ended December 31, 1997, the Plan's investments
(including investments bought, sold, and held during the year) appreciated
(depreciated) as follows:
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year ended Nine months ended
December 31,1998 December 31,1997
- -----------------------------------------------------------------------------------------------------------------
(in thousands)
<S> <C> <C>
FMC Stock Fund $(56,819) $51,546
Clipper Fund (21) (27)
Mutual Qualified (Z) Fund (1,517) 378
Sequoia Fund 9,026 4,762
Fidelity Puritan Fund 262 (15)
Fidelity Blue Chip Fund 4,254 505
Low-Priced Stock Fund (367) 7
Diversified International Fund 262 (90)
U.S. Equity Index Pool Fund 3,958 1,832
Harsco Stock Fund (78) 60
Fixed Income Fund - (1,118)
Equity Fund - 5,852
- -----------------------------------------------------------------------------------------------------------------
$(41,040) $63,692
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
Prior to June 1, 1997 the trusts participating in the Master Trust had an
undivided interest in the assets (except for Harsco Corporation stock),
liabilities, income, expenses, and gains or losses of the Master Trust. For
allocation purposes, each of the participating trusts retained an ownership
percentage in the Master Trust net assets which was initially established
on the basis of relative net assets contributed by each plan to the Master
Trust. Each month, the percentage was adjusted based on the relative amount
of contributions and distributions attributable to each plan. The
percentage calculated at each month-end was used to allocate the investment
income, net of expenses, and gains or losses of Master Trust investments
during that month.
10
<PAGE>
FMC EMPLOYEES' THRIFT AND STOCK
PURCHASE PLAN
Notes to Financial Statements
December 31, 1998 and December 31, 1997
- --------------------------------------------------------------------------------
(e) Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the plan administrator to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and reported amounts of revenue and expenses
during the reporting period. Actual results could differ from these
estimates, but the plan administrator does not believe such differences
will materially affect the Plan's financial position or results of
operations.
(3) Income Taxes
The Plan received a favorable determination letter from the Internal
Revenue Service on April 9, 1986 indicating that it is qualified under
Section 401(a) of the Internal Revenue Code and therefore the related
Master Trust (and, prior to that, the predecessor trust) are exempt from
tax under Section 501(a) of the Code. The Plan has been subsequently
restated to comply with the Tax Reform Act of 1986 and subsequent
legislation. Although the Plan has not yet received a new determination
letter on the submitted restated document, the plan administrator and the
Plan's counsel are confident that the Plan meets the requirements of
Section 401(a).
The Company receives a Federal income tax deduction for its contributions
to the Plan. Participating employees are not subject currently to Federal
income tax on their elective contributions, Company contributions,
appreciation in the Company's common stock, income, and other items
allocated to their individual accounts. Individual participants are taxed
on such items at the time of distribution from the Plan.
(4) Plan Merger and Asset Transfers
During 1998, four of the Company's bargaining employee units at Pocatello,
ID, Kemmerer, WY, Lawrence, KS, and Carteret, NJ were merged into the Plan.
As a result the plan received assets value of $6,470,000 from the FMC
Corporation 401(k) Plan for Employees Covered by a Collective Bargaining
Agreement. In addition, during the period the Plan received $97,000 due to
employee transfers and turnover.
Effective June 1, 1997, the Company's defense segment employees' assets
were spun off from the Plan. As a result, assets with a value of
$207,768,000 were transferred to the United Defense Salaried Employees'
Thrift and Stock Purchase Plan. On June 1, 1997 the Plan received
$19,988,000 from the Moorco International Inc. Incentive Savings Plan and
$12,960,000 from Frigoscandia's U.S. operation and Stein division plans as
result of the plans' mergers into the Plan. On October 7, 1997, the plan
transferred $9,889,000 to the United Defense, L. P. Salaried Plan due to
the sale of Company's defense business to the Carlyle Group. In addition,
during the period the Plan received $82,000 due to employee transfers and
turnover.
(5) Impact of Year 2000 Issue
The Year 2000 (Y2K) issue refers to the risk that systems, products, and
equipment using data sensitive software or computer chips with two digit
date fields will recognize a date using "00" as the year 1900 rather than
the year 2000. This could result in system failures, miscalculations, and
business interruptions that, if not addressed, could have a materially
adverse impact on the Plan.
The majority of the Plan's applications are already Y2K-compliant, and the
remainder will be before December 31, 1999. The Plan outsources most of its
critical computing operations to professional outsource service providers.
The Plan has confirmed or is confirming that each of its outsourcers is
either already Y2K-compliant or has a detailed program in place to achieve
compliance within an acceptable time frame. The plan will not bear any
costs associated with making the systems Y2K-compliant.
