1
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended March 31, 1999
Commission File Number 1-6903
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PROFIT SHARING PLAN FOR EMPLOYEES OF TRINITY INDUSTRIES, INC.
AND CERTAIN AFFILIATES
(Full Title of the Plan)
TRINITY INDUSTRIES, INC.
(Name of issuer of the securities held pursuant to the plan)
Delaware 75-0225040
(State of Incorporation) (I.R.S. Employer Identification No.)
2525 Stemmons Freeway Dallas, Texas 75207-2401
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code (214) 631-4420
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2
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Financial Statements and
Supplemental Schedules
CONTENTS
Report of Ernst & Young LLP, Independent Auditors....................... 1
Financial Statements
Statements of Financial Condition as of March 31, 1999 and 1998......... 2
Statements of Income and Changes in Plan Equity for the years
ended March 31, 1999, 1998 and 1997................................ 4
Notes to Financial Statements........................................... 7
Exhibits and Supplemental Schedules
Line 27a - Schedule of Assets Held for Investment Purposes.............. 21
Line 27d - Schedule of Reportable Transactions.......................... 22
Consent of Ernst & Young LLP, Independent Auditors...................... 24
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees have duly caused this Annual Report to be signed by the undersigned
thereunto duly authorized.
Profit Sharing Plan for Employees of Trinity Industries, Inc. and Certain
Affiliates
/S/ John M. Lee
- --------------------------
John M. Lee
Vice President
June 28, 1999
4
Report of Ernst & Young LLP, Independent Auditors
Board of Directors
Trinity Industries, Inc.
We have audited the accompanying statements of financial condition of the Profit
Sharing Plan for Employees of Trinity Industries, Inc. and Certain Affiliates as
of March 31, 1999 and 1998, and the related statements of income and changes in
plan equity for each of the three years in the period ended March 31, 1999.
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 financial condition of the Plan at March 31, 1999 and
1998, and the income and changes in Plan equity for each of the three years in
the period ended March 31, 1999, 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 accompanying supplemental schedules of assets
held for investment purposes as of March 31, 1999, and reportable transactions
for the year then ended, are presented for purpose of additional analysis and
are not a required part of the 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 Fund Information in the statements of financial condition and
the statements of income and changes in plan equity is presented for purposes of
additional analysis rather than to present the financial condition and income
and changes in plan equity of each fund. The supplemental schedules and Fund
Information have been subjected to the auditing procedures applied in our audits
of the financial statements and, in our opinion, are fairly stated in all
material respects in relation to the financial statements taken as a whole.
ERNST & YOUNG LLP
Dallas, Texas
June 18, 1999
5
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Statement of Financial Condition, with Fund Information
March 31, 1999
CHASE
VISTA CHASE CHASE
PRIME CORE VISTA CHASE
STOCK PUTNAM MONEY EQUITY U.S. VISTA
ACCOUNT VOYAGER MARKET FUND TREASURY BALANCED
------------ ------------ ------------ ------------ ------------ ------------
ASSETS
Cash $ $ $ $ $ $
-- -- 24 -- -- --
Notes receivable from -- -- -- -- -- --
participants
Investment in Trinity
Industries, Inc. common stock,
at fair value 14,157,579 -- -- -- -- --
($13,230,551 cost)
Investment in Halter Marine
Group, Inc. common stock, at
fair value 880,943 -- -- -- -- --
($2,969,517 cost)
Investment in mutual funds, at
fair value ($99,245,222 cost) -- 28,896,556 44,132,441 26,643,069 8,611,647 46,266
Interest income receivable -- -- -- -- 9,874 --
Contribution receivable from 980,679 1,319,348 1,852,530 1,195,145 398,008 53,395
Trinity
Contribution receivable from
employees 123,016 165,767 189,611 151,219 47,995 8,463
------------ ------------ ------------ ------------ ------------ ------------
Plan equity $ 16,142,217 $ 30,381,671 $ 46,174,606 $ 27,989,433 $ 9,067,524 $ 108,124
============ ============ ============ ============ ============ ============
CHASE VISTA
INTERNATIONAL PARTICIPANT
EQUITY LOANS TOTAL
------------ ------------ ------------
ASSETS
Cash $ $ $
-- -- 24
Notes receivable from -- 1,442,735 1,442,735
participants
Investment in Trinity
Industries, Inc. common stock,
at fair value -- -- 14,157,579
($13,230,551 cost)
Investment in Halter Marine
Group, Inc. common stock, at
fair value -- -- 880,943
($2,969,517 cost)
Investment in mutual funds, at
fair value ($99,245,222 cost) 12,538 -- 108,342,517
Interest income receivable -- -- 9,874
Contribution receivable from 11,192 -- 5,810,297
Trinity
Contribution receivable from
employees 2,152 42,181 730,404
------------ ------------ ------------
Plan equity $ 25,882 $ 1,484,916 $131,374,373
============ ============ ============
See accompanying notes.
2
6
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Statement of Financial Condition, with Fund Information
March 31, 1998
PUTNAM
GUARANTEED PUTNAM U.S. GOVT.
