SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 11-K/A
(Mark One)
[X] Annual Report pursuant to Section 15(3) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 2002
OR
[_] Transition report pursuant to Section 15(d) of the Securities Exchange Act
of 1934 For the transition period from _______________ to _______________
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
Mestek, Inc.
Savings & Retirement Plan
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executed office:
Mestek, Inc.
260 North Elm Street
Westfield, Massachusetts 01085
MESTEK, INC.
SAVINGS & RETIREMENT PLAN 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.
Date: July 15, 2003 /s/: Stephen M. Shea
---------------------------------------------
Stephen M. Shea
Senior Vice President-Finance
Financial Statements and Report of Independent Certified Public Accountants
Mestek, Inc. Savings and Retirement Plan
December 31, 2002 and 2001
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Table of Contents
December 31, 2002 and 2001
Page
Report of Independent Certified Public Accountants..........................3
Financial Statements
Statements of Net Assets Available for Benefits....................4
Statement of Changes in Net Assets Available for Benefits..........5
Notes to Financial Statements......................................6
Supplemental Schedules
Schedule H, Line 4i - Schedule of Assets Held for Investment
Purposes........................................................13
Report of Independent Certified Public Accountants
Plan Administrator
Mestek, Inc. Savings and Retirement Plan
We have audited the accompanying statements of net assets
available for benefits of Mestek, Inc. Savings and Retirement Plan as of
December 31, 2002 and 2001, and the related statement of changes in net assets
available for benefits for the year ended December 31, 2002. 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 auditing standards
generally accepted in the United States of America. 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 Mestek, Inc. Savings and Retirement Plan as of December 31, 2002 and 2001,
and the changes in net assets available for benefits for the year ended December
31, 2002 in conformity with accounting principles generally accepted in the
United States of America.
Our audits were performed for the purpose of forming an
opinion on the basic financial statements taken as a whole. The supplemental
schedule of Assets Held for Investment Purposes as of December 31, 2002, is
presented for additional analysis and is not a required part of the basic
financial statements but is supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedule
is the responsibility of the Plan's management. The supplemental schedule has
been subjected to the auditing procedures applied in the audit 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.
/s/ Grant Thornton LLP
Boston, Massachusetts
July 10, 2003
4
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 2002 and 2001
2002 2001
Non- Non-
Participant Participant Participant Participant
Directed Directed Total Directed Directed Total
ASSETS
Investments, at fair value (note B):
MassMutual Pooled Separate Accounts
Core equity fund $3,132,703 $12,174 $3,144,877 $4,212,071 $14,917 $4,226,988
Small company fund 1,871,085 12,052 1,883,137 2,576,910 13,821 2,590,731
Balanced fund 2,005,817 - 2,005,817 2,646,373 - 2,646,373
Intermediate bond fund 2,555,791 - 2,555,791 2,768,024 - 2,768,024
Mestek stock fund 109,942 - 109,942 125,310 - 125,310
Indexed equity fund 3,635,827 - 3,635,827 5,495,848 - 5,495,848
Growth equity fund 1,388,649 - 1,388,649 1,179,170 - 1,179,170
International equity fund 764,024 - 764,024 982,166 - 982,166
Medium company growth equity fund 1,097,287 - 1,097,287 2,278,995 - 2,278,995
Mestek profit sharing fund - 14,414,063 14,414,063 - 15,197,740 15,197,740
Notes receivable from participants 1,806,900 488,797 2,295,697 1,681,435 453,323 2,134,758
----------- ----------- ----------- ----------- ------------ ----------
18,368,025 14,927,086 33,295,111 23,946,302 15,679,801 39,626,103
Investments, at contract value (notes B and E):
MassMutual Life Insurance
Company Investment Contract 26,852,641 444,508 27,297,149 18,329,657 446,849 18,776,506
----------- ---------- ------------ ---------- ----------- ----------
Total investments 45,220,666 15,371,594 60,592,260 42,275,959 16,126,650 58,402,609
----------- ----------- ---------- ---------- ---------- ---------
Receivables:
Participants' contributions 257,515 - 257,515 242,568 - 242,568
Employer's contributions 44,561 1,664,959 1,709,520 43,319 1,382,621 1,425,940
----------- --------- --------- ----------- ----------- ----------
Total receivables 302,076 1,664,959 1,967,035 285,887 1,382,621 1,668,508
----------- --------- --------- ------------ ----------- ---------
NET ASSETS AVAILABLE FOR BENEFITS $45,522,742 $17,036,553 $62,559,295 $42,561,846 $17,509,271 $60,071,117
=========== =========== =========== =========== =========== ===========
The accompanying notes are an integral part of the financial statements.
