1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11K
X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the fiscal year ended December 31, 1999
OR
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to
Commission file number 33-75622
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
SAVINGS PLAN FOR THE EMPLOYEES
OF ALBEMARLE CORPORATION
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
Albemarle Corporation
330 South Fourth Street
P.O. Box 1335
Richmond, Virginia 23210
2
REQUIRED INFORMATION
See Appendix 1.
SIGNATURES
The Plan. 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.
SAVINGS PLAN FOR THE EMPLOYEES OF
ALBEMARLE CORPORATION
BY: s\ Charles B. Walker
--------------------
Charles B. Walker
Chairman of the Savings Plan
Committee
Dated: June 27, 2000
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Appendix 1.
SAVINGS PLAN FOR THE EMPLOYEES OF
ALBEMARLE CORPORATION
ANNUAL REPORT
DECEMBER 31, 1999 AND 1998
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SAVINGS PLAN FOR THE EMPLOYEES OF ALBEMARLE CORPORATION
INDEX OF FINANCIAL STATEMENTS AND SCHEDULES
Page
Report of Independent Accountants 2
Financial Statements:
Statement of Assets Available for Benefits at December 31,
1999 and 1998 3
Statement of Changes in Assets Available for Benefits for the
Year Ended December 31, 1999 4
Notes to Financial Statements 5-10
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes 11
Schedule of Investment Assets Both Acquired and Disposed of
Within the Plan Year *
Nonexempt Transactions *
Schedule of Loans or Fixed Income Obligations in Default or
Classified as Uncollectible *
Schedule of Leases in Default or Classified as Uncollectible *
Schedule of Reportable Transactions *
* Other schedules required by Section 2520.103-10 of the
Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of
1974 ("ERISA") have been omitted because they are not applicable.
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Report of Independent Accountants
To the Administrator of the
Savings Plan for the Employees of Albemarle Corporation:
In our opinion, the accompanying statements of assets available for benefits
and the related statement of changes in assets available for benefits present
fairly, in all material respects, the assets available for benefits of the
Savings Plan for the Employees of Albemarle Corporation (the "Plan") at
December 31, 1999 and 1998, and the changes in assets available for benefits
for the year ended December 31, 1999 in conformity with accounting principles
generally accepted in the United States. 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 auditing standards generally
accepted in the United States 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 schedule of assets
held for investment purposes at December 31, 1999 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 supplemental schedule is the
responsibility of the Plan's management. The supplemental schedule has been
subjected to the auditing procedures applied in the 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.
PricewaterhouseCoopers LLP
Richmond, Virginia
June 2, 2000
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SAVINGS PLAN FOR THE EMPLOYEES OF ALBEMARLE CORPORATION
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS
December 31, 1999 and 1998
(in US dollars)
1999 1998
---------------------------------------- ----------------------------------------
Participant NonParticipant Participant NonParticipant
Directed Directed Total Directed Directed Total
Assets:
Cash $ 579,483 $ 27,125 $ 606,608 $ 274,188 $ - $ 274,188
Investments at fair value(see Note 3) 194,519,364 37,600,083 232,119,447 198,591,985 43,637,026 242,229,011
Receivables:
Employer contributions - 24,383 24,383 - 24,159 24,159
Employee contributions 56,161 - 56,161 52,700 - 52,700
Dividends and interest 41,196 - 41,196 24,158 - 24,158
Other 8,857 - 8,857 7,929 - 7,929
------------ ------------ ------------ ------------ ------------ ------------
Assets available for benefits $195,205,061 $ 37,651,591 $232,856,652 $198,950,960 $ 43,661,185 $242,612,145
============ ============ ============ ============ ============ ============
<FN>
The accompanying notes are an integral part of the financial statements.
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SAVINGS PLAN FOR THE EMPLOYEES OF ALBEMARLE CORPORATION
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS
for the year ended December 31, 1999
(in US dollars)
Participant NonParticipant
Directed Directed Total
Additions:
Dividends and interest $ 6,373,570 $ 750,436 $ 7,124,006
Employee contributions(see Note 2) 11,413,572 - 11,413,572
Employer contributions(see Note 3) - 5,141,888 5,141,888
Other 33,982 - 33,982
------------ ------------ ------------
Total additions 17,821,124 5,892,324 23,713,448
============ ============ ============
Deductions:
Benefit payments 21,937,525 2,271,582 24,209,107
Net depreciation in fair value of investments(see Note 3) 581,407 8,654,060 9,235,467
Administration expenses 24,367 - 24,367
------------ ------------ ------------
Total deductions 22,543,299 10,925,642 33,468,941
------------ ------------ ------------
Net decrease (4,772,175) (5,033,318) (9,755,493)
Transfers 976,276 (976,276) -
Assets available for benefits, beginning of year 198,950,960 43,661,185 242,612,145
------------ ------------ ------------
Assets available for benefits, end of year $195,205,061 $ 37,651,591 $232,856,652
============ ============ ============
<FN>
The accompanying notes are an integral part of the financial statements.
