SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year ended December 31,1998 FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN OWENS CORNING One Owens Corning Parkway Toledo, Ohio 43659 Commission File No. 1-3660 - ----------------------------------------------------------------- REQUIRED INFORMATION (a) Financial Statements. 1. REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS 2. Statements of Assets Available for Benefits - as of March 24, 1999, December 31, 1998 and December 31, 1997 3. Statements of Changes in Assets Available for Benefits - for the period ended March 24, 1999 and the year ended December 31, 1998 4. Notes to Financial Statements 5. Supplemental Schedules: Schedule I - Item 27a - Schedule of Assets Held for Investment Purposes as of December 31,1998 Schedule II - Item 27d - Schedule of Reportable Transactions for the Year Ended December 31,1998 (b) Exhibit. Consent of Arthur Andersen LLP In accordance with the instruction to this Form 11-K, "plans subject to the Employee Retirement Income Security Act of 1974 ("ERISA") may file plan financial statements and schedules prepared in accordance with the financial reporting requirements of ERISA." As the Plan is subject to the filing requirements of ERISA, the aforementioned financial statements and schedules of the Plan have been prepared in accordance with such requirements. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the Plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN BY /S/ MICHAEL I. MILLER Michael I. Miller Chairman, Investment Review Committee DATED: JUNE 28, 1999 Report of Independent Public Accountants TO THE PLAN ADMINISTRATOR, Fibreboard Corporation 401(k) Retirement Plan: We have audited the accompanying statements of assets available for benefits of Fibreboard Corporation 401 (k) Retirement Plan as of March 24, 1999, December 31, 1998, and 1997, and the related statement of changes in assets available for benefits for the period ended March 24, 1999 and the year ended December 31, 1998. These financial statements and the schedules referred to below are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the assets available for benefits of the Plan as of March 24, 1999, December 31, 1998 and 1997, and the changes in its assets available for benefits for the period ended March 24, 1999 and the year ended December 31, 1998 in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental schedules of 1) assets held for investment purposes and 2) reportable transactions 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. The Fund Information in the statement of assets available for benefits and the statement of changes in assets available for benefits is presented for purpose of additional analysis rather than to present the assets available for benefits and changes in assets available for 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. TOLEDO, OHIO JUNE 25, 1999 -1- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF ASSETS AVAILABLE FOR BENEFITS AS OF MARCH 24, 1999 AND DECEMBER 31, 1998 March 24, December 31, December 31, 1999 1998 1997 --------- ------------ ------------ Cash and cash equivalents - 31 342,505 Investments, at fair value: Charles Schwab Fund - - 4,348,450 Janus Fund - - 7,826,128 Neuberger and Berman Guardian Fund - - 8,599,956 PIMCO Total Return Fund - - 5,344,892 Warburg Pincus International Equity Fund - - 4,137,698 Barron Asset Fund - - 7,171,062 Personal Choice Account - 16 1,076,794 Louisiana Pacific Stock Fund - - 253,156 Owens Corning Stock - - - Participant Loans - - 2,044,322 Contributions receivable - 2,120,855 2,850,058 Liabilities Refundable contributions - - (4,721) ------------ ------------ -------------- Assets available for benefits - $ 2,120,902 $ 43,990,300 ============ ============ ============== The accompanying notes are an integral part of these statements. -2- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE PERIOD ENDED MARCH 24, 1999 March 24, 1999 -------------- Investment Income Dividends and Interest $ 22,465 Net Appreciation in Fair Value Of Investments 26,392 Interest on loans - Contributions Employer - Employee - Other 4,644 -------------- Total Additions $ 53,501 -------------- Deductions and Transfers Benefits Paid - -------------- Net Benefits Paid - Transfers Loan activity - Transfer to successor trustee (2,174,403) -------------- Total Transfers (2,174,403) -------------- Total Deductions