11
<PAGE>
FMC CORPORATION THRIFT AND STOCK Schedule 1
----------
PURCHASE PLAN
Item 27a - Schedule of Assets Held for Investment Purposes
<TABLE>
<CAPTION>
December 31, 1998
(In thousands)
==================================================================================================================================
Description of investment including Current value
Identity of issue, borrower, lessor maturity date, rate of interest at December 31,
or similar party collateral, par, or maturity value Cost 1998
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
FMC Common Stock FMC Corporation Stock
Party in Interest 5,314,602 shares plus $1.4 million in
interest-bearing cash $223,882 297,618
Stable Value Fund Portfolio includes investment contracts
offered by major insurance companies
and other approved financial institutions 142,803 142,804
Clipper Fund Stock Long-term Growth Fund 21,308 24,832
Mutual Qualified Fund (Z) Stock Long-term Growth Fund 15,337 16,524
Sequoia Fund Stock Long-term Growth Fund 31,877 49,477
Fidelity Puritan Fund Stock and Bond Fund 8,910 9,123
Fidelity Blue Chip Fund Large Companies Stock Fund 17,620 21,865
Fidelity Low-Priced Stock Fund Growth Mutual Fund 4,714 4,358
Fidelity Diversified International Fund Growth Mutual Fund of Foreign
Companies 3,398 3,525
Retirement Government Money Market Fund Money Market Mutual Fund 4,291 4,291
U.S Equity Index Pool Stock Index Fund 12,394 17,016
Harsco Stock Fund Harsco Corporation Stock
approximately 3,526 shares 200 204
Participants' loans receivable Varying rates of interest 7.2% - 8.5% 21,664 21,664
- ----------------------------------------------------------------------------------------------------------------------------------
Total assets held for investment purposes $508,398 613,301
==================================================================================================================================
</TABLE>
See accompanying independent auditors' report.
12
<PAGE>
FMC CORPORATION THRIFT AND STOCK Schedule 2
----------
PURCHASE PLAN
Item 27d - Schedule of 5% Reportable Transactions
<TABLE>
<CAPTION>
Year ended December 31, 1998
(In thousands)
====================================================================================================================================
Current
Expenses value of asset
Description Purchase Selling incurred Cost of on transaction Net gain
Identity of party involved of security price price with trades security date (loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Fidelity Institutional Retirement Stable Value Fund $ 31,406 34,109 - 34,109 34,109 -
Services Company
Number of Transactions: 508
Fidelity Institutional Retirement Sequoia Fund 22,646 11,684 - 8,707 11,684 2,977
Services Company
Number of Transactions: 496
Fidelity Institutional Retirement FMC Stock Fund* 45,142 36,289 - 23,346 36,289 12,943
Services Company
Number of Transactions: 504
====================================================================================================================================
</TABLE>
* Party in Interest
See accompanying independent auditors' report.
13
<PAGE>
EXHIBIT INDEX
NUMBER IN
EXHIBIT TABLE DESCRIPTION
- ------------- -----------
10.1 FMC Employees' Thrift and Stock Purchase Plan, as
revised and restated as of April 1, 1991 (incorporated
by reference from Exhibit 10.3 to the Form SE filed on
March 27, 1992).
10.2 Amendments to the FMC Employees' Thrift and Stock
Purchase Plan, through December 31, 1994 (incorporated
by reference from Exhibit 10.6 to the Form 10-K filed
on March 29, 1995).
10.3 Master Trust Agreement between FMC Corporation and
Fidelity Management Trust Company effective June 1,
1997, for the FMC Employees' Thrift and Stock Purchase
Plan (incorporated by reference from Exhibit 10.12 to
the Form 10-K filed on March 18, 1998).
10.4 Amendment dated March 28, 1996 to the FMC Employees'
Thrift and Stock Purchase Plan (incorporated by
reference from Exhibit 10.6.a to the Form 10-K filed on
March 18, 1998).
10.5 Amendments effective April 1 and June 1, 1995 to the
FMC Employees' Thrift and Stock Purchase Plan
(incorporated by reference from Exhibit 10.6.b to the
Form 10-K filed on March 18, 1998).
10.6 Amendment dated October 1, 1997 to the FMC Employees'
Thrift and Stock Purchase Plan (incorporated by
reference from Exhibit 10.6.c to the Form 10-K filed on
March 18, 1998).
23.1 Consent of KPMG LLP.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Employee Welfare Benefits Plan Committee of
FMC Corporation:
We consent to incorporation by reference in the registration statement (No. 33-
48984) on Form S-8 of FMC Corporation of our report dated June 25, 1999,
relating to the statements of net assets available for plan benefits of FMC
Employees' Thrift and Stock Purchase Plan, as of December 31, 1998 and December
31, 1997, and the related statements of changes in the net assets available for
plan benefits for the year ended December 31, 1998 and the nine month period
ended December 31, 1997, which report appears in the December 31, 1998 annual
report on Form 11-K of FMC Employees' Thrift and Stock Purchase Plan for the
fiscal year ended December 31, 1998.
/s/ KPMG LLP
Chicago, Illinois
June 25, 1999
