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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Xxxx
One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition period from to
COMMISSION FILE NO. 1-4957
PROFIT SHARING, INVESTMENT
AND PAY DEFERRAL PLAN
OF NALCO CHEMICAL
NALCO CHEMICAL COMPANY
XXX XXXXX XXXXXX
XXXXXXXXXX, XXXXXXXX 00000-0000
(ISSUER AND ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NALCO CHEMICAL COMPANY
PROFIT SHARING, INVESTMENT
AND PAY DEFERRAL PLAN
FINANCIAL STATEMENTS
AND SCHEDULES
----------------
DECEMBER 31, 1997 AND 1996
NALCO CHEMICAL COMPANY
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
FINANCIAL STATEMENTS AND SCHEDULES
INDEX
PAGE(S)
-----------
Report of Independent Accountants................................... 1
Statements of Net Assets Available for Plan Benefits................ 2
Statements of Changes in Net Assets Available for Plan Benefits..... 3
Notes to Financial Statements....................................... 4-11
Supplementary Schedules:
Assets Held for Investment.......................................... Schedule I
Reportable Transactions............................................. Schedule II
Note: All other schedules have been omitted because they are not applicable
REPORT OF INDEPENDENT ACCOUNTANTS
March 20, 1998
To the Employee Benefit Plan
Administration Committee of
Nalco Chemical Company:
In our opinion, the accompanying statements of net assets available for plan
benefits and the related statements of changes in net assets available for
plan benefits present fairly, in all material respects, the net assets
available for benefits of the Nalco Chemical Company Profit Sharing,
Investment and Pay Deferral Plan at December 31, 1997 and 1996, and the
changes in net assets available for benefits for the years then ended, in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the plan's management; our responsibility
is to express an opinion of these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for the opinion expressed above.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
the supplementary schedules is presented for purposes of additional analysis
and is not a required part of the basic financial statements but is additional
information required by ERISA. Such information 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.
PRICE WATERHOUSE LLP
1
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1997 AND 1996
1997 1996
------------ ------------
Investments, at fair value:
Nalco Chemical Company common stock................ $ 98,123,822 $103,167,292
Mutual funds....................................... 98,974,383 80,842,233
Group annuity contract deposits.................... 50,965,924 54,277,887
Bank commingled investment funds................... 41,540,862 25,382,090
Collective short-term investment funds............. 10,500,682 15,966,425
------------ ------------
300,105,673 279,635,927
Loans receivable from participants................... 5,604,934 5,272,538
Due from Nalco Chemical Company Employee Stock
Ownership Plan...................................... 89,410 --
Accrued income receivable............................ 246,199 197,768
------------ ------------
Net assets available for plan benefits............... $306,046,216 $285,106,233
============ ============
The accompanying notes are an integral part of these financial statements.
2
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1996
1997 1996
------------ ------------
Sources of net assets:
Contributions by employees....................... $ 14,403,378 $ 12,995,367
Dividend income.................................. 3,774,078 4,255,329
Interest Income.................................. 4,492,750 4,739,023
Transfers from Nalco Chemical Company Employee
Stock Ownership Plan............................ 934,736 941,886
Net realized/unrealized appreciation of
investments..................................... 30,169,423 31,980,537
------------ ------------
Total sources of net assets........................ 53,774,365 54,912,142
Applications of net assets:
Administrative expenses.......................... (71,324) (68,265)
Withdrawals by participants...................... (32,763,058) (28,270,923)
------------ ------------
Increase in net assets available for plan benefits. 20,939,983 26,572,954
Net assets available for plan benefits at beginning
of period......................................... 285,106,233 258,533,279
------------ ------------
Net assets available for plan benefits at end of
period............................................ $306,046,216 $285,106,233
============ ============
The accompanying notes are an integral part of these financial statements.
3
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
NOTE 1--DESCRIPTION OF THE PLAN:
The Nalco Chemical Company Profit Sharing, Investment and Pay Deferral Plan
(the Plan) is a voluntary contribution, individual account plan, which covers
substantially all Nalco Chemical Company (the Company) employees. No service
requirement exists before an employee is eligible to participate in the Plan.
Pursuant to section 6 of the Plan document, profit sharing contributions are
at the discretion of the Company. The Company has not contributed to the Plan
since January 1, 1990. The Plan also accepts transfers of Company common stock
and cash from the Employee Stock Ownership Plan for retirees.
Beginning in 1993, the Plan expanded to include seven investment
alternatives: the Nalco Stock Fund, the U.S. Government Money Market Fund, the
Stable Capital Fund, the Bond Index Fund, the Balanced Fund, the Growth and
Income Fund, and the Equity Index Fund. In 1995, an international equity fund
was added, the EuroPacific Fund. A participant who has attained the age of 50
can transfer once per calendar year a minimum of 10% of his balance from the
Nalco Stock Fund to any of the other funds in the Plan. The maximum allowable
transfer is determined by the Employee Benefit Plan Administration Committee
(EBPAC). Participants electing to make tax-deferred contributions through cash
or salary deductions have the option of investing these contributions in a
combination of any of the funds. Participants can transfer assets acquired
with their individual funds at their discretion.
A participant can also make contributions which are not tax-deferred through
payroll deductions or a lump-sum investment. All participant contributions
vest immediately, and participants are entitled to their entire account
balance upon retirement, termination, disability, or death as a lump-sum
payment (or in semi-annual stock installments for shares in the Nalco Stock
Fund).
Effective June 1, 1993, participants are allowed to borrow from the Plan,
provided the amount does not exceed the lesser of one-half the vested Plan
balance of the participant, or $50,000. The length of the loan is decided by
the employee, subject to certain governmental restrictions, and the interest
charged is determined by EBPAC and communicated to the participants in
writing.
At December 31, 1997, employees participating in the Plan had invested in
the available funds as follows (some have investments in more than one fund):
1997 1996
----- -----
Total employees participating................................. 3,175 3,204
Nalco Stock Fund............................................ 2,410 2,556
U.S. Government Money Market Fund........................... 236 223
Stable Capital Fund......................................... 1,443 1,652
Bond Index Fund............................................. 403 356
Balanced Fund............................................... 1,135 1,011
Growth and Income Fund...................................... 2,236 2,129
Equity Index Fund........................................... 1,723 1,415
EuroPacific Fund............................................ 950 788
The Company believes that the Plan will continue without interruption, but
reserves the right to terminate the Plan at any time. In the event of
termination of the Plan, the Nalco Chemical Company Profit Sharing,
4
Investment and Pay Deferral Plan Trust (the Trust) will continue until all of
the funds held by The Northern Trust Company (the Trustee) have been
distributed to the participants or their beneficiaries. Such distribution will
be made in accordance with the provisions of the plan document in effect on
the date of its termination.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting
The financial statements of the Plan are prepared on the accrual basis of
accounting, except for benefit payments to former participants which are
recorded when paid as noted below.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the use of certain estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities and the periods in which
certain items of revenue and expense are included. Actual results may differ
from such estimates.
Withdrawals by Participants
Withdrawals by participants include benefit payments, transfers out of the
plan, and net loan activity.
Valuation of Investments
All investments, except for group annuity contract deposits, are valued by
the Trustee based on the closing market value on the last business day of the
plan year. The group annuity contract deposits are stated at estimated fair
value, which represents contributions made under the contracts at original
cost plus interest at the contract rate. The insurance companies are
contractually liable for the contract value provided the investment remains
with the insurance company.
Amounts Due Participants
In accordance with ERISA requirements for reporting by employee benefit
plans, benefit payments to former participants are recorded when paid.
Accordingly, at December 31, 1997 and December 31, 1996, the following amounts
have been allocated to the individual accounts of withdrawing participants,
but not recorded as liabilities on the Statements of Net Assets Available for
Plan Benefits or withdrawals by participants in the Statements of Changes in
Net Assets Available for Plan Benefits:
1997 1996
-------- ----------
Nalco Stock Fund..................................... $244,098 $ 705,187
U.S. Government Money Market Fund.................... -- 4,894
Stable Capital Fund.................................. 267,323 1,101,967
Bond Index Fund...................................... -- 2,415
Balanced Fund........................................ 5,193 21,814
Growth and Income Fund............................... 155,336 561,128
Equity Index Fund.................................... 25,192 208,747
EuroPacific Fund..................................... 30,375 137,143
-------- ----------
$727,517 $2,743,295
======== ==========
The preceding accounting treatment results in a difference between these
financial statements and the Form 5500 as these amounts have been recorded as
liabilities as of December 31, 1997 and 1996, and have been included in the
benefits paid for the respective years on the Form 5500.
5
NOTE 3--INVESTMENTS:
The cost of investments and number of shares or units held at December 31,
1997 and 1996 were as follows:
1997 1996
----------------------- -----------------------
SHARES OR SHARES OR
UNITS COST UNITS COST
---------- ------------ ---------- ------------
Nalco Chemical Company Common
Stock......................... 2,480,223 $ 37,146,056 2,855,842 $ 40,377,018
American Balanced Fund......... 1,139,119 16,371,281 897,776 12,221,073
American EuroPacific Fund...... 456,076 11,570,309 393,984 9,438,990
Dreyfus Government Money Market
Instruments................... 2,676,600 2,676,600 1,913,427 1,913,427
Hartford Annuity Contract
Deposit....................... 2,563,076 2,563,076 2,493,039 2,493,039
Life of Georgia Contract
Deposit....................... 6,282,171 6,282,171 5,935,391 5,935,391
Pacific Mutual Contract
Deposit....................... 3,149,032 3,149,032 2,952,635 2,952,635
Provident Contract Deposit..... 3,723,764 3,723,764 3,506,039 3,506,039
Sun Life America Contract
Deposit....................... 2,191,985 2,191,985 2,056,298 2,056,298
Allamerica Group Annuity
Contract Deposit.............. 4,522,389 4,522,389 4,185,459 4,185,459
Ohio National Group Annuity
Contract Deposit.............. 2,979,775 2,979,775 2,792,475 2,792,475
Protective Life Group Annuity
Contract Deposit.............. 2,892,390 2,892,390 2,732,537 2,732,537
Xxxx Xxxxxxx Mutual Life
Insurance Company Group
Annuity Contract Deposit...... -- -- 2,729,307 2,729,307
X.X. Xxxxxx Group Annuity
Contract Deposit.............. 10,000,000 10,000,000 10,000,000 10,000,000
New York Life Group Annuity
Contract Deposit.............. 5,553,351 5,553,351 5,233,580 5,233,580
New York Life Group Annuity
Contract Deposit.............. -- -- 1,538,896 1,538,896
Principal Mutual Group Annuity
Contract Deposit.............. 5,581,170 5,581,170 5,244,967 5,244,967
Transamerica Group Annuity
Contract Deposit.............. 1,526,821 1,526,821 2,877,266 2,877,266
Xxxxxxxxx & Xxxxxx Guardian
Fund.......................... 2,570,243 58,104,493 2,169,599 44,705,133
Barclays Equity Index Fund..... 1,437,519 26,606,279 1,147,067 17,686,050
Barclays Government/Corporate
Bond Index Fund............... 294,949 3,553,220 236,123 2,629,958
The Northern Trust Company
Collective Short-Term
Investment Fund............... 10,500,682 10,500,682 15,966,425 15,966,425
------------ ------------
Total...................... $217,494,844 $199,215,963
============ ============
Individual investments that represent 5% or more of the fair value of net
assets available for plan benefits at December 31, 1997 are as follows:
SHARES OR
UNITS COST FAIR VALUE
--------- ----------- -----------
Barclays Equity Index Fund................. 1,437,519 $26,606,279 $37,576,753
Nalco Chemical Company Common Stock........ 2,480,223 37,146,056 98,123,822
American Balanced Fund..................... 1,139,119 16,371,281 17,861,388
Xxxxxxxxx & Xxxxxx Guardian Fund........... 2,570,243 58,104,493 66,569,298
NOTE 4--TRANSACTIONS WITH RELATED PARTY:
Certain expenses pertaining to the operation of the Plan are paid by the
Company and are not charged against the assets or income of the Plan. In
addition, various administrative, legal, and accounting services are performed
by Company personnel on behalf of the Plan. No charges are made to the Plan
for these services.
NOTE 5--INCOME TAX STATUS:
The Internal Revenue Service issued a letter of determination dated July 17,
1995 stating the Plan is qualified under section 401(a) of the Internal
Revenue Code (the Code) and is, therefore, exempt from federal income taxation
under section 501(a) of the Code. Participants are not subject to federal
income tax until amounts are distributed to them.
6
NOTE 6--GROUP ANNUITY CONTRACTS:
The fair value of group annuity contract deposits at December 31, 1997 and
1996 was comprised of the following:
DECEMBER 31,
-----------------------
1997 1996
----------- -----------
Xxxx Xxxxxxx Mutual Life Insurance Company
contract deposit, GAC7892, due 12/1/97 (5.77% in
1996)............................................ -- $ 2,729,307
Hartford contract deposit, GA10156, due 12/21/98
(4.87% in 1997 and 1996)......................... $ 2,563,076 2,493,039
Life of Georgia contract deposit, FR101, due
9/9/99
(5.93% in 1997 and 6.15% in 1996)................ 6,282,171 5,935,391
Pacific contract deposit, G2608401, due 6/1/98
(6.65% in 1997 and 1996)......................... 3,149,032 2,952,635
Provident contract deposit, #627-0569-201A, due
6/1/99
(6.21% in 1997 and 1996)......................... 3,723,764 3,506,039
Sun Life America contract deposit, #4656, due
7/25/98
(6.58% in 1997 and 1996)......................... 2,191,985 2,056,298
Allamerica contract deposit, GA91636A, due
11/30/99
(8.05% in 1997 and 1996)......................... 4,522,389 4,185,459
Ohio National contract deposit, #5708, due
11/30/99
(6.75% in 1997 and 1996)......................... 2,979,775 2,792,475
Protective Life contract deposit, GA1191, due
6/1/98
(5.85% in 1997 and 1996)......................... 2,892,390 2,732,537
X.X. Xxxxxx contract deposit, NALCO-01, due
6/1/2000
(5.50% in 1997 and 6.08% in 1996)................ 10,000,000 10,000,000
New York Life contract deposit, #30481, due
6/30/99
(6.11% in 1997 and 1996)......................... 5,553,351 5,233,580
New York Life contract deposit, #30481-002, due
7/12/97
(5.90% in 1996).................................. -- 1,538,896
Principal Mutual contract deposit, #4-23183, due
12/31/2000
(6.41% in 1997 and 1996)......................... 5,581,170 5,244,967
Transamerica contract deposit, S1393-00, due
1/30/98
(6.13% in 1997 and 1996)......................... 1,526,821 2,877,264
----------- -----------
$50,965,924 $54,277,887
=========== ===========
Average yields for the above contracts are not calculated as the rates are
guaranteed. No valuation reserve was established in 1997 or 1996 as the
companies listed all maintain at least an A+ credit rating.
7
NOTE 7--STATEMENTS OF NET ASSETS:
The statements of net assets available for plan benefits by fund as of
December 31, 1997 and 1996 are as follows:
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS BY FUND
AS OF DECEMBER 31, 1997
U.S. GOVT STABLE
NALCO STOCK MONEY MKT CAPITAL BOND INDEX BALANCED GROWTH & EQUITY
FUND FUND FUND FUND FUND INCOME FUND INDEX FUND
----------- ---------- ----------- ---------- ----------- ----------- -----------
Investments, at fair
value:
Nalco Chemical Company
common stock.......... $98,123,822
Mutual Funds........... $2,676,600 $17,861,388 $66,569,298
Group annuity contract
deposits.............. $50,965,924
Bank commingled mutual
funds................. $3,964,109 $37,576,753
Collective short-term
investment fund....... 1,548,151 8,793,071
----------- ---------- ----------- ---------- ----------- ----------- -----------
99,671,973 2,676,600 59,758,995 3,964,109 17,861,388 66,569,298 37,576,753
Loans receivable from
participants...........
Due from Nalco Chemical
Company Employee Stock
Ownership Plan......... 89,410
Accrued income
receivable............. 11,133 11,130 222,764
----------- ---------- ----------- ---------- ----------- ----------- -----------
Net assets available for
plan benefits.......... $99,772,516 $2,687,730 $59,981,759 $3,964,109 $17,861,388 $66,569,298 $37,576,753
=========== ========== =========== ========== =========== =========== ===========
EUROPACIFIC LOAN CLEARING
FUND ACCOUNT ACCOUNT TOTAL
----------- ---------- -------- ------------
Investments, at fair value:
Nalco Chemical Company common
stock........................... $ 98,123,822
Mutual Funds..................... $11,867,097 98,974,383
Group annuity contract deposits.. 50,965,924
Bank commingled mutual funds..... 41,540,862
Collective short-term investment
fund............................ $159,460 10,500,682
----------- ---------- -------- ------------
11,867,097 159,460 300,105,673
Loans receivable from
participants.................... $5,604,934 5,604,934
Due from Nalco Chemical Company
Employee Stock Ownership Plan... 89,410
Accrued income receivable........ 1,172 246,199
----------- ---------- -------- ------------
Net assets available for plan
benefits........................ $11,867,097 $5,604,934 $160,632 $306,046,216
=========== ========== ======== ============
8
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS BY FUND
AS OF DECEMBER 31, 1996
U.S. GOVT. STABLE
NALCO MONEY MKT. CAPITAL BOND INDEX BALANCED
STOCK FUND FUND FUND FUND FUND
------------ ---------- ----------- ---------- -----------
Investments, at fair
value:
Nalco Chemical Company
common stock.......... $103,153,745
Mutual Funds........... $1,913,427 $13,062,639
Group annuity contract
deposits.............. $54,277,887
Bank commingled mutual
funds................. $2,899,584
Collective short-term
investment fund....... 923,478 14,643,455
------------ ---------- ----------- ---------- -----------
Loans receivable from
participants........... 104,077,223 1,913,427 68,921,342 2,899,584 13,062,639
Accrued income
receivable............. 8,061 7,011 181,661
------------ ---------- ----------- ---------- -----------
Net assets available for
plan benefits.......... $104,085,284 $1,920,438 $69,103,003 $2,899,584 $13,062,639
============ ========== =========== ========== ===========
GROWTH & EQUITY EUROPACIFIC LOAN CLEARING
INCOME FUND INDEX FUND FUND ACCOUNT ACCOUNT TOTAL
----------- ----------- ----------- ---------- -------- ------------
Investments, at fair
value:
Nalco Chemical Company
common stock.......... $ 13,547 $103,167,292
Mutual Funds........... $55,606,827 $10,259,340 80,842,233
Group annuity contract
deposits.............. 54,277,887
Bank commingled mutual
funds................. $22,482,506 25,382,090
Collective short-term
investment fund....... 399,492 15,966,425
----------- ----------- ----------- ---------- -------- ------------
55,606,827 22,482,506 10,259,340 413,039 279,635,927
Loans receivable from
participants........... $5,272,538 5,272,538
Accrued income
receivable............. 1,035 197,768
----------- ----------- ----------- ---------- -------- ------------
Net assets available for
plan benefits.......... $55,606,827 $22,482,506 $10,259,340 $5,272,538 $414,074 $285,106,233
=========== =========== =========== ========== ======== ============
9
NOTE 8--STATEMENTS OF CHANGES IN NET ASSETS:
The statements of changes in net assets available for plan benefits by fund