and Transfers (2,174,403) -------------- Net Additions (Deductions) (2,120,902) Assets Available for Benefits Beginning of Year 2,120,902 -------------- Assets Available for Benefits End of Year $ - ============== The accompanying notes are an integral part of these statements. -3- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31,1998 1998 Supplemental Information By Fund Charles Cash Schwab Janus -------- Fund ----- Investment Income ------ Dividends and Interest $ - $ 196,750 $ 241,758 Net Appreciation in Fair Value of Investments - - 2,455,914 Interest on loans - 11,445 32,906 Contributions Employer - 109,243 270,985 Employee - 293,804 902,471 -------- ------------ ----------- Total Additions - 611,242 3,904,034 -------- ------------ ----------- Deductions and Transfers Benefits Paid - (2,943,068) (3,001,052) Administrative expense - (7,790) (16,287) -------- ------------ ----------- Net Benefits Paid - (2,950,858) (3,017,339) -------- ------------ ----------- Transfers Loan activity - (33,301) (114,128) Transfers and forfeitures (342,474) (2,584,844) (9,093,500) -------- ------------ ----------- Total Transfers (342,474) (2,618,145) (9,207,628) -------- ------------ ----------- Total Deductions and Transfers (342,474) (5,569,003) (12,224,967) -------- ------------ ----------- Net Additions (Deductions) (342,474) (4,957,761) (8,320,933) Assets Available for Benefits Beginning of Year 342,505 4,957,761 8,320,933 -------- ----------- ----------- Assets Available for Benefits End of Year $ 31 $ - $ - =========== =========== ============ The accompanying notes are an integral part of these statements. -4- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31,1998 1998 Supplemental Information By Fund Neuberger PIMCO Warburg Pincus And Berman Total International Guardian Return Equity Investment Income ----------- ----------- -------------- Dividends and Interest $ 1,035,130 $ 695,867 $ (8,553) Net Appreciation in Fair Value of Investments (823,322) (32,813) 263,880 Interest on loans 37,082 27,138 20,153 Contributions Employer 278,127 105,600 175,213 Employee 927,179 855,350 567,991 ----------- ---------- ---------- Total Additions 1,454,196 1,651,142 1,018,684 ----------- ---------- ---------- Deductions and Transfers Benefits Paid (3,013,047) (1,703,512) (1,938,279) Administrative expense (14,336) (9,028) (7,547) ------------ ----------- ----------- Net Benefits Paid (3,027,383) (1,712,540) (1,945,826) Transfers Loan activity (125,055) (71,742) (45,854) Transfers and forfeitures (7,425,163) (5,612,431) (3,487,470) ------------ ----------- ----------- Total Transfers (7,550,218) (5,684,173) (3,533,324) ------------ ----------- ----------- Total Deductions and Transfers (10,577,601) (7,396,713) (5,479,150) ------------- ----------- ----------- Net Additions (Deductions) (9,123,405) (5,745,571) (4,460,466) Assets Available for Benefits Beginning of Year 9,123,405 5,745,571 4,460,466 ----------- ---------- ---------- Assets Available for Benefits End of Year $ - $ - $ - ============ ========== =========== The accompanying notes are an integral part of these statements. -5- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31,1998 1998 Supplemental Information By Fund Barron Louisiana Asset Personal Pacific ------ Choice Acct --------- Investment Income ----------- Dividends and Interest $ (8,249) $ (18,090) $ 4,661 Net Appreciation in Fair Value of Investments 134,915 - 16,873 Interest on loans 36,682 3,276 - Contributions Employer 244,781 12,904 - Employee 760,742 44,052 - ---------- ----------- --------- Total Additions 1,168,871 42,142 21,534 ---------- ----------- --------- Deductions and Transfers Benefits Paid (2,249,288) (1,104,795) (176,837) Administrative expense (11,999) (1,738) (398) ---------- ---------- --------- Net Benefits Paid (2,261,287) (1,106,533) (177,235) Transfers Loan activity (122,960) 1,071 - Transfers and forfeitures (6,420,964) (42,505) (97,455) ---------- ---------- --------- Total Transfers (6,543,924) (41,434) (97,455) ---------- ---------- --------- Total Deductions and Transfers (8,805,211) (1,147,967) (274,690) Net Additions (Deductions) (7,636,340) (1,105,825) (253,156) Assets Available for Benefits Beginning of Year 7,636,340 1,105,841 253,156 ---------- ---------- -------- Assets Available for Benefits End of Year $ - 16 - ========== ========== ======== The accompanying notes are an integral part of these