FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the plan period ended March 31, 1994
Commission file no. 1-924
A. Full title of the plan:
AEROQUIP CORPORATION
RETIREMENT SAVINGS AND PROFIT SHARING PLAN
B. Name of issuer of the securities
held pursuant to the plan and the
address of its principal executive office:
TRINOVA CORPORATION
3000 Strayer
Maumee, Ohio 43537-0050
This document, including exhibits, contains 31 pages.
The cover page consists of 1 page.
The Exhibit Index is located on page 30.
<PAGE>
REQUIRED INFORMATION
The following financial statements are furnished for the Aeroquip
Corporation Retirement Savings and Profit Sharing Plan:
Page
Report of Independent Auditors 3
Statements of Assets Available for
Plan Benefits 4
Statements of Changes in Assets Available
for Plan Benefits 5
Notes to Financial Statements 6
Exhibit
The following exhibit is filed herewith:
Exhibit
Number
(23) Consent of Independent Auditors
SIGNATURE
The Plan. 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.
AEROQUIP CORPORATION
RETIREMENT SAVINGS AND PROFIT SHARING PLAN
By: /S/ WILLIAM R. AMMANN
William R. Ammann
Vice President - Administration
and Treasurer
September 28, 1994 TRINOVA Corporation
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<PAGE>
REPORT OF INDEPENDENT AUDITORS
Administrative Committee
Aeroquip Corporation
Retirement Savings and Profit Sharing Plan
We have audited the accompanying statements of assets available for plan
benefits of the Aeroquip Corporation Retirement Savings and Profit Sharing
Plan as of March 31, 1994 and December 31, 1993 and the related statements of
changes in assets available for plan benefits for the three month period ended
March 31, 1994 and each of the two years in the period ended December 31,
1993. 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 assets available for plan benefits of the Plan at
March 31, 1994 and December 31, 1993 and the changes in its assets available
for plan benefits for the three month period ended March 31, 1994 and each of
the two years in the period ended December 31, 1993, in conformity with
generally accepted accounting principles.
/S/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Toledo, Ohio
September 2, 1994
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<PAGE>
STATEMENTS OF ASSETS AVAILABLE FOR PLAN BENEFITS
AEROQUIP CORPORATION
RETIREMENT SAVINGS AND PROFIT SHARING PLAN
March 31 December 31
1994 1993
[Note 1]
ASSETS
Contributions receivable from employer $ $ 8,426,305
Contributions receivable from employees 199,748
Loans receivable from plan participants 2,151,365
Value of interest in Master Trust - Note 7
Fixed Income Fund 215,466,589
Vanguard Mutual Funds 21,351,432
Multi-Asset Fund 27,045,631
TRINOVA Stock Fund 6,953,915
Government Securities Fund 1,226,768
272,044,335
ASSETS AVAILABLE FOR PLAN BENEFITS $ 0 $282,821,753
============ ============
See accompanying notes
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<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
AEROQUIP CORPORATION
RETIREMENT SAVINGS AND PROFIT SHARING PLAN
<CAPTION>
Three-Month
Period Ended
March 31 Year Ended December 31
1994 1993 1992
<S> <C> <C> <C>
ADDITIONS
Contributions by employees $ 2,317,096 $6,857,517 $7,584,159
Contributions by employer 908,831 11,031,930 7,504,206
Net investment income
Interest earned 3,260,319 14,891,675 17,250,336
Dividends 141,457 1,071,061 667,591
Realized gains on sales of investments 7,474,327 891,618 797,483
Other - principally unrealized gains
(losses) on investments (7,893,922) 5,362,782 1,551,117
2,982,181 22,217,136 20,226,527
6,208,108 40,106,583 35,354,892
DEDUCTIONS
Benefits paid to participants 19,759,893 21,901,321 36,911,610
Investment management fees 92,721 160,172 139,965
Net transfers to affiliated
benefit plans [Note 1] 269,177,247 423,625 37,460
289,029,861 22,485,118 37,089,035
NET ADDITIONS (DEDUCTIONS) (282,821,753) 17,621,465 (1,734,143)
Assets available for plan benefits
at beginning of period 282,821,753 265,200,288 266,934,431
ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF PERIOD $ 0 $282,821,753 $265,200,288
============ ============ ============
<FN>
See accompanying notes
</FN>
</TABLE>
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<PAGE>
NOTES TO FINANCIAL STATEMENTS
AEROQUIP CORPORATION
RETIREMENT SAVINGS AND PROFIT SHARING PLAN
MARCH 31, 1994
NOTE 1 - PLAN MERGER
At March 31, 1994, the Aeroquip Corporation Retirement Savings and
Profit Sharing Plan (the "Plan") and its assets available for plan benefits
were merged into the TRINOVA Corporation Retirement Savings and Profit-Sharing
Plan (the "TRINOVA Plan"), formerly the TRINOVA Corporation Retirement Savings
and Profit Sharing Plan for Corporate Employees. The operation and provisions
of the TRINOVA Plan are substantially the same as those under the Plan. The
assets available for plan benefits merged into the TRINOVA Plan amounted to
$269,119,478 and have been included in net transfers to affiliated benefit
plans in the statement of changes in assets available for plan benefits for
the three-month period ended March 31, 1994.
Additionally, Hazlehurst and Associates was terminated as recordkeeper of the
plan assets and The Vanguard Group was added as trustee and recordkeeper for
the TRINOVA Plan.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accounting records of the Plan are maintained on the accrual
basis.