for the years ended December 31, 1997 and 1996 are as follows:
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS BY FUND
FOR THE YEAR ENDED DECEMBER 31, 1997
U.S. GOVT
NALCO MONEY MKT STABLE BOND INDEX BALANCED GROWTH &
STOCK FUND FUND CAPITAL FUND FUND FUND INCOME FUND
------------ ----------- ------------ ---------- ----------- -----------
Sources of net assets:
Contributions by
employees............. $ 685,190 $ 146,442 $ 1,983,419 $ 210,068 $ 1,267,695 $ 5,085,028
Dividend income........ 2,636,406 548,267 394,153
Interest income........ 70,793 113,949 3,832,273
Transfers from Nalco
Chemical Company
Employee Stock
Ownership Plan........ 934,736
Net transfers
authorized by
participants.......... (8,883,795) 1,977,860 (4,764,197) 871,764 1,854,982 2,339,787
Net
realized/unrealized
appreciation of
investments........... 9,435,900 263,048 2,331,498 9,336,785
------------ ----------- ------------ ---------- ----------- -----------
Total sources of net
assets.............. 4,879,230 2,238,251 1,051,495 1,344,880 6,002,442 17,155,753
Applications of net
assets:
Administrative
expenses..............
Withdrawals by
participants.......... (9,191,998) (1,470,959) (10,172,739) (280,355) (1,203,693) (6,193,282)
------------ ----------- ------------ ---------- ----------- -----------
Increase (decrease) in
net assets available
for plan benefits...... (4,312,768) 767,292 (9,121,244) 1,064,525 4,798,749 10,962,471
Net assets available for
plan benefits at
beginning of period.... 104,085,284 1,920,438 69,103,003 2,899,584 13,062,639 55,606,827
------------ ----------- ------------ ---------- ----------- -----------
Net assets available for
plan benefits at end of
period................. $ 99,772,516 $ 2,687,730 $ 59,981,759 $3,964,109 $17,861,388 $66,569,298
============ =========== ============ ========== =========== ===========
EQUITY EUROPACIFIC LOAN CLEARING
INDEX FUND FUND ACCOUNT ACCOUNT TOTAL
----------- ----------- ---------- --------- ------------
Sources of net assets:
Contributions by
employees............. $ 3,077,632 $ 1,221,567 $ 726,337 $ 14,403,378
Dividend income........ 194,558 694 3,774,078
Interest income........ $ 459,017 16,718 4,492,750
Transfers from Nalco
Chemical Company
Employee Stock
Ownership Plan........ 934,736
Net transfers
authorized by
participants.......... 6,310,004 293,698 (103) 0
Net
realized/unrealized
appreciation of
investments........... 8,112,811 688,912 469 30,169,423
----------- ----------- ---------- --------- ------------
Total sources of net
assets.............. 17,500,447 2,398,735 459,017 744,115 53,774,365
Applications of net
assets:
Administrative
expenses.............. (71,324) (71,324)
Withdrawals by
participants.......... (2,406,200) (790,978) (126,621) (926,233) (32,763,058)
----------- ----------- ---------- --------- ------------
Increase (decrease) in
net assets available
for plan benefits...... 15,094,247 1,607,757 332,396 (253,442) 20,939,983
Net assets available for
plan benefits at
beginning of period.... 22,482,506 10,259,340 5,272,538 414,074 285,106,233
----------- ----------- ---------- --------- ------------
Net assets available for
plan benefits at end of
period................. $37,576,753 $11,867,097 $5,604,934 $ 160,632 $306,046,216
=========== =========== ========== ========= ============
10
NALCO CHEMICAL COMPANY
----------------
PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS BY FUND
FOR THE YEAR ENDED DECEMBER 31, 1996
U.S. GOVT GROWTH
NALCO STOCK MONEY MKT STABLE BOND INDEX BALANCED & INCOME
FUND FUND CAPITAL FUND FUND FUND FUND
------------ ---------- ------------ ---------- ----------- -----------
Sources of net assets:
Contributions by
employees............. $ 758,733 $ 120,998 $ 2,528,121 $ 216,843 $ 1,031,468 $ 5,362,833
Dividend income........ 3,099,842 424,394 565,562
Interest income........ 77,157 62,414 4,140,330
Transfers from Nalco
Chemical Company
Employee Stock
Ownership Plan........ 941,886
Net transfers
authorized by
participants.......... (11,876,137) 837,002 (2,983,492) 170,806 2,775,143 (4,632,297)
Net
realized/unrealized
appreciation
(depreciation) of
investments........... 18,404,557 55,858 1,002,573 7,865,115
------------ ---------- ------------ ---------- ----------- -----------
Total sources of net
assets.............. 11,406,038 1,020,414 3,684,959 443,507 5,233,578 9,161,213
Applications of net
assets:
Administrative
expenses.............. 2,815
Withdrawals by
participants.......... (8,360,795) (225,295) (11,604,902) (92,946) (686,717) (3,142,509)
------------ ---------- ------------ ---------- ----------- -----------
Increase (decrease) in
net assets available
for plan benefits..... 3,045,243 795,119 (7,917,128) 350,561 4,546,861 6,018,704
Net assets available
for plan benefits at
beginning of period... 101,040,041 1,125,319 77,020,131 2,549,023 8,515,778 49,588,123
------------ ---------- ------------ ---------- ----------- -----------
Net assets available
for plan benefits at
end of period......... $104,085,284 $1,920,438 $ 69,103,003 $2,899,584 $13,062,639 $55,606,827
============ ========== ============ ========== =========== ===========
EQUITY EUROPACIFIC LOAN CLEARING
INDEX FUND FUND ACCOUNT ACCOUNT TOTAL
----------- ----------- ---------- ---------- ------------
Sources of net assets:
Contributions by
employees............. $ 2,085,277 $ 819,745 $ 71,349 $ 12,995,367
Dividend income........ 160,966 4,565 4,255,329
Interest income........ $ 446,323 12,799 4,739,023
Transfers from Nalco
Chemical Company
Employee Stock
Ownership Plan........ 941,886
Net transfers
authorized by
participants.......... 7,847,638 5,704,703 (125,137) 2,281,771 0
Net
realized/unrealized
appreciation
(depreciation) of
investments........... 3,544,864 1,108,492 (922) 31,980,537
----------- ----------- ---------- ---------- ------------
Total sources of net
assets.............. 13,477,779 7,793,906 321,186 2,369,562 54,912,142
Applications of net
assets:
Administrative
expenses.............. (71,080) (68,265)
Withdrawals by
participants.......... (995,415) (761,255) (418,529) (1,982,560) (28,270,923)
----------- ----------- ---------- ---------- ------------
Increase (decrease) in
net assets available
for plan benefits...... 12,482,364 7,032,651 (97,343) 315,922 26,572,954
Net assets available for
plan benefits at
beginning of period.... 10,000,142 3,226,689 5,369,881 98,152 258,533,279
----------- ----------- ---------- ---------- ------------
Net assets available for
plan benefits at end of
period................. $22,482,506 $10,259,340 $5,272,538 $ 414,074 $285,106,233
=========== =========== ========== ========== ============
11
NALCO CHEMICAL COMPANY
----------------
SCHEDULE I--PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
ASSETS HELD FOR INVESTMENT
AS OF DECEMBER 31, 1997
IDENTITY OF ISSUER DESCRIPTION OF INVESTMENT COST FAIR VALUE
------------------ ------------------------- ---- ----------
*Nalco Chemical Company 2,480,223 shares of common stock $ 37,146,056 $ 98,123,822
Hartford Group annuity contract deposit, 2,563,076 2,563,076
GA10156, 4.87%, due 12/21/98
Life of Georgia Group annuity contract deposit, 6,282,171 6,282,171
FR101, 5.93%, due 9/9/99
Pacific Group annuity contract deposit, 3,149,032 3,149,032
G2608401, 6.65%, due 6/1/98
Provident Group annuity contract deposit, 3,723,764 3,723,764
#627-05692-01A, 6.21%, due 6/1/99
Sun Life America Group annuity contract deposit, 2,191,985 2,191,985
#4656, 6.58%, due 7/25/98
Allamerica Group annuity contract deposit, 4,522,389 4,522,389
GA91636A, 8.05%, due 11/30/99
Ohio National Group annuity contract deposit, 2,979,775 2,979,775
#5708, 6.75%, due 11/30/99
Protective Life Group annuity contract deposit, 2,892,390 2,892,390
GA1191, 5.85%, due 6/1/98
X.X. Xxxxxx Group annuity contract deposit, 10,000,000 10,000,000
NALCO-01, 5.50%, due 6/1/2000
New York Life Group annuity contract deposit, 5,553,351 5,553,351
#30481, 6.11%, due 6/30/99
Principal Mutual Group annuity contract deposit, 5,581,170 5,581,170
#4-23183, 6.41%, due 12/31/2000
Transamerica Group annuity contract deposit, 1,526,821 1,526,821
S1393-00, 6.13%, due 1/30/98
American American EuroPacific Growth Fund-- 11,570,309 11,867,097
456,076 shares
American Balanced Fund--1,139,119 shares 16,371,281 17,861,388
Dreyfus U.S. Government Money Market Fund 2,676,600 2,676,600
Xxxxxxxxx & Xxxxxx Guardian Fund--2,570,243 shares 58,104,493 66,569,298
Barclays Global Investors Barclays Equity Index Fund--1,437,519 shares 26,606,279 37,576,753
Barclays Bond Index Fund--294,949 shares 3,553,220 3,964,109
*The Northern Trust Company Collective Short-Term Investment Fund 10,500,682 10,500,682
*Participant loans Participant loans, average interest rate of 8.64% 5,604,934 5,604,934
------------ ------------
$223,099,778 $305,710,607
============ ============
--------
*Party-in-interest to the Plan.
12
NALCO CHEMICAL COMPANY
---------------
SCHEDULE II--PROFIT SHARING, INVESTMENT AND PAY DEFERRAL PLAN
REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
CATEGORY (III)--A SERIES OF SECURITY TRANSACTIONS IN EXCESS OF 5% OF THE
CURRENT VALUE OF PLAN ASSETS:
EXPENSES VALUE OF
INCURRED ASSET ON
IDENTITY OF PARTY PURCHASE SELLING WITH COST OF TRANSACTION NET GAIN
INVOLVED DESCRIPTION OF ASSET PRICE PRICE TRANSACTION ASSET DATE (LOSS)
----------------------- ---------------------- ----------- ----------- ----------- ----------- ----------- ----------
Xxxxxxxxx & Xxxxxx Man- Xxxxxxxxx & Xxxxxx
agement Guardian Equity Fund
139 purchases $21,802,364 $21,802,364 $21,802,364
118 sales $11,347,288 8,442,781 11,347,288 $2,904,507
The Northern Trust Com- Collective Short-Term
pany Investment Fund:
279 purchases 75,451,265 75,451,265 75,451,265
364 sales 80,917,008 80,917,008 80,917,008
Barclays Global Invest- Barclays Equity
ors Index Fund:
164 purchases 14,371,898 14,371,898 14,371,898
86 sales 7,390,461 5,451,668 7,390,461 1,938,793
Nalco Chemical Company Nalco Chemical Company
Common Stock:
5 purchases 2,440,901 $2,669 2,440,901 2,440,901
11 sales 14,634,855 19,604 5,408,633 14,634,855 9,206,618
There were no reportable category (i), (ii), or (iv) transactions for the
year ended December 31, 1997
13
SIGNATURES
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.
Profit Sharing, Pay Deferral and
Investment Plan of Nalco Chemical
Company
/s/ X. X. Xxxxx
By__________________________________
Member, Employee Benefit Plan
Administration Committee
Dated: March 30, 1998