STOCK INVESTMENT GROWTH & INCOME
ACCOUNT ACCOUNT INCOME TRUST
------------ ------------ ------------ ------------
ASSETS
Cash and short-term investments $ 311,055 $ 2,187,542 $ 15,001 $ 15,276
Notes receivable from participants -- -- -- --
Investment in Trinity Industries, Inc.
common stock, at fair value ($9,856,316 23,455,410 -- -- --
cost)
Investment in Halter Marine Group, Inc.
common stock, at fair value ($3,472,278 2,771,188 -- -- --
cost)
Investment in guaranteed investment
contracts, at contract value -- 37,478,543 -- --
Investment in mutual funds, at fair value
($39,991,701 cost) -- -- 21,241,233 6,845,093
Interest receivable 1,243 195,007 259 123
Contribution receivable from Trinity 681,292 1,406,200 902,855 264,223
Contribution receivable from employees -- -- -- --
------------ ------------ ------------ ------------
Plan equity $ 27,220,188 $ 41,267,292 $ 22,159,348 $ 7,124,715
============ ============ ============ ============
PUTNAM PARTICIPANT
VOYAGER LOANS TOTAL
------------ ------------ ------------
ASSETS
Cash and short-term investments $ 14,999 $ 76,521 $ 2,620,394
Notes receivable from participants -- 1,266,866 1,266,866
Investment in Trinity Industries, Inc.
common stock, at fair value ($9,856,316 -- -- 23,455,410
cost)
Investment in Halter Marine Group, Inc.
common stock, at fair value ($3,472,278 -- -- 2,771,188
cost)
Investment in guaranteed investment
contracts, at contract value -- -- 37,478,543
Investment in mutual funds, at fair value
($39,991,701 cost) 22,909,895 -- 50,996,221
Interest receivable 285 812 197,729
Contribution receivable from Trinity 981,319 -- 4,235,889
Contribution receivable from employees -- 39,993 39,993
------------ ------------ ------------
Plan equity $ 23,906,498 $ 1,384,192 $123,062,233
============ ============ ============
See accompanying notes.
3
7
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Statement of Income and Changes in Plan Equity with Fund Information
Year ended March 31, 1999
PUTNAM CHASE
U.S. VISTA
GUARANTEED PUTNAM GOVT. PRIME
STOCK INVESTMENT GROWTH & INCOME PUTNAM MONEY
ACCOUNT ACCOUNT INCOME TRUST VOYAGER MARKET
------------- ------------- ------------- ------------- ------------- -------------
Net investment income:
Interest $ 11,833 $ 2,187,308 $ 3,344 $ 1,837 $ 4,042 $ 509,445
Dividends 386,374 -- 2,017,648 426,349 1,851,484 --
------------- ------------- ------------- ------------- ------------- -------------
398,207 2,187,308 2,020,992 428,186 1,855,526 509,445
Net realized gain (loss) on
sale of investments (80,991) -- 3,340,788 (71,418) 502,063 --
Unrealized appreciation
(depreciation) of
investments (14,104,550) -- (4,451,348) (19,258) 1,460,688 --
Contributions:
Employee contributions 3,281,801 3,968,916 3,022,426 853,395 4,410,888 1,285,100
Employer contributions 980,679 -- -- -- 1,319,348 1,852,530
------------- ------------- ------------- ------------- ------------- -------------
4,262,480 3,968,916 3,022,426 853,395 5,730,236 3,137,630
Withdrawals, distributions,
transfers and other (1,553,117) (47,423,516) (26,092,206) (8,315,620) (3,073,340) 42,527,531
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in
plan equity (11,077,971) (41,267,292) (22,159,348) (7,124,715) 6,475,173 46,174,606
Plan equity at beginning of
year 27,220,188 41,267,292 22,159,348 7,124,715 23,906,498 --
------------- ------------- ------------- ------------- ------------- -------------
Plan equity at end of year $ 16,142,217 $ -- $ -- $ -- $ 30,381,671 $ 46,174,606
============= ============= ============= ============= ============= =============
CHASE
CORE CHASE CHASE CHASE VISTA
EQUITY VISTA U.S. VISTA INTERNATIONAL PARTICIPANT
FUND TREASURY BALANCED EQUITY LOANS TOTAL
------------- ------------- ------------- ------------- ------------- -------------
Net investment income:
Interest $ -- $ 9,874 $ -- $ -- $ 3,836 $ 2,731,519
Dividends 2,568 126,563 286 -- -- 4,811,272
------------- ------------- ------------- ------------- ------------- -------------
2,568 136,437 286 -- 3,836 7,542,791
Net realized gain (loss) on
sale of investments 138 (33) -- -- -- 3,690,547
Unrealized appreciation
(depreciation) of
investments 1,212,586 (110,113) 147 71 -- (16,011,777)
Contributions:
Employee contributions 910,036 284,455 53,720 14,590 452,921 18,538,248
Employer contributions 1,195,145 398,008 53,395 11,192 -- 5,810,297
------------- ------------- ------------- ------------- ------------- -------------
2,105,181 682,463 107,115 25,782 452,921 24,348,545
Withdrawals, distributions,
transfers and other 24,668,960 8,358,770 576 29 (356,033) (11,257,966)
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in
plan equity 27,989,433 9,067,524 108,124 25,882 100,724 8,312,140
Plan equity at beginning of
year -- -- -- -- 1,384,192 123,062,233
------------- ------------- ------------- ------------- ------------- -------------
Plan equity at end of year $ 27,989,433 $ 9,067,524 $ 108,124 $ 25,882 $ 1,484,916 $ 131,374,373
============= ============= ============= ============= ============= =============
See accompanying notes
4
8
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Statement of Income and Changes in Plan Equity, with Fund Information
Year ended March 31, 1998
GUARANTEED PUTNAM PUTNAM U.S.