5
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Statement of Changes in Net Assets Available for Benefits
For the year ended December 31, 2002
Non-
Participant Participant
Directed Directed Total
Additions
Additions to net assets attributed to:
Contributions:
Participants $3,679,822 $ - $3,679,822
Employer 477,995 1,930,878 2,408,873
Rollover 3,947,023 - 3,947,023
Investment Loss (2,261,559) (866,947) (3,128,506)
----------- --------- -----------
Total additions 5,843,281 1,063,931 6,907,212
Deductions
Deductions from net assets attributed to:
Benefits paid to participants 2,858,825 1,528,522 4,387,347
Administrative Expenses 23,560 8,127 31,687
----------- ------------ -----------
Total deductions 2,882,385 1,536,649 4,419,034
----------- ------------ -----------
NET (DECREASE) INCREASE 2,960,896 (472,718) 2,488,178
Net assets available for benefits:
Beginning of year 42,561,846 17,509,271 60,071,117
---------- ---------- ----------
End of year $45,522,742 $17,036,553 $62,559,295
=========== =========== ===========
The accompanying notes are an integral part of the financial statements.
13
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements
December 31, 2002 and 2001
NOTE A - DESCRIPTION OF PLAN
The following description of Mestek, Inc. Savings and Retirement Plan (the
"Plan") provides only general information. Participants should refer to the
Plan Agreement for a more complete description of the Plan's provisions.
General
The Plan is a defined contribution profit sharing plan established for
the benefit of the employees of Mestek, Inc. ("the Company"). The Plan
has two components, a profit sharing account and a 401(k) account. The
Plan covers salaried or hourly employees not covered by a collective
bargaining agreement, who choose to participate, and who have completed
at least one year of service. The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA").
Plan Amendment
In 1999, the Plan Administrator amended the Plan, allowing Mestek, Inc.
"Company Stock" to be included as an investment option. The term "Company
Stock" shall include shares of Mestek, Inc. common stock and other equity
securities issued by the employer that qualify as a "qualifying equity
security" as defined by ERISA. Up to 100% of the assets of the Plan may
be invested in "Company Stock", subject to any limitations posed by ERISA
or other regulatory agencies, such as the Securities and Exchange
Commission.
Contributions
A. 401(k) Account
Participants may elect to have up to fifty percent of their
compensation withheld, up to the maximum allowed by the Internal
Revenue Code. The amounts withheld from compensation reduce the
amount of income reportable for income tax purposes.
Participants may elect to make nondeductible voluntary contributions
up to an additional ten percent of their gross earnings each year
within legal limits.
The Company contributes $.25 for each $1.00 deferred by participants
and deposited to the Plan. This contribution is limited to the first
6% deferred by participants, and, in total, the Company contribution
will not exceed 1.5% of an employee's annual compensation. The
Company does not match any amounts relating to nondeductible
voluntary contributions. Contributions are funded on a current basis.
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements - Continued
December 31, 2002 and 2001
NOTE A - DESCRIPTION OF PLAN - Continued
B. Profit Sharing Account
On an annual basis, the Company determines whether to make a Profit
Sharing contribution and how much to contribute. Currently, the
Company contributes 3% of an employee's gross salary for all
eligible, active employees employed on the last day of the year.
