SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1996
[ ] 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 1-9148
THE SAVINGS-INVESTMENT PLAN OF THE PITTSTON COMPANY AND IT'S
SUBSIDIARIES
(Full title of the Plan)
THE PITTSTON COMPANY
(Name of the issuer of securities held pursuant to the Plan)
P.O. BOX 4229,
1000 VIRGINIA CENTER PKWY.,
RICHMOND, VIRGINIA 23058-4229
(Address of issuer's principal (Zip Code)
executive offices)
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Financial Statements and Schedules
December 31, 1996 and 1995
(With Independent Auditors' Report Thereon)
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Index to Financial Statements and Schedules
December 31, 1996 and 1995
Independent Auditors' Report
Statement of Net Assets Available for Plan Benefits, with Fund Information
as of December 31, 1996
Statement of Net Assets Available for Plan Benefits, with Fund Information
as of December 31, 1995
Statement of Changes in Net Assets Available for Plan Benefits, with Fund
Information for the Year Ended December 31, 1996
Statement of Changes in Net Assets Available for Plan Benefits, with Fund
Information for the Year Ended December 31, 1995
Notes to Financial Statements
Schedules
Schedule of Assets Held for Investment Purposes
as of December 31, 1996 1
Schedule of Reportable Transactions
for the Year Ended December 31, 1996 2
Other schedules not filed herewith are omitted because of the absence of
conditions under which they are required.
INDEPENDENT AUDITORS' REPORT
The Compensation and Benefits Committee of
the Board of Directors
The Pittston Company:
We have audited the accompanying statements of net assets available for plan
benefits of the Savings-Investment Plan of The Pittston Company and its
Subsidiaries as of December 31, 1996 and 1995, and the related statements of
changes in net assets available for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the
Savings-Investment Plan of the Pittston Company and its Subsidiaries as of
December 31, 1996 and 1995, and the changes in net assets available for plan
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplementary information included in
Schedules 1 and 2 is presented for the purpose 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 fund information in the statements of net assets available for plan
benefits and the statements of changes in net assets available for plan benefits
is presented for purposes of additional analysis rather than to present the net
assets available for plan benefits and 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.
June 27, 1997
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Statement of Net Assets Available for Plan Benefits, with Fund Information
December 31, 1995
(In thousands)
<TABLE>
<CAPTION>
|------------------------Participant Directed---------------------|-Non-Participant Directed-|
American America
IDS IDS New Express Trust Express Trust Templeton
Mutual Dimensions Equity Collective Foreign Services Minerals
Fund Fund Fund Index Fund II Income Fund II Fund Stock Stock Total
- - ------------------------------------------------------------------------------------------------------------------------------------
Assets
Assets held by Trustee:
<S> <C> <C> <C> <C>
Common stock.......................$ - - - - - 55,275 6,178 61,453
Mutual funds....................... 13,632 15,127 6,325 43,042 1,281 - - 79,407
Principal cash..................... - - - - - 10 - 10
Short-term investments............. - - - - - 339 200 539
- - ------------------------------------------------------------------------------------------------------------------------------------
13,632 15,127 6,325 43,042 1,281 55,624 6,378 141,409
Accrued income..................... - 674 - - - 2 1 677
Loans to participating
employees........................ 1,649 1,445 311 7,486 20 - - 10,911
- - ------------------------------------------------------------------------------------------------------------------------------------
15,281 17,246 6,636 50,528 1,301 55,626 6,379 152,997
Contributions receivable:
Participating employees............ 178 240 107 442 44 - - 1,011
Participating employers............ - - - - - 484 77 561
- - ------------------------------------------------------------------------------------------------------------------------------------
Total assets..................... 15,459 17,486 6,743 50,970 1,345 56,110 6,456 154,569
Liabilities
Cash overdraft........................ - - - 22 - - - 22
- - ------------------------------------------------------------------------------------------------------------------------------------
Net assets available for plan
benefits (includes $387 for
benefits payable to participants
at December 31, 1995)..............$ 15,459 17,486 6,743 50,948 1,345 56,110 6,456 154,547
- - ------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
</TABLE>
<PAGE>
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Statement of Net Assets Available for Plan Benefits, with Fund Information