statements. -6- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31,1998 1998 Supplemental Information By Fund Owens Corning Participant Stock Loans ------------- ------------ Investment Income Dividends and Interest $ 2,298 $ - Net Appreciation in Fair Value of Investments 8,530 - Interest on loans 731 2,110 Contributions Employer 3,059 - Employee 7,595 - ------------- ------------ Total Additions 22,213 2,110 ------------- ------------ Deductions and Transfers Benefits Paid (135) (558,954) Administrative expense - - ------------- ------------ Net Benefits Paid (135) (558,954) Transfers Loan activity 1,291 510,678 Transfers and forfeitures (23,369) (1,998,156) -------------- ------------ Total Transfers (22,078) (1,487,478) -------------- ------------ Total Deductions and Transfers (22,213) (2,046,432) -------------- ------------ Net Additions (Deductions) - (2,044,322) Assets Available for Benefits Beginning of Year - 2,044,322 -------------- ----------- Assets Available for Benefits End of Year $ - - ============== =========== The accompanying notes are an integral part of these statements. -7- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31,1998 1998 Supplemental Information By Fund Contribution Receivable Total ------------ ----- Investment Income Dividends and Interest $ - $ 2,141,572 Net Appreciation in Fair Value of Investments - 2,023,977 Interest on loans - 171,523 Contributions Employer 2,120,855 3,320,767 Employee - 4,359,184 ----------- ------------- Total Additions 2,120,855 12,017,023 ----------- ------------- Deductions and Transfers Benefits Paid - (16,688,967) Administrative expense - (69,123) ----------- ------------ Net Benefits Paid - (16,758,090) Transfers Loan activity - - Transfers and forfeitures - (37,128,331) ----------- ------------ Total Transfers - (37,128,331) ----------- ------------ Total Deductions and Transfers - (53,886,421) ----------- ----------- Net Additions (Deductions) 2,120,855 (41,869,398) Assets Available for Benefits Beginning of Year - 43,990,300 ----------- ---------- Assets Available for Benefits End of Year $2,120,855 $ 2,120,902 =========== ========== The accompanying notes are an integral part of these statements. -8- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN NOTES TO FINANCIAL STATEMENTS 1) PLAN DESCRIPTION The Fibreboard Corporation 401 (k) Retirement Plan ("the Plan"), was established in 1988 and is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The Plan is a defined contribution pension plan. Effective July 3, 1997, Fibreboard Corporation was acquired by Owens Corning. The Plan continued to cover all employees of the former Fibreboard Corporation until January 1, 1999, at which time it was merged into the Owens Corning Savings Plans. In connection with the merger, substantially all of the Plan's assets were transferred to the Owens Corning plans on December 31, 1998, at which time, or as soon as possible thereafter, the amounts were invested in the options provided by the Owens Corning Savings Plans. At the date of the merger, all active participants were entitled to their full interests and no forfeiture provisions apply. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions through the date of the merger. Participant Accounts -------------------- Each participant's account is credited with the participant's contribution as provided through payroll deductions and allocations of (a) contributions made by the employer for the benefit of the participants, which in certain circumstances is subject to limitations as defined in the Plan agreement and (b) Plan earnings. The participant's contribution may be from 1- 14% of compensation. The Plan provides a retirement contribution and match, equal to a specified percentage of eligible compensation (percentage varies by employee group) for participants. Vesting ------- Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Vesting in the employer's contribution portion plus actual earnings thereon is based on years of service. Additionally, participants become fully vested in their accounts upon reaching age 60 or on the date of death or full and permanent disability. A year of service for vesting purposes is 1,000 hours in a calendar year. The employer's profit sharing and matching contribution will vest over the following schedule: Years of Vested Service Percentage --------- ---------- Less than 2 0% 2 20% 3 40% 4 60% 5 80% 6 or more 100% If