SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended: Commission File Number
September 30, 1999 0-20984
Transition Report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 for the transition
period from ________ to ________.
HAHN AUTOMOTIVE WAREHOUSE, INC. 401(k) PLAN
HAHN AUTOMOTIVE WAREHOUSE, INC.
(Exact name of Registrant as specified in its Charter)
New York 16-0467030
(State of Incorporation)(I.R.S. Employer Identification No.)
415 West Main Street, Rochester, New York 14608
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 716)235-1595
<PAGE 1>
Index
Report of Independent Accountants
Financial Statements:
Statements of Net Assets Available for Benefits
as of September 30, 1999 and 1998
Statement of Changes in Net Assets Available for Benefits
for the Year Ended September 30, 1999
Notes to Financial Statements
Supplemental Schedules:
Item 27(a) -Schedule of Assets Held for Investment Purposes at
September 30, 1999
Item 27(d) -Schedule of Reportable Transactions for the Year Ended
September 30, 1999
Consent of Independent Accountants
<PAGE 2>
Report of Independent Accountants
To the Participants and Plan Administrator of the
Hahn Automotive Warehouse, Inc. 401(k) Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Hahn Automotive Warehouse, Inc. 401(k) Plan (the "Plan") at September 30,
1999 and 1998, and the changes in net assets available for benefits for the year
ended September 30, 1999 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 audits. We conducted our audits 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 audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes at September 30, 1999, and reportable transactions
for the year then ended are presented for the purpose of additional analysis and
are not a required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules are the responsibility of the Plan's
management. The supplemental schedules 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.
PricewaterhouseCoopers LLP
March 20, 2000
<PAGE 3>
Hahn Automotive Warehouse, Inc.
401(k) Plan
Statement of Net Assets Available for Benefits
<TABLE>
<CAPTION>
September
30,
1999 1998
Assets
<S> <C> <C>
Investments, at fair value (Note 4) $ 5,521,914 $5,605,898
Receivables:
Employer contribution 77,067 108,497
Participant contributions 96,471 66,436
Interest receivable 5,555 8,325
179,093 183,258
5,701,007 5,789,156
Liabilities
Accounts payable 41,590 1,587
41,590 1,587
Net assets available for benefits $ 5,659,417 $5,787,569
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE 4>
Hahn Automotive Warehouse, Inc.
401(k) Plan
Statement of Change in Net Assets Available for Benefits
<TABLE>
<CAPTION>
Year Ended
September 30, 1999
<S> <C>
Additions to net assets attributed to:
Investment income -
Net appreciation in fair value of investments $ 88,775
Dividends and interest 262,327
351,102
Contributions -
Employer 77,067
Participant 711,600
Rollover 31,490
820,157
1,171,259
Deductions from net assets attributed to:
Benefits paid to participants 1,241,163
Administrative expenses 58,248
1,299,411
Net decrease for year (128,152)
Net assets available for benefits:
Beginning of year 5,787,569
End of year $ 5,659,417
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE 5>
Hahn Automotive Warehouse, Inc.
410(k) Plan
Notes to Financial Statements
Years Ended September 30, 1999 and 1998
1. Description of Plan
The Hahn Automotive Warehouse, Inc. 401(k) Plan (the "Plan") is a defined
contribution plan covering all eligible employees of Hahn Automotive
Warehouse, Inc. and its subsidiaries (the "Company"). See Note 8 with
respect to Autoworks, Inc. The Plan was established by the Company on
October 1, 1990.
Eligible employees include all employees of the Company and related
entities, greater than twenty-one years of age and upon completion of 1,000
hours of service. The Plan allows participants to contribute an aggregate
amount up to 15% of their compensation.
The Company will match 15% of a participant's contribution not to exceed 15%
of the participant's annual compensation. Additional amounts may be
contributed by the Company at the discretion of the Company's Board of
Directors. No discretionary contributions have been made for 1999 or 1998.