Participant Accounts
Each participant's account is credited with the participant's
contribution, the Company's contribution and allocations of plan
earnings. Plan earnings are allocated based on account balances by fund.
Vesting
Participants are immediately vested in their deferred salary
contributions and voluntary contributions plus actual earnings thereon.
Vesting in the Company contribution portion of an individual
participant's 401K account is based on the following schedule:
Contributions Contributions
Made Prior to Made After
Years of Service October 1, 2001 October 1, 2001
---------------- --------------- ---------------
1 0% 0%
2 0% 20%
3 20% 40%
4 40% 60%
5 60% 80%
6 80% 100%
7 or more 100%
Vesting in the Profit Sharing portion of the plan follows the 7-year
schedule above.
Forfeitures
A. 401(k) Account
Forfeitures are applied first to reduce expenses related to the
administration of the Plan and then to reduce Company
contributions.
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements - Continued
December 31, 2002 and 2001
NOTE A - DESCRIPTION OF PLAN - Continued
B. Profit Sharing Account
Forfeitures are reallocated among Participants in the ratio that
the compensation of each Participant bears to the total
compensation of all Participants.
Notes Receivable from Participants
Participants are eligible to borrow up to 50% of their vested balance to
a maximum of $50,000. Loans bear interest at market rates (4.75% - 10.5%)
and are repayable over a period not to exceed five years.
Investments
A. 401(k) Account
Upon enrollment in the Plan, participants may direct contributions to
any combination of fund options maintained by MassMutual Life
Insurance Company ("MassMutual"). All funds (except for the
Investment Contract), are invested in Pooled Separate Accounts and do
not guarantee principal or rate of return. Plan participants may
change their investment election at any time through MassMutual's
automatic record-keeping system.
B. Profit Sharing Account
Assets are invested at the discretion of the Retirement Committee.
The following is a description of each investment option:
The Investment Contract is invested in a group annuity contract issued
by MassMutual. This fund will receive a rate of interest set by
MassMutual annually (6% for fiscal year 2002 and 6.5% for fiscal year
2001). Both the principal and interest are guaranteed by MassMutual for
the duration of the contract.
The Core equity fund invests primarily in common stocks of large, well
established companies.
The Small company fund invests mainly in common stocks of small,
publicly traded companies that have some unique product, market
position, or operating method which sets them apart.
The Balanced fund invests in a blend of three types of assets: stocks,
bonds and short-term securities (or cash).
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements - Continued
December 31, 2002 and 2001
NOTE A - DESCRIPTION OF PLAN - Continued
The Intermediate bond fund invests mainly in investment-grade, publicly
traded bonds (debt issued by the U.S. government, agencies and
companies). The bonds mature over periods from 1 to 10 years.
The Indexed equity fund invests in stocks which will approximate, as
closely as possible, the Standard & Poor's 500 Index.
The Growth equity fund invests primarily in equity securities of large
companies with long-term growth potential.
The International equity fund invests at least 90% of its assets in
equity securities of companies wherever located, the primary stock
market of which is outside the United States with the intentions of
long-term growth.
The Medium company growth equity fund invests primarily in equity
securities of medium-size companies with long-term growth potential.
The Mestek stock fund is invested in the common stock of Mestek, Inc.
The Mestek profit sharing fund is a pooled separate account, which
invests in the Investment Contract and certain other funds described
above (including the Core Equity Fund, the Small Company Fund and the
Indexed Equity Fund).
Included in investment loss is interest and dividends of $1,522,501 and
realized and unrealized net loss on investments of $4,651,007.
Withdrawals
Participants are allowed to withdraw certain portions of their account,
as defined by the Plan, upon retirement, termination of employment, or
determination of financial hardship.