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SAVINGS PLAN FOR THE EMPLOYEES OF ALBEMARLE CORPORATION
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies:
General:
The accompanying financial statements of the Savings Plan For The
Employees Of Albemarle Corporation (the "Plan") have been prepared in
conformity with generally accepted accounting principles.
Accounting Estimates:
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires the Plan to
make significant estimates and assumptions that affect the reported
amounts of assets as of the date of the financial statements and the
reported amounts of changes in assets available for plan benefits
during the reporting periods. Actual results could differ from those
estimates.
Risks and Uncertainties:
The Plan provides for various mutual fund investment options in stocks,
bonds and fixed income securities. Investments are exposed to various
risks, such as interest rate, market and credit. Due to the level of
risk associated with certain investment securities and the level of
uncertainty related to changes in the value of investment securities,
it is at least reasonably possible that changes in risks in the near
term would materially affect participants' account balances and the
amounts reported in the statements of assets available for benefits and
the statement of changes in assets available for benefits.
New Accounting Pronouncement:
On August 25, 1999, the Financial Accounting Standards Board approved
for issuance Statement of Position 99-3, Accounting for and Reporting
of Certain Defined Contribution Plan Investments and Other Disclosure
Matters (the "SOP"). This SOP became effective for years ending after
December 15, 1999. The Plan has adopted the provisions of the SOP in
presenting the accompanying 1999 and 1998 financial statements. The
primary effect of this SOP on the accompanying financial statements is
the elimination of the presentation of separate transactions and
balances by investment option for participant-directed investments. The
December 31, 1998 statement of assets available for benefits has been
reclassified to conform to the 1999 presentation.
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1. Summary of Significant Accounting Policies, continued:
Securities Valuation:
Investments are stated at values determined as follows:
Common stocks - last published sale price on the New
York Stock Exchange
Mutual funds and Equity
Index Trust - quoted market value
Retirement Preservation Trust - Investments in Guaranteed Insurance
Contracts ("GIC's") and Bank
Investment Contracts ("BIC's") with
benefit responsive features are
carried at cost plus accrued
interest ("contract value"). Money
market instruments and US Government
agency obligations are valued at
amortized cost.
Loans to participants - balances due which approximate fair
value
Securities Transactions and Related Investment Income:
Securities transactions are accounted for on a trade-date basis and
dividend income is recorded on the ex-dividend date. Interest income is
recorded as earned. The Plan presents in the statement of changes in
assets available for benefits the "net depreciation in fair value of
investments" which consists of realized gains and losses and changes in
the unrealized appreciation (depreciation) on those investments.
Investment income is allocated to participant accounts in proportion
to the participant's account balance.
2. Description of Plan:
a. General: The Plan is a defined contribution plan. It is subject to
the provisions of the Employee Retirement Income Security Act of
1974. Merrill Lynch served as the Plan's trustee for the year ended
December 31, 1999. Information regarding Plan benefits, priority of
distributions upon termination of the Plan, and vesting is provided
in the Plan agreement which is available at the main office of the
Plan administrator at 451 Florida Street, Baton Rouge, Louisiana
70801.
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2. Description of Plan, continued:
b. Contributions: Participants in the Plan make pre-tax and/or
after-tax contributions as defined in the Plan document limited to a
percentage of their base salaries. Albemarle makes a matching
contribution to the Plan equal to fifty percent (50%) of the first
ten percent (10%) of each participant's contribution. Contributions
made by Albemarle are invested in the Albemarle Corporation Common
Stock Fund which contains both participant and nonparticipant
directed balances. Participants may also contribute amounts
representing distributions from other qualified defined benefit or
defined contribution plans. The Plan allows non-highly compensated
participants, as defined by the Plan document, to make a pre-tax or
after-tax election percentage raging from a minimum of one percent
(1%) to a maximum of fifteen percent (15%) to be contributed into
the Plan.
c. Vesting: Participant contributions are 100% vested at all times.