Company matching and discretionary contributions vest as follows:
20% vested after three years of service
40% vested after four years of service
60% vested after five years of service
80% vested after six years of service
100% vested after seven years of service
Normal retirement age is 65 at which time, participants are entitled to
receive 100% of their account balance. Vested amounts are distributable
upon termination, death, disability or the termination of the Plan.
Participants receive their distribution in a single lump-sum check.
Unvested balances of participants terminating their employment will be
forfeited immediately upon payment of the vested balance to the participant.
Forfeitures are used to pay administrative expenses and reduce employer
contributions. The trustee holds all Plan assets and distributes the funds
among the various investment options (see Note 3) as elected by the
participants.
<PAGE 6>
The trustee also makes disbursements from the trust upon receiving proper
authorization and loan/benefit amount information from the Plan
administrator. See Note 8 with respect to account balances of the former
employees of Autoworks, Inc. ("Autoworks").
Upon termination of the Plan, the accounts of all participants will become
vested. After payment of expenses incurred by the Plan, the asset will be
distributed to participants, former participants, and beneficiaries in
proportion to their respective account balances.
Effective July 1998, Fleet Investment Management was replaced by
Manufacturers & Traders Trust Company ("M&T") as the Plan's trustee.
2. Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan have been prepared on the accrual basis
of accounting. The preparation of the Plan's financial statements in
conformity with generally accepted accounting principles may require the
Plan administrator to make significant estimates and assumptions that affect
the reported amounts of net assets available for benefits at the date of the
financial statements and the changes in net assets available for benefits
during the reporting period and, when applicable, disclosures of contingent
assets and liabilities at the date of the financial statements. Actual
results could differ from those estimates.
The Company 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 Plan year ended September 30, 1999.
Accordingly, fund information is not presented in the financial statements.
Certain prior year amounts have been reclassified to conform with the
current year presentation.
Administrative Expenses
All administrative expenses are paid by the Plan.
<PAGE 7>
Investment Valuation and Income Recognition
Investments are stated at fair value based on market quotations, appraised
values or values as determined by the trustee. The GIC Fund is valued at
contract value (Note 5).
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of its
investments, which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
Purchases and sales of securities are recorded on a trade date basis.
Dividends are recorded on the ex-dividend date.
Risks and Uncertainties
The Plan provides for any combination of eleven investment options (Note 3).
Investments are exposed to various risks, such as interest rate and market.
Due to the level of risk associated with certain investments and the level
of uncertainty related to changes in the value of investments, it is at
least reasonably possible that changes in risks in the near term would
materially affect participants' account balances and the amount reported in
the statement of net assets available for benefits and the statement of
changes in net assets available for benefits.
3. Investment Options
Participants may direct their account balance in one percent increments to
be invested in any of the following eleven investment options (objective
according to respective prospectus):
Money Market Fund - This fund invests primarily in short-term funds such
as commercial paper, negotiable certificates of deposit, and treasury
bills.
GIC Fund - This fund invests primarily in guaranteed investment contracts
issued by insurance companies and commercial banks and other similar types
of fixed income investments.
<PAGE 8>
Intermediate Bond Fund - This fund invests in investment grade debt
obligations, obligations issued or guaranteed by the U.S. Government, and
money market instruments offering high current income and principal
stability.
Asset Allocation Fund - This fund invests in a diversified portfolio of
equities, fixed income investments, and cash equivalents offering high
total return.
Small Capital Equity Fund - This fund is a diversified portfolio that
invests in equity of companies that the advisor believes offers the
potential for significant capital appreciation.
Hahn Stock Fund - This fund allows employees to invest in the Company's
common stock. The number of shares held at September 30, 1999 and 1998
was 17,705 and 70,840, respectively.
Large Company Index Fund - This fund invests in the common stock of
domestic companies with significant market capitalization.
Large Cap Value Fund - This fund is a value-oriented growth and income
fund that invests in large and medium-sized companies whose stocks are
considered to be undervalued by the Fund's advisors and out of favor with
investors.
