<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
Commission File Number 0-11688
A. American Ecology Corporation Retirement Plan
B. American Ecology Corporation
805 W Idaho Suite 200
Boise ID 83702
SIGNATURES
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.
American Ecology Corporation Retirement Plan
Date June 27, 1997 /s/ R.S. Thorn
-------------------------------
R.S. Thorn
Plan Administrator
<PAGE> 2
FINANCIAL STATEMENTS
--------
AMERICAN ECOLOGY CORPORATION
RETIREMENT PLAN
--------
DECEMBER 12, 1996 AND DECEMBER 31, 1995
<PAGE> 3
TABLE OF CONTENTS
Page No.
--------
INDEPENDENT AUDITORS' REPORT .................................... 1
FINANCIAL STATEMENTS
Statement of Net Assets Available for Benefits............... 3
Statement of Changes in Net Assets Available
for Benefits............................................... 4
Notes to Financial Statements................................ 5
SUPPLEMENTAL INFORMATION
Item 27d - Schedule of Reportable Transactions............... 13
<PAGE> 4
INDEPENDENT AUDITORS' REPORT
To the Administrative Committee
American Ecology Corporation Retirement Plan
We have audited the accompanying statement of net assets available for benefits
of American Ecology Corporation Retirement Plan as of December 12, 1996 and
December 31, 1995 and the related statement of changes in net assets available
for benefits for the period January 1, 1996 through December 12, 1996. 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 benefits of American
Ecology Corporation Retirement Plan as of December 12, 1996 and December 31,
1995 and the changes in net assets available for benefits for the period
January 1 through December 12, 1996 in conformity with generally accepted
accounting principles.
-1-
<PAGE> 5
To the Administrative Committee
American Ecology Corporation Retirement Plan
Page 2
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of reportable
transactions is presented for purposes of additional analysis and is not a
required part of the basic 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 has been subjected to the auditing procedures
applied in our audits of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ D. Jae Hallett
- ---------------------------------
by D. Jae Hallett, Partner
BALUKOFF, LINDSTROM & CO., P.A.
Boise, Idaho
June 20, 1997
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<PAGE> 6
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 12, 1996 and December 31, 1995
<TABLE>
<CAPTION>
ASSETS
1996 1995
---------- ----------
<S> <C> <C>
Cash $ -- $ 101,795
Interest receivable -- 160
Investments, at fair value
Equity investment funds -- 3,670,219
Common stock of American Ecology Corporation -- 26,556
Bond fund -- 470,723
Money market fund -- 365,492
Common collective trust -- 18,653
Investment in guaranteed interest accounts, at
contract value -- 631,937
---------- ----------
TOTAL INVESTMENTS -- 5,183,580
Employer contributions receivable -- 84,509
---------- ----------
TOTAL ASSETS -- 5,370,044
LIABILITIES
Administrative expenses payable -- 30,130
---------- ----------
TOTAL LIABILITIES -- 30,130
---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $ -- $5,339,914
========== ==========
</TABLE>
See accompanying notes
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<PAGE> 7
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
PERIOD FROM JANUARY 1, 1996 THROUGH DECEMBER 12, 1996
<TABLE>
<S> <C>
ADDITIONS TO NET ASSETS ATTRIBUTED TO
Investment income
Net appreciation in fair value of investments $ 403,570
Interest 39,798
Dividends 162,803
-----------
TOTAL ADDITIONS 606,171
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO
Withdrawals and benefit payments 1,271,416
Administrative expenses and other 18,602
Plan merger with American Ecology Corporation
401(k) Savings Plan 4,656,067
-----------
TOTAL DEDUCTIONS 5,946,085
-----------
NET DECREASE IN NET ASSETS
AVAILABLE FOR BENEFITS (5,339,914)
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF PERIOD 5,339,914
-----------
NET ASSETS AVAILABLE FOR BENEFTS,
END OF PERIOD $ --
===========
</TABLE>
See accompanying notes
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<PAGE> 8
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
NOTE A - DESCRIPTION OF THE PLAN
General
American Ecology Corporation Retirement Plan ("the Plan"), was adopted
effective January 1, 1972, as a defined contribution plan, and was amended and
restated to its present form effective March 23, 1987. The Plan covers all
employees of American Ecology Corporation and its subsidiaries ("the Company"),
hired in a job category which will result in 1,000 hours of service during any
consecutive 12-month period and who have attained the age of 21. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of
1974 ("ERISA"). Participants should refer to the Plan agreement for a more
complete description of the Plan.