December 31, 1996
(In thousands)
<TABLE>
<CAPTION>
|-----------------------------------------------------------------------------Participant Directed-
Inter- Small-
Stable Spectrum Equity Equity national Cap
Brink's Burlington Minerals Value Income Income Index Stock Value
Fund Stock Stock Stock Fund Fund Fund Fund Fund Fund
- - ------------------------------------------------------------------------------------------------------------------------------------
Assets
Assets held by Trustee:
<S> <C> <C> <C>
Common stock.......................$ 114 30 23 - - - - - -
Mutual funds....................... - - - 50,868 260 1,421 8,362 2,363 777
- - ------------------------------------------------------------------------------------------------------------------------------------
114 30 23 50,868 260 1,421 8,362 2,363 777
Loans to participating
employees........................ - - - 9,327 (3) 4 517 69 -
- - -------------------------------------------------------------------------------------------------------------------
114 30 23 60,195 257 1,425 8,879 2,432 777
Contributions receivable:
Participating employees........... 17 4 3 342 6 27 95 42 15
Participating employers........... - - - - - - - - -
- - -------------------------------------------------------------------------------------------------------------------
Total assets.................... 131 34 26 60,537 263 1,452 8,974 2,474 792
Net assets available for plan
benefits (includes $337 for
benefits payable to participants
at December 31, 1996).............$ 131 34 26 60,537 263 1,452 8,974 2,474 792
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
|--Participant Directed------------------------------|-------Non-Participant Directed--------|
New Personal Personal Personal
America New Strategy Strategy Strategy
Growth Horizons Fund - Fund - Fund - Brink's Burlington Minerals
Fund Fund Fund Income Balanced Growth Stock Stock Stock Total
- - -------------------------------------------------------------------------------------------------------------------
Assets
Assets held by Trustee:
<S> <C> <C> <C> <C> <C>
Common stock.............$ - - - - - 47,151 18,556 7,854 73,728
Mutual funds............. 19,949 2,678 432 15,383 504 - - - 102,997
- - -------------------------------------------------------------------------------------------------------------------
19,949 2,678 432 15,383 504 47,151 18,556 7,854 176,725
Loans to participating
employees............... 1,999 8 (7) 1,987 (9) 58 19 7 13,976
- - -------------------------------------------------------------------------------------------------------------------
21,948 2,686 425 17,370 495 47,209 18,575 7,861 190,701
Contributions receivable:
Participating employees.. 209 56 11 135 25 - - - 987
Participating employers.. - - - - - 287 70 151 508
- - -------------------------------------------------------------------------------------------------------------------
Total assets........... 22,157 2,742 436 17,505 520 47,496 18,645 8,012 192,196
Net assets available for plan
benefits (includes $337 for
benefits payable to participants
at December 31, 1996)...$ 22,157 2,742 436 17,505 520 47,496 18,645 8,012 192,196
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Statement of Changes in Net Assets Available for Plan Benefits, with Fund Information
Year Ended December 31, 1995
(In thousands)
<CAPTION>
|--------------------------Participant Directed---------------------------
American America
SIP IDS IDS New Express Trust Express Trust
Income Mutual Dimensions Equity Collective
Fund Account Fund Fund Index Fund II Income Fund II
- - -------------------------------------------------------------------------------------------------------------------
Additions to net assets:
Income:
<S> <C> <C> <C>
Dividends...............................$ - 654 674 - -
Interest:
Participant loans..................... - 91 102 37 367
Other................................. 3 - - - -
Net appreciation (depreciation) in
fair value of investments............... 25 1,943 3,147 1,424 2,490
Contributions:
Employer................................ - - - - -
Employee................................ - 1,988 2,600 1,093 5,393
Rollovers from other qualified
plans................................. - 124 132 59 200
- - -------------------------------------------------------------------------------------------------------------------
Total additions....................... 28 4,800 6,655 2,613 8,450
- - -------------------------------------------------------------------------------------------------------------------
Distributions to participants or
beneficiaries........................... - (1,058) (1,248) (318) (4,972)
Administrative expenses.................... - - - - (16)
- - -------------------------------------------------------------------------------------------------------------------
Total deductions...................... - (1,058) (1,248) (318) (4,988)
- - -------------------------------------------------------------------------------------------------------------------
