SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
[FEE REQUIRED]
For the fiscal year ended December 31, 1995
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 1-5471
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
GLOBAL MARINE SAVINGS INCENTIVE PLAN
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
GLOBAL MARINE INC.
777 N. Eldridge Road
Houston, Texas 77079
(713) 596-5100
GLOBAL MARINE SAVINGS INCENTIVE PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
WITH REPORT OF INDEPENDENT ACCOUNTANTS
As of December 31, 1995 and 1994, and
for the Year Ended December 31, 1995
GLOBAL MARINE SAVINGS INCENTIVE PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
TABLE OF CONTENTS
------------
Report of Independent Accountants
Financial Statements:
Statement of Net Assets Available For Benefits, with Fund
Information, as of December 31, 1995 and 1994
Statement of Changes In Net Assets Available For Benefits, with
Fund Information, for the Year Ended December 31, 1995
Notes to Financial Statements
Supplemental Schedules:
Item 27a - Schedule of Assets Held For Investment Purposes as of
December 31, 1995
Item 27d - Schedule of Reportable Transactions
for the Year Ended December 31, 1995
All other schedules are omitted because they are not applicable.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Administrator of the
Global Marine Savings Incentive Plan:
We have audited the accompanying statement of net assets available for
benefits of the Global Marine Savings Incentive Plan (the "Plan") as of
December 31, 1995 and 1994, and the related statement of changes in net
assets available for benefits for the year ended December 31, 1995. These
financial statements are the responsibility of the management of Global
Marine Corporate Services Inc. (the Plan sponsor). 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 benefits of the Plan
as of December 31, 1995 and 1994, and the changes in net assets available for
benefits for the year ended December 31, 1995, in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic Plan
financial statements taken as a whole. The supplemental schedules identified
in the table of contents on page 1 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 statement of net assets
available for benefits and the statement of changes in net assets available for
benefits is presented for purposes of additional analysis rather than to
present the net assets available for plan benefits and 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/ Coopers & Lybrand L.L.P.
Houston, Texas
June 21, 1996
GLOBAL MARINE SAVINGS INCENTIVE PLAN
Statement of Net Assets Available For Benefits, with Fund Information
<TABLE>
<CAPTION>
Participant Directed
-----------------------------------------------------------------------------------------------------------
Retirement
Money Managed Intermediate Equity- Blue Chip Asset GMI Participant
Market Income Bond Income Magellan Growth Manager Stock Loans Total
------ ------ ---- ------ -------- ------ ------- ----- ----- -----
December 31,
1995:
Assets:
Investments,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
at fair
market value $1,954,799 $2,033,421 $89,107 $3,033,088 $7,916,748 $924,604 $146,509 $2,580,320 $426,278 $19,104,874
---------- ---------- ------- ---------- ---------- -------- -------- ---------- -------- -----------
Liabilities:
Distributions
payable 19,586 19,012 1,887 34,600 103,755 16,264 2,118 32,346 - 229,568
---------- ---------- ------- ---------- ---------- -------- -------- ---------- -------- -----------
Net Assets
Available for
Benefits $1,935,213 $2,014,409 $87,220 $2,998,488 $7,812,993 $908,340 $144,391 $2,547,974 $426,278 $18,875,306
========== ========== ======= ========== ========== ======== ======== ========== ======== ===========
</TABLE>
<TABLE>
<CAPTION>
Participant Directed
------------------------------------------------------------------------------------------
Retirement
Money Managed Intermediate Equity- Blue Chip Asset GMI
Market Income Bond Income Magellan Growth Manager Stock Total
------ ------ ---- ------ -------- ------ ------- ----- -----
December 31, 1994:
Assets:
Investments, at
(s) <C> <C> <C> <C> <C> <C> <C> <C> <C>
fair market value $1,675,130 $2,025,072 $17,989 $2,209,673 $5,656,742 $428,988 $43,310 $812,766 $12,869,670
---------- ---------- ------- ---------- ---------- -------- ------- -------- -----------
Liabilities:
Distributions
payable 23,263 34,802 387 29,621 84,497 9,317 777 9,211 191,875
---------- ---------- ------- ---------- ---------- -------- ------- -------- -----------
Net Assets Available
for Benefits
$1,651,867 $1,990,270 $17,602 $2,180,052 $5,572,245 $419,671 $42,533 $803,555 $12,677,795
========== ========== ======= ========== ========== ======== ======= ======== ===========
</TABLE>
The accompanying notes are an
integral part of the financial statements.