An administrative committee, appointed by the board of directors of the
Company, is responsible for the general administration of the Plan. The
administrative committee appoints a member of the administrative committee to
serve as Plan administrator. The administrative committee is given all powers
necessary to enable it to carry out its duties including, but not limited to,
the power to interpret the Plan, decide on all questions of eligibility and the
status and rights of participants and direct disbursements of benefits in
accordance with the provisions of the Plan. Prior to May 1, 1995, the
administrative committee appointed three employees of the Company as trustees
who had the authority to control the assets of the Plan in accordance with the
terms of the Plan. During this period, Alex Brown & Sons Incorporated (Alex
Brown) was appointed as custodian of the Plan's assets authorizing Alex Brown
to manage the Plan's assets. During the period May 1, 1995 through November 20,
1996 the administrative committee appointed Hand and Associates as recordkeeper
and American Industries Trust Company as trustee of the plan. As plan trustees,
American Industries Trust Company had the authority to control the assets of
the Plan in accordance with the terms of the Plan.
Effective November 20, 1996, the administrative committee appointed PGG & R as
plan administrator, Manulife Financial as recordkeeper of the plan, and Fleet
Investment Advisors as the trustee of the Plan. As plan trustees, Fleet
Investment Advisors has the authority to control the assets of the Plan in
accordance with the terms of the Plan.
Contributions
Effective December 31, 1995, the Plan was amended to provide that participants
would not earn additional benefits under the Plan, Company contributions would
not be made, and employees would not be eligible to become participants in the
Plan on or after December 31, 1995.
-5-
<PAGE> 9
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
Prior to January 1, 1996, the Company made a basic contribution equal to 5
percent of compensation below the prior year's FICA wage base plus a
contribution equal to 10 percent of compensation above the prior year's FICA
wage base, and a past service contribution, as defined, for each participant
who is an active participant on the contribution date. Additionally, active
participants could make voluntary after-tax contributions up to 10 percent of
their compensation, as defined. Voluntary contributions were made in accordance
with procedures and limitations set up by the Plan administrator.
Plan Amendment
Effective November 20, 1996, the Plan merged with the American Ecology
Corporation 401(k) Savings Plan and Trust into a single plan known exclusively
as the American Ecology Corporation 401(k) Savings Plan. Transfer of Plan
assets of $4,656,067 occurred on December 12, 1996.
Vesting
Employee contributions and the earnings associated therewith are 100 percent
vested for each participant. Participants are vested in the Company's basic and
supplemental contributions and earnings thereon at a rate of 20 percent in the
first year of service anniversary and an additional 20 percent after completing
each year of service after each anniversary. The Plan provides for participants
to be fully vested upon death, permanent disability or the attainment of age
55.
Investment Options
Upon enrollment in the Plan, a participant may direct employee and employer
contributions in any of the following seven investment options:
Templeton Foreign Fund - seeks capital growth by investing in stocks and
debt obligations of companies and governments principally outside the
United States.
Fidelity OTC Portfolio - seeks capital growth by investing primarily in
securities traded in the over-the-counter securities market.
Fidelity Advisor Equity Growth Fund - seeks capital growth by investing in
common stock, preferred stock, and securities convertible to common stock
with above average growth statistics.
Phoenix Balanced Fund - seeks capital growth and conservation of capital by
investing in common stocks and fixed-income securities such as U.S.
Treasury obligations.
-6-
<PAGE> 10
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
Scudder Short-Term Bond Fund - seeks high level of income consistent with a
high degree of principal stability by investing in high quality short-term
bonds, including U.S. government securities and corporate debt securities.
Alex Brown Cash Reserve Fund Prime Series - seeks preservation of capital
and liquidity by investing in money market investments, including U.S.
Treasury obligations.
American Ecology Corporation Common Stock - invests in common stock of
American Ecology Corporation.
Prior to January 1993, the Company had entered into a group annuity contract
with Principal Mutual Life Insurance Company ("PMLIC"). The Company and
participants had several investment options under this contract and had
utilized guaranteed interest accounts which bear interest at a rate in effect
at the date of contribution as determined by PMLIC (composite rate of 8.39% at
December 31, 1995) and mature through December 31, 1997. The balances in the
guaranteed interest accounts will remain in such accounts until maturity or
withdrawal by the employee.
Participant Accounts
Each participant's account is credited with the Company's contributions and the
Company's matching contributions. Dividend and interest income is allocated
quarterly to participants' accounts based upon their pro-rata share of the
equity in each investment fund before such allocation. Forfeitures of
terminated participants' nonvested benefits are applied to pay administrative
expenses and reduce the Company's contributions to the Plan. Forfeitures were
utilized during fiscal 1996 and 1995 to pay administrative expenses.
Payment of Withdrawals and Benefits
Upon normal retirement or death, vested benefits due to participants and their
beneficiaries may be paid in the form of either a lump-sum distribution or
fixed period annuities.