Investment transfers....................... (48,481) (41) 634 1,004 47,486
- - -------------------------------------------------------------------------------------------------------------------
Net increase (decrease) for year........... (48,453) 3,701 6,041 3,299 50,948
Net assets:
Beginning of year....................... 48,453 11,758 11,445 3,444 -
- - -------------------------------------------------------------------------------------------------------------------
End of year.............................$ - 15,459 17,486 6,743 50,948
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Participant
|--Directed---|-Non-Participant Drected-|
Templeton
Foreigh Services Minerals
Fund Fund Stock Stock Total
- - -------------------------------------------------------------------------------------------------------------------
Additions to net assets:
Income:
<S> <C> <C> <C> <C>
Dividends...............................$ 73 347 262 2,010
Interest:
Participant loans..................... 10 - - 607
Other................................. - 22 12 37
Net appreciation (depreciation) in
fair value of investments............... 24 8,664 (4,215) 13,502
Contributions:
Employer................................ - 5,448 1,044 6,492
Employee................................ 414 - - 11,488
Rollovers from other qualified
plans................................. 37 - 39 591
- - -------------------------------------------------------------------------------------------------------------------
Total additions....................... 558 14,481 (2,858) 34,727
- - -------------------------------------------------------------------------------------------------------------------
Distributions to participants or
beneficiaries........................... (32) (4,446) (586) (12,660)
Administrative expenses.................... - - - (16)
- - -------------------------------------------------------------------------------------------------------------------
Total deductions...................... (32) (4,446) (586) (12,644)
- - -------------------------------------------------------------------------------------------------------------------
Investment transfers....................... 117 (666) (53) -
- - -------------------------------------------------------------------------------------------------------------------
Net increase (decrease) for year........... 643 9,369 (3,497) 22,051
Net assets:
Beginning of year....................... 702 46,741 9,953 132,496
- - -------------------------------------------------------------------------------------------------------------------
End of year.............................$ 1,345 56,110 6,456 154,547
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
<TABLE>
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Statement of Changes in Net Assets Available for Plan Benefits, with Fund Information
Year Ended December 31, 1996
(In thousands)
<CAPTION>
|------------------------------------------------------------------------------------Participant Directed-
American American
IDS IDS New Express Express TempletonStable Spectrum Equity
Brink'sBurlington MineralsMutualDimensions Trust EquityTrust Collective Foreign Value Income Income
Fund Stock Stock Stock Fund Fund Index Fund IIIncome Fund II Fund Fund Fund Fund
- - -------------------------------------------------------------------------------------------------------------------
Additions to net assets:
Income:
<S> <C> <C> <C> <C> <C> <C> <C>
Dividends................$ - - 2 137 14 - - - 2,178 10 63
Interest from participant
loans.................. - 1 - 26 24 5 126 - 351 2 6
Net appreciation
(depreciation) in fair value
of investments........... (5) - 3 224 1,044 414 641 64 - 2 53
Contributions:
Employer................. - - - - - - - - - - -
Employee................. 111 30 21 355 605 247 899 167 3,961 41 200
Rollovers from other
qualified plans........ - - - - - - - - 133 34 22
- - -------------------------------------------------------------------------------------------------------------------
Total additions........ 106 31 26 742 1,687 666 1,666 231 6,623 89 344
- - -------------------------------------------------------------------------------------------------------------------
Distributions to
participants or
beneficiaries............ - - - (293) (290) (97) (966) (27) (3,499) (10) (42)
Investment transfers........ 25 3 - (15,908)(18,883) (7,312) (51,648) (1,549) 48,272 184 1,150
- - -------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
for year................. 131 34 26 (15,459)(17,486) (6,743) (50,948) (1,345) 51,396 263 1,452
Plan merger (note 1)........ - - - - - - - - 9,141 - -
Net assets:
Beginning of year........ - - - 15,459 17,486 6,743 50,948 1,345 - - -
- - -------------------------------------------------------------------------------------------------------------------
End of year..............$131 34 26 - - - - - 60,537 263 1,452
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
|---------------------------Participant Directed--------------------------|--Non-Participant Directed----|
Inter- Small- New Personal Personal Personal
Equity national Cap America New Strategy Strategy Strategy
Index Stock Value Growth Horizons Fund - Fund - Fund -Services Brink'sBurlington Minerals
Fund Fund Fund Fund Fund Fund Income Balanced Growth Stock Stock Stock Stock Total
- - -------------------------------------------------------------------------------------------------------------------
Additions to net assets:
Income:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dividends..............$ 201 63 39 1,669 243 40 695 38 - 174 217 308 6,091
Interest from participant
loans................ 46 15 4 131 17 2 94 5 - 2 - - 857
Net appreciation
(depreciation) in fair value
of investments......... 873 115 26 (178) (173) (1) 770 (1) 439 8,234 941 748 14,233
Contributions:
Employer............... - - - - - - - - - 3,509 2,034 1,001 6,544
Employee................1,061 461 100 2,326 418 81 1,576 183 - - - - 12,843
Rollovers from other
qualified plans........ 46 23 9 58 50 44 111 13 - - - - 543
- - -------------------------------------------------------------------------------------------------------------------
Total additions.......2,227 677 178 4,006 555 166 3,246 238 439 11,919 3,192 2,057 41,111
- - -------------------------------------------------------------------------------------------------------------------
Distributions to
participants or
beneficiaries...........(328) (60) (2) (779) (91) - (675) - - (3,802) (1,197) (445)(12,599)
Investment transfers.......7,075 1,857 616 18,930 2,278 270 14,934 282 (56,549)39,379 16,650 (56) -
- - -------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
for year................8,974 2,474 792 22,157 2,742 436 17,505 520 (56,110)47,496 18,645 1,556 28,512
Plan merger (note 1)........ - - - - - - - - - - - - 9,141
Net assets:
Beginning of year........ - - - - - - - - 56,110 - - 6,456 154,547
- - -------------------------------------------------------------------------------------------------------------------
End of year..............$8,974 2,474 792 22,157 2,742 436 17,505 520 - 47,496 18,645 8,012 192,196
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
December 31, 1996 and 1995
(1) Plan Information and Summary of Significant Accounting Policies
Description of Plan
The Savings-Investment Plan of The Pittston Company and its
Subsidiaries (the "Plan") is a voluntary defined contribution plan
sponsored by The Pittston Company and participating subsidiaries (the
"Company"). Employees of the Company who are not members of a
collective bargaining unit (unless the agreement provides specifically
for participation) are eligible to participate after six months of full
time service in which they have at least 1,000 hours of service or at
least 1,000 hours of service in any 12 month period.
A participant may withdraw at anytime without being suspended from the
Plan:
(a) Company contributions made prior to January 1, 1985.
(b) all or a portion of after-tax contributions made prior to
January 1, 1987.
(c) any rollover contributions.
Any withdrawals of Company matched contributions made after January 1,
1985 require the employer to suspend making any contributions on behalf
of the participant for a period of six months.
Because of the Plan's special income tax advantages, the Internal
Revenue Service ("IRS") generally requires that pretax savings remain
in the Plan while the participant is actively employed. However, there
are currently two exceptions to this rule:
(a) If the participant is age 59 1/2 or older, he or she may withdraw
all or a portion of his or her pretax contributions, or
(b) If the participant has a "financial hardship" (as that term is
defined by IRS guidelines) it is possible to withdraw all or a
portion of his or her pretax contributions in the Plan up to
the amount needed to satisfy the hardship, regardless of age.
The first exception results in a suspension of Company contributions
for a period of six months. A hardship withdrawal results in a
suspension of employee pretax contributions for twelve months.
From time to time, some of the available monies in each of the funds is
invested in short-term investments to increase liquidity for making
loans and distributing funds to participants. Additionally, loans to
participating employees are shown as an asset in the fund in which the
employee had invested contributions.
<PAGE>
-2-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
Basis of Presentation
The accompanying financial statements have been prepared on the accrual
basis of accounting and present net assets available for plan benefits
and changes in those net assets at fair values. The fair value of
Company stocks and mutual fund investments was determined by using
quoted market prices. Short-term investments are stated at cost, which
approximates fair value. Participant loan balances are valued at cost
which approximates fair value. The cost of securities sold is
determined principally on the basis of specific identification.
Trust Fund Management
During the first three months of 1996 and all of 1995, trustee and
recordkeeping services, as well as investment manager responsibilities,
were provided through IDS Trust Company. Effective April 1, 1996, all
trustee, recordkeeping and investment manager responsibilities were
transferred to T. Rowe Price & Company (the "Trustee").
Under the Trust Agreement between the Company and the Trustee, the
Trustee is responsible for the safekeeping of assets in the Trust Fund
and the maintenance of records relating to receipts and disbursements
from the Trust Fund. The Trustee invests funds and makes payments from
the Trust Fund as directed by participants and the Company.
Vesting Policy
The individual is 100% vested in the market value of his or her pretax
contributions and vesting in the Company matched contributions is based
on years of service as follows:
Less than 3 years...................................None
3 but less than 4 years.............................50%
4 but less than 5 years.............................75%
5 or more years.....................................100%
If a participant ends his or her employment with the Company and is
subsequently rehired, their prior service with the Company is counted
for vesting purposes. Once a participant reaches normal retirement age,
he or she is 100% vested in Company matching contributions regardless
of years of service.
Forfeitures, the nonvested portion of a participant's account upon
withdrawal from the Plan, are used to offset future contributions of
the Company to the Plan. Participants should refer to the Plan document
for more complete information.
<PAGE>
-3-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
Plan Merger
Effective April 1, 1996, the Production Incentive Plan of Paramont Coal
Corporation, a non-contributory defined contribution plan covering
substantially all salaried and hourly employees of Paramont Coal
Corporation, a wholly-owned indirect subsidiary of The Pittston
Company, was merged with the Plan. As a result, net assets of
approximately $9,141,000 were transferred into the Plan.
Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and
to terminate the Plan subject to the provisions of the Employee
Retirement Income Security Act. In the event of Plan termination,
participants will become 100 percent vested in their accounts.
Use of Estimates
In accordance with generally accepted accounting principles, management
of the Company has made a number of estimates and assumptions relating
to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these financial
statements. Actual results could differ from those estimates.
(2) Participant Loans
Participants can borrow up to the lesser of $50,000 or 50% of their
aggregate vested account balance in the Plan, including rollovers,
subject to certain maximum limits designated by the IRS. Each loan is
secured by a pledge of the participant account balance in the Plan to
the extent of the unpaid balance. Negative loan balances in the Plan
may occur within a particular investment option if a participant has
changed his or her allocation method from the method used at the time
the loan was distributed. The interest rate charged is generally equal
to the prime interest rate plus 1%. Repayments are made through level
monthly payroll deductions and cannot exceed 4 1/2 years for general
purpose loans and 15 years for principal residence loans.
(3) Contributions
Each participant could designate a basic contribution of up to the
lesser of $9,500 or 15% of pretax earnings during 1996 and $9,240 or
15% of pretax earnings during 1995, subject to limitations under IRS
non-discrimination tests. For purposes of determining Plan
contributions, earnings are defined as regular pay including
commissions and bonuses,
<PAGE>
-4-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
excluding overtime, premium pay and allowances. Employee contributions
may be divided among investment funds, in multiples of 1%, based upon
the participant's election. Participants have the option to change
their contribution percentages on a monthly basis.
Effective April 1, 1996, T. Rowe Price & Company assumed trustee,
recordkeeping and investment management services of the Plan. In
conjunction with the transfer of these functions, participant
contributions maintained by the prior Trustee were transferred to the
following funds:
o T. Rowe Price Stable Value Fund - consisting primarily of
guaranteed investment contracts, bank investment contracts and
structured investment contracts.
o T. Rowe Price Spectrum Income Fund - consisting primarily of a
diversified group of T. Rowe Price mutual funds which invest
principally in fixed-income securities.
o T. Rowe Price Equity Income Fund - consisting of investments
in dividend paying common stocks, and fixed income and
convertible securities.
o T. Rowe Price Equity Index Fund - consisting of investments in
some or all of the stocks in the Standard & Poor's 500 Index.
o T. Rowe Price International Stock Fund - consisting of
investments in established non-U.S. equities.
o T. Rowe Price Small-Cap Value Fund - consisting of investments
in common stocks of companies with market capitalizations
which are generally $500 million or less.
o T. Rowe Price New America Growth Fund - consisting of
investments in common stock of U.S. companies which operate in
the service sector of the economy and which generally have
lower fixed costs, are less capital intensive and maintain
smaller inventories.
o T. Rowe Price New Horizons Fund - consisting of investments in
common stocks of young, emerging growth companies in a broad
range of industries.
o T. Rowe Price Personal Strategy Fund - Income - consisting of
investments with a primary emphasis on income and a secondary
emphasis on capital appreciation and typically consists of
approximately 40% in stocks, 40% in bonds and 20% in money
market securities.
<PAGE>
-5-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
o T. Rowe Price Personal Strategy Fund - Balanced - consisting
of investments with an emphasis on both capital appreciation
and income and typically consists of approximately 60% in
stocks, 30% in bonds and 10% in money market securities.
o T. Rowe Price Personal Strategy Fund - Growth - consisting of
investments with a primary emphasis on capital appreciation
and typically consists of approximately 80% in stocks and 20%
in bonds and money market securities.
Additionally, on April 1, 1996, the Plan was amended to permit
participants to invest their own contributions in the Company's three
classes of Common Stock.
During 1995, participant contributions to the Plan could be invested in
the following funds:
o SIP Income Account - consisted primarily of guaranteed
investment contracts, bank investment contracts and short-term
instruments.
o IDS Mutual Fund - consisted primarily of securities of medium
to large, well established companies that offer long term
capital appreciation and reasonable income from dividends and
interest.
o IDS New Dimensions Fund - consisted primarily of common equity
in companies focused on long-term capital appreciation.
o American Express Trust Equity Index Fund II - consisted
primarily of some or all of the stocks in the Standard &
Poor's 500 Index.
o American Express Trust Collective Income Fund II - consisted
primarily of investments in guaranteed investment contracts,
bank investment contracts and structured investment contracts.
o Templeton Foreign Fund - consisted of investments in equity
securities of companies and fixed income instruments of
governments outside the United States.
During 1995, the SIP Income Account was closed and participant
contributions were transferred to the American Express Trust Collective
Income Fund II. The other funds, indicated above, remained available
for participant contributions throughout 1995 and the first three
months of 1996.
Participant contributions up to 5% were matched by the Company at rates
ranging from 50% to 100% and 50% to 125% in 1996 and 1995,
respectively. Participants who were employees of Brink's, Incorporated
and Pittston Minerals Ventures, wholly-owned subsidiaries of the
Company, Pittston Administrative Services and corporate office
employees were matched at a
<PAGE>
-6-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
rate of 100% in 1996 and 1995. Participants who were employees of
Burlington Air Express Inc., a wholly-owned subsidiary of the Company,
were matched at a rate of 75% in 1996 and 87.5% in 1995. Participants
who were employees of Brink's Home Security, Inc., a wholly-owned
subsidiary of the Company, were matched at a rate of 75% in 1996 and
125% in 1995. During 1995, the matched contribution for Brink's Home
Security, Inc. was composed of a base rate of 75% plus an additional
amount based on performance. This additional allocation to the base
rate did not occur during 1996. Participants who were employees of
Pittston Coal Company, a wholly-owned subsidiary of the Company, were
matched at a rate of 50% in 1996 and 1995. The Company may adjust the
rate at which contributions are matched.
During 1995, all Company contributions were invested in the Company
Stock Fund and were used to purchase Pittston Services Group Common
Stock ("Services Stock") and Pittston Minerals Group Common Stock
("Minerals Stock"). Additionally, Company matching contributions were
used to purchase Services Stock or Minerals Stock depending on whether
a participant was employed by one of the companies in the Services
Group or Minerals Group, respectively. On January 18, 1996, the
shareholders of the Company approved the Brink's Stock Proposal,
resulting in the modification, effective as of January 19, 1996, of the
capital structure of the Company to include an additional class of
common stock. The outstanding shares of Services Stock were
redesignated as Pittston Brink's Group Common Stock ("Brink's Stock")
on a share-for-share basis, and a new class of common stock, designated
as Pittston Burlington Group Common Stock ("Burlington Stock"), was
distributed on the basis of one-half share of Burlington Stock for each
share of Services Stock held by shareholders of record on January 19,
1996. Accordingly, on the effective date, 1,755,550 shares of Services
Stock were converted to 1,755,550 shares of Brink's Stock and 877,775
shares of Burlington Stock. All participant portions of Company
matching contributions held in Services Stock prior to the
redesignation were replaced with shares of Brink's Stock and Burlington
Stock. During 1996, Company matching contributions were used to
purchase Brink's Stock, Burlington Stock or Minerals Stock depending on
whether a participant was employed by one of the companies in the
Brink's Group, Burlington Group or Minerals Group, respectively.