MAS MID Cap Growth Fund - This fund invests primarily in common stocks of
smaller and medium-size companies which the advisor believes will offer
long-term growth potential.
Oakmark Fund - This fund invests primarily in equity securities which the
advisor believes will offer long-term capital appreciation.
Global Fund - This fund invests primarily in common stocks of foreign
issuers which the advisor believes will offer long-term growth of capital.
<PAGE 9>
4. Investments
Investments at fair value at September 30, 1999 and 1998 based on quoted net
asset values, are stated below.
<TABLE>
<CAPTION>
1999
Money Intermediate
Market Bond Oakmark
GIC Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Fixed income:
M&T GIC $ 664,324 $ - $ - $ -
M&T Bond - - 451,779 -
Subtotal 664,324 - 451,779 -
Equities:
Oakmark Fund - - - 124,836
Large Cap Value Fund - - - -
MAS MID Cap Growth Fund - - - -
M&T Balanced Fund - - - -
Global Fund - - - -
Small Cap Equity Fund - - - -
Hahn Stock - - - -
Large Company Index Fund - - - -
Subtotal - - - 124,836
Cash equivalents:
M&T MM Account - 38,757 - -
Subtotal - 38,757 - -
Cash - - - -
Total $ 664,324 $ 38,757 $ 451,779 $ 124,836
<PAGE 10>
</TABLE>
<TABLE>
<CAPTION>
1999 Large MAS
Cap MID Asset
Value Cap Growth Allocation Global
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Fixed income:
M&T GIC $ - $ - $ - $ -
M&T Bond - - - -
Subtotal - - - -
Equities:
Oakmark Fund - - - -
Large Cap Value Fund 276,304 - - -
MAS MID Cap Growth Fund - 571,917 - -
M&T Balanced Fund - - 1,136,733
Global Fund - - - 240,557
Small Cap Equity Fund - - - -
Hahn Stock - - - -
Large Company Index Fund - - - -
Subtotal 276,304 571,917 1,136,733 240,557
Cash equivalents:
M&T MM Account - - - -
Subtotal - - - -
Cash - - 4,447 -
Total $ 276,304 $ 571,917 $1,141,180 $ 240,557
</TABLE>
<PAGE 11>
<TABLE>
<CAPTION>
1999 Small Large
Capital Hahn Company
Equity Stock Index
Fund Fund Fund Total
<S> <C> <C> <C> <C>
Fixed income:
M&T GIC $ - $ - $ - $ 664,324
M&T Bond - - - 451,779
Subtotal - - - 1,116,103
Equities:
Oakmark Fund - - - 124,836
Large Cap Value Fund - - - 276,304
MAS MID Cap Growth Fund - - - 571,917
M&T Balanced Fund - - - 1,136,733
Global Fund - - 240,557
Small Cap Equity Fund 1,193,132 - - 1,193,132
Hahn Stock - 22,131 - 22,131
Large Company Index Fund - - 775,418 775,418
Subtotal 1,193,132 22,131 775,418 4,341,028
Cash equivalents:
M&T MM Account - 23,721 - 62,478
Subtotal - 23,721 - 62,478
Cash - (2,142) - 2,305
Total $1,193,132 $ 43,710 $ 775,418 $ 5,521,914
<PAGE 12>
</TABLE>
4. Investments - continued
<TABLE>
<CAPTION>
1998
Large
Intermediate Cap
Bond Oakmark Value
GIC Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Fixed income:
M&T GIC $ 981,117 $ - $ - $ -
M&T Bond - 671,679 - -
Subtotal 981,117 671,679 - -
Equities:
Oakmark Fund - - 47,686 -
Large Cap Value Fund - - - 109,812
MAS MID Cap Growth Fund - - - -
M&T Balanced Fund - - - -
Global Fund - - - -
Small Cap Equity Fund - - - -
Hahn Stock - - - -
Large Company Index Fund - - - -
Subtotal - - 47,686 109,812
Cash equivalents:
M&T MM Account - - - -
Subtotal - - - -
Cash 4,778 3,491 - -
Total $ 985,895 $ 675,170 $ 47,686 $109,812
</TABLE>
<PAGE 13>
<TABLE>
<CAPTION>
1998 MAS Small
MID Asset Capital
Cap Growth Allocation Global Equity
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Fixed income:
M&T GIC $ - $ - $ - $ -
M&T Bond - - - -
Subtotal - - - -
Equities:
Oakmark Fund - - - -
Large Cap Value Fund - - - -
MAS MID Cap Growth Fund 74,394 - - -
M&T Balanced Fund - 1,473,127 - -
Global Fund - - 50,837 -
Small Cap Equity Fund - - - 1,577,210
Hahn Stock - - - -
Large Company Index Fund - - - -