participants are not fully vested upon terminating employment, the participants forfeit the nonvested portion of their accounts. Forfeitures were approximately $240,000 for the year ended December 31, 1998 and were used to reduce employer contributions. -9- FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN NOTES TO FINANCIAL STATEMENTS (Continued) 1) PLAN DESCRIPTION (continued) Participants Loans ------------------ Participants may borrow from their vested account balances 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 cannot exceed five years, unless the loan is used to purchase a primary residence. The loans are secured by 50% of the vested balance in the participant's account and bear interest at a rate commensurate with local prevailing rates as of the date of the loan. Principal and interest are paid ratably through regular payroll deductions. Investment Elections -------------------- Participants direct the investment of their account balances and all contributions. Investment options available from January 1, 1998 to the date of the transfer of assets to the Owens Corning Savings Plans were as follows: Schwab Value Advantage Fund - Objective is to invest in low risk, short-term financial instruments. Invests in short term bank paper, commercial paper, repurchase agreements and obligations of, or guaranteed by, the U.S. government, the Canadian government or their agencies or instrumentalities. Janus Fund - Invests in companies that are expected to have above-average prospects for long term growth in earnings and profitability. Neuberger & Berman Equity Guardian Fund - A value equity fund that invests in companies believed to be undervalued or having lower than average price/earnings ratios, and potential for capital appreciation. PIMCO Total Return Fund - A core bond fund that invests in a diversified portfolio of corporate, government and government agency bonds. Warburg Pincus International Equity Fund - Seeks long-term capital appreciation by investing substantially all of its assets in common stocks and securities convertible into or exchangeable for common stocks of non-United States issuers. Barron Asset Fund - A small capitalization fund that invests in equity securities of companies with market capitalization between $100 million and $1.5 billion that the advisor believes have undervalue assets or favorable growth prospects. Personal Choice Account - Allows participants to choose their own investments. Owens Corning Stock Fund - This fund is invested primarily in shares of Owens Corning common stock as well as a small amount of short-term investments. Ownership is measured in units of the fund instead of shares of stock. Units will be adjusted for any changes resulting from stock dividends, stock splits and similar changes. No further investments can be made in the Louisiana-Pacific Stock Fund. -10- FIBREBOARD CORPORATION 401(K) RETIREMENT PLAN NOTES TO FINANCIAL STATEMENTS (Continued) (2) SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting ------------------- The accompanying financial statements have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles. Investments ----------- The Plan's investments are stated at fair market value based on quoted market prices, except for the participant loans, which are valued at cost, which approximates fair market value. Purchases and sales of investments are accounted for on a trade date basis. Administrative Expenses ----------------------- Substantially all administrative expenses of the Plan are paid by Owens Corning. Benefits -------- Benefits are recorded when paid. Use of Estimates ---------------- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of changes in net assets available for benefits during the reporting period. Actual results could differ from those estimates. (3) INCOME TAX STATUS The Plan is intended to satisfy the tax exemption qualification requirements under Section 401 (a) of the Internal Revenue Code; therefore, the Plan and related trust are intended to be exempt from Federal income taxes. The Plan obtained its latest determination letter on May 25, 1995, in which the Internal Revenue Service sated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. The Plan has been amended since receiving the determination letter. However, the plan administrator and the Plan's tax counsel believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code. Therefore, no