STOCK INVESTMENT GROWTH & GOVT. INCOME
ACCOUNT ACCOUNT INCOME TRUST
------------- ------------- ------------- -------------
Net investment income:
Interest $ 13,478 $ 2,357,177 $ 3,746 $ 1,695
Dividends 280,127 -- 2,294,268 387,367
------------- ------------- ------------- -------------
293,605 2,357,177 2,298,014 389,062
Net realized gain (loss) on sale of investments 347,060 -- 238,425 (4,246)
Unrealized appreciation (depreciation) of
investments 12,455,553 -- 2,388,560 202,427
Contributions:
Employee contribution 2,761,318 4,682,007 3,178,363 924,506
Employer contribution 681,292 1,406,200 902,855 264,223
------------- ------------- ------------- -------------
3,442,610 6,088,207 4,081,218 1,188,729
Withdrawals, distributions,
transfers and other (1,809,717) (4,445,632) (688,901) (407,255)
------------- ------------- ------------- -------------
Net increase in plan equity 14,729,111 3,999,752 8,317,316 1,368,717
Plan equity at beginning of year 12,491,077 37,267,540 13,842,032 5,755,998
------------- ------------- ------------- -------------
Plan equity at end of year $ 27,220,188 $ 41,267,292 $ 22,159,348 $ 7,124,715
============= ============= ============= =============
PUTNAM PARTICIPANT
VOYAGER LOANS TOTAL
------------- ------------- -------------
Net investment income:
Interest $ 4,569 $ 5,414 $ 2,386,079
Dividends 1,091,255 -- 4,053,017
------------- ------------- -------------
1,095,824 5,414 6,439,096
Net realized gain (loss) on sale of investments 365,269 -- 946,508
Unrealized appreciation (depreciation) of
investments 5,733,735 (1,483) 20,778,792
Contributions:
Employee contribution 3,627,687 457,886 15,631,767
Employer contribution 981,319 -- 4,235,889
------------- ------------- -------------
4,609,006 457,886 19,867,656
Withdrawals, distributions,
transfers and other (1,445,982) (100,856) (8,898,343)
------------- ------------- -------------
Net increase in plan equity 10,357,852 360,961 39,133,709
Plan equity at beginning of year 13,548,646 1,023,231 83,928,524
------------- ------------- -------------
Plan equity at end of year $ 23,906,498 $ 1,384,192 $ 123,062,233
============= ============= =============
See accompanying notes.
5
9
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Statement of Income and Changes in Plan Equity, with Fund Information
Year ended March 31, 1997
GUARANTEED PUTNAM PUTNAM U.S.
STOCK INVESTMENT GROWTH & GOVT. INCOME
ACCOUNT ACCOUNT INCOME TRUST
------------ ------------ ------------ ------------
Net investment income:
Interest $ 4,733 $ 2,618,472 $ 2,184 $ 335,753
Dividends 277,519 -- 961,995 --
------------ ------------ ------------ ------------
282,252 2,618,472 964,179 335,753
Net realized gain (loss) on sale of investments 26,352 -- 36,728 (29,828)
Unrealized appreciation (depreciation) of
investments (2,325,333) -- 676,370 (32,663)
Contributions:
Employee contribution 2,758,108 5,065,279 2,387,157 953,693
Employer contribution 676,128 1,779,673 758,561 271,819
------------ ------------ ------------ ------------
3,434,236 6,844,952 3,145,718 1,225,512
Withdrawals, distributions,
transfers and other (1,494,617) (6,515,500) 1,544,735 (190,070)
Halter Maine Group, Inc. divestiture (1,556,223) (7,473,914) (1,220,040) (658,137)
------------ ------------ ------------ ------------
Net increase (decrease) in plan equity (1,633,333) (4,525,990) 5,147,690 650,567
Plan equity at beginning of year 14,124,410 41,793,530 8,694,342 5,105,431
------------ ------------ ------------ ------------
Plan equity at end of year $ 12,491,077 $ 37,267,540 $ 13,842,032 $ 5,755,998
============ ============ ============ ============
PUTNAM PARTICIPANT
VOYAGER LOANS TOTAL
------------ ------------ ------------
Net investment income:
Interest $ 3,032 $ 7,358 $ 2,971,532
Dividends 642,747 -- 1,882,261
------------ ------------ ------------
645,779 7,358 4,853,793
Net realized gain (loss) on sale of investments 21,920 -- 55,172
Unrealized appreciation (depreciation) of
investments (928,839) 1,483 (2,608,982)
Contributions:
Employee contribution 2,751,676 332,111 14,248,024
Employer contribution 906,172 -- 4,392,353
------------ ------------ ------------
3,657,848 332,111 18,640,377
Withdrawals, distributions,
transfers and other 3,469,873 (238,145) (3,423,724)
Halter Maine Group, Inc. divestiture (1,383,931) -- (12,292,245)
------------ ------------ ------------
Net increase (decrease) in plan equity 5,482,650 102,807 5,224,391
Plan equity at beginning of year 8,065,996 920,424 78,704,133
------------ ------------ ------------
Plan equity at end of year $ 13,548,646 $ 1,023,231 $ 83,928,524
============ ============ ============
See accompanying notes.