Subtotal 74,394 1,473,127 50,837 1,577,210
Cash equivalents:
M&T MM Account - - - -
Subtotal - - - -
Cash - 13,723 - -
Total $ 74,394 $ 1,486,850 $ 50,837 $1,577,210
<PAGE 14>
</TABLE>
<TABLE>
<CAPTION>
1998 Large
Hahn Company
Stock Index
Fund Fund Total
<S> <C> <C> <C>
Fixed income:
M&T GIC $ - $ - $ 981,117
M&T Bond - - 671,679
Subtotal - - 1,652,796
Equities:
Oakmark Fund - - 47,686
Large Cap Value Fund - - 109,812
MAS MID Cap Growth Fund - - 74,394
M&T Balanced Fund - - 1,473,127
Global Fund - - 50,837
Small Cap Equity Fund - - 1,577,210
Hahn Stock 352,611 - 352,611
Large Company Index Fund - 240,625 240,625
Subtotal 352,611 240,625 3,926,302
Cash equivalents:
M&T MM Account 3,981 - 3,981
Subtotal 3,981 - 3,981
Cash 11 816 22,819
Total $ 356,603 $ 241,441 $5,605,898
</TABLE>
During 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated in
value by $88,775 as follows:
<PAGE 15>
5. Investment Contact with Bank
In 1998, the Plan entered into a benefit-responsive investment contract with
M&T. M&T maintains the contributions in the GIC Fund. The fund is credited
with earnings on the underlying investments and charged for participant
withdrawals and administrative expenses. The contract is included in the
financial statements at contract value as reported to the Plan by M&T.
Contract value represents contributions made under the contract, plus
earnings, less participant withdrawals and administrative expenses.
There are no reserves against contract value for credit risk of the contract
issuer or otherwise. The average yield and crediting interest rates were
approximately 6 percent and 7 percent for 1999 and 1998, respectively. The
crediting interest rate is based on a formula agreed upon with the issuer.
Such interest rates are reviewed on a quarterly basis for resetting.
6. Federal Income Tax
The Company has received a determination letter from the Internal Revenue
Service stating that the Plan, as amended through August 4, 1998,
constituted a qualified plan under Sections 401(a) and 401(k) of the
Internal Revenue Code.
As long as the Plan is qualified, a participating employee (or other
designated beneficiary or legal representative) will not be subject to
Federal income taxes on dividends, interest or profits from the sale of
securities received by the trustee until cash benefits are distributed to
the participant.
<PAGE 16>
7. Party-In-Interest Transactions
Plan assets consist of certain investments managed by M&T Investment Group
which is a subsidiary of M&T, the trustee. Therefore, these transactions
qualify as party-in-interest.
8. Autoworks
On July 24, 1997, the Company's retail subsidiary, Autoworks, filed for
reorganization under Chapter 11 of the United States Bankruptcy Code in the
United States Bankruptcy Court of the Western District of New York (the
"Court"). By December 31, 1997, upon completion of store closings and the
closing of Autoworks' distribution center, all Autoworks' employees had been
terminated which, given the ratio of Autoworks' employees to the total number
of Company employees, resulted in the execution of a partial plan termination
and the immediate vesting of all account balances of Autoworks' employees,
which amounted to approximately $1.2 million. A majority of these balances
were distributed during the Plan years ended September 30, 1999 and 1998 upon
request of the individual participants. The Autoworks, Inc. Plan of
Reorganization was approved and confirmed pursuant to a Court Order dated
November 18, 1999. The remaining assets of Autoworks, Inc. have been
transferred to a Creditor's Trust , to be administered under a Creditor's
Trust Agreement dated November 18, 1999.