provision for income taxes has been included in the Plan's financial statements. Participants generally are not subject to Federal income tax on employer contributions or fund earnings until those amounts are distributed to them. Participants may elect to designate all or a portion of their contributions to the Plan as deferred income pursuant to Section 401(k) of the Code. This election permits the participants to exclude from gross taxable income for Federal tax purposes that portion of their contribution so designated, subject to certain limitations, until such time as it is withdrawn from the Plan. -11- SCHEDULE I FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN EIN: 94-0751580 PN: 007 ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1998 ----------------------- Identity Par Value Of Party Or Shares Description Cost Current -------- --------- ----------- ---- ------- *The Charles Schwab n/a Charles Schwab Cash $ 21 $ 21 Trust Company *The Charles Schwab 2 shares Citizens Utilities Sr. B - 16 Trust Company *The Charles Schwab 9.57 Charles Schwab Trust Company units Retirement 10 10 Money Fund ---- ---- $ 31 $ 47 ==== ==== * Represents a party-in-interest -12- SCHEDULE II FIBREBOARD CORPORATION 401(k) RETIREMENT PLAN EIN 94-0751580 PLAN: 007 SCHEDULE 27d-SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31,1998 Current Value Identity of Number of of Assets on Party Transac- Purchase Selling Historical Transaction Gain (Loss) Involved Description tions Price Price Cost Date on Sale - ------------ ----------- --------- -------- ------- ---------- ------------ ----------- *Charles AGGREGATE PURCHASES 977 $3,787,121 N/A $3,787,121 $3,787,121 N/A Schwab OF SCHWAB VALUE Trust ADVANTAGE MONEY MARKET Company FUND *Charles Aggregate sales of 577 N/A $8,331,888 8,331,888 8,331,888 - Schwab Schwab Value Advantage Trust Money Market Fund Company *Charles Individual purchase of 1 N/A 3,379,849 3,379,849 3,379,849 - Schwab Schwab Value Advantage Trust Money Market Fund Company *Charles Aggregate purchases of 1,119 3,328,098 N/A 3,328,098 3,328,098 N/A Schwab PIMCO Total Return Trust Fund Company *Charles Aggregate sales of 592 N/A 8,631,149 8,672,990 8,631,149 (41,841) Schwab PIMCO Total Return Trust Fund Company *Charles Individual sale of 1 N/A 5,592,789 5,637,699 5,592,789 (44,910) Schwab PIMCO Total Return Trust Fund Company *Charles Aggregate purchases of 1,277 3,836,782 N/A 3,836,782 3,836,782 N/A Schwab Neuberger & Berman Trust Guardian Fund Company *Charles Aggregate sales of 770 N/A 11,657,915 12,494,578 11,657,915 (836,663) Schwab Neuberger & Berman Trust Guardian Fund Company *Charles Individual sale of 1 N/A 6,677,330 7,574,051 6,677,330 (896,721) Schwab Neuberger & Berman Trust Guardian Fund Company *Charles Aggregate purchases of 1,142 6,531,211 N/A 6,531,211 6,531,211 N/A Schwab Warburg Pincus Trust International Equity Company Fund *Charles Aggregate sales of 629 N/A 10,925,281 10,668,909 10,925,281 256,372 Schwab Warburg Pincus Trust International Equity Company Fund *Charles Individual sale of 1 N/A 3,178,928 3,489,151 3,178,928 (310,223) Schwab Warburg Pincus Trust International Equity Company Fund *Charles Aggregate purchases of 1,395 3,806,519 N/A 3,806,519 3,806,519 N/A Schwab Janus Fund Trust Company *Charles Aggregate sales of 758 N/A 14,100,401 11,658,231 14,100,401 2,442,170 Schwab Janus Fund Trust Company *Charles Individual sale of 1 N/A 9,299,927 7,378,604 9,299,927 1,921,323 Schwab Janus Fund Trust Company *Charles Aggregate purchases of 1,295 11,005,360 N/A 11,005,360 11,005,360 N/A Schwab Baron Asset Fund Trust Company *Charles Aggregate sales of 743 N/A 18,330,918 18,207,344 18,330,918 123,574 Schwab Baron Asset Fund Trust Company *Charles Individual sale of 1 N/A 6,059,040 4,908,931 6,059,040 1,150,109 Schwab Baron Asset Fund Trust Company *Represents a party-in-interest EXHIBIT 99 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference of our report, dated June 25, 1999, included in the Owens Corning Savings and Security Plan's annual report on Form 11-K for the period ended March 24, 1999 and the year ended December 31, 1998, into the Company's previously filed Registration Statements on Form S-8 and active S-3 (File Nos. 33- 9563, 33-9986, 33-18262, 33-20997, 33-27209, 33-31687, 33-48707, 33-57886, 33-60487, 333-09367, 333-32145, 333-47961 and 333- 48153, 333-76765). ARTHUR ANDERSEN LLP Toledo, Ohio, June 25, 1999