GLOBAL MARINE SAVINGS INCENTIVE PLAN
Statement of Changes In Net Assets Available For Benefits, with Fund Information
for the Year Ended December 31, 1995
<TABLE>
<CAPTION>
Participant Directed
-----------------------------------------------------------------------------------------------------
Retirement
Money Managed Intermediate Equity- Blue Chip Asset GMI Participant
Market Income Bond Income Magellan Growth Manager Stock Loans Total
------ ------ ---- ------ -------- ------ ------- ----- ----- -----
Additions:
Employer
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
contributions $ 79,507 $ 84,359 $ 9,040 $ 107,851 $ 259,008 $ 51,908 $ 8,391 $ 48,117 $ 648,181
Employee
contributions 209,972 260,903 24,953 332,327 783,664 192,343 28,925 152,661 1,985,748
Transfers in 200,216 173,020 54,270 90,607 268,892 367,343 93,598 455,035 $431,531 2,134,512
Interest income 99,934 - - - - - - - 2,801 102,735
Dividend income - 121,224 3,521 174,044 455,717 69,382 3,310 - - 827,198
Net appreciation - - 2,982 533,416 1,608,609 102,944 11,630 1,417,129 - 3,676,710
---------- ---------- --------- ---------- ---------- --------- --------- ---------- -------- -----------
Total
additions 589,629 639,506 94,766 1,238,245 3,375,890 783,920 145,854 2,072,942 434,332 9,375,084
---------- ---------- --------- ---------- ---------- --------- --------- ---------- -------- -----------
Deductions:
Distributions 172,562 179,382 1,986 143,587 419,958 53,819 3,109 68,658 - 1,043,061
Transfers out 133,721 435,985 23,162 276,222 715,184 241,432 40,887 259,865 8,054 2,134,512
---------- ---------- --------- ---------- ---------- -------- -------- ---------- -------- -----------
Total
deductions 306,283 615,367 25,148 419,809 1,135,142 295,251 43,996 328,523 8,054 3,177,573
---------- ---------- --------- --------- ---------- -------- -------- ---------- -------- -----------
Net additions 283,346 24,139 69,618 818,436 2,240,748 488,669 101,858 1,744,419 426,278 6,197,511
Net assets
available for
benefits,
beginning of
year 1,651,867 1,990,270 17,602 2,180,052 5,572,245 419,671 42,533 803,555 - 12,677,795
---------- ---------- -------- ---------- ---------- -------- ------- ---------- -------- -----------
Net Assets
Available
for Benefits,
End of Year $1,935,213 $2,014,409 $ 87,220 $2,998,488 $7,812,993 $908,340 $144,391 $2,547,974 $426,278 $18,875,306
========== ========== ======== ========== ========== ======== ======== ========== ======== ===========
</TABLE>
The accompanying notes are an
integral part of the financial statements.
GLOBAL MARINE SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
1. Description of the Plan
The following brief description of the Global Marine Savings Incentive Plan
(the "Plan") is provided for general informational purposes only. For more
complete information, participants should refer to the "Savings Incentive
Plan" section of the Global Marine Employee Handbook, to the "Information for
Participants" document and other documents constituting a prospectus under
the Securities Act of 1933, and to the Plan document.
General
The Plan is a defined contribution plan covering all employees of the Plan
sponsor, Global Marine Corporate Services Inc. ("GMCSI"), or of a Participating
Employer, as defined in the Plan, who are U.S. citizens or resident aliens, have
at least one year of service, have completed at least 1,000 hours of service
during that year, and are age twenty-one or older. The Plan is subject to
the provisions of section 401(a), 401(k) and 501(a) of the Internal Revenue Code
of 1986, and of the Employee Retirement Income Security Act of 1974.
Contributions
Each participant may elect to defer in any whole percent a portion of his or
her compensation for each pay period, from a minimum of one percent to a maximum
of six percent, as a pre-tax basic contribution. Each participant may also
elect to defer in any whole percent an additional one to nine percent of his or
her compensation for each pay period as a pre-tax excess contribution,
provided, however, that the combined total of the pre-tax basic contribution and
the pre-tax excess contribution cannot exceed fifteen percent of compensation.