Terminated employees who have a vested balance greater than $3,500 and current
employees who have discontinued contributions to the Plan are not required to
withdraw amounts from their Plan accounts.
The Plan has provisions for hardship withdrawals from the participant's
deferral account. Matching contributions and allocated earnings are not
available for hardship withdrawals.
-7-
<PAGE> 11
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
Expenses
Expenses of administering the Plan are the responsibility of the Plan. During
the year ended December 31, 1995, $30,130 of administrative expenses were paid
by the Company on behalf of the Plan and are to be reimbursed by the Plan.
These amounts are included in administrative expenses payable. During the
period ended December 12, 1996, the Plan paid the $30,130 accounts payable and
$18,602 of other administrative expenses.
NOTE B - SUMMARY OF ACCOUNTING POLICIES
Investment Valuation and Income Recognition
Investments in guaranteed interest accounts are carried at contract value,
which approximates principal amounts contributed to the accounts, plus accrued
interest, less distributions from the contract. Investments in all other
investment options are carried at their fair value measured and quoted market
prices in active markets or by the contracted price. Investment income is
recorded as earned.
Purchases and sales of securities are recorded on a trade-date basis. Dividends
are recorded on the ex-dividend date.
Payment of Benefits
Benefits are recorded when paid.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires the plan administrator to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results may differ from those estimates.
-8-
<PAGE> 12
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
NOTE C - GUARANTEED INTEREST ACCOUNTS
The guaranteed interest accounts held by the Plan are as follows:
<TABLE>
<CAPTION>
December 12, December 31,
----------------------------
1996 1995
----------------------------
<S> <C> <C>
Guaranteed interest account with interest at
rate in effect at date of contribution
(rate of 8.01% at December 31, 1995),
maturing on December 31, 1995 $ -- $ 11,616
Guaranteed interest account with interest at
rate in effect at date of contribution
(rate of 6.57% at December 31, 1995),
maturing on December 31, 1996 -- 49,284
Guaranteed interest account with interest at
rate in effect at date of contribution
(rate of 8.53% at December 31, 1995)
maturing on December 31, 1997 -- 571,037
------------ --------
$ -- $631,937
============ ========
</TABLE>
NOTE D - INCOME TAX STATUS
The Plan obtained its latest determination letter on September 7, 1988, in
which the Internal Revenue Service stated that the Plan, as then designed, was
in compliance with the applicable requirements of the Internal Revenue Code
("IRC"). The Plan has been amended since receiving the determination letter.
However, the Plan administrator believes the Plan is currently designed and
being operated in compliance with the applicable requirements of the IRC.
Therefore, the Plan administrator believes the Plan was qualified and the
related trust was tax-exempt as of December 12, 1996 and December 31, 1995.
NOTE E - PLAN SPONSOR GOING CONCERN
The Company issued its latest audited financial statements as of December 31,
1996. Included in the independent auditor's report was a paragraph regarding
the substantial doubt about the Company's ability to continue as a going
concern. Failure of the Company to continue as a going concern could ultimately
affect the Plan and the American Ecology Corporation 401(k) Savings Plan.
-9-
<PAGE> 13
AMERICAN ECOLOGY CORPORATION RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
December 12, 1996 and December 31, 1995
NOTE F - PARTICIPANT DIRECTED FUNDS
Following is the Statement of Changes in Net Assets Available for Benefits by
Fund at December 12, 1996:
-10-
<PAGE> 14
American Ecology Corporation Retirement Plan
Statement of Changes in Net Assets
For the period January 1, 1996 through December 12, 1996
<TABLE>
<CAPTION>
Participant Directed
---------------------------------------------------------------------------------------------
Templeton Fidelity Fidelity Phoenix Scudder
Foreign OTC Advisors Balanced Short-term Alex
Fund Portfolio Equity Growth Fund Bond Fund Brown
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions
Investment income (loss)
Net appreciation (loss) $ 56,680 $ 102,488 $ 208,835 $ 62,830 $ (9,214) $ -
Interest - - - - -
Dividends 28,087 66,876 7,081 19,560 24,303 16,884
---------------------------------------------------------------------------------------------
Subtotal 84,767 169,364 215,916 82,390 15,089 16,884
Contributions
Employer 12,806 13,870 25,334 12,669 6,383 10,917
---------------------------------------------------------------------------------------------
Total additions 97,573 183,234 241,250 95,059 21,472 27,801