Investment Valuation and Income Recognition
Marketable securities are stated at aggregate fair value and are
valued at the last sales price of the valuation period quoted by a national
securities exchange. The guaranteed investment contracts are stated at
contract value which approximates fair value. The difference between fair
value and the cost of investments is reflected in the statement of changes in
assets available for plan benefits as unrealized gains (losses) on
investments.
Realized gains or losses on the sales of investments represent the
differences between the proceeds received upon sale and the cost of
investments sold, determined on an average cost basis.
Investment management fees are paid by the Plan, while all other
administrative expenses of the Plan are currently borne by the Plan sponsor,
Aeroquip Corporation ("Aeroquip"), a wholly-owned subsidiary of TRINOVA
Corporation, ("TRINOVA").
Payment of Benefits
Effective January 1, 1993 the Plan changed its method of accounting
for benefits of employees who have withdrawn from participation in the Plan
but have not yet been paid. This change was made to conform with new guidance
in the American Institute of Certified Public Accountants Audit and Accounting
Guide "Audits of Employee Benefits Plan." The cumulative effect of this
change as of January 1, 1993 and the effect of the change on the 1993
financial statements was not material.
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<PAGE>
NOTE 3 - DESCRIPTION OF PLAN
The Plan is a defined contribution plan. Eligible participants
generally include all full-time employees of Aeroquip and part-time employees
of Aeroquip who were participants on December 31, 1989, in any qualified
pension or profit-sharing plan sponsored by Aeroquip. However, bargaining
unit employees are excluded (unless the collective bargaining agreement
specifically authorizes their participation) as are leased employees and
employees classified as interns.
Participants may contribute to the Plan on a pre-tax basis by salary
reduction up to 15 percent of their annual compensation (in increments of 1
percent). Aeroquip will match participant pre-tax contributions dollar for
dollar up to the first 2 percent, and 50 percent of the next 2 percent, of
each participant's annual compensation. Participants may also contribute up
to 10 percent of their annual compensation to the Plan on an after-tax basis,
provided that pre-tax contributions have met the limit allowable under IRS
regulations. Aeroquip also makes an annual profit-sharing contribution to the
Plan based upon the return on net assets achieved by Aeroquip. All eligible
participants receive a minimum profit-sharing allocation of 1 percent of
annual compensation up to the Social Security wage base and 1.5 percent of
annual compensation in excess of the Social Security wage base regardless of
their level of elective deferrals. The total amount contributed on behalf of
each eligible participant is subject to calendar-year limits of the Internal
Revenue Code, which are indexed and adjusted for changes in the cost of
living.
Participants have an immediate and fully-vested interest in the
portion of the Plan accounts represented by their pre-tax and voluntary
after-tax contributions to the Plan, including any earnings on these amounts.
Aeroquip's matching contributions on participants' pre-tax elective deferrals
are also immediately and fully vested. Aeroquip's profit-sharing allocations,
as well as earnings thereon, vest at the rate of 25 percent per year of
service. Service with Aeroquip prior to enactment of the Plan counts for
vesting purposes.
If a participant has less than four years of service and employment
ends for a reason other than retirement, disability or death, the participant
forfeits the unvested portion of the account if he or she takes distribution
of the vested portion of the account. If that participant resumes employment
within the next five years following the date on which termination occurs, and
repays to the Plan the full amount of the distribution, the participant's
account will be restored to the amount on the date of distribution. Forfeited
balances are used to reduce Aeroquip's future contributions.
Each participant individually directs his or her contributions and
Aeroquip's contributions, except for 25 percent of Aeroquip's profit-sharing
contribution, into one or more of the following investment funds. Twenty-five
percent of each participant's profit-sharing allocation is automatically
invested in the TRINOVA Stock Fund.
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<PAGE>
NOTE 3 - DESCRIPTION OF PLAN (Continued)
(1) TRINOVA Stock Fund, selected by 5,034 and 4,565
participants at March 31, 1994 and December 31, 1993, respectively,
is invested in TRINOVA common stock. Cash dividends paid on shares
held by the Trust will be used to purchase additional shares for
participant accounts. Twenty-five percent of each participant's
profit-sharing allocation is automatically invested in the TRINOVA
Stock Fund until distribution to the participant or until the
participant reaches age 55. After age 55, the participant has the
option to redirect the investment of the 25 percent portion from the
TRINOVA Stock Fund into any of the other available funds.
Participants may elect to have additional amounts over Aeroquip's 25
percent profit-sharing contribution invested in the TRINOVA Stock
Fund. TRINOVA common stock is acquired in open market purchases at
fair market value.
(2) Fixed Income Fund, selected by 4,976 and 5,110
participants at March 31, 1994 and December 31, 1993, respectively,
is invested in insurance company investment contracts, bank
investment contracts and their equivalent. These contracts have a
specified interest rate for a period of one to five years.
Approximately every three months, Aeroquip announces the interest
rate which will be paid on all monies that are in the Fixed Income
Fund. This interest rate is a single blended rate of the interest
rates being paid on each of the contracts in force during that
period. New contracts are negotiated with insurance companies or
financial institutions rated AA+ by Standard and Poors or its
equivalent and have a maximum average contract life of five years.
(3) Multi-Asset Fund, selected by 2,444 and 1,920 participants
at March 31, 1994 and December 31, 1993, respectively, is invested
in nine major world capital classes, including stocks and bonds of
U.S. and international companies, venture capital, real estate and
cash equivalents. Brinson Partners, Inc. is the investment manager
of the Multi-Asset Fund. This investment option was terminated
effective March 31, 1994. Cash and cash equivalents from the
liquidation of the fund's shares will be transferred to the Vanguard
Star Fund, which is a new investment option under the TRINOVA Plan.
