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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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
For the fiscal year ended December 31, 1999.
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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 1-5492-1
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A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
Nashua Corporation Employees' Savings Plan
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
Nashua Corporation
11 Trafalgar Square
Second Floor
Nashua, New Hampshire 03063
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FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULE
Nashua Corporation Employees' Savings Plan
Years ended December 31, 1999 and 1998
with Report of Independent Auditors
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Nashua Corporation Employees' Savings Plan
Financial Statements
and Supplemental Schedule
Years ended December 31, 1999 and 1998
TABLE OF CONTENTS
<TABLE>
<S> <C>
Report of Independent Auditors..........................................................................1
Financial Statements
Statements of Net Assets Available for Benefits.........................................................3
Statements of Changes in Net Assets Available for Benefits..............................................4
Notes to Financial Statements...........................................................................5
Supplemental Schedule
Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes
at End of Year......................................................................................12
</TABLE>
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Report of Independent Auditors
The Plan Administrator and Participants
Nashua Corporation Employees' Savings Plan
We have audited the accompanying statement of net assets available for benefits
of Nashua Corporation Employees' Savings Plan as of December 31, 1999, and the
related statement of changes in net assets available for benefits for the year
then ended. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 audit provides 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 at
December 31, 1999, and the changes in its net assets available for benefits for
the year then ended, in conformity with accounting principles generally accepted
in the United States.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
held for investment purposes at end of year as of December 31, 1999, is
presented for purposes of additional analysis and is not a required part of the
financial statements, but is 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 supplemental schedule
is the responsibility of the Plan's management. The supplemental schedule has
been subjected to the auditing procedures applied in our audit of the financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.
/s/ ERNST & YOUNG LLP
Manchester, New Hampshire
May 26, 2000
1
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator
of the Nashua Corporation Employees' Savings Plan
In our opinion, the accompanying statement of net assets available for plan
benefits and the related statement of changes in net assets available for plan
benefits present fairly, in all material respects, the net assets available for
plan benefits of the Nashua Corporation Employees' Savings Plan (the "Plan") at
December 31, 1998, and the changes in net assets available for plan benefits
for the year then ended in conformity with generally accepted accounting
principles. 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 audit. We conducted our audit of these statements in
accordance with generally accepted auditing standards which 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, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for the opinion expressed above.
As further described in Note 1, on July 1, 1998, the Plan transferred assets
totaling $6,538,012 to the York Photo Labs Savings Plan resulting from the sale
of Nashua Corporation's Photo Finishing Group to Images, LLC on April 8, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, MA
July 14, 1999
2
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Nashua Corporation Employees' Savings Plan
Statements of Net Assets Available for Benefits
DECEMBER 31
1999 1998
----------- -----------
ASSETS
Investments, at fair or contract value $79,744,327 $67,815,763
Receivables:
Employee's contributions -- 16,163
Employer's contribution -- 48,515
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Total receivables -- 64,678
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Net assets available for benefits $79,744,327 $67,880,441
=========== ===========
See accompanying notes.
3
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Nashua Corporation Employees' Savings Plan
Statements of Changes in Net Assets Available for Benefits
YEAR ENDED DECEMBER 31
1999 1998
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ADDITIONS
Net realized and unrealized appreciation in
fair value of investments $ 7,237,758 $ 7,716,239
Interest and dividends 6,279,999 4,227,694
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13,517,757 11,943,933
Contributions:
Employee and rollovers 2,754,262 2,541,486
Employer 808,323 899,181
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3,562,585 3,440,667
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Total additions 17,080,342 15,384,600
DEDUCTIONS
Withdrawals and benefits paid directly
to participants 5,182,189 9,381,830
Transfer to other plans -- 6,538,012
Administrative expenses 34,267 34,785
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Total deductions 5,216,456 15,954,627
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Net increase (decrease) 11,863,886 (570,027)
Net assets available for benefits
at beginning of year 67,880,441 68,450,468
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Net assets available for benefits
at end of year $79,744,327 $ 67,880,441
=========== ============
See accompanying notes.
4
<PAGE> 8
Nashua Corporation Employees' Savings Plan
Notes to Financial Statements
December 31, 1999
1. DESCRIPTION OF PLAN
The following description of the Nashua Corporation Employees' Savings Plan (the
Plan) provides only general information. Participants should refer to the
Summary Plan Description and Plan agreement for a more complete description of
the Plan's provisions.
GENERAL
The Plan is a defined contribution plan covering all full-time employees of
Nashua Corporation (the Company) who have at least two months of credited
service. It is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA).
Nashua Corporation's Photofinishing Group was sold on April 8, 1998 to Images,
LLC. As of the sale date, the active participants of the Photofinishing Group
had the option to take a distribution from the Plan or rollover balances into
the Purchaser's plan, York Photo Labs Savings Plan. Rollover amounts relating to
the Photofinishing Group participants transferred from the Plan on July 1, 1998
were $6,538,012.