The employer matches pre-tax basic contributions in an amount equal to 100
percent of the first one percent of compensation contributed, 50 percent of
the second one percent of compensation contributed, and 25 percent of each
of the next four percentage points of compensation contributed. The employer
does not make a matching contribution on pre-tax excess contributions. Each
participant's annual contribution shall not exceed the maximum amount allowed
for deferral for U.S. federal income tax purposes, which, for 1995, was
$9,240. The amount of a participant's annual compensation which may be taken
into account, for purposes of determining the amount of the employer match or
for any other purpose under the Plan, shall not exceed an amount prescribed
annually by the Internal Revenue Service ("IRS"). The prescribed amount was
$150,000 for 1995. Each participant's employee and employer accounts are
fully vested and nonforfeitable at all times, except as noted below.
The amount that can be deferred by any participant who is designated as a
highly compensated employee ("HCE") under IRS guidelines may be limited to an
amount which is less than the maximum annual deferral amount prescribed by the
IRS. Whether or not such limitations are imposed in a given year will depend on
whether the Plan passes certain tests with respect to the deferral rates of
HCEs in comparison with non-HCEs. Failure to pass these tests may result in the
refunding of a portion of each HCE's employee contribution for the year and the
inclusion of such amount in his or her taxable income for the year. Any matching
employer contribution on such refunded amount will (i) be forfeited by the
participant and applied to reduce the employer's matching contribution for
the following year, (ii) if so determined by the Compensation Committee of
the Board of Directors of Global Marine Inc. ("GMI") and ratified by GMCSI's
Board of Directors, be distributed to the participants to whose accounts such
excess contributions were originally allocated and included in the participants'
taxable earnings for the year, or (iii) be otherwise allocated in a
nondiscriminatory manner.
In February 1996 the Plan paid $229,568 to HCEs, consisting of refunds of
employee contributions above the limit for 1995 and earnings thereon. In March
1995 the Plan paid $191,875 to HCEs for refunds and earnings with respect to
employee contributions above the limit for 1994. There were no employer
contributions on such refunded amounts for 1995 or 1994.
Account Valuation and Payment of Benefits
Participant account balances are valued as of the close of each business day.
Participants are eligible for a distribution following termination of service,
financial hardship, or attainment of age fifty-nine and one-half. Participants
or beneficiaries will receive their benefits in a single lump-sum distribution.
Hardship withdrawals are limited to participant contributions and earnings
thereon as of December 31, 1988, plus participant contributions and rollovers
made thereafter.
Investment Options
Participants may elect to have their employee and employer contributions
invested in one or more of the investment options listed below. Each of the
Fidelity funds listed below, with the exception of the Managed Income
Portfolio, is an open-end, diversified management investment company managed by
Fidelity Management & Research Company ("FMRC"). The Managed Income
Portfolio is a commingled pool of investments managed by Fidelity Management
Trust Company ("FMTC"). The number of participants in each investment option
as of December 31, 1995 is noted parenthetically.
Fidelity Retirement Money Market Portfolio - (245) A money market fund
managed with the objective of seeking as high a level of income as is
consistent with the preservation of capital and liquidity. The fund
invests in high-quality, U.S. dollar-denominated money-market
instruments of U.S. and foreign issuers, short-term corporate
obligations, U.S. government obligations and certificates of deposit.
Fidelity Managed Income Portfolio - (255) A commingled pool of short-
and long-term investment contracts issued by insurance companies, banks
or other approved financial institutions managed with the objective of
preservation of capital and a competitive level of income over time.
The average portfolio maturity generally ranges from two to three
years.
Fidelity Intermediate Bond Fund - (36) A fixed-income security fund
managed with the objective of seeking a high level of current income
by investing in investment-grade corporate debt obligations,
obligations issued or guaranteed by the U.S. government or any of its
agencies and obligations of U.S. banks, including certificates of
deposit and bankers acceptances. The average portfolio maturity ranges
from three to ten years. The values of the securities in this fund
will vary with interest rates, and the yield will fluctuate with market
conditions.
Fidelity Equity-Income Fund - (307) An income-oriented stock fund
managed with the objective of achieving yields exceeding the composite
yield on securities comprising the Standard and Poor's Composite Stock
Price Index of 500 common stocks, with the potential for capital
growth. Investments consist primarily of common and preferred stocks,
and debt obligations convertible into common stocks.
Fidelity Magellan Fund - (489) An aggressive stock fund managed
with the objective of seeking long-term capital appreciation by
investing primarily in common stocks and securities convertible
into common stocks of both well-known and lesser-known domestic,
foreign and multinational companies.