In the event employment is terminated as a result of attaining normal
retirement age, electing retirement under the terms of the Company's
defined benefit pension plan, total and permanent disability, or
death, or in the event the Plan is terminated, participants will have
a 100% vested interest in that portion of their account which
represents employer contributions. If termination of employment is
the result of other reasons, vesting in employer contributions is
based on years of service, as follows: 60% for three years of
service, 80% for four years of service, and 100% for five or more
years of service.
d. Investment options: The Plan consists of ten active funds and two
inactive funds. The active funds are as follows:
- Albemarle Corporation Common Stock Fund, invested in common
stock of Albemarle.
- Merrill Lynch Retirement Preservation Trust, a collective
trust maintained by Merrill Lynch Trust Company of America and
invested primarily in a broadly diversified portfolio of GIC's
and BIC's, synthetic GIC's and separate accounts in
obligations of U.S. government and U.S. government agency
securities, and in high-quality money market securities.
- PIMCO Total Return Fund, invested in shares of a registered
investment company that invests in a diversified portfolio of
fixed income securities of varying maturities, including some
high-yield and foreign fixed income securities.
- Merrill Lynch Capital Fund, Inc., invested in shares of a
registered investment company that invests in domestic and/or
foreign equity, debt, and convertible securities.
- Merrill Lynch Equity Index Trust, a collective trust
maintained by Merrill Lynch Trust Company of America indexed
to the S&P 500 Index and invested in a portfolio of equity
securities designed to substantially match the S&P 500 index.
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2. Description of Plan, continued:
- Davis New York Venture Fund, Inc. invested in shares of a
registered investment company that invests primarily in common
stocks or convertible securities of companies with a market
capitalization of at least $250 million. Cash or fixed-income
securities may also be included in the portfolio.
- Alliance Premier Growth Fund, invested in shares of a
registered investment company that invests primarily in equity
securities of a limited number of carefully selected, large
capitalization companies.
- Merrill Lynch Growth Fund, invested in shares of a registered
investment company that invests in equity securities
considered undervalued compared to market averages or the
company's historic values.
- Franklin Small Cap Growth Fund, invested in shares of a
registered investment company that invests primarily in equity
securities of companies which have market capitalizations of
less than $1 billion at the time of investment.
- Ivy International Fund, invested in shares of a registered
investment company that invests primarily in equity securities
traded in European, Pacific Basin and Latin American markets.
Inactive funds are the Tredegar Corporation Common Stock Fund, which
invested in common stock of Tredegar Corporation, and the Ethyl
Corporation Common Stock Fund, which invested in common stock of
Ethyl Corporation.
Participants currently in the Plan may select a program for
investment in any of the ten active funds, or in any combination
thereof. Participants may not contribute to the two inactive funds
nor transfer funds from other options into those funds; however,
dividends earned are reinvested in the inactive funds. Transfers may
be made between active funds and out of the inactive funds. In
addition, participants have a one-time election to transfer the
Company's contributions from the Albemarle Corporation Common Stock
fund to other active funds during the course of their employment.
e. Participant loans: Participants may borrow from their fund accounts
a minimum of $1,000 up to a maximum equal to the lesser of $50,000
or 50 percent of their account balance. Loan transactions are
treated as a transfer to (from) the investment fund from (to) the
Loan fund. Loan terms range from 1-5 years. The loans are
collateralized by the balance in the participant's account and bear
interest at a rate of prime plus one percent on the last day of the
quarter. The interest rate as of December 31, 1999 and 1998, was
9.25% and 8.75%, respectively. Principal and interest is paid
ratably through payroll deductions.
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2. Description of Plan, continued:
f. Payment of benefits: Benefits are recorded when paid. Employees
become fully vested in the Company's matching contribution after
completing five years of service. Employees are considered partially
vested if they have completed from three to five years of service.
Employees may decide whether benefits will be received directly in
the form of a lump sum or rolled over to an individual IRA account or
to another qualified plan.
g. Forfeitures: Employees who leave Albemarle before becoming fully
vested in Albemarle contributions forfeit the value of their
nonvested account. Forfeitures during a plan year serve to reduce
required Company contributions and are reflected in the statement
of changes in assets available for benefits with fund information
in the year in which the forfeitures are applied to Albemarle's
contribution. For the year ended December 31, 1999, $39,728 of
forfeitures became available and will be used as a reduction of
required Company contributions for the 2000 plan year.