6
10
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements
March 31, 1999 and 1998
1. DESCRIPTION OF THE PLAN
GENERAL
The Profit Sharing Plan for Employees of Trinity Industries, Inc. and Certain
Affiliates (the Plan) was adopted by the Board of Directors of Trinity
Industries, Inc. (the Board) on December 11, 1986 and became effective January
1, 1987, for eligible employees of Trinity Industries, Inc. and Certain
Affiliates (the Employer). The Plan was amended and restated effective April 1,
1994. The Plan is a defined contribution plan designed to comply with the
provisions of Title I of the Employee Retirement Income Security Act of 1974
(ERISA). The following is a brief description of the Plan. Participants should
refer to the Plan document for complete information regarding the Plan. The
Plan's fiscal year end is March 31.
DIVESTITURE
At the close of business on March 31, 1997, Trinity Industries, Inc. completed
the divestiture, which commenced on September 26, 1996, of Halter Marine Group,
Inc. (Halter) by distributing the remaining shares of Halter stock to its
stockholders in the form of a tax-free distribution. The Plan received .348
shares of Halter common stock for each share of Trinity Common Stock held in the
Plan in the form of a tax-free distribution.
The financial statements for the year ended March 31, 1997 reflect the transfer
of participants' assets, who were employed by Halter, out of the Plan.
PARTICIPATION
Each employee is eligible to contribute to the Plan on the first day of the
calendar quarter on or immediately following his employment date with the
Company and must meet the following requirements:
Must be classified as a full-time, part-time, or temporary employee of
Trinity Industries, Inc.; and
Must be in a unit of employees who are designated as eligible to
participate in the Plan; and
Must not be included in a unit of employees covered by a collective
bargaining agreement unless benefits under this Plan were included in an
agreement as a result of good faith bargaining.
7
11
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
Eligible employees automatically become participants and must indicate on the
form or forms provided by the Plan Committee (Committee) whether or not they
want to make contributions to the Plan. If they elect to contribute, they will
authorize the Employer to make payroll deductions for contributions to the Plan.
CONTRIBUTIONS
For fiscal years 1999 and 1998, each Plan participant agreed to contribute not
less than two percent nor more than fourteen percent of their compensation in
one percent increments as designated by the participant. A participant's salary
reduction may not exceed specified IRS limits for each calendar year. A salary
reduction and contribution agreement must be entered into by each employee as
the employee begins participation in the Plan and may be amended by such
employee twice each year.
Employer matching contributions shall be made if Company earnings are at least
sufficient to pay dividends to stockholders ($0.69, $0.68, and $0.68 per share
for the years ended March 31, 1999, 1998, and 1997, respectively) but in no
event less than $0.33 per share of common stock. Effective April 1, 1998, if the
Employer matching contribution is made, then each participant shall receive an
amount equal to a percentage of that portion of such participant's employee
contribution up to six percent of such participant's total compensation for the
year under the following schedule:
PERCENTAGE OF
YEARS OF SERVICE EMPLOYER CONTRIBUTION
Less than 1 0%
1 but less than 2 25%
2 but less than 3 30%
3 but less than 4 35%
4 but less than 5 40%
5 years 50%
Prior to April 1, 1998, if the Employer matching contribution was made, then
each participant with at least five years of service received an amount equal to
50 percent of that portion of such participant's employee contribution up to six
percent of such participant's total compensation for the year, and each
participant with at least one but less than five years of service received an
amount equal to 25 percent of that portion of such participant's employee
contribution up to
8
12
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
six percent of such participant's total compensation for the year.
Employer contributions are net of forfeitures, as defined. Employer
contributions for a given plan year shall be deposited in the Profit Sharing
Trust for Employees of Trinity Industries, Inc. and Certain Affiliates (the
Trust Fund) as defined below, no later than the date on which the Employer files
its federal income tax return for such year.
The Employer and Chase Bank of Texas, N.A. (the Trustee) have entered into a
Trust Agreement under which the latter acts as Trustee under the Plan.
The Plan offers the following investment options (hereafter collectively
referred to as the Trust Fund):
Trinity Stock Investment Account (Stock Account) is an investment in
shares of Employer common stock purchased on behalf of the participants
and Halter common stock by virtue of the tax-free distribution. Idle
cash is invested in interest-bearing accounts until such time as it can
be utilized to purchase Employer common stock.
Guaranteed Investment Contract Account (the Guaranteed Investment
Account) is an investment in guaranteed investment contracts issued by
various insurance companies selected annually by the Committee.
Effective January 1, 1999, the Guaranteed Investment Account is no
longer an investment option.
At March 31, 1998, the guaranteed investment contracts had guaranteed
annual rates of return of 7.33% (GAC 8672), 6.08% (GAC 20254), and
5.66% (GAC 16795). The crediting interest rates approximated average
yields.
Participant's accounts invested in the Guaranteed Investment Account earn
interest at a rate blended from all of the contracts included in the Guaranteed
Investment Account. The account is credited with earnings on the underlying
investments and charged for plan withdrawals and administrative expenses charged
by the insurance companies. Transfers of participants accounts to and from the
Guaranteed Investment Account are not permitted. However, during fiscal year
1997, participants were offered a one-time option to transfer monies out of the
Guaranteed Investment Account and into other fund options.
9
13
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
Mutual Funds Investment Accounts are investments in registered
investment companies selected by the Committee. At March 31, 1999 the
funds are Putnam Voyager, Chase Vista Prime Money Market, Chase Core
Equity, Chase Vista U.S. Treasury, Chase Vista Balanced, and Chase
Vista International Equity. At March 31, 1998, the funds were Putnam
U.S. Government Income Trust, Putnam Growth and Income, and Putnam
Voyager.
Participants may elect the extent to which assets are invested in the options
described above in increments of 10% or 25%.
The number of participants in each fund as of March 31, 1999 and 1998,
respectively, was as follows: 10,606 and 3,936 in Stock Account, 0 and 4,543 in
Guaranteed Interest Account, 0 and 4,150 in Putnam Growth & Income, 0 and 1,743
in Putnam U.S. Government Income Trust, 6,508 and 4,246 in Putnam Voyager, 9,182
and 0 in Chase Vista Prime Money Market, 6,550 and 0 in Chase Core Equity, 3,786
and 0 in Chase Vista U.S. Treasury, 290 and 0 in Chase Vista Balanced Fund, and
118 and 0 in Chase Vista International Equity.
BENEFITS
Distribution of a participant's account balance is payable upon retirement at or
after age 65, total disability, death, or termination of employment.
Distribution is equal to the salary reduction contribution and related earnings
plus the vested portion of the Employer contribution and related earnings.
Withdrawals of up to 100 percent of the employee contribution can be made only
to meet "immediate and heavy financial needs" (medical care, college tuition,
the purchase of a principal residence, or to prevent the foreclosure on a
principal residence) as long as the funds are not available for such needs from
other sources. No withdrawal can be made against the earnings on the employee
contributions or against the Employer contribution and related earnings. These
restrictions no longer apply when the participant reaches age 59 1/2.
Loans for "immediate and heavy financial needs" may be made for a minimum of
$1,000 up to a maximum of $50,000, not to exceed 50% of the Employee
contribution and related earnings and not to exceed 50% of the vested portion of
the Employer contribution and related earnings. Loans are subject to rules and
regulations established by the Committee, as defined in the Plan.
10
14
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
VESTING
The Employer contribution and related earnings (losses) vest to participants,
depending upon the number of years of vesting service, as defined, completed by
such participant as follows:
YEARS OF SERVICE PERCENTAGE VESTED
------------------ -----------------
Less than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
Participants are 100% vested in their Employer contribution and allocated
portion of related earnings (losses) upon their attainment of age 65 and are
always 100% vested in their employee contribution and related earnings (losses)
on such contribution.
ADMINISTRATION OF THE PLAN
The Plan is administered by the Committee, consisting of at least three persons
who are appointed by the Board. The members of the Committee serve at the
discretion of the Board, and any Committee member who is an employee of the
Employer shall not receive compensation for his services.
A separate account is maintained for each participant. The Plan provides that
account balances for participants are adjusted periodically as follows:
Employee contributions are generally allocated on a quarterly basis;
Participant's share of the Employer contribution shall be allocated to
the participant's account as of a date no later than the last day of
the Plan year;
11
15
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
Earnings and appreciation or depreciation in the fair value of
investment assets of the Trust Fund for each calendar quarter shall be
allocated to the accounts of participants, former participants and
beneficiaries who had unpaid balances in their accounts on the last day
of such calendar quarter in proportion to the balances in such accounts
at the beginning of the calendar quarter.
Upon request, distributions shall be made no earlier than the later of the last
day of the calendar quarter in which entitlement occurs or the date on which the
Committee determines the final balances. Distributions from the Stock Account
shall be made in cash unless otherwise designated by the participant.
INCOME TAX STATUS
The Plan has received determination letters from the Internal Revenue Service
dated November 4, 1994, September 27, 1996, April 30, 1997 and December 9, 1998,
stating that the Plan is qualified under Section 401(a) of the Internal Revenue
Code (the Code) and, therefore, the related trust is exempt from taxation. Once
qualified, the Plan is required to operate in conformity with the Code to
maintain its qualification. The Plan Administrator believes the Plan is being
operated in compliance with the applicable requirements of the Code and,
therefore, believes that the Plan is qualified and the related trust is tax
exempt.
Employee contributions and Employer contributions are not included in the
participant's federal taxable income in the year such contribution are made. A
participant shall not be subject to federal income taxes with respect to
participation in the Plan until the amounts are withdrawn or distributed.
AMENDMENT OR TERMINATION OF THE PLAN
The Employer may amend the Plan at any time. However, no amendment, unless made
to secure approval of the Internal Revenue Service or other governmental agency,
may operate retroactively to reduce or divest the then vested interest in the
Plan of any participant, former participant or beneficiary, or to reduce or
divest any benefit payable under the Plan unless all participants, former
participants and beneficiaries then having vested interests or benefit payments
affected thereby consent to such amendment.
12
16
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
The Employer may terminate the Plan at any time. Upon complete or partial
termination, the accounts of all participants affected thereby shall become 100%
vested, and the Committee shall direct the Trustee to distribute the assets in
the Trust Fund, after receipt of any required approval by the Internal Revenue
Service and payment of any expenses properly chargeable thereto, to
participants, former participants, and beneficiaries in proportion to their
respective account balances.
2. SIGNIFICANT ACCOUNTING POLICIES
INVESTMENTS AND NET INVESTMENT INCOME
Cash and cash equivalents are valued at cost which approximates fair value.
Investments in the common stock of the Employer and Halter are value at their
quoted market price. Investment in mutual funds are valued at the quoted market
prices which represent the net asset value of shares held by the Plan at year
end. The fair value approximates the recorded contract value for the guaranteed
investment contracts.
Security transactions are recorded on a trade date basis. The statements of
income and changes in Plan equity include net unrealized appreciation or
depreciation in fair value on investments.