(4) Government Securities Fund, selected by 600 and 506
participants at March 31, 1994 and December 31, 1993, respectively,
is invested in fixed income securities issued or guaranteed by the
U.S. Government, or its agents or instrumentalities. These
securities include U.S. Treasury bills, notes and bonds. The
Government Securities Fund seeks to provide a high level of current
income, consistent with the preservation of capital. Ryan Labs.,
Inc. is the investment manager of the Government Securities Fund.
This investment option was terminated effective March 31, 1994.
Cash and cash equivalents from the liquidation of the fund's shares
will be transferred to the Vanguard Money Market Reserve - U.S.
Treasury Portfolio Funds, which is a new investment option under the
TRINOVA Plan.
-8-
<PAGE>
NOTE - 3 DESCRIPTION OF PLAN (Continued)
(5) Vanguard Funds, selected by 1,865 and 1,307 participants
at March 31, 1994 and December 31, 1993, respectively, is managed by
The Vanguard Group of Investment Companies. There are four
individual mutual funds in which participants may invest:
(a) Vanguard Index Trust - 500 Portfolio Fund (Index Fund):
Money in the Index Fund is invested in stocks of the companies which
make up the Standard & Poor's 500 Composite Stock Price Index. The
objective of the Index Fund is to match the performance of the
Standard & Poor's 500 Index.
(b) Vanguard/Windsor II Fund (Windsor II Fund): Money in the
Windsor II Fund is invested in stocks which, in the opinion of the
fund's investment manager are undervalued in the marketplace. The
stocks held in the Windsor II Fund tend to offer above-average
dividend yields and will normally have below-average price-to
earnings ratios and below-average price-to-book value ratios
relative to the stock market in general.
(c) Vanguard/Morgan Growth Fund (Morgan Growth Fund): Money
in the Morgan Growth Fund is invested primarily in stocks of
"established growth" companies. The companies will normally be
medium and larger size companies with above-average growth in sales
and earnings over extended periods.
(d) Vanguard - International Growth Portfolio Fund
(International Growth Fund): Money in the International Growth Fund
is invested in non-U.S. stocks that have been selected for their
growth potential. The International Growth Fund tends to be widely
diversified both geographically and in terms of size of companies.
Participants of the Plan have general purpose and home loans
available. The minimum loan permitted is $1,000. Under a general purpose or
home loan, a participant may borrow up to the lesser of one-half of his or her
vested account balances or the total of his or her pre-tax, match and roll-in
contributions to the Plan, up to a maximum of $50,000. In no event may the
aggregate amount of loans exceed $50,000. All loans will be repaid to the
Plan in equal installments through payroll deductions over a period up to five
years for general purpose and twenty years for home loans. Interest is
charged at a reasonable rate, as determined by the Administrative Committee.
Aeroquip reserves the right to amend, modify or terminate the
Plan at any time.
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<PAGE>
NOTE 4 - BENEFITS
A participant is entitled to the benefit provided by the
contributions and income thereon (including realized and unrealized gains and
losses) allocated to the participant's account.
Upon termination of employment due to retirement, total and
permanent disability or death, a participant or his or her spousal beneficiary
will be entitled to receive distribution of the participant's entire account
without regard to the Plan's vesting rules: (i) in one lump sum amount; or
(ii) in monthly installments of a fixed amount or over a specified period of
time in an amount of at least $100 per month. Distribution payments to non-
spousal beneficiaries will be made in a lump sum only. If the value of a
participant's account is less than $3,500, the Plan Administrator will
distribute the participant's entire interest in one lump sum payment.
Withdrawals of pre-tax contributions and Aeroquip's profit-
sharing and matching contributions during a participant's employment are not
permitted prior to age 59-1/2, unless the participant can show financial
hardship for which he or she has no other available resources. Such
situations are limited to: (i) certain medical expenses; (ii) payment of
tuition and related educational fees for post-secondary education for the next
year; (iii) costs related to the purchase of a principal residence; or (iv)
payments necessary to avoid eviction from, or a foreclosure on the mortgage
of, the participant's principal residence.
NOTE 5 - INCOME TAX STATUS
The Plan is intended to be qualified under section 401(a) of
the Internal Revenue Code, and Aeroquip has taken the appropriate steps to
obtain a ruling of this effect from the Internal Revenue Service. Aeroquip
believes the Plan as written is in operational compliance with the Internal
Revenue Code of 1986 as amended.
NOTE 6 - TAX EFFECTS ON PLAN PARTICIPANTS
A proportionate amount of any withdrawal during employment from
a participant's Plan account attributable to after-tax, voluntary
contributions made after 1986 will be treated as a distribution of earnings on
such contributions, and the remaining amount of the withdrawal will be
considered a return of the participant's after-tax, voluntary contributions.
After-tax, voluntary contributions made prior to 1987 may be withdrawn in
whole or in part without their applicable earnings. The amount considered as
a return of the participant's after-tax, voluntary contributions will not be
subject to Federal income tax. However, the amount withdrawn that constitutes
earnings on after-tax, voluntary contributions and any amount withdrawn during
employment from a participant's Plan account attributable to pre-tax salary
reduction contributions and Aeroquip's matching contributions will be subject
to Federal income tax at ordinary income tax rates and may be subject to an
additional excise tax, as described below.