CONTRIBUTIONS
Each year, participants may contribute from 1% up to 15% of pretax annual
compensation, as defined in the Plan. Participants may also contribute amounts
representing distributions from other qualified defined benefit or defined
contribution plans. The Company contributes 50% for the first 6% of base
compensation that a participant contributes to the Plan. Additional amounts may
be contributed at the option of the Company's board of directors.
During the years ended December 31, 1999 and 1998, amounts related to employee
rollovers from other qualified plans amounted to $218,110 and $-0-,
respectively.
Upon enrollment, a participant can direct their contributions and the Company
matching contribution into any of the Plan's fund options. Participants may
change their investment options daily. Employees' contributions into the Nashua
Corporation Common Stock Fund are limited to 25% of their account balance.
5
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Nashua Corporation Employees' Savings Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF PLAN (CONTINUED)
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contributions and
allocations of the Company's contributions and plan earnings. Allocations are
based on participant earnings or account balances, as defined. The benefit to
which a participant is entitled is the benefit that can be provided from the
participant's account.
VESTING
Participants are immediately vested in all contributions, plus actual earnings
thereon.
PARTICIPANT LOANS
Participants may borrow from their fund accounts a minimum of $1,000 up to a
maximum equal to the lesser of $50,000 or 50% of their vested account balance.
Loan terms range from 1-5 years or up to 20 years for the purchase of a primary
residence. The loans are secured by the balance in the participant's account and
bear interest at a fixed rate commensurate with local prevailing rates, as
determined quarterly by the plan administrator. Principal and interest is paid
ratably through payroll deductions.
PAYMENT OF BENEFITS
On termination of service, a participant may receive a lump-sum amount equal to
the vested value of his or her account, or upon death, disability or retirement,
or elect to receive other optional forms of payment as described in the Plan
document.
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 ERISA.
6
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Nashua Corporation Employees' Savings Plan
Notes to Financial Statements (continued)
2. SUMMARY OF ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements have been prepared on the accrual basis of accounting.
INVESTMENT VALUATION AND INCOME RECOGNITION
Shares of registered investment companies and collective investment funds are
valued at quoted market prices, which represent the net asset values of shares
held by the Plan at year end. Common shares of Company stock and treasury
instruments held in the Plan are valued at closing sales prices. The Plan's
guaranteed investment contracts are valued at contract value, which approximates
fair value. Contract value represents contributions made under the contracts,
plus interest earned, less funds used to pay withdrawals and expenses. The
participant loans are valued at their outstanding balances, which approximate
fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
EXPENSES
Substantially all expenses of the Plan are paid by the Company. Certain expenses
related to participant loans are paid by the Plan via a reduction of participant
accounts.
RECLASSIFICATION
The Plan has elected to adopt Statement of Position 99-3 "Accounting For and
Reporting of Certain Defined Contribution Benefit Plan Investments and Other
Disclosure Matters" for the 1999 financial statement presentation. Accordingly,
1998 amounts have been reclassified to conform with Statement of Position 99-3.
7
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Nashua Corporation Employees' Savings Plan
Notes to Financial Statements (continued)
3. INVESTMENTS
During 1999 and 1998, the Plan's investments (including investments purchased,
sold and held during the year) appreciated (depreciated) in fair value as
determined by quoted market prices as follows:
NET REALIZED AND UNREALIZED
APPRECIATION (DEPRECIATION)
IN FAIR VALUE OF INVESTMENTS
1999 1998
-----------------------------------
Nashua Corporation Common Stock $ (939,635) $ 481,884
Shares of registered investment companies 8,177,393 7,234,355
-----------------------------------
$ 7,237,758 $7,716,239
===================================
Investments that represent 5% or more of the fair value of the Plan's net assets
available for benefits are as follows:
DECEMBER 31
1999 1998
-----------------------------------------
Fidelity Managed Income Portfolio II -- $ 6,986,654
Fidelity Puritan Fund $ 6,887,933 7,168,739
Fidelity Magellan Fund 24,192,401 19,224,304
Fidelity Contrafund 4,304,098 3,767,581
Fidelity Equity-Income Fund 5,140,368 5,368,736
Fidelity Growth Company Fund 12,693,116 6,665,068
Fidelity U.S. Government Reserve
Money Market Fund 8,379,510 --
8
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Nashua Corporation Employees' Savings Plan
Notes to Financial Statements (continued)
4. GUARANTEED INVESTMENT CONTRACT FUND
The Plan's investment in the Guaranteed Investment Contract Fund consists of the
following:
DECEMBER 31
1999 1998
-------------------- -------------------
First Allmerica
3.25%, due 4/30/00 $ 713,059 $ 690,614
Life of Virginia
8.32%, due 1/31/99 - 1,279,416
Pacific Mutual Life Insurance Company
5.30%, due 4/29/00 912,298 866,380
Monumental Life
3.63%, due 4/30/01 633,105 610,928
Monumental Life
5.21%, due 4/30/01 485,227 461,226
United States Treasury Note
8.50%, due 11/15/00 2,981,165 3,151,419
Fidelity Managed Income Portfolio II -- 6,986,654
Fidelity U.S. Government Reserve
Money Market Fund 8,379,510 --
Cash -- 389,058
-------------------- -------------------
$14,104,364 $14,435,695
==================== ===================
The average yields of the Guaranteed Investment Contract Fund for the years
ended December 31, 1999 and 1998 were approximately 7.4% and 5.92%,
respectively. Crediting interest rates remained the same, as noted above, for
both 1999 and 1998.