9. Subsequent Events
Effective October 1, 1999, the Plan changed its recordkeeper from the Burke
Group to EPIC Advisors Inc.
<PAGE 17>
Hahn Automotive Warehouse, Inc.
Item 27(a) - Schedule of Assets Held for Investment Purposes
September 30, 1999
<TABLE>
<CAPTION>
Description of Investments Cost Market
Value
<S> <C> <C>
Fixed income:
* M&T GIC $ 664,324 $ 664,324
* M&T Bond 476,700 451,779
Equities:
Asset Allocation Fund 1,088,952 1,136,733
Small Cap Equity Fund 1,116,377 1,193,132
Hahn Automotive Stock 149,479 22,131
Large Company Index Fund 761,049 775,418
Oakmark Fund 128,546 124,836
MAS MID Cap Growth Fund 503,201 571,917
Global Fund 218,030 240,557
Large Cap Value Fund 297,291 276,304
Cash and cash equivalents:
Cash 2,305 2,305
* M&T Money Market Account 62,478 62,478
Total $5,468,732 $5,521,914
</TABLE>
* Party-in-Interest
<PAGE 18>
Hahn Automotive Warehouse, Inc.
Item 27(d) - Schedule of Reportable Transactions
For the Plan Year Ended September 30, 1999
<TABLE>
<CAPTION>
Current Value of
Number Asset on
of Purchase Selling Cost of Transaction Net Gain
Description of Asset Transactions Price Price Asset Date (Loss)
<S> <C> <C> <C> <C> <C> <C>
Asset Allocation Fund 1 $1,633,845 $1,633,845 $ 1,633,845 $ -
Small Capital Equity Fund 1 1,720,930 1,720,930 1,720,930 -
Small Capital Equity Fund 46 2,074,163 2,074,163 2,074,163 -
MAS MID Cap Growth Fund 64 563,701 563,701 563,701 -
Asset Allocation Fund 34 1,849,101 1,849,101 1,849,101 -
Large Cap Value Fund 44 345,647 345,647 345,647 -
Large Company Index Fund 74 581,394 581,394 581,394 -
Small Capital Equity Fund 1 $1,720,906 2,104,612 1,720,906 (383,706)
Asset Allocation Fund 1 1,633,845 1,722,007 1,633,845 (88,162)
Small Capital Equity Fund 2 1,722,437 2,106,516 1,722,437 (384,079)
Asset Allocation Fund 2 1,635,321 1,723,584 1,635,321 (88,263)
Hahn Stock 37 204,452 622,066 204,452 (417,614)
M&T GIC 84 377,571 377,571 377,571 -
Small Capital Equity Fund 85 943,243 956,276 943,243 (13,033)
Intermediate Bond Fund 67 360,107 370,570 360,107 (10,463)
Asset Allocation Fund 73 803,806 760,149 803,806 43,657
</TABLE>
Transactions or series of transactions in excess of 5% of the current value
of the Plan's assets as of September 30, 1998 as defined in Section 2520.103-6
of the Department of Labor's Rules and Regulations for reporting and
disclosure under ERISA.
<PAGE 19>
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-81854) of Hahn Automotive Warehouse, Inc. 401(k)
Plan filed with the Securities and Exchange Commission on July 22, 1994 of our
report dated March 20, 2000, relating to the financial statements of Hahn
Automotive Warehouse, Inc. 401(k) Plan as of September 30, 1999 and 1998, and
for the year ended September 30, 1999 which appears in this Form 11-K.
PricewaterhouseCoopers LLP
Rochester, New York
March 30,2000
<PAGE 20>