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<PAGE>
NOTE 6 - TAX EFFECTS ON PLAN PARTICIPANTS (Continued)
The amount of a distribution received in a lump sum equal to a
participant's after-tax, voluntary contributions not previously withdrawn due
to retirement, death, total and permanent disability, or termination of
employment for any other reason is not subject to Federal income tax. The
amount of the lump sum distribution in excess of a participant's after-tax,
voluntary contributions not previously withdrawn is subject to Federal income
tax at ordinary income tax rates. However, the taxable portion of a
qualifying lump sum distribution may be eligible under certain circumstances
for special ten-year or five-year averaging or capital gains treatment.
Whether a lump sum distribution qualifies for special ten-year or five-year
averaging or capital gains treatment depends upon, among other things, the
participant's age, employment status, and dates of participation in the Plan.
If a participant receives TRINOVA common stock as part of a lump sum
distribution, the excess, if any, of the fair market value of the common stock
over the cost of the common stock is not subject to Federal income tax at the
time of distribution but generally will be subject to Federal income tax upon
any subsequent disposition of the common stock. However, a participant may
elect, on the tax return on which the distribution is required to be included,
not to have such excess excluded from Federal income tax in the year of
distribution, in which case such excess will be taxed in that year.
If a distribution is made in installments, then the pro rata
portion of each installment attributable to a participant's after-tax,
voluntary contributions not previously withdrawn is not subject to Federal
income tax, and the remaining portion is taxed at ordinary income tax rates.
Any lump sum distribution that a participant receives from the
Plan will generally be subject to mandatory tax withholding. The Plan will
withhold 20 percent of the taxable part of the participant's distribution to
pay federal income tax.
Certain penalty taxes may be imposed on the taxable portion of a
distribution or withdrawal from the Plan. The taxable portion of a
distribution made to a participant prior to age 59-1/2 will be subject to a 10
percent penalty tax unless certain exceptions apply. In addition, the taxable
portion of a distribution or withdrawal from the Plan and from an individual
retirement account (IRA) may be subject to a 15 percent penalty tax to the
extent they aggregate more than a certain amount during any year.
Loans from the Plan are generally not considered a distribution
or a withdrawal for Federal income tax purposes unless the participant
terminates employment with an outstanding loan balance and fails to retire
that balance in full within 90 days.
A participant, under certain circumstances, may directly roll
over amounts distributed from the Plan to another qualified plan or an
individual retirement plan (IRA) and avoid mandatory federal withholding and
penalty taxes.
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<PAGE>
NOTE 6 - TAX EFFECTS ON PLAN PARTICIPANTS (Continued)
Participant contributions made on a pre-tax salary reduction
basis are not taxed for Federal income tax purposes until actually distributed
and are not considered wages for Federal income tax withholding purposes, but
are considered wages for Federal Insurance Contributions Act (FICA) purposes.
Participant after-tax, voluntary contributions are taxed for
Federal income tax purposes when made, and are subject to withholding and FICA
taxes at that time.
Matching contributions and other employer contributions are not
included in the participant's taxable wages for federal income tax purposes
when paid to the Plan, and are not considered wages for federal income tax
purposes or FICA purposes.
NOTE 7 - VALUE OF INTEREST IN MASTER TRUST
The Plan's investments, except for loans, are held in safekeeping by
The Northern Trust Company as Trustee under a Master Trust Agreement (the
"Master Trust"). The Master Trust holds the investment assets for the Plan
and other designated defined contributions plans of Aeroquip, its parent
TRINOVA and TRINOVA's other subsidiary. The following table presents the
fair values of investments:
March 31 December 31
1994 1993
Investments at Fair Value:
Fixed Income Fund $253,510,747 $303,865,565
Vanguard Mutual Funds 72,165,164 46,310,371
Multi-Asset Funds 67,262,443 46,920,647
TRINOVA Stock Fund 15,786,370 12,317,310
Government Securities Fund $ 3,501,026 $ 3,572,450
$412,225,750 $412,986,343
============ ============
Net investment income for the Master Trust is as follows:
Three Months
ended
March 31 Year Ended December 31
1994 1993 1992
Net investment income:
Interest earned $ 5,410,175 $21,924,851 $23,821,843
Dividends 172,192 2,182,874 1,345,912
Realized gains 12,116,175 1,758,587 1,388,865
Other - Principally
unrealized gains (losses) (13,942,049) 10,234,251 2,922,290
$ 3,777,397 $36,100,563 $29,478,910
=========== =========== ===========
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<PAGE>
NOTE 7 - VALUE OF INTEREST IN MASTER TRUST (Continued)
At March 31, 1994, the assets of the Plan were merged into the
TRINOVA Plan, therefore the Plan has zero interest in the net assets of the
Master Trust at that date. At December 31, 1993, the Plan's interest in the
assets of the Master Trust was approximately 65.8 percent. The Plan's
interest in any one Master Trust fund does not correspond to the Plan's
overall interest in the Master Trust as participants in each plan select
individual investment options. Investment income and administrative expenses
related to the Master Trust are allocated to the individual plans based upon
average monthly balances invested by each plan.