Company matching contributions for those participants not employed by a
specific subsidiary of the Company were allocated between Brink's
Stock, Burlington Stock and Minerals Stock based upon the proportion
that the total fair value of each stock at the previous year end bears
to the total combined fair value of the stocks.
(4) Distributions
Upon leaving the Company for any reason and after a formal disbursement
request is made by the participant, the full fair value of the
employee's contributions and related investment income and all vested
Company matching contributions and related investment income will be
<PAGE>
-7-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
distributed in cash except payouts from the Company stock funds which
will be made in shares of the Company's stock unless cash payment is
specifically requested. The value of any fractional shares is
distributed in cash. Additionally, if a participant's employment with
the Company terminates and he or she has an account balance more than
$3,500, he or she may (1) elect to leave all of his or her
contributions and related investment income and the vested portion of
Company contributions and related investment income in the Plan for an
unlimited period of time, or (2) make an irrevocable election to
receive the payout in installments for a period of up to five years.
Participants who retire on their normal retirement date may elect to
defer distribution until age 70.
(5) Administration
Substantially all costs incurred in the administration of the Plan are
paid by the Company. The balance of such costs, if any, is paid by the
Plan.
(6) Federal Income Taxes
The Plan obtained its latest determination letter on February 9, 1995,
in which the IRS stated that the Plan, as designed, was in compliance
with Section 401(a) of the Internal Revenue Code and accordingly, the
Plan is exempt from income tax under Section 501(a) of the Internal
Revenue Code. The Plan was amended and restated since the receipt of
the determination letter. The Company is in the process of completing a
determination letter request which is intended to be filed with the IRS
prior to December 31, 1997. The Company believes the amended Plan
continues to satisfy the applicable requirements of the Internal
Revenue Code.
-8-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
(7) Investments
Investments at December 31, 1996 and 1995 consisted of:
1996 1995
--------------------------------------------
(In thousands)
Investment at fair value as determined by quoted market prices:
Mutual funds $ 102,997 79,407
Common stocks 73,728 61,453
--------------------------------------------
176,725 140,860
--------------------------------------------
Investments at estimated fair value:
Loans to participating employees 13,976 10,911
Short-term investments in money
market funds -- 539
--------------------------------------------
$ 190,701 152,310
--------------------------------------------
During 1996, the Plan's investments (including investments brought,
sold and held during the year) appreciated in value as follows:
Year Ended December 31,
1996 1995
-------------------------------
Investments at fair value as determined by quoted (In thousands) market
prices:
Mutual funds $ 3,873 9,053
Common stocks 10,360 4,449
-------------------------------
$ 14,233 13,502
-------------------------------
-9-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
Investments at fair value which represent 5% or more of the net assets
of the Plan are as follows:
December 31
--------------------------------
Investment 1996 1995
----------
--------------------------------
(In thousands)
Pittston Services Group Common Stock...$ - 55,275
Pittston Brink's Group Common Stock.... 47,265 -
Pittston Burlington Group Common Stock. 18,586 -
Pittston Minerals Group Common Stock... - 6,178
IDS Mutual Fund........................ - 13,632
IDS New Dimensions Fund................ - 15,127
American Express Trust Collective
Income Fund II....................... - 43,042
T. Rowe Price Stable Value Fund........ 50,868 -
T. Rowe Price New America Growth Fund.. 19,949 -
T. Rowe Price Personal Strategy Fund
- Balanced.......................... 15,383 -
Participant Loans...................... 13,976 10,911
(8) Reconciliation to Form 5500
The Form 5500 for the years ended December 31, 1996 and 1995 for the
Plan includes a liability for benefits payable in the statements of net
assets available for plan benefits. The accompanying financial
statements disclose this liability parenthetically on the statements of
net assets available for plan benefits. The following reconciles net
assets available for plan benefits and benefits paid to participants
from the Form 5500 to the Plan financial statements.