The issuing institution's ability to meet its contractual obligation under the
respective contracts may be affected by future economic and regulatory
developments in the insurance industry.
9
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Nashua Corporation Employees' Savings Plan
Notes to Financial Statements (continued)
5. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated October 25, 1994, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (the Code) and, therefore, the related trust is
exempt from taxation. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The Plan Administrator
believes the Plan is being operated in compliance with the applicable
requirements of the Code and, therefore, believes that the Plan is qualified and
the related trust is tax-exempt.
6. PARTY-IN-INTEREST TRANSACTIONS
Certain of the Plan's assets are invested in mutual funds for which FMR Corp.
provides investment advisory services. FMR Corp. is an affiliate of both
Fidelity Management Trust Company and Fidelity Investments Institutional
Operations Company, Inc., the Plan's trustee and recordkeeper, respectively.
Accordingly, these transactions qualify as party-in-interest.
7. SUBSEQUENT EVENT
In March 2000, the Company acquired Rittenhouse Paper Company. Rittenhouse Paper
Company sponsors a 401(k) plan having assets of approximately $19,000,000 at
December 31, 1999. The impact to the Rittenhouse 401(k) Plan has not been
determined.
10
<PAGE> 14
Supplemental Schedule
<PAGE> 15
Nashua Corporation Employees' Savings Plan
EIN: 02-0170100/ Plan Number: 010
Schedule H, Line 4i - Schedule of Assets Held
for Investment Purposes at End of Year
December 31, 1999
<TABLE>
<CAPTION>
IDENTITY OF ISSUE, BORROWER, DESCRIPTION OF CURRENT
LESSOR OR SIMILAR PARTY INVESTMENT VALUE
----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Mutual Funds:
* Fidelity Management
Trust Company Puritan Fund, 361,951 shares $ 6,887,933
Magellan Fund, 177,065 shares 24,192,401
Contrafund, 71,711 shares 4,304,098
Equity-Income Fund, 96,118 shares 5,140,368
Growth Company Fund, 150,571 shares 12,693,116
Intermediate Bond Fund, 47,045 shares 459,161
Europe Fund, 45,660 shares 1,710,872
Pacific Basin Fund, 48,299 shares 1,388,116
Asset Manager Fund, 39,301 shares 722,353
Small Cap Stock Fund, 46,851 shares 753,836
Government Money Market Fund, 811,538 shares 811,538
Spartan U.S. Equity Index Fund, 61,211 shares 3,188,476
-------------------
62,252,268
Fixed Income Investments:
U.S. Treasury Note 8.50%, due 11/15/00 2,981,165
First Allmerica 3.25%, due 4/30/00 713,059
Monumental Life 3.63%, due 4/30/01 633,105
Monumental Life 5.21%, due 4/30/01 485,227
Pacific Life 5.30%, due 4/29/00 912,298
* Fidelity Management Fidelity U.S. Government Reserve Money
Trust Company Market Fund, 8,379,510 shares 8,379,510
-------------------
14,104,364
Common Stock
* Nashua Corporation Nashua Corporation
Common Stock, 210,455 shares 1,578,413
-------------------
Interest Bearing Cash Cash 120,668
-------------------
* Participant Loans 8.0% to 13.5% 1,688,614
-------------------
$79,744,327
===================
</TABLE>
* Indicates a party-in-interest to the Plan.
12
<PAGE> 16
NASHUA CORPORATION EMPLOYEES' SAVINGS PLAN. Pursuant to the requirements of the
Securities Act of 1934, the Plan Committee has duly caused this annual report to
be signed on its behalf by the undersigned thereunto duly authorized.
NASHUA CORPORATION
EMPLOYEES' SAVINGS PLAN
Date: JUNE 28, 2000 By /s/ John L. Patenaude
-------------- ---------------------------
John L. Patenaude
Nashua Corporation
Vice President - Finance,
Chief Financial Officer
13