3. Investments:
The following table presents investments held at year-end that represent
five percent (5%) or more of assets available for benefits:
1999 1998
Albemarle Corporation common stock $80,379,900* $96,569,689*
Merrill Lynch Equity Index Trust 1 53,061,082 46,551,220
Merrill Lynch Retirement Preservation
Trust 36,396,719 37,691,936
Tredegar Corporation common stock 12,500,550
Ethyl Corporation common stock 12,788,184
* Nonparticipant-directed totals $37,600,083 and $43,637,026 for 1999
and 1998, respectively.
During 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) depreciated
in value by $9,235,467 as follows:
Common stock $(23,512,178)
Mutual Funds and Equity Index Trust 14,276,711
-------------
$ (9,235,467)
=============
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4. Federal Income Taxes:
The Internal Revenue Service advised the plan administrator on July 10,
1995, that the Plan constitutes a qualified trust under Section 401 of
the Internal Revenue Code (the "Code") and is therefore exempt from
federal income taxes. The Plan has been amended since July 10, 1995,
and was restated effective November 1, 1997. Currently the U.S.
Treasury Department has not reviewed these new amendments. However, the
plan administrator and the Plan's legal counsel believe that the Plan
is currently designed and being operated in compliance with the
applicable requirements of the Code. Until such time as participants
withdraw all or part of their accumulated account balance, their
invested funds are not subject to federal income taxes for contributions
made by them and on their behalf by Albemarle or for investment income
received on such investments.
5. Administration Expenses:
Expenses of the Trustee in administering the Plan are paid from Plan
assets, while certain recordkeeping fees and other administrative
charges are borne by Albemarle.
6. Plan Termination:
Although Albemarle has not expressed any intent to do so, it has the
right under the Plan to discontinue its contributions at any time and
terminate the Plan subject to the provisions of the Employee Retirement
Income Security Act of 1974. In the event of Plan termination,
participants will become 100% vested in the Company's matching account
balances and the assets of the Plan shall be allocated to participants
in proportion to their account balances as of the effective date of
termination.
7. Related Party Transactions:
Certain Plan investments are shares of mutual funds managed by Merrill
Lynch, the trustee of the Plan. Participants have the option of
investing in Albemarle common stock.
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SAVINGS PLAN FOR THE EMPLOYEES OF ALBEMARLE CORPORATION
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1999
(in US dollars)
(a) (b) (c) (d) (e)
Identity Description Cost of Current
Each Item Value*
- - - --- -------------------------------------- ------------------------------------------------------ ------------ ------------
** Merrill Lynch Retirement Preservation Collective trust invested in GIC's, BIC's, obligations $ - $ 36,396,719
of U.S. Gov't and U.S. Gov't agencies and high quality
money market securities
PIMCO Total Return Fund Mutual fund that invests in fixed income securities - 5,767,917
** Merrill Lynch Capital Fund, Inc. Mutual fund that invests in equity, debt and - 9,403,866
convertible securities
** Merrill Lynch Equity Index Trust Collective trust indexed to the S&P 500 Index - 53,061,082
Davis New York Venture Fund, Inc. Mutual fund that invests in companies with at least - 5,370,810
$250 million in market capitalization
Alliance Premier Growth Fund Mutual fund that invests in selected equity securities - 10,916,791
of large capitalized companies
** Merrill Lynch Growth Fund Mutual fund that invests in securities which are - 1,833,571
considered undervalued
Franklin Small Cap Growth Fund Mutual fund that invests in companies with less than - 7,129,718
$1 billion in market capitalization
Ivy International Fund Mutual fund that invests in international equity - 1,501,955
securities
** Albemarle Corporation common stock $.01 par value, 4,189,290 shares 65,066,672 80,379,900
Ethyl Corporation common stock $1.00 par value, 2,058,828 shares - 7,205,898
Tredegar Corporation common stock No par value, 502,287 shares - 10,390,807
Loan fund Terms from 1-5 years with interest rate of prime plus - 2,760,412
1 percent, 9.25% at December 31, 1999
------------
Total plan investments $232,119,446
============
<FN>
* See Note 1 of Notes to Financial Statements
** Denotes a party-in-interest to the Plan
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Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S8 (No. 3375622) of Albemarle Corporation of our report dated
June 2, 2000 relating to the financial statements of the Savings Plan for the
Employees of Albemarle Corporation, which appears in this Form 11K.
PricewaterhouseCoopers LLP
Richmond, Virginia
June 2, 2000