1996 1995
---------------------------------
(In thousands)
Net assets available for plan
benefits - Form 5500.................$ 191,859 154,160
Benefits payable....................... 337 387
--------------------------------
Net assets available for plan benefits -
financial statements.................$ 192,196 154,547
--------------------------------
-10-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
1996 1995
--------------------------------
(In thousands)
Benefits paid to participants per the
Statement of Changes in Net Assets
Available for Plan Benefits...........$ 12,599 12,660
Add: benefits payable to participants at
end of year........................... 337 387
Less: benefits payable to participants at
beginning of year..................... 387 459
--------------------------------
Benefits paid to participants per the
Form 5500.............................$ 12,549 12,588
--------------------------------
-11-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
Schedule 1
<TABLE>
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1996
(In thousands, except share amounts)
<CAPTION>
Description of Investment
Including Maturity Date,
Identity of Issue, Borrower, Rate of Interest, Collateral, Fair
Lessor or Similar Party Par or Maturity Value Cost Value
- - -------------------------------------------------------------------------------------------------------------------
<S> <C>
The Pittston Company 1,750,683 shares Pittston
Brink's Group Common Stock;
$1 par value $ 26,983 47,265
The Pittston Company 929,398 shares Pittston
Burlington Group Common Stock;
$1 par value 11,325 18,586
The Pittston Company 512,388 shares Pittston
Minerals Group Common Stock;
$1 par value 6,952 7,877
T. Rowe Price 50,867,555 shares in the Stable
Value Fund 50,868 50,868
T. Rowe Price 23,178 shares in the Spectrum
Income Fund 258 260
T. Rowe Price 63,063 shares in the Equity
Income Fund 1,371 1,421
T. Rowe Price 411,105 shares in the Equity
Index Fund 7,557 8,362
T. Rowe Price 171,256 shares in the International
Stock Fund 2,263 2,363
T. Rowe Price 39,720 shares in the Small-Cap
Value Fund 750 777
-12-
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS SUBSIDIARIES
Notes to Financial Statements
Schedule 1
SAVINGS-INVESTMENT PLAN
OF THE PITTSTON COMPANY AND ITS
SUBSIDIARIES Item 27a - Schedule of Assets Held
for Investment Purposes
December 31, 1996
(In thousands, except share amounts)
Description of Investment
Including Maturity Date,
Identity of Issue, Borrower, Rate of Interest, Collateral, Fair
Lessor or Similar Party Par or Maturity Value Cost Value
- - -------------------------------------------------------------------------------------------------------------------
T. Rowe Price 519,899 shares in the New
America Growth Fund 20,194 19,949
T. Rowe Price 123,014 shares in the New
Horizons Fund 2,848 2,678
T. Rowe Price 37,336 shares in the Personal
Strategy Fund - Income 438 432
T. Rowe Price 1,157,507 shares in the Personal
Strategy Fund - Balanced 14,651 15,383
T. Rowe Price 35,821 shares in the Personal
Strategy Fund - Growth 506 504
Loans to
Participating
Employees
Participant
loans at
interest rates
ranging from
6.8% to 10.0%;
repayment not
to exceed 4
1/2 years for
general
purpose and 15
years
for principal residence 13,976 13,976
- - -------------------------------------------------------------------------------------------------------------------
$ 160,940 190,701
- - -------------------------------------------------------------------------------------------------------------------
</TABLE>
Consent of Independent Auditors
We consent to incorporation by reference in the registration statement (No.
333-02219) on Form S-8 of The Pittston Company of our report dated June 27,
1997, relating to the statements of net assets available for plan benefits of
the Savings-Investment Plan of The Pittston Company and its Subsidiaries as of
December 31, 1996 and 1995, and the related statements of changes in net assets
available for plan benefits for the years then ended and all related schedules,
which report appears in the 1996 Annual Report on Form 11-K of the
Savings-Investment Plan of The Pittston Company and its Subsidiaries.
KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP
Richmond, Virginia
June 27, 1997
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustee
(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.
Savings-Investment Plan
of The Pittston Company
and its Subsidiaries
(Name of Plan)
Frank T. Lennon
(Frank T. Lennon
Vice President - Human Resources
and Administration)
Date: June 26, 1997