The Plan's financial statements are prepared on an accrual basis of accounting.
REALIZED GAINS AND LOSSES
Realized gains and losses have been calculated using average cost.
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates that affect the
amounts in the financial statements and accompanying notes. Actual results could
differ from those estimates.
13
17
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
3. INVESTMENTS
Investments are as follows:
MARCH 31, 1999 MARCH 31, 1998
---------------------------------------- ---------------------------------------
NO. OF NO. OF
SHARES COST FAIR VALUE SHARES COST FAIR VALUE
---------- ------------ ------------ --------- ------------ ------------
Trinity Industries, Inc. common stock 481,960 $ 13,230,551 $ 14,157,579* 426,462 $ 9,856,316 $ 23,455,410*
Halter Marine Group, Inc. common stock
151,560 2,969,517 880,943 174,563 3,427,278 2,771,188
Guaranteed investment contracts:
GAC 20254 -- -- -- -- 16,156,699 16,156,699*
GAC 8672 -- -- -- -- 4,167,290 4,167,290
GAC 16795 -- -- -- -- 17,154,554 17,154,554*
------------ ------------ ------------ ------------
-- -- -- -- 37,478,543 37,478,543
Mutual funds:
Putnam Growth & Income -- -- -- 1,409,471 16,789,885 21,241,233*
Putnam U.S. Gov't Income Trust -- -- -- 594,704 6,825,834 6,845,093*
Putnam Voyager 1,245,004 20,901,928 28,896,556* 1,308,932 16,375,982 22,909,895*
Chase Core Equity 936,487 25,430,433 26,643,069* -- -- --
Chase Vista International Equity 999 12,517 12,538 -- -- --
Chase Vista Balanced 2,882 46,119 46,266 -- -- --
Chase Vista Prime Money Market 44,132,441 44,132,441 44,132,441* -- -- --
Chase Vista US Treasury 774,428 8,721,784 8,611,647* -- -- --
------------ ------------ ------------ ------------
99,245,222 108,342,517 39,991,701 50,996,221
Participant loans 1,442,735 1,442,735 1,266,866 1,266,866
------------ ------------ ------------ ------------
$116,888,025 $124,823,774 $ 92,020,704 $115,968,228
============ ============ ============ ============
* Individual investment represents 5% or more of the fair value of net assets.
14
18
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
4. RECONCILIATION OF FINANCIAL STATEMENTS TO THE FORM 5500
The following is a reconciliation of Plan equity per the financial statements to
the Form 5500:
MARCH 31
1999 1998
------------- -------------
Plan equity per the financial statements $ 131,374,373 $ 123,062,233
Amounts allocated to withdrawing participants (4,665,228) (2,792,574)
------------- -------------
Plan equity per the Form 5500 $ 126,709,145 $ 120,269,659
============= =============
The following is a reconciliation of withdrawals, distributions, and transfers
per the financial statements to the Form 5500:
YEAR ENDED
MARCH 31,
1999
-----------
Withdrawals, distributions and transfers per the
financial statements $11,257,966
Amounts allocated to withdrawing participants at end of year 4,665,228
Amounts allocated to withdrawing participants at beginning of year (2,792,574)
-----------
Withdrawals, distributions and transfers per the Form 5500
$13,130,620
===========
Amounts allocated to withdrawing participants are recorded on the Form 5500 for
withdrawals that have been processed and approved for payment prior to March 31
but not yet paid as of that date.
15
19
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
5. UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS AND NET REALIZED GAIN
OR LOSS ON SALE OF INVESTMENTS
Unrealized appreciation (depreciation) of investments in Trinity and Halter
common stock, mutual funds, and participant loans for the years ended March 31,
1999, 1998, and 1997 were determined as follows:
INVESTMENTS AT INVESTMENTS AT NET INCREASE
FAIR VALUE COST (DECREASE)
------------- ------------- -------------
March 31, 1999
Trinity common stock
March 31, 1999 $ 14,157,579 $ 13,230,551 $ 927,028
March 31, 1998 23,455,410 9,856,316 13,599,094
------------- ------------- -------------
(9,297,831) 3,374,235 (12,672,066)
Halter common stock
March 31, 1999 880,941 2,969,517 (2,088,576)
March 31, 1998 2,771,188 3,427,278 (656,090)
------------- ------------- -------------
(1,890,245) (457,761) (1,432,486)
Mutual funds
March 31, 1999 108,342,517 99,245,222 9,097,295
March 31, 1998 50,996,221 39,991,701 11,004,520
------------- ------------- -------------
57,346,296 59,253,521 (1,907,225)
Participant loans
March 31, 1999 1,442,735 1,442,735 --
March 31, 1998 1,266,866 1,266,866 --
------------- ------------- -------------
175,869 175,869 --
Unrealized depreciation of
investments ($ 16,011,777)
=============
16
20
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
5. UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS AND NET REALIZED GAIN
OR LOSS ON SALES OF INVESTMENTS (CONTINUED)
INVESTMENTS AT INVESTMENTS AT NET INCREASE
FAIR VALUE COST (DECREASE)
------------ ------------ ------------
March 31, 1998
Trinity common stock