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<PAGE>
NOTE 7 - VALUE OF INTEREST IN MASTER TRUST (Continued)
Fair values and costs of the Plan's interest in the assets of the Master Trust
at December 31, 1993 are as follows:
Description Fair Value Cost
FIXED INCOME FUND
Aetna Life Insurance Contract
expiring in 1994 $ 5,731,429 $ 5,731,429
Allstate Insurance Contract
expiring in 1997 3,679,974 3,679,974
Allstate Insurance Contract
expiring in 1998 9,847,974 9,847,974
Allstate Insurance Contract
expiring in 1998 3,685,190 3,685,190
American International
Life Insurance Contract
expiring in 1997 11,565,612 11,565,612
Balcor Equity Pension
Investors II 48,842 48,842
Bankers Trust Delaware Group Annuity
Contract expiring in 1996 17,776,307 17,776,307
Bankers Trust Delaware Group Annuity
Contract expiring in 1996 12,863,400 12,863,400
Citibank, N.A. Contract
expiring in 1998 9,286,054 9,286,054
Citibank, N.A. Contract
expiring in 1998 11,399,477 11,399,477
Executive Life Insurance Contract
(In Rehabilitation) expired in 1991 304,636 304,636
Insured Pension Investors - 1984 49,329 49,329
Insured Pension Investors - 1985 48,850 48,850
Lotsoff Contract expiring in 1999 9,373,827 9,373,827
Mass Mutual Insurance Contract
expiring in 1994 14,813,413 14,813,413
Metropolitan Life Insurance Contract
expiring in 1994 1,432,193 1,432,193
Metropolitan Life Insurance Contract
expiring in 1995 17,659,327 17,659,327
Metropolitan Life Insurance Contract
expiring in 1995 7,444,325 7,444,325
Metropolitan Life Insurance Contract
expiring in 1996 12,124,532 12,124,532
Mutual Benefit Life Insurance Contract
(In Rehabilitation) expired in 1992 21,108,339 21,108,339
Mutual Benefit Life Insurance Contract
(In Rehabilitation) expired in 1992 2,561,070 2,561,070
Mutual Benefit Life Insurance Contract
(In Rehabilitation) expiring in 1994 10,161,797 10,161,797
Prudential Life Insurance Contract
expiring in 1996 12,892,438 12,892,438
Prudential Life Insurance Contract
expiring in 1998 7,110,171 7,110,171
Cash and cash equivalents 12,483,013 12,483,013
Interest receivable 15,070 15,070
215,466,589 215,466,589
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<PAGE>
NOTE 7 - VALUE OF INTEREST IN MASTER TRUST (Continued)
Description Fair Value Cost
VANGUARD MUTUAL FUND
Vanguard/Morgan Growth Fund
(254,444.495 shares) 3,055,879 3,148,008
Vanguard Index Fund
(204,927.674 shares) 8,981,981 8,237,241
Vanguard/Windsor II Fund
(321,248.940 shares) 5,474,083 5,224,270
Vanguard International Growth Fund
(263,669.509 shares) 3,562,176 2,893,956
Cash and cash equivalents 276,908 276,908
Interest Receivable 405 405
21,351,432 19,780,788
MULTI-ASSET FUND
Brinson Partners Multi-Asset Fund
(50,597.076 shares) 26,621,308 19,611,485
Cash and cash equivalents 423,419 423,419
Interest receivable 904 904
27,045,631 20,035,808
TRINOVA STOCK FUND
TRINOVA Corporation Common Stock
(220,559 shares) 6,920,039 5,001,093
Cash and cash equivalents 33,775 33,775
Interest receivable 101 101
6,953,915 5,034,969
GOVERNMENT SECURITIES FUND
U.S. Government Agency Issues 1,150,964 1,159,748
Cash and cash equivalents 53,948 53,948
Interest receivable 21,856 21,856
1,226,768 1,235,552
TOTALS $272,044,335 $261,553,706
============ ============
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<PAGE>
NOTE 7 - VALUE OF INTEREST IN MASTER TRUST (Continued)
At December 31, 1993, the Fixed Income Fund of the Plan holds an
investment in an Executive Life Insurance Company (Executive Life) guaranteed
investment contract that was to have expired in 1991 in the amount of
$304.636. In 1991, First Executive Corporation, the parent of Executive Life
Insurance Company, filed for protection under Chapter 11 of the Federal
Bankruptcy Code. State insurance regulators have taken control of Executive
Life, as well as other investments of the parent. A Plan of Rehabilitation
was filed on September 6, 1991 in the Superior Court of the State of
California for the County of Los Angeles and was approved on August 31, 1993.
The Plan of Rehabilitation became effective on September 3, 1993 and provides
for a minimum of approximately 75 percent of the contract principal to be
repaid after a minimum rehabilitation period of five years.
Also, at December 31, 1993, the Fixed Income Fund of the Plan holds
investments in Mutual Benefit Life Insurance Company (Mutual Benefit)
guaranteed investment contracts totaling $34,085,575, of which $23,669,409 was
to have expired in 1992. The New Jersey Insurance Department has taken
control of Mutual Benefit. A Plan of Rehabilitation was filed on August 3,
1992, and amended on January 15, 1993, in the Superior Court of New Jersey.
The Plan of Rehabilitation became effective on April 29, 1994 and provides for
the contract principal to be repaid over a five-year period from 1999 through
2003. The repayment dates may be extended if warranted by Mutual Benefit's
financial condition.