Payment of Benefits
Upon death, disability, or termination of service, a participant (or
participant's beneficiary in the event of death) with $5,000 or more in
vested benefits may elect to receive a lump-sum distribution equal to the
participant's vested account balance, deferred annuity or for assets to
remain in the Plan. Additional options are available under the Plan upon
retirement.
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements - Continued
December 31, 2002 and 2001
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following are the significant accounting policies followed by the Plan:
Basis of Accounting
The accompanying financial statements of the Plan have been prepared
using the accrual basis of accounting.
Investment Valuation
The Plan's investments are stated at fair value, based on quoted market
prices, except for its investment contract which is valued at contract
value (see note E).
Payment of Benefits
Benefit payments to participants are recorded upon distribution.
Expenses
Administrative costs paid for by the Company are not included in the
accompanying financial statements.
Insurance
In prior years, participants had the ability to purchase individual life
insurance policies through the Plan and pay for the premiums with vested
benefit amounts. The Plan no longer allows for the purchase of new
policies, but existing policyholders may continue to hold and fund such a
policy. The remaining policies are allocated insurance contracts and,
accordingly, the cash surrender value of such policies has been excluded
from Plan assets.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and the disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Notes to Financial Statements - Continued
December 31, 2002 and 2001
NOTE C - TAX STATUS
Although the Plan has received a favorable determination letter dated June
16, 1995 from the Internal Revenue Service, it has not been updated for the
latest plan amendments. However, the plan administrator believes that the
Plan is designed and is being operated in compliance with the applicable
requirements of the IRC. Therefore, the plan administrator believes that the
Plan was qualified and the related trust was tax-exempt for the year ended
December 31, 2002.
NOTE D - PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions and to terminate the Plan
subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100% vested in their accounts.
NOTE E - INVESTMENT CONTRACT WITH INSURANCE COMPANY
The Plan has an investment contract with MassMutual. MassMutual maintains the
contributions in a pooled account. The account is credited with a guaranteed
rate of return and is charged for Plan withdrawals and administrative
expenses charged by MassMutual. The contract is included in the financial
statements at contract value, as reported to the Plan by MassMutual. Contract
value represents contributions made under the contract, plus earnings less
Plan withdrawals and administrative expenses.
NOTE F - INVESTMENT APPRECIATION (DEPRECIATION)
During 2002, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
appreciated/(depreciated) in value as follows:
2002
Mutual Funds (4,619,369)
Common Stock (31,638)
NOTE G - ROLLOVERS TO THE PLAN
Included in rollover contributions during 2002, the Plan received rollover
contributions totaling $3,079,351 from another Company sponsored plan.
SUPPLEMENTAL SCHEDULE
MESTEK, INC. SAVINGS AND RETIREMENT PLAN
Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes
EIN 25-0661650 PLAN #002
December 31, 2002
Description of Investment
Including Maturity Date, Rate
Identity of Issue, Borrower, of Interest, Collateral, Current
Lessor, or Similar Party Par or Maturity Value Cost Value
----------------------------------------------------------------------------------- --------- --------------
* MassMutual Life Insurance Company Core equity fund $3,668,675 $3,144,877
* MassMutual Life Insurance Company Small company fund 2,066,811 1,883,137
* MassMutual Life Insurance Company Balanced fund 2,159,168 2,005,817
* MassMutual Life Insurance Company Intermediate bond fund 2,370,339 2,555,791
* MassMutual Life Insurance Company Mestek stock fund 122,666 109,942
* MassMutual Life Insurance Company Indexed equity fund 4,657,185 3,635,827
* MassMutual Life Insurance Company Growth equity fund 1,728,286 1,388,649
* MassMutual Life Insurance Company International equity fund 1,040,482 764,024
* MassMutual Life Insurance Company Medium company 1,502,998 1,097,287
growth equity fund
* MassMutual Life Insurance Company Mestek profit sharing fund 15,233,527 14,414,063
* MassMutual Life Insurance Company Investment Contract** 27,297,149 27,297,149
Participants Notes Notes receