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
-------------
(Mark One)
----
/ X / ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1998.
OR
----
/ / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________to______________
Commission file number 33-64647
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 TREDEGAR INDUSTRIES, INC.
B. Name of the issuer of the securities held pursuant to the plan and
the address of its principal executive office:
Tredegar Corporation
1100 Boulders Parkway
Richmond, Virginia 23225
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 TREDEGAR INDUSTRIES, INC.
By: /s/ N. A. Scher
-------------------------------------
N. A. Scher, Chairman
Employee Savings Plan Committee
Dated: June 25, 1998
SAVINGS PLAN FOR THE EMPLOYEES OF
TREDEGAR INDUSTRIES, INC.
ANNUAL REPORT
FOR THE YEAR ENDED
DECEMBER 31, 1998
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
INDEX OF FINANCIAL STATEMENTS
Page
Independent auditors' report 1
Financial statements
Statement of net assets available for benefits at:
December 31, 1998 2
December 31, 1997 3
Statement of changes in net assets available
for benefits for the year
ended:
December 31, 1998 4
December 31, 1997 5
December 31, 1996 6
Notes to financial statements 7-17
Independent Auditors' Report
To the Plan Administrator, Savings Plan for
the Employees of Tredegar Industries, Inc.
We have audited the accompanying statements of net assets available for
benefits of the Savings Plan for the Employees of Tredegar Industries, Inc.
(Plan) as of December 31, 1998 and 1997, and the related statements of changes
in net assets available for benefits for each of the three years in the period
ended December 31, 1998. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for benefits of the
Plan as of December 31, 1998 and 1997, and the changes in net assets available
for benefits for each of the three years in the period ended December 31, 1998,
in conformity with generally accepted accounting principles.
/s/ Poti, Walton & Associates, PC
POTI, WALTON & ASSOCIATES, PC
(formerly Plott & Walton, P.C.)
Richmond, Virginia
June 4, 1999
1
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998
Total Active Inactive
-------------- -------------- ------------
Assets:
Investments:
Money market funds - Wachovia Bank Diversified Trust Fund (cost $237,604) $ 237,604 $ 221,975 $ 15,629
Common stocks:
Albemarle Corporation (cost $454,802) 1,893,421 - 1,893,421
Ethyl Corporation (cost $906,476) 941,681 - 941,681
Tredegar Corporation (cost $17,505,074) 88,064,798 88,064,798 -
Actively managed commingled funds:
Frank Russell Investment Contract Fund (cost $4,635,205) 5,259,945 5,259,945 -
Frank Russell Global Balanced Fund (cost $4,404,207) 6,006,568 6,006,568 -
Frank Russell Equity I Fund (cost $5,362,754) 8,757,333 8,757,333 -
Frank Russell Equity II Fund (cost $794,799) 978,768 978,768 -
Loans to participants 450,598 450,598 -
------------ ------------- -----------
Total investments 112,590,716 109,739,985 2,850,731
Interest and dividends receivable 174,775 156,360 18,415
Cash 1,598 1,513 85
------------ ------------- -----------
Net assets available for benefits $112,767,089 $109,897,858 $2,869,231
============ ============= ===========
The accompanying notes are an integral part of these financial statements
2
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997
Total Active Inactive
------------ ------------- -----------
Assets:
Investments:
Money market funds - Wachovia Bank Diversified Trust Fund (cost $99,158) $ 99,158 $ 67,262 $ 31,896
Common stocks:
Albemarle Corporation (cost $556,834) 2,410,253 - 2,410,253
Ethyl Corporation (cost $1,027,436) 1,460,082 - 1,460,082
Tredegar Corporation (cost $15,006,131) 88,749,896 88,749,896 -
Actively managed commingled funds:
Frank Russell Investment Contract Fund (cost $5,542,604) 5,958,153 5,958,153 -
Frank Russell Global Balanced Fund (cost $4,105,608) 5,196,770 5,196,770 -
Frank Russell Equity I Fund (cost $5,062,350) 7,049,564 7,049,564 -
Frank Russell Equity II Fund (cost $586,015) 784,621 784,621 -
Loans to participants 415,971 415,971 -
------------ ------------- -----------
Total investments 112,124,468 108,222,237 3,902,231
Interest and dividends receivable 141,965 121,009 20,956
Cash 587 408 179
------------ ------------- -----------
Net assets available for benefits $112,267,020 $108,343,654 $3,923,366
============ ============= ===========
The accompanying notes are an integral part of these financial statements
3
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1998
Total Active Inactive
------------ ------------- -----------
Additions to net assets attributed to:
Investment income:
Interest $ 67,416 $ 65,391 $ 2,025
Dividends 661,118 585,650 75,468
Net appreciation (depreciation) in the fair value of investments 5,222,130 5,630,973 (408,843)
------------ ------------- -----------
5,950,664 6,282,014 (331,350)
Contributions:
Employer 2,144,300 2,144,300 -
Participants 4,892,202 4,892,202 -
------------ ------------- -----------
7,036,502 7,036,502 -
------------ ------------- -----------
Total additions 12,987,166 13,318,516 (331,350)
Deductions from net assets attributed to:
Administrative expenses 290,183 286,197 3,986
Withdrawals paid to participating employees 12,196,914 11,991,973 204,941
------------ ------------- -----------
Total deductions 12,487,097 12,278,170 208,927
------------ ------------- -----------
500,069 1,040,346 (540,277)
Intraplan transfers - 513,858 (513,858)
------------ ------------- -----------
Net increase (decrease) for the year 500,069 1,554,204 (1,054,135)
Net assets available for benefits:
Beginning of year 112,267,020 108,343,654 3,923,366
------------ ------------- -----------
End of year $112,767,089 $109,897,858 $2,869,231
============ ============= ===========
The accompanying notes are an integral part of these financial statements
4
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1997
Total Active Inactive
------------ ------------- -----------
Additions to net assets attributed to:
Investment income:
Interest $ 46,305 $ 41,341 $ 4,964
Dividends 590,434 466,069 124,365
Net appreciation in the fair value of investments 39,417,632 39,146,620 271,012
------------ ------------- -----------
40,054,371 39,654,030 400,341
Contributions:
Employer 1,754,488 1,754,488 -
Participants 3,955,256 3,955,256 -
------------ ------------- -----------
5,709,744 5,709,744 -
------------ ------------- -----------
Total additions 45,764,115 45,363,774 400,341
Deductions from net assets attributed to:
Administrative expenses 178,740 175,042 3,698
Withdrawals paid to participating employees 9,166,873 8,715,130 451,743
------------ ------------- -----------
Total deductions 9,345,613 8,890,172 455,441
------------ ------------- -----------
36,418,502 36,473,602 (55,100)
Intraplan transfers - 944,220 (944,220)
------------ ------------- -----------
Net increase (decrease) for the year 36,418,502 37,417,822 (999,320)
Net assets available for benefits:
Beginning of year 75,848,518 70,925,832 4,922,686
------------ ------------- -----------
End of year $112,267,020 $108,343,654 $3,923,366
============ ============= ===========
The accompanying notes are an integral part of these financial statements
5
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1996
Total Active Inactive
------------ ------------- -----------
Additions to net assets attributed to:
Investment income:
Interest $ 190,342 $ 163,115 $ 27,227
Dividends 604,707 398,583 206,124
Net appreciation (depreciation) in the fair value of investments 29,454,043 29,754,217 (300,174)
------------- ------------- -------------
30,249,092 30,315,915 (66,823)
Contributions:
Employer 1,681,868 1,681,868 -
Participants 3,753,198 3,753,198 -
------------- ------------- -------------
5,435,066 5,435,066 -
------------- ------------- -------------
Total additions 35,684,158 35,750,981 (66,823)
Deductions from net assets attributed to:
Administrative expenses 106,781 99,151 7,630
Withdrawals paid to participating employees 14,253,450 13,026,873 1,226,577
------------- ------------- -------------
Total deductions 14,360,231 13,126,024 1,234,207
------------- ------------- -------------
21,323,927 22,624,957 (1,301,030)
Transfers:
Intraplan - 4,997,810 (4,997,810)
To successor plan (78,699) (77,730) (969)
------------- ------------- -------------
Total transfers (78,699) 4,920,080 (4,998,779)
------------- ------------- -------------
Net increase (decrease) for the year 21,245,228 27,545,037 (6,299,809)
Net assets available for benefits:
Beginning of year 54,603,290 43,380,795 11,222,495
------------- ------------- -------------
End of year $75,848,518 $70,925,832 $ 4,922,686
============= ============= =============
The accompanying notes are an integral part of these financial statements
6
SAVINGS PLAN FOR THE EMPLOYEES OF TREDEGAR INDUSTRIES, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
Note 1 Summary of Significant Accounting Policies
General - Tredegar Corporation (formerly known as Tredegar Industries,
Inc.) (Tredegar), which engages directly or through subsidiaries in
plastics and aluminum businesses, is a Virginia corporation that was
organized in 1988 as a wholly owned subsidiary of Ethyl Corporation. On
or about July 10, 1989 (Record Date), Ethyl Corporation distributed all
of the outstanding shares of Tredegar common stock to the holders of
common stock of Ethyl Corporation at the rate of one share of Tredegar
common stock for every ten shares of Ethyl Corporation common stock
held on the Record Date.