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<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION
<CAPTION>
Fixed Vanguard Multi- TRINOVA
Income Mutual Asset Stock
Fund Funds Fund Fund
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1993 $215,466,589 $21,351,432 $27,045,631 $6,953,915
ADDITIONS
Contributions
Employees 1,194,811 456,466 455,286 80,861
Employer 4,444,899 908,523 1,272,092 2,324,488
5,639,710 1,364,989 1,727,378 2,405,349
Net investment income
Interest earned 3,158,568 7,769 34,287 1,686
Dividends 93,622 47,835
Realized gains on
sales of investments
Aggregate proceeds 226,499 31,135,244 265,928
Aggregate cost 23,913,047 190,168
226,499 7,222,197 75,760
Other - principally unrealized gains
(losses) on investments (1,256,599) (7,258,962) 608,144
3,158,568 (928,709) (2,478) 733,425
8,798,278 436,280 1,724,900 3,138,774
DEDUCTIONS
Benefits paid to participants 16,327,425 1,252,500 1,929,845 153,767
Investment management fees 5,188 87,147
Net transfers among investment
funds and net transfers to benefit
plans of affiliated companies 207,937,442 20,530,024 26,753,539 9,938,922
224,264,867 21,787,712 28,770,531 10 092,689
NET DEDUCTIONS (215,466,589) (21,351,432) (27,045,631) (6,953,915)
ASSETS AVAILABLE FOR PLAN
BENEFITS AT MARCH 31, 1994 $ 0 $ 0 $ 0 $ 0
</TABLE>
-17-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION>
Government
Securities Contribution
Fund Loans Receivable Total
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1993 $1,226,768 $2,151,365 $8,626,053 $282,821,753
ADDITIONS
Contributions
Employees 70,982 58,690 2,317,096
Employer 265,549 (8,306,720) 908,831
336,531 (8,248,030) 3,225,927
Net investment income
Interest earned 23,617 34,392 3,260,319
Dividends 141,457
Realized gains on
sales of investments
Aggregate proceeds 1,905,010 33,532,681
Aggregate cost 1,955,139 26,058,354
(50,129) 7,474,327
Other - principally unrealized gains
(losses) on investments 13,495 (7,893,922)
(13,017) 34,392 2,982,181
323,514 34,392 (8,248,029) 6,208,108
DEDUCTIONS
Benefits paid to participants 96,356 19,759,893
Investment management fees 386 92,721
Net transfers among investment
funds and net transfers to benefit
plans of affiliated companies 1,453,540 2,185,752 378,023 269,177,247
1,550,282 2,185,757 378,023 289,029,861
NET DEDUCTIONS (1,226,768) (2,151,365) (8,626,053) (282,821,753)
ASSETS AVAILABLE FOR PLAN
BENEFITS AT MARCH 31, 1994 $ 0 $ 0 $ 0 $ 0
</TABLE>
-18-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION>
Fixed Vanguard Multi- TRINOVA
Income Mutual Asset Stock
Fund Funds Fund Fund
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1992 $220,159,054 $ 14,847,977 $18,605,474 $4,103,533
ADDITIONS
Contributions
Employees 4,439,188 917,511 1,140,902 200,265
Employer 4,132,337 705,487 1,044,390 1,348,814
8,571,525 1,622,998 2,185,292 1,549,079
Net investment income
Interest earned 14,665,331 12,284 14,567 1,925
Dividends 912,167 158,894
Realized gains on
sales of investments
Aggregate proceeds 344,275 559,940 1,009,579
Aggregate cost 255,073 791,669
344,275 304,867 217,910
Other - principally unrealized gains
(losses) on investments 1,100,581 2,278,772 1,991,252
14,665,331 2,369,307 2,598,206 2,369,060
23,236,856 3,992,305 4,783,498 3,919,060
DEDUCTIONS
Benefits paid to participants 18,056,652 1,462,899 1,640,493 407,087
Investment management fees 19,112 139,712
Net transfers among investment funds
and net transfers to benefit plans
of affiliated companies 9,872,669 (3,993,161) (5,436,864) 661,591
27,929,321 (2,511,150) (3,656,659) 1,068,678
NET ADDITIONS (DEDUCTIONS) (4,692,465) 6,503,455 8,440,157 2,850,382
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1993 $215,466,589 $21,351,432 $27,045,631 $6,953,915
============ ============ ============ ===========
</TABLE>
-19-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION>
Government
Securities Contribution
Fund Loans Receivable Total
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1992 $ 837,570 $1,664,419 $4,982,261 $265,200,288
ADDITIONS
Contributions
Employees 151,732 7,919 6,857,517
Employer 165,029 3,635,873 11,031,930
316,761 3,643,792 17,889,447
Net investment income
Interest earned 63,280 134,288 14,891,675
Dividends 1,071,061
Realized gains on
sales of investments
Aggregate proceeds 4,299,472 6,213,265
Aggregate cost 4,274,906 5,321,648
24,566 891,617
Other - principally unrealized gains
(losses) on investments (7,823) 5,362,782
80,023 134,288 22,217,136
396,784 134,288 3,643,792 40,106,583
DEDUCTIONS
Benefits paid to participants 334,190 21,901,321
Investment management fees 1,348 160,172
Net transfers among investment funds
and net transfers from benefit plans
of affiliated companies (327,952) (352,658) 423,625
7,586 (352,658) 22,485,118
NET ADDITIONS (DEDUCTIONS) 389,198 486,946 3,643,792 17,621,465
ASSETS AVAILABLE FOR PLAN
BENEFITS AT DECEMBER 31, 1993 $1,226,768 $ 2,151,365 $ 8,626,053 $ 282,821,753
========== =========== =========== =============
</TABLE>
-20-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION> Vanguard