March 31, 1998 $ 23,455,410 $ 9,856,316 $ 13,599,094
March 31, 1997 11,707,801 11,220,350 487,451
------------ ------------ ------------
11,747,609 (1,364,034) 13,111,643
Halter common stock
March 31, 1998 2,771,188 3,427,278 (656,090)
March 31, 1997 -- -- --
------------ ------------ ------------
2,771,188 3,427,278 (656,090)
Mutual funds
March 31, 1998 50,996,221 39,991,701 11,004,520
March 31, 1997 30,931,691 28,251,893 2,679,798
------------ ------------ ------------
20,064,530 11,739,808 8,324,722
Participant loans
March 31, 1998 1,266,866 1,266,866 --
March 31, 1997 959,157 957,674 1,483
------------ ------------ ------------
307,709 309,192 (1,483)
Unrealized appreciation of
investments $ 20,778,792
============
17
21
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
5. UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS AND NET REALIZED GAIN
OR LOSS ON SALE OF INVESTMENTS (CONTINUED)
INVESTMENTS AT INVESTMENTS AT NET INCREASE
FAIR VALUE COST (DECREASE)
------------ ------------ ------------
March 31, 1997
Trinity common stock
March 31, 1997 $ 11,707,801 $ 11,220,350 $ 487,451
March 31, 1996 13,156,629 10,343,846 2,812,783
------------ ------------ ------------
(1,448,828) 876,504 (2,325,332)
Putnam mutual funds
March 31, 1997 30,931,691 28,251,893 2,679,798
March 31, 1996 19,569,446 16,604,515 2,964,931
------------ ------------ ------------
11,362,245 11,647,378 (285,133)
Participant loans
March 31, 1997 959,157 957,674 1,483
March 31, 1996 863,724 863,724 --
------------ ------------ ------------
95,433 93,950 1,483
Unrealized depreciation of
investments ($ 2,608,982)
============
18
22
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
5. UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS AND NET REALIZED GAIN
OR LOSS ON SALE OF INVESTMENTS (CONTINUED)
Net realized gain or loss on sale of investments in Trinity and Halter common
stock, mutual funds, and participant loans for the years ended March 31, 1999,
1998, and 1997 are as follows:
NET REALIZED
GAIN OR LOSS ON
AGGREGATE AGGREGATE SALE OF
PROCEEDS COST INVESTMENTS
----------- ----------- -----------
March 31, 1999
Trinity common stock $ 1,697,458 $ 1,625,336 $ 72,122
Halter common stock 473,362 626,475 (153,113)
Mutual funds 82,705,695 78,934,157 3,771,538
----------- ----------- -----------
$84,876,515 $81,185,968 $ 3,690,547
=========== =========== ===========
March 31, 1998
Trinity common stock $ 1,221,055 $ 1,067,942 $ (153,113)
Halter common stock 1,097,263 903,316 193,947
Mutual funds 16,697,796 16,098,348 599,448
----------- ----------- -----------
$19,016,114 $18,069,606 $ 946,508
=========== =========== ===========
March 31, 1997
Trinity common stock $ 3,709,239 $ 3,682,887 $ 26,352
Halter common stock -- -- --
Mutual funds 16,262,136 16,233,316 28,820
----------- ----------- -----------
$19,971,375 $19,916,203 $ 55,172
=========== =========== ===========
19
23
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Notes to Financial Statements (continued)
6. EXPENSES
The expenses incurred by the Trustee in the performance of its duties, including
the Trustee's compensation and the services of the recordkeeper, shall be paid
by the Plan unless paid by the Employer. The Employer paid $337,328, $526,177,
and $187,993 for recordkeeping and trustee fees on behalf of the Plan for the
fiscal years ended March 31, 1999, 1998, and 1997, respectively.
7. YEAR 2000 (UNAUDITED)
The Company has determined that it will be necessary to take certain steps in
order to ensure that the Plan's information technology (IT) systems are prepared
to handle year 2000 date issues. Both internal and external resources are being
utilized to replace or modify existing IT systems and software applications, and
to test those systems and applications for year 2000 compliance. Approximately
$3.6 million has been spent on compliance efforts company-wide, and an
additional $3.3 million is expected to be spent by the year 2000.
In addition, Plan management has established formal communications with its
third-party service providers to determine if they have developed plans to
address their own year 2000 issues as they relate to the Plan's operations. All
third-party service providers have indicated that they will be year 2000
compliant before critical dates occur. At this time, the Company believes all
significant areas have been identified, remediation is on schedule, and
contingency plans to deal with year 2000 issues will be in place.
8. SUBSEQUENT EVENT
Effective April 1, 1999, the Plan was amended and restated to change the
following: eligibility begins on the first of the month following 60 days of
employment; salary deferral increases or decreases are allowed for any pay
period; the Plan's assets are valued daily; two loans may be outstanding at one
time; investment transfers are permitted on any business day; and salary
deferrals can range from 1% to 14%.