The Savings Plan for the Employees of Tredegar Industries, Inc. (Plan)
was adopted by the Board of Directors of Tredegar on June 14, 1989, and
was approved by Ethyl Corporation, Tredegar's sole shareholder, on June
19, 1989. The Plan was effective as of July 1, 1989. In connection with
the establishment of the Plan and the distribution of Tredegar's common
stock, the accounts of Tredegar employees in the Savings Plan for the
Employees of Ethyl Corporation (Ethyl Plan) were transferred to the
Plan.
The Plan is subject to Titles I, II and III and is exempt from Title IV
of the Employee Retirement Income Security Act of 1974 (ERISA). Title
IV of ERISA provides for federally sponsored insurance for plans that
terminate with unfunded benefits. No such insurance is provided to
participants in this Plan, however, because the benefits that
participants are entitled to receive are always equal to the value of
their account balances and, for that reason, the Plan is always fully
funded. The value of a participant's account may change from time to
time. Each participant assumes the risk of fluctuations in the value of
his account.
The accompanying financial statements of the Plan have been prepared in
conformity with generally accepted accounting principles.
Security Valuation - Investments are stated at fair value determined as
follows:
Money market funds - market price which is equivalent to cost
Common stocks - last published sale price on the New York Stock
Exchange
Actively managed commingled funds - provided in the audited annual
report of the Frank Russell Trust Company
Security Transactions and Related Investment Income - Security
transactions are accounted for on the trade date and dividend income is
recorded as earned on the ex-dividend date. Interest income is recorded
as earned on the accrual basis. In determining the realized net gain or
loss on securities sold, the cost of securities is determined on an
average cost basis. The Plan presents in the statements of changes in
net assets available for benefits the net appreciation (depreciation)
in the fair value of investments, which consists of the realized gains
or losses and the change in unrealized appreciation (depreciation) on
those investments.
Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires the plan
administrator to make estimates and assumptions that affect certain
reported amounts and disclosures. Accordingly, actual results may
differ from those estimates.
Note 2 Description of Plan
The Plan is a defined contribution plan. Information regarding plan
benefits and vesting is provided in the Plan and related documents
which are available at Tredegar's main office at 1100 Boulders Parkway,
Richmond, Virginia 23225.
7
Note 3 Active Funds
As of December 31, 1998, the following net assets were available for
benefits:
Tredegar
Corporation Stable Loans
Common Value Balanced Equity to
Stock Fund Fund Fund Fund Participants Total
----------- ---------- ---------- ---------- -------- ------------
Assets:
Investments:
Money market funds - Wachovia Bank
Diversified Trust Fund $ 170,220 $ 6,377 $ 14,253 $ 31,125 $ - $ 221,975
Common stocks:
Tredegar Corporation 88,064,798 - - - - 88,064,798
Actively managed commingled funds:
Frank Russell Investment Contract Fund - 5,259,945 - - - 5,259,945
Frank Russell Global Balanced Fund - - 6,006,568 - - 6,006,568
Frank Russell Equity I Fund - - - 8,757,333 - 8,757,333
Frank Russell Equity II Fund - - - 978,768 - 978,768
Loans to participants - - - - 450,598 450,598
----------- ---------- ---------- ---------- -------- ------------
Total investments 88,235,018 5,266,322 6,020,821 9,767,226 450,598 109,739,985
Interest and dividends receivable 156,360 - - - - 156,360
Cash 1,281 60 67 105 - 1,513
----------- ---------- ---------- ---------- -------- ------------
Net assets available for benefits $88,392,659 $5,266,382 $6,020,888 $9,767,331 $450,598 $109,897,858
=========== ========== ========== ========== ======== ============
As of December 31, 1997, the following net assets were available for
benefits:
Tredegar
Corporation Stable Loans
Common Value Balanced Equity to
Stock Fund Fund Fund Fund Participants Total
----------- ---------- ---------- ---------- -------- ------------
Assets:
Investments:
Money market funds - Wachovia Bank
Diversified Trust Fund $ 26,496 $ 5,622 $ 17,600 $ 17,544 $ - % 67,262
Common stocks:
Tredegar Corporation 88,749,896 - - - - 88,749,896
Actively managed commingled funds:
Frank Russell Investment Contract Fund - 5,958,153 - - - 5,958,153
Frank Russell Global Balanced Fund - - 5,196,770 - - 5,196,770
Frank Russell Equity I Fund - - - 7,049,564 - 7,049,564
Frank Russell Equity II Fund - - - 784,621 - 784,621
Loans to participants - - - - 415,971 415,971
----------- ---------- ---------- ---------- -------- ------------
Total investments 88,776,392 5,963,775 5,214,370 7,851,729 415,971 108,222,237
Interest and dividends receivable 121,009 - - - - 121,009
Cash 290 15 41 62 - 408
----------- ---------- ---------- ---------- -------- ------------
Net assets available for benefits $88,897,691 $5,963,790 $5,214,411 $7,851,791 $415,971 $108,343,654
=========== ========== ========== ========== ======== ============
8
Note 3 Active Funds (Continued)
For the year ended December 31, 1998, net assets available for benefits
changed as follows:
Tredegar
Corporation Stable Loans
Common Value Balanced Equity to
Stock Fund Fund Fund Fund Participants Total
----------- ---------- ---------- ---------- -------- ------------
Additions to net assets attributed to:
Investment income:
Interest $ 20,388 $ 1,531 $ 994 $ 1,416 $ 41,062 $ 65,391
Dividends 585,650 - - - - 585,650
Net appreciation in the fair value of 2,641,059 350,010 882,670 1,757,234 - 5,630,973
investments
----------- ---------- --------- ---------- -------- ------------
3,247,097 351,541 883,664 1,758,650 41,062 6,282,014
Contributions:
Employer 2,144,300 - - - - 2,144,300
Participants 2,152,869 393,749 705,385 1,640,199 - 4,892,202
----------- ---------- --------- ---------- -------- ------------
4,297,169 393,749 705,385 1,640,199 - 7,036,502
----------- ---------- --------- ---------- -------- ------------
Total additions 7,544,266 745,290 1,589,049 3,398,849 41,062 13,318,516
Deductions from net assets attributed to:
Administrative expenses 104,671 27,904 58,169 95,453 - 286,197
Withdrawals to participating employees 8,130,497 1,384,607 1,565,718 866,131 45,020 11,991,973
----------- ---------- --------- ---------- -------- ------------
Total deductions 8,235,168 1,412,511 1,623,887 961,584 45,020 12,278,170
----------- ---------- --------- ---------- -------- ------------
(690,902) (667,221) (34,838) 2,437,265 (3,958) 1,040,346
Intraplan transfers 185,870 (30,187) 841,315 (521,725) 38,585 513,858
----------- ---------- --------- ---------- -------- ------------
Net increase (decrease) for the year (505,032) (697,408) 806,477 1,915,540 34,627 1,554,204
Net assets available for benefits:
Beginning of year 88,897,691 5,963,790 5,214,411 7,851,791 415,971 108,343,654
----------- ---------- ---------- ---------- -------- ------------
End of year $88,392,659 $5,266,382 $6,020,888 $9,767,331 $450,598 $109,897,858
=========== ========== ========== ========== ======== ============
For the year ended December 31, 1997, net assets available for benefits
changed as follows:
Tredegar
Corporation Stable Loans
Common Value Balanced Equity to
Stock Fund Fund Fund Fund Participants Total
----------- ---------- --------- ---------- -------- ------------
Additions to net assets attributed to:
Investment income:
Interest $ 17,564 $ 645 $ 431 $ 645 $ 22,056 $ 41,341
Dividends 465,612 218 61 178 - 466,069
Net appreciation in the fair value of 319,389 806,777 1,761,848 - 39,146,620
investments 36,258,606
----------- -------- ---------- ---------- -------- ------------
36,741,782 320,252 807,269 1,762,671 22,056 39,654,030
Contributions:
Employer 1,754,488 - - - - 1,754,488
Participants 1,476,986 401,711 672,749 1,403,810 - 3,955,256
3,231,474 401,711 672,749 1,403,810 - 5,709,744
----------- --------- ---------- ---------- -------- ------------
Total additions 39,973,256 721,963 1,480,018 3,166,481 22,056 45,363,774
Deductions from net assets attributed to:
Administrative expenses 52,984 21,821 39,578 60,659 - 175,042
Withdrawals to participating employees 7,331,325 487,498 340,494 541,038 14,775 8,715,130
----------- --------- ---------- ---------- -------- ------------
Total deductions 7,384,309 509,319 380,072 601,697 14,775 8,890,172
----------- --------- ---------- ---------- -------- ------------
32,588,947 212,644 1,099,946 2,564,784 7,281 36,473,602
=========== ========= ========== ========== ======== ============
9
Note 3 Active Funds (Continued)
Tredegar
Corporation Stable Loans
Common Value Balanced Equity to
Stock Fund Fund Fund Fund Participants Total
----------- --------- ---------- ---------- -------- ------------
Intraplan transfers (1,945,757) 1,205,706 628,575 803,334 252,362 944,220
----------- --------- ---------- ---------- -------- ------------
Net increase for the year 30,643,190 1,418,350 1,728,521 3,368,118 259,643 37,417,822
Net assets available for benefits:
Beginning of year 58,254,501 4,545,440 3,485,890 4,483,673 156,328 70,925,832
----------- --------- ---------- ---------- -------- ------------
End of year $88,897,691 $5,963,790 $5,214,411 $7,851,791 $415,971 $108,343,654
For the year ended December 31, 1996, net assets available for benefits
changed as follows:
Tredegar
Short-Term Government Corporation Stable Loans
Investment Obligations Common Value Balanced Equity to
Fund Fund Stock Fund Fund Fund Fund Participants Total
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
attributed to:
Investment income:
Interest $ 18,287 $ 118,338 $ 18,039 $ 129 $ 2,051 $ 4,311 $ 1,960 $ 163,115
Dividends - - 398,346 45 60 132 - 398,583
Net appreciation
(depreciation) in
the fair value of
investments - (59,855) 28,867,858 135,034 322,243 488,937 - 29,754,217
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
18,287 58,483 29,284,243 135,208 324,354 493,380 1,960 30,315,915
Contributions:
Employer - - 1,681,868 - - - - 1,681,868
Participants 331,990 305,091 1,381,320 299,030 490,983 944,784 - 3,753,198
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
331,990 305,091 3,063,188 299,030 490,983 944,784 - 5,435,066
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
Total additions 350,277 363,574 32,347,431 434,238 815,337 1,438,164 1,960 35,750,981
Deductions from net assets
attributed to:
Administrative expenses 400 14,863 43,607 8,428 14,990 16,863 - 99,151
Withdrawals to
participating employees 1,953,531 504,313 9,570,619 427,776 249,975 320,659 - 13,026,873
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
Total deductions 1,953,931 519,176 9,614,226 436,204 264,965 337,522 - 13,126,024
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
(1,603,654) (155,602) 22,733,205 (1,966) 550,372 1,100,642 1,960 22,624,957
Transfers:
Intraplan (718,584) (5,804,260) 500,331 4,547,406 2,935,518 3,383,031 154,368 4,997,810
To successor plan - (7,680) (70,050) - - - - (77,730)
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
Total transfers (718,584) (5,811,940) 430,281 4,547,406 2,935,518 3,383,031 154,368 4,920,080
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
Net increase (decrease) for (2,322,238) (5,967,542) 23,163,486 4,545,440 3,485,890 4,483,673 156,328 27,545,037
the year
Net assets available for
benefits:
Beginning of year 2,322,238 5,967,542 35,091,015 - - - - 43,380,795
---------- ---------- ----------- ---------- ---------- ---------- ---------- -----------
End of year $ - $ - $58,254,501 $4,545,440 $3,485,890 $4,483,673 $ 156,328 $70,925,832
========== ========== =========== ========== ========== ========== ========== ===========
10
Note 4 Inactive Funds
As of December 31, 1998, the following assets were available for
benefits:
Ethyl Albemarle
Short-Term Corporation Corporation
Investment Common Common
Fund Stock Fund Stock Fund Total
---------- ----------- ----------- ----------
Assets:
Investments:
Money market funds -
Wachovia Bank Diversified Trust Fund $1,371 $ 10,137 $ 4,121 $ 15,629
Common stocks:
Albemarle Corporation - - 1,893,421 1,893,421
Ethyl Corporation - 941,681 - 941,681
------ --------- ---------- ----------
Total investments 1,371 951,818 1,897,542 2,850,731
Interest and dividends receivable - 10,451 7,964 18,415
Cash 14 48 23 85
------ --------- ---------- ----------
Net assets available for benefits $1,385 $962,317 $1,905,529 $2,869,231
====== ========= ========== ==========
As of December 31, 1997, the following assets were available for
benefits:
Ethyl Albemarle
Short-Term Corporation Corporation
Investment Common Common
Fund Stock Fund Stock Fund Total
---------- ----------- ----------- ----------
Assets:
Investments:
Money market funds -
Wachovia Bank Diversified Trust Fund $13,607 $ $ $
16,543 1,746 31,896
Common stocks:
Albemarle Corporation - - 2,410,253 2,410,253
Ethyl Corporation - 1,460,082 - 1,460,082
------- ---------- ---------- ----------
Total investments 13,607 1,476,625 2,411,999 3,902,231
Interest and dividends receivable - 11,870 9,086 20,956
Cash 83 86 10 179
------- ---------- ---------- ----------
Net assets available for benefits $13,690 $1,488,581 $2,421,095 $3,923,366
======= ========== ========== ==========
11
Note 4 Inactive Funds (Continued)
For the year ended December 31, 1998, net assets available for benefits
changed as follows:
Ethyl Albemarle
Short-Term Corporation Corporation
Investment Common Common
Fund Stock Fund Stock Fund Total
---------- ----------- ----------- ----------
Additions to net assets attributable to:
Investment income:
Interest $ 271 $ 1,110 $ 644 $ 2,025
Dividends - 42,943 32,525 75,468
Net depreciation in the fair value of investments - (355,476) (53,367) (408,843)