Clearing Fixed Income Mutual
Fund Fund Funds
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1991 $1,781,684 $238,954,146 $ 6,771,853
ADDITIONS
Contributions
Employees 5,262,345 902,357
Employer 2,655,071 431,180
7,917,416 1,333,537
Net investment income
Interest earned 1,327 17,075,302 8,890
Dividends 528,930
Realized gains on sales
of investments
Aggregate proceeds 7,225,262
Aggregate cost 6,773,651
451,611
Other - principally unrealized gains
(losses) on investments (6,137)
1,327 17,075,302 983,294
1,327 24,992,718 2,316,831
DEDUCTIONS
Benefits paid to participants (34,423) 30,762,007 2,218,447
Investment management fees 7,637 15,879
Net transfers among investment funds
and net transfers from benefit plans
of affiliated companies 1,817,434 13,018,166 (7,993,619)
1,783,011 43,787,810 (5,759,293)
NET ADDITIONS (DEDUCTIONS) (1,781,684) (18,795,092) 8,076,124
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $ -0- $220,159,054 $14,847,977
========== ============ ===========
</TABLE>
-21-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION>
Government
Multi-Asset TRINOVA Stock Securities
Fund Fund Fund
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1991 $12,548,564 $3,868,874 $
ADDITIONS
Contributions
Employees 1,153,548 216,180 139,502
Employer 621,611 436,043 81,650
1,775,159 652,223 221,152
Net investment income
Interest earned 22,474 4,740 30,173
Dividends 138,661
Realized gains on sales
of investments
Aggregate proceeds 1,851,076 1,154,027 1,213,556
Aggregate cost 1,533,050 1,128,627 1,211,110
318,026 25,400 2,446
Other - principally unrealized gains
(losses) on investments 1,279,527 275,616 2,111
1,620,027 444,417 34,730
3,395,186 1,096,640 255,882
DEDUCTIONS
Benefits paid to participants 3,328,623 561,877 75,079
Investment management fees 107,680 8,152 617
Net transfers among investment funds
and net of transfers from benefit plans
of affiliated companies (6,098,027) 291,952 (657,384)
(2,661,724) 861,981 (581,688)
NET ADDITIONS (DEDUCTIONS) 6,056,910 234,659 837,570
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $18,605,474 $4,103,533 $ 837,570
=========== ========== ==========
</TABLE>
-22-
<PAGE>
<TABLE>
NOTE 8 - CHANGES IN ASSETS BY INVESTMENT OPTION (Continued)
<CAPTION>
Contribution
Loans Receivable Total
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1991 $1,215,927 $1,793,383 $266,934,431
ADDITIONS
Contributions
Employees (89,773) 7,584,159
Employer 3,278,651 7,504,206
3,188,878 15,088,365
Net investment income
Interest earned 107,430 17,250,336
Dividends 667,591
Realized gains on sales
of investments
Aggregate proceeds 11,443,921
Aggregate cost 10,646,438
797,483
Other - principally unrealized gains
(losses) on investments 1,551,117
107,430 20,266,527
107,430 35,354,892
DEDUCTIONS
Benefits paid to participants 36,911,610
Investment management fees 139,965
Net transfers among investment funds
and net transfers from benefit plans
of affiliated companies 341,062 37,460
341,062 37,089,035
NET ADDITIONS (DEDUCTIONS) 448,492 3,188,878 (1,734,143)
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $1,664,419 $4,982,261 $265,200,288
========== ========== ============
</TABLE>
-23-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND
A summary of the activity within the separate Vanguard Mutual Fund options
for the three month period ended March 31, 1994 is as follows:
<CAPTION>
Morgan International
Growth Fund Index Fund Windsor II Fund Growth Fund
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1993 $3,055,879 $8,981,981 $5,474,083 $3,562,176
Contributions and transfers from
other investment options 2,134,616 5,512,516 8,505,936 4,594,381
Net investment income
Interest earned 101 183 287 5,306
Dividends 29,862 63,760
Realized gains (losses) (4,851) 105,540 43,798 76,135
Unrealized gains (losses) (176,062) (536,805) (362,746) (180,986)
(150,950) (367,322) (318,661) (99,545)
Net Intra-Vanguard Transfers 30,148 (447,814) (4,239) 421,905
2,013,814 4,697,380 8,183,036 4,916,741
Benefit payments and transfers
to other investment options 224,066 732,807 593,759 344,978
Expenses 782 2,566 1,099 741
Transfer to affiliated plan 4,844,845 12,943,988 13,062,261 8,133,198
5,069,693 13,679,361 13,657,119 8,478,917
NET DEDUCTIONS (3,055,879) (8,981,981) (5,474,083) (3,562,176)
ASSETS AVAILABLE FOR PLAN BENEFITS
AT March 31, 1994 $ 0 $ 0 $ 0 $ 0
</TABLE>
-24-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND OPTION (Continued)
<CAPTION>
Total
Trustee Benefits Vanguard
Cash Account Payable Mutual Funds
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1993 $277,313 $21,351,432
Contributions and transfers from
other investment options 20,747,449
Net Investment Income
Interest Earned 1,892 7,769
Dividends 93,622
Realized gains (losses) 5,877 226,499
Unrealized gains (losses) (1,256,599)
7,769 (928,709)
Net Intra-Vanguard Transfers
7,769 19,818,740
Benefit payments and transfers
to other investment options 303,071 2,198,681
Expenses 5,188
Transfer to affiliated plan (17,989) 38,966,303