Deductions
Withdrawals and benefit payments 155,587 204,670 326,983 236,100 110,845 77,926
Administrative expenses - - - - - -
Interfund transfers and
plan merger 487,882 761,594 1,249,794 864,725 381,350 315,367
---------------------------------------------------------------------------------------------
Total deductions 643,469 966,264 1,576,777 1,100,825 492,195 393,293
Net decrease during period (545,896) (783,030) (1,335,527) (1,005,766) (470,723) (365,492)
Net assets available for
benefits beginning of period 545,896 783,030 1,335,527 1,005,766 470,723 365,492
---------------------------------------------------------------------------------------------
Net assets available for
benefits end of period $ - $ - $ - $ - $ - $ -
=============================================================================================
<CAPTION>
Non-
participant
Participant Directed Directed
-------------------------------------------- -------------
American Guaranteed
Ecology Short-term Interest
Common Income Other Accounts Total
-------------------------------------------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Additions
Investment income (loss)
Net appreciation (loss) $ (18,049) $ - $ - $ - $ 403,570
Interest - 1,487 (160) 38,471 39,798
Dividends 12 - - - 162,803
----------------------------------------------------------- -----------
Subtotal (18,037) 1,487 (160) 38,471 606,171
Contributions
Employer 2,530 - (84,509) - -
----------------------------------------------------------- -----------
Total additions ( 15,507) 1,487 (84,669) 38,471 606,171
Deductions
Withdrawals and benefit payments 2,381 - - 156,924 1,271,416
Administrative expenses - - 18,602 - 18,602
Interfund transfers and
plan merger 8,668 20,140 53,063 513,484 4,656,067
----------------------------------------------------------- -----------
Total deductions 11,049 20,140 71,665 670,408 5,946,085
Net decrease during period (26,556) (18,653) (156,334) (631,937) (5,339,914)
Net assets available for
benefits beginning of period 26,556 18,653 156,334 631,937 5,339,914
----------------------------------------------------------- -----------
Net assets available for
benefits end of period $ - $ - $ - $ - $ -
=========================================================== ===========
</TABLE>
-11-
<PAGE> 15
SUPPLEMENTAL DATA
-12-
<PAGE> 16
American Ecology Corporation
EIN: 95-3889638
Item 27d - Schedule of Reportable Transactions
Retirement Plan
Plan #034
For the period January 1, 1996 through December 12, 1996
<TABLE>
<CAPTION>
Current Value
of asset
Purchase Selling Cost of at date of Net
Identity of Party Involved Description price price asset transaction gain (loss)
- --------------------------------- ------------------------ ---------- --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Category (i): A single transaction in excess of 5% of plan assets
Fidelity Institutional Retirement
Services Company Fidelity Advisors Growth $ -- $1,222,848 $1,047,058 $1,222,848 $ 175,790
Alex Brown & Sons Alex Brown Prime -- 4,019,258 4,019,258 4,019,258 --
1,112,578 -- 1,112,578 1,112,578 --
2,564,122 -- 2,564,122 2,564,122 --
Fidelity Institutional Retirement
Services Company Fidelity OTC -- 738,684 659,265 738,684 79,419
Phoenix Equity Planning
Corporation Phoenix Series Balanced -- 853,269 792,221 853,269 61,048
Scudder Scudder -- 373,894 379,898 373,894 (6,004)
Templeton Funds, Inc. Templeton Foreign Fund -- 488,005 444,017 488,005 43,988
</TABLE>
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<PAGE> 17
American Ecology Corporation
EIN: 95-3889638
Item 27d - Schedule of Reportable Transactions
Retirement Plan
Plan #034
For the period January 1, 1996 through December 12, 1996
<TABLE>
<CAPTION>
Current Value
of asset
Purchase Selling Cost of at date of Net
Identity of Party Involved Description price price asset transaction gain (loss)
- --------------------------------- ------------------------ ---------- --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Category (iii): A series of transactions in excess of 5% of plan assets
Fidelity Institutional Retirement
Services Company Fidelity Advisors Growth -- 1,613,140 1,404,305 1,613,140 208,835
Alex Brown & Sons Alex Brown Prime 3,826,757 -- 3,826,757 3,826,757 --
-- 4,191,931 4,191,931 4,191,931 --
Fidelity Institutional Retirement
Services Company Fidelity OTC -- 944,927 842,439 944,927 102,488
Phoenix Equity Planning
Corporation Phoenix Series Balanced -- 1,122,294 1,059,464 1,122,294 62,830
Scudder Scudder -- 502,832 512,046 502,832 (9,214)
Templeton Funds, Inc. Templeton Foreign Fund -- 661,394 604,714 661,394 56,680
</TABLE>
A reportable transaction represents a transaction, or series of transactions in
the same security involving an aggregate amount in excess of 5% of the Plan
assets as of January 1, 1996.
There were no category (ii) or (iv) reportable tranactions during 1996.
-14-