-------- ----------- ---------- -----------
Total additions 271 (311,423) (20,198) (331,350)
Deductions from net assets attributed to:
Administrative expenses 183 1,387 2,416 3,986
Withdrawals paid to participating employees 11,355 64,812 128,774 204,941
-------- ----------- ---------- -----------
Total deductions 11,538 66,199 131,190 208,927
-------- ----------- ---------- -----------
(11,267) (377,622) (151,388) (540,277)
Intraplan transfers (1,038) (148,642) (364,178) (513,858)
-------- ----------- ---------- -----------
Net decrease for the year (12,305) (526,264) (515,566) (1,054,135)
Net assets available for benefits:
Beginning of year 13,690 1,488,581 2,421,095 3,923,366
-------- ----------- ---------- -----------
End of year $ 1,385 $ 962,317 $1,905,529 $2,869,231
======== ========== ========== ==========
For the year ended December 31, 1997, net assets available for benefits
changed as follows:
Ethyl Colony Albemarle
Short-Term Corporation Corporation Corporation
Investment Common Common Common
Fund Stock Fund Stock Fund Stock Fund Total
---------- ----------- ---------- ---------- --------
Additions to net assets attributable to:
Investment income:
Interest $ 2,847 $ 1,323 $ 106 $ 688 $ 4,964
Dividends - 90,104 - 34,261 124,365
Net appreciation (depreciation) in the fair value of - (361,080) - 632,092 271,012
investments
---------- ---------- --------- ---------- ----------
Total additions 2,847 (269,653) 106 667,041 400,341
Deductions from net assets attributed to:
Administrative expenses 397 1,549 2 1,750 3,698
Withdrawals paid to participating employees 164,955 123,861 - 162,927 451,743
---------- ---------- --------- ---------- ----------
Total deductions 165,352 125,410 2 164,677 455,441
---------- ---------- --------- ---------- ----------
(162,505) (395,063) 104 502,364 (55,100)
Intraplan transfers (11,147) (348,010) (300,259) (284,804) (944,220)
---------- ---------- --------- ---------- ----------
Net increase (decrease) for the year (173,652) (743,073) (300,155) 217,560 (999,320)
Net assets available for benefits:
Beginning of year 187,342 2,231,654 300,155 2,203,535 4,922,686
---------- ---------- --------- ---------- ----------
End of year $ 13,690 $1,488,581 $ - $2,421,095 $3,923,366
========== ========== ========= ========== ==========
12
Note 4 Inactive Funds (Continued)
For the year ended December 31, 1996, net assets available for benefits
changed as follows:
Ethyl Colony Albemarle
Short-Term Corporation Corporation Corporation
Investment Common Common Common
Fund Stock Fund Stock Fund Stock Fund Total
---------- ----------- ---------- ---------- --------
Additions to net assets attributable to:
Investment income:
Interest $ 12,802 $ 2,032 $ 11,093 $ 1,300 $ 27,227
Dividends - 139,990 31,187 34,947 206,124
Net appreciation (depreciation) in the fair value of - 715,983 (33,352) (300,174)
investments (982,805)
--------- ---------- --------- ---------- ----------
Total additions 12,802 (840,783 758,263 2,895 (66,823)
Deductions from net assets attributed to:
Administrative expenses 4,817 538 1,312 963 7,630
Withdrawals paid to participating employees 155,333 376,912 317,682 376,650 1,226,577
--------- ---------- --------- --------- ----------
Total deductions 160,150 377,450 318,994 377,613 1,234,207
--------- ---------- --------- --------- ----------
(147,348) (1,218,233) 439,269 (374,718) (1,301,030)
Transfers:
Intraplan 334,722 (1,207,374) (3,165,898) (959,260) (4,997,810)
To successor plan (32) (329) (253) (355) (969)
--------- ---------- --------- --------- ----------
Total transfers 334,690 (1,207,703) (3,166,151) (959,615) (4,998,779)
--------- ---------- ---------- ---------- -----------
Net increase (decrease) for the year 187,342 (2,425,936) (2,726,882) (1,334,333) (6,299,809)
Net assets available for benefits:
Beginning of year - 4,657,590 3,027,037 3,537,868 11,222,495
--------- ---------- ---------- ---------- -----------
End of year $187,342 $2,231,654 $ 300,155 $2,203,535 $ 4,922,686
========= ========== ========== ========== ===========
Note 5 Contributions and Investment Options
As of December 31, 1998 and 1997, there were 1,893 and 1,511 employees,
respectively, participating in the Plan. Participation in each fund was
as follows:
Number of Participants
December 31,
1998 1997
Short-Term Investment Fund 20 39
Tredegar Corporation Common Stock Fund 1,841 1,424
Albemarle Corporation Common Stock Fund 167 204
Ethyl Corporation Common Stock Fund 160 196
Stable Value Fund 500 511
Balanced Fund 614 601
Equity Fund 948 917
As of December 31, 1998 and 1997, 2,289 and 2,171 employees,
respectively, were eligible to participate in the Plan.
13
Note 5 Contributions and Investment Options (Continued)
Participants may contribute a percentage of his or her base pay (as
defined) ranging from a minimum of 1% to a maximum of 15%. The
contribution paid on behalf of the participant by Tredegar is generally
50% of each nonrepresented participant's contribution up to 10%.
Contributions made by Tredegar are invested in the Tredegar Corporation
Common Stock Fund.
Participants in the plan have several investment options available in
which to direct their contributions. A general description of the funds
in which the Plan participants may allocate their contributions (in
increments of 10%) is as follows:
The Stable Value Fund offers some of the traditional features of a bond
fund without the attendant market volatility. The investments of this
fund consist primarily of guaranteed investment contracts issued by
insurance carriers.
The Balanced Fund offers a balanced investment consisting of 50%
domestic equities, 10% international equities, and 40% fixed income
instruments.
The Equity Fund brings a diversified approach to the management of
equities the objective of which is to provide long-term growth of
capital and income. Investments of this fund consist primarily of
equities and short-term investments.
Tredegar Corporation Common Stock Fund offers the participant the
opportunity to invest in Tredegar stock.
No additional contributions may be invested in the Ethyl Corporation
Common Stock Fund (Ethyl Fund), the Albemarle Corporation Common Stock
Fund (Albemarle Fund), or the Short-Term Investment Fund (STIF).
Investments in the Ethyl or Albemarle Funds may continue or the
participants may direct the transfer of their investment in these Funds
to the Stable Value Fund, Balanced Fund, Equity Fund, or the Tredegar
Corporation Common Stock Fund. Investments remaining in the STIF at
December 31, 1998, were distributed to the participants in January
1999.
Investments in the Short-Term Investment Fund were selected by Wachovia
Bank, N.A. (Trustee), from fund securities maturing within one year or
revolving credit arrangements that are completely liquid investments.
Investments in the common stock of Ethyl Corporation and Albemarle
Corporation are now held until liquidation or distribution under the
Plan. The Trustee is permitted under the trust agreement to invest
monies held by it until such time as the funds are invested in
accordance with participants' directions or disbursed in accordance
with the terms of the Plan. These permitted investments include certain
commercial paper, variable notes, certificates of deposit and money
market funds.
The cost basis assigned to the Albemarle Corporation common stock
received from the distribution by Ethyl Corporation was 34.99% of the
cost basis of the Ethyl Corporation common stock. The market value of
Albemarle Corporation common stock on February 28, 1994, was $1,889,293
in excess of the cost basis assigned.
14
Note 6 Investments
The following tables present the fair value of investments as of
December 31, 1998 and 1997. Investments that represent five percent or
more of the Plan's net assets are separately identified.
FAIR VALUE OF INVESTMENTS
December 31, 1998
Number of shares or units - Fair
Name of issuer and title of each issue principal bonds and notes Cost Value (1)
- --------------------------------------------------------------- --------------------------- ------------ -------------
Money market funds - Wachovia Bank Diversified Trust Fund $ 237,604 $ 237,604
Investments at fair value as determined by quoted market price:
Common stocks:
Albemarle Corporation 79,723 454,802 1,893,421
Ethyl Corporation 167,410 906,476 941,681
Tredegar Corporation 3,913,991 17,505,074 88,064,798
----------- -----------
18,866,352 90,899,900
Actively managed commingled funds (2):
Frank Russell Investment Contract Fund 251,467 4,635,205 5,259,945
Frank Russell Global Balanced Fund 235,506 4,404,207 6,006,568
Frank Russell Equity I Fund 245,834 5,362,754 8,757,333
Frank Russell Equity II Fund 37,872 794,799 978,768
----------- ------------
15,196,965 21,002,614
Loans to participants $450,598 450,598 450,598
----------- ------------
Total investments $34,751,519 $112,590,716
=========== ============
(1) Investments are carried in the statement of net assets available for
benefits at fair value.
(2) Investment values are based on the audited annual report of the Frank
Russell Trust Company.