Fidelity Blue Chip Growth Fund - (149) A common stock fund managed with
the objective of seeking growth of capital over the long term by
investing in a diversified portfolio of common stocks of well-known and
established companies. Most of the fund investments are in companies
included in the Standard and Poor's Composite Stock Price Index of 500
common stocks or in the Dow Jones Industrial Average.
Fidelity Asset Manager Fund - (32) A fund managed with the objective of
seeking a high total return with reduced risk over the long term.
The fund invests in a mix of domestic and foreign equities, bonds and
short-term debt instruments. The mix is gradually adjusted to respond
to changing market conditions. The fund's managers define a neutral mix
as 20% of assets in short-term debt instruments, 40% in intermediate to
long-term bonds, and 40% in equity securities. The actual range for
each category is zero to 70% in short-term debt instruments, 20% to 60%
in intermediate- to long-term bonds, and 10% to 60% in equities.
Global Marine Inc. Stock Fund - (163) An unmanaged fund composed solely
of common stock of GMI.
Participant Loans
Effective October 1, 1995, a loan feature was added to the Plan to allow
participants to borrow from their fund accounts. Under the loan feature,
participants may borrow by transferring from their fund accounts a minimum of
$1,000 up to a maximum amount equal to the lesser of $50,000 or 50 percent of
their account balances, excluding amounts invested in the GMI Stock Fund.
Participants may initiate one home loan and one general-purpose loan per
calendar year but may have only one of each type of loan outstanding at any
time. Loan terms range from six months to five years for general-purpose loans
and from five to fifteen years for home loans. The loans are collateralized by
the balances in the participants' accounts and bear interest at rates determined
from time to time by the Plan administrative committee. Interest rates on loans
outstanding as of December 31, 1995, ranged from 8-1/4% to 8-3/4%. Principal,
interest, and loan fees are paid through monthly payroll deductions.
2. Summary of Significant Accounting Policies
The financial statements of the Plan were prepared on an accrual basis in
accordance with generally accepted accounting principles.
The Plan's investments are stated at fair value. Shares in the funds managed
by FMRC and FMTC were valued based on their quoted closing net asset value per
share. The shares of GMI common stock were valued at the quoted closing market
price per share. Participant loans were valued at cost which approximated
fair value. Purchases and sales of shares were recorded on a trade-date
basis.
The net appreciation or depreciation which is presented in the statement of
changes in net assets available for benefits consists of the realized gains or
losses on shares redeemed or sold during the year and the net change in
unrealized appreciation or depreciation on shares held at year end.
Custodial and recordkeeping fees charged by FMTC, the Plan trustee, were paid
by GMCSI and were not charged to the Plan. Participant loan initiation and
maintenance fees were paid by the applicable participant. No charge was made to
the Plan for GMCSI's applicable administrative costs.
3. Amendments
A third Plan amendment, dated May 23, 1995, was adopted to update certain
administrative provisions as necessitated by the 1994 change in the Plan
trustee. In addition, certain matters related to recent IRS rulings were
addressed.
The Plan was further amended and restated effective October 1, 1995, primarily
to add a participant loan feature.
4. Tax Status
The Plan is designed to constitute a qualified plan under section 401(a) of
the Internal Revenue Code ("IRC") and is not subject to federal income taxes.
The IRS issued its latest determination letter dated March 23, 1994, conditioned
upon the Plan's adoption of the then-proposed second Plan amendment. In the
letter, the IRS stated that the Plan, after giving effect to the second
amendment, was in compliance with the applicable requirements of the Internal
Revenue Code. Although the Plan was further amended, the Plan administrator and
tax counsel believe that the Plan is currently designed and being operated in
compliance with the applicable requirements of the IRC. Therefore, no provision
for income taxes has been included in the Plan's financial statements.