285,082 41,170,172
NET DEDUCTIONS (277,313) (21,351,432)
ASSETS AVAILABLE FOR PLAN BENEFITS
AT MARCH 31, 1994 $ 0 $ 0
</TABLE>
-25-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND
A summary of the activity within the separate Vanguard Mutual Fund options
for the year ended December 31, 1993 is as follows:
<CAPTION>
Morgan International
Growth Fund Index Fund Windsor II Fund Growth Fund
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $2,599,107 $8,605,963 $2,702,945 $1,042,857
Contributions and transfers from 1,075,327 2,654,554 2,362,646 788,175
other investment options
Net investment income
Interest earned 1,278 2,875 3,484 743
Dividends 344,007 238,359 301,686 28,116
Realized gains (losses) 34,880 230,614 59,903 18,878
Unrealized gains (losses) (165,694) 380,229 151,363 734,683
214,471 852,077 516,436 782,420
Net Intra-Vanguard Transfers (426,508) (1,283,351) 528,929 1,180,930
863,290 2,223,280 3,408,011 2,751,525
Benefit payments and transfers
to other investment options 403,665 1,836,513 633,309 230,260
Expenses 2,853 10,749 3,564 1,946
406,518 1,847,262 636,873 232,206
NET ADDITIONS 456,772 376,018 2,771,138 2,519,319
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1993 $3,055,879 $8,981,981 $5,474,083 $3,562,176
========== ========== ========== ==========
</TABLE>
-26-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND OPTION (Continued)
<CAPTION>
Total
Trustee Benefits Vanguard
Cash Account Payable Mutual Fund
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $ 17,450 $(120,345) $14,847,977
Contributions and transfers from
other investment options 255,958 7,136,660
Net Investment Income
Interest earned 3,905 12,285
Dividends 912,168
Realized gains (losses) 344,275
Unrealized gains (losses) 3,905 1,100,581
Net Intra-Vanguard Transfers 259,863 9,505,969
Benefit payments and transfers
to other investment options (120,345) 2,983,402
Expenses 19,112
(120,345) 3,002,514
NET ADDITIONS 259,863 120,345 6,503,455
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1993 $277,313 $ 0 $21,351,432
======== ======== ===========
</TABLE>
-27-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND
A summary of the activity within the separate Vanguard Mutual Fund options
for the year ended December 31, 1992 is as follows:
<CAPTION>
Morgan International
Growth Fund Index Fund Windsor II Fund Growth Fund
<S> <C> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1991 $ $6,805,382 $ $
Contributions and transfers from
other investment options 2,111,187 6,392,378 2,171,249 814,821
Net investment income
Interest earned 1,429 1,738 684 232
Dividends 135,504 252,166 118,641 22,619
Realized gains (losses) (18,175) 461,836 16,055 (8,105)
Unrealized gains (losses) 73,564 (111,638) 98,449 (66,512)
192,322 604,102 233,829 (51,766)
Net Intra-Vanguard Transfers 828,305 (2,274,903) 1,030,032 416,566
3,131,814 4,721,577 3,435,110 1,179,621
Benefit payments and transfers
to other investment options 530,756 2,912,040 729,898 135,556
Expenses 1,951 8,956 2,267 1,208
532,707 2,920,996 732,165 136,764
NET ADDITIONS (DEDUCTIONS) 2,599,107 1,800,581 2,702,945 1,042,857
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $2,599,107 $8,605,963 $2,702,945 $1,042,857
========== ========== ========== ==========
</TABLE>
-28-
<PAGE>
<TABLE>
NOTE 9 - VANGUARD MUTUAL FUND OPTION (Continued)
<CAPTION>
Total
Trustee Benefits Vanguard
Cash Account Payable Mutual Fund
<S> <C> <C> <C>
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1991 $ 3,446 $(36,975) $ 6,771,853
Contributions and transfers from
other investment options 10,694 11,500,329
Net Investment Income
Interest Earned 4,807 8,890
Dividends 528,930
Realized gains (losses) 451,611
Unrealized gains (losses) (6,317)
4,807 983,294
Net Intra-Vanguard Transfers
15,501 12,483,623
Benefit payments and transfers
to other investment options 83,370 4,391,620
Expenses 1,497 15,879
1,497 83,370 4,407,499
NET ADDITIONS (DEDUCTIONS) 14,004 (83,370) 8,076,124
ASSETS AVAILABLE FOR PLAN BENEFITS
AT DECEMBER 31, 1992 $17,450 ($120,345) $14,847,977
======= ========== ===========
</TABLE>
-29-
EXHIBIT INDEX
Exhibit
Number Page
(23) Consent of Independent Auditors 31
-30-
Exhibit (23)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in Post-Effective Amendment No. 1
to Registration Statement No. 33-9127 on Form S-3 dated August 28, 1987,
Registration Statement No. 33-19555 on Form S-3 dated January 15, 1988, Post-
Effective Amendment No. 2 to Registration Statement No. 33-14682 on Form S-8
dated April 28, 1989, Registration Statement No. 33-28638 on Form S-8 dated
May 10, 1989, Registration Statement No. 33-54059 on Form S-8 dated June 10,
1994, and Registration Statement No. 33-55399 on Form S-8 dated September 8,
1994 of our report dated September 22, 1994 with respect to the financial
statements of Aeroquip Corporation Retirement Savings and Profit Sharing Plan
included in the Annual Report (Form 11-K) for the period ended March 31, 1994.
/S/ ERNST & YOUNG LLP
ERNST & YOUNG LLP
Toledo, Ohio
September 28, 1994
-31-