FAIR VALUE OF INVESTMENTS
December 31, 1997
Number of shares or units - Fair
Name of issuer and title of each issue principal bonds and notes Cost Value (1)
- --------------------------------------------------------------- --------------------------- ------------ -------------
Money market funds - Wachovia Bank Diversified Trust Fund $ 99,158 $ 99,158
Common stocks:
Albemarle Corporation 100,953 556,834 2,410,253
Ethyl Corporation 189,917 1,027,436 1,460,082
Tredegar Corporation 1,347,247 15,006,131 88,749,896
----------- ------------
16,590,401 92,620,231
Actively managed commingled funds (2):
Frank Russell Investment Contract Fund 303,399 5,542,604 5,958,153
Frank Russell Global Balanced Fund 238,220 4,105,608 5,196,770
Frank Russell Equity I Fund 247,666 5,062,350 7,049,564
Frank Russell Equity II Fund 30,327 586,015 784,621
----------- ------------
15,296,577 18,989,108
Loans to participants $415,971 415,971 415,971
----------- ------------
Total investments $32,402,107 $112,124,468
=========== ============
(1) Investments are carried in the statement of net assets available for
benefits at fair value.
(2) Investment values are based on the audited annual report of the Frank
Russell Trust Company.
15
Note 6 Investments (Continued)
Closing stock prices as of December 31, 1998 and 1997, were as follows:
1998 1997
Albemarle Corporation common stock $23.750 $23.875
Ethyl Corporation common stock 5.625 7.688
Tredegar Corporation common stock 22.500 21.958 (1)
Frank Russell Investment Contract Fund 20.917 19.638
Frank Russell Global Balanced Fund 25.505 21.815
Frank Russell Equity I Fund 35.623 28.464
Frank Russell Equity II Fund 25.844 25.872
(1) On July 1, 1998, Tredegar effected a 3 for 1 stock split. The
1997 stock price has been adjusted to reflect the split.
During the years ended December 31, 1998, 1997, and 1996, the Plan's
investment portfolio (including investments bought, sold and held
during the year) appreciated in value by $5,222,130, $39,417,632, and
$29,454,043 as follows:
NET CHANGE IN FAIR VALUE
1998 1997 1996
------------ ------------ -------------
Investments at fair value as determined by quoted market price:
United States government obligations $ - $ - $ (59,855)
Tredegar Corporation common stock 2,641,059 36,258,606 28,867,859
Albemarle Corporation common stock (53,367) 632,092 (33,352)
Ethyl Corporation common stock (355,476) (361,080) (982,804)
First Colony Corporation common stock - - 715,983
------------ ------------ ------------
2,232,216 36,529,618 28,507,831
Investments at fair value as determined in the audited annual Report of
the Frank Russell Trust Company:
Frank Russell Investment Contract Fund 350,010 319,389 135,033
Frank Russell Global Balanced Fund 882,670 806,777 322,243
Frank Russell Equity I Fund 1,753,885 1,581,478 455,074
Frank Russell Equity II Fund 3,349 180,370 33,862
------------ ------------ ------------
2,989,914 2,888,014 946,212
------------ ------------ ------------
Net change in fair value $5,222,130 $39,417,632 $29,454,043
============ ============ ============
Note 7 Federal Income Taxes
The Internal Revenue Service has determined and informed Tredegar by a
letter dated January 22, 1996, that the Plan and related trust are
designed in accordance with the applicable sections of the Internal
Revenue Code (IRC). 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 designed and is currently being
operated in compliance with the applicable requirements of the IRC.
16
Note 8 Administrative Expenses
The Plan is responsible for all trustee and investment management fees.
Tredegar pays for all other administrative expenses up to an annual
limit of $75,000. Any expenses in excess of this limit are paid by the
Plan.
Note 9 Forfeitures
Employees who leave Tredegar before becoming fully vested in Tredegar
contributions forfeit the value of their nonvested account. Forfeitures
are applied against Tredegar's contributions throughout the year.
Forfeitures were as follows:
1998 $ 55,581
1997 113,119
1996 100,102
Note 10 Year 2000 Issues
The Plan's management believes that all necessary steps have been taken
to address Year 2000 issues. If any problems should occur, the Plan's
management is prepared to resolve them as quickly as possible or, if
necessary, revert to a manual process. No material adverse effects on
the Plan are expected from any Year 2000 issues.
17
EXHIBIT INDEX
24.1 Consent of Independent Auditors
Exhibit 24.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement of Tredegar Corporation on Form S-8 (File Number 33-64647) of our
report dated June 4, 1999, appearing in this Annual Report on Form 11-K of the
Savings Plan for the Employees of Tredegar Industries, Inc. for the year ended
December 31, 1998.
/s/ Poti, Walton & Associates, PC
POTI, WALTON & ASSOCIATES, PC
(formerly Plott & Walton, P.C.)
June 21, 1999