20
24
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Line 27a - Schedule of Assets Held for Investment Purposes
March 31, 1999
(e)
(b) (c) (d) CURRENT
(a) IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT COST VALUE
- ------- ------------------------ --------------------------------- ------------ ------------
* Trinity Industries, Inc. Common stock; 481,960 shares $ 13,230,551 $ 14,157,579
* Halter Marine Group, Inc. Common stock; 151,560 shares 2,969,517 880,943
* Putnam Investments, Inc. Voyager mutual fund; 1,245,004
shares 20,901,928 28,896,556
* Chase Bank of Texas, N.A. Chase Core Equity; mutual fund;
936,487 shares 25,430,433 26,643,069
Chase Vista International Equity;
mutual fund; 999 shares
12,517 12,538
Chase Vista Balanced; mutual fund;
2,882 shares 46,119 46,266
Chase Vista Prime Money Market;
mutual fund; 44,132,441 shares
44,132,441 44,132,441
Chase Vista U.S. Treasury; mutual
fund; 774,428 shares 8,721,784 8,611,647
* Participants Loans with interest rates ranging
from 9.25% to 10.5% - 1,442,735
------------ ------------
$115,445,290 $124,823,774
============ ============
* Party-in-interest
21
25
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Line 27d - Schedule of Reportable Transactions
Year ended March 31, 1999
(h)
(b) (c) (d) (g) CURRENT VALUE OF (i)
(a) DESCRIPTION PURCHASE SELLING COST OF ASSET ON NET GAIN OR
IDENTITY OF PARTY INVOLVED OF ASSET PRICE PRICE ASSET TRANSACTION DATE (LOSS)
- --------------------------- ------------- ---------- ----------- ----------- ---------------- -----------
Category (i) - Individual transactions in excess of 5% of Plan assets.
Chase Bank of Texas, N.A Short-term Money Market $21,396,821 $ -- $21,396,821 $21,396,821 $ --
20,440,325 -- 20,440,325 20,440,325 --
8,183,891 -- 8,183,891 8,183,891 --
24,607,237 -- 24,607,237 24,607,237 --
-- 42,667,333 42,667,333 42,667,333 --
-- 24,607,237 24,607,237 24,607,237 --
-- 8,305,104 8,305,104 8,305,104 --
Putnam Investments, Inc. Growth & Income -- 24,607,238 21,432,817 24,607,238 3,174,421
Putnam Investments, Inc. U.S. Government Income Trust -- 8,142,614 8,215,947 8,142,614 (73,333)
Chase Bank of Texas, N.A Core Equity 24,654,560 -- 24,654,560 24,654,560 --
Chase Bank of Texas, N.A Prime Money Market 42,495,141 -- 42,495,141 42,495,141 --
Chase Bank of Texas, N.A U.S. Treasury 8,353,611 -- 8,353,611 8,353,611 --
Metropolitian Life
Insurance Co. GAC 20254 -- 16,891,397 16,891,397 16,891,397 --
Travelers GAC 16795 -- 19,896,534 19,896,534 19,896,534 --
Travelers GAC 16956 19,983,759 -- 19,983,759 19,983,759 --
-- 20,440,325 20,440,325 20,440,325 --
22
26
Profit Sharing Plan for Employees of
Trinity Industries, Inc. and Certain Affiliates
Line 27d - Schedule of Reportable Transactions (continued)
Year ended March 31, 1999
(h)
(b) (c) (d) (g) CURRENT VALUE OF (i)
(a) DESCRIPTION PURCHASE SELLING COST OF ASSET ON NET GAIN OR
IDENTITY OF PARTY INVOLVED OF ASSET PRICE PRICE ASSET TRANSACTION DATE (LOSS)
- -------------------------- ----------- ----------- ----------- ----------- ---------------- -----------
Category (iii) - Series of securities transactions in excess of 5% of Plan assets.
Travelers GAC 16956 $20,437,394 $ -- $ 20,437,394 $20,437,394 $ --
-- 20,440,325 20,440,325 20,440,325 --
Travelers GAC 16795 241,980 -- 241,980 241,980 --
-- 19,896,534 19,896,534 19,896,534 --
Metropolitian Life
Insurance Co. GAC 20254 734,697 -- 734,697 734,697 --
-- 16,891,396 16,891,396 16,891,396 --
Putnam Investments, Inc. Growth and Income 5,905,236 -- 5,905,236 5,905,236 --
-- 25,696,918 22,715,420 25,696,918 2,981,498
Putnam Investments, Inc. Voyager 6,507,781 -- 6,507,781 6,507,781 --
-- 2,106,091 1,604,029 2,106,091 502,062
Putnam Investments, Inc. U.S. Government 1,847,212 -- 1,847,212 1,847,212 --
Income Trust -- 8,597,046 8,525,627 8,597,046 (71,419)
Chase Bank of Texas, N.A. Chase Core Equity 25,432,228 -- 25,432,228 25,432,228 --
-- 1,883 1,745 1,883 138
Chase Bank of Texas, N.A. Chase Vista Prime 44,222,829 -- 44,222,829 44,222,829 --
Money Market -- 90,388 90,388 90,388 --
Chase Bank of Texas, N.A. Chase Vista U.S. 8,722,835 -- 8,722,835 8,722,835 --
Treasury -- 1,041 1,075 1,041 (34)
Chase Bank of Texas, N.A. Short-term Money 95,929,497 -- 95,929,497 95,929,497 --
Market -- 98,557,880 98,557,880 98,557,880 --
There were no category (ii) or (iv) reportable transactions for the Plan year
ended March 31, 1999. Columns (e) and (f) are not applicable.
23
27
Exhibits and
Supplemental Schedules
28
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Post Effective Amendment No.
1 to the Registration Statement (Form S-8, File No. 33-10937), pertaining to the
Profit Sharing Plan for Employees of Trinity Industries, Inc. and Certain
Affiliates and in the related Prospectus of our report dated June 18, 1999, with
respect to the financial statements and supplemental schedules of the Profit
Sharing Plan for Employees of Trinity Industries, Inc. and Certain Affiliates
included in this Annual Report (Form 11-K) for the year ended March 31, 1999.
ERNST & YOUNG LLP
Dallas, Texas
June 25, 1999