SUPPLEMENTAL SCHEDULES
GLOBAL MARINE SAVINGS INCENTIVE PLAN
Item 27a - Schedule of Assets Held For Investment Purposes
as of December 31, 1995
<TABLE>
<CAPTION>
Number
of Current
Identity of Issue Description Shares Cost (1) Value
----------------- ----------- ------ ---- -----
Fidelity Retirement Money Market
<S> <C> <C> <C> <C>
Portfolio Money market fund 1,954,799 $1,954,799 $1,954,799
Fidelity Managed Income Commingled pool of
Portfolio investment contracts,
issued by banks and
insurance companies 2,033,421 2,033,421 2,033,421
Fidelity Intermediate Bond Fund Bond fund 8,560 86,615 89,107
Fidelity Equity-Income Fund Stock and bond fund 79,965 2,477,602 3,033,088
Fidelity Magellan Fund Common stock fund 92,077 6,479,236 7,916,748
Fidelity Blue Chip Growth Fund Common stock fund 30,049 858,318 924,604
Fidelity Asset Manager Fund Stock, bond, and short-
term instrument fund 9,243 139,240 146,509
GMI Stock Fund Shares of GMI common stock 294,894 1,274,013 2,580,320
Participant Loans Loans to participants, at annual
rates of interest ranging from
8-1/4% to 8-3/4% - - 426,278
----------- -----------
$15,303,244 $19,104,874
=========== ===========
</TABLE>
- -----------------------------
(1) Cost was determined based on historical cost. Gain or loss on sale
transactions was based on average cost.
GLOBAL MARINE SAVINGS INCENTIVE PLAN
Item 27d - Schedule of Reportable Transactions
for the Year Ended December 31, 1995
<TABLE>
<CAPTION>
Purchase Selling Cost of Current Net Gain
Identity of Party Description of Asset Price Price Asset Value (1) or (Loss)
- ----------------- -------------------- ----- ----- ----- ----- ---------
Series of Transactions:
Fidelity Purchases of Retirement Money
Market Portfolio, at various times
<S> <C> <C> <C> <C> <C>
during the year $589,629 N/A N/A $589,629 N/A
Fidelity Sales of Retirement Money Market
Portfolio, at various times during
the year N/A $309,961 $309,961 $309,961 -
Fidelity Purchases of Equity-Income
Fund, at various times during
the year $704,829 N/A N/A $704,829 N/A
Fidelity Sales of Equity-Income
Fund, at various times during
the year N/A $414,830 $320,245 $414,830 $94,585
Fidelity Purchases of Magellan Fund,
at various times during the year $1,767,281 N/A N/A $1,767,281 N/A
Fidelity Sales of Magellan Fund,
at various times during the year N/A $1,115,884 $803,687 $1,115,884 $312,197
Fidelity Purchases of Managed Income
Portfolio, at various times
during the year $639,506 N/A N/A $639,506 N/A
Fidelity Sales of Managed Income Portfolio,
at various times during the year N/A $631,156 $631,156 $631,156 -
Fidelity Purchases of Blue Chip Growth
Portfolio, at various times
during the year $680,976 N/A N/A $680,976 N/A
Fidelity Sales of Blue Chip Growth Portfolio,
at various times during the year N/A $288,304 $253,036 $288,304 $35,268
Fidelity Purchases of GMI common
stock, at various times
during the year $655,813 N/A N/A $655,813 N/A
Fidelity Sales of GMI common stock,
at various times during the year N/A $305,388 $190,899 $305,388 $114,489
</TABLE>
Normal expenses associated with asset purchases are included in
the asset cost and are not disclosed separately. All other
required information which is not presented here has been omitted for the
reason that such information is not applicable, or can be obtained from
information found elsewhere in the financial statements.
- ---------------------
(1) As of transaction date.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Annual Report to be signed on its behalf by the undersigned
hereunto duly authorized.
GLOBAL MARINE SAVINGS INCENTIVE PLAN
Date: June 26, 1996 By /s/Thomas R. Johnson
-----------------------
Thomas R. Johnson
Acting Chairman of the Administrative Committee
of the Global Marine Savings Incentive Plan
EXHIBIT 99
----------
EXHIBIT INDEX
-------------
Exhibit
Number Description
- ------ -----------
23.1 Consent of Independent Accountants
EXHIBIT 23.1
------------
CONSENT OF INDEPENDENT ACCOUNTANT
We consent to the incorporation by reference of our report dated
June 21, 1996 on our audits of the financial statements and supplemental
schedules for the Global Marine Savings Incentive Plan (the "Plan"), as
of December 31, 1995 and 1994, and for the year ended December 31, 1995,
which report is included in this Annual Report on Form 11-K, into the
registration statement on Form S-8 of Global Marine Inc. (Registration
No. 33-40266) pertaining to 1,000,000 shares of Global Marine Inc. Common
Stock, par value $.10 per share, to be offered or sold pursuant to the Plan.
/s/ Coopers & Lybrand L.L.P
Houston, Texas
June 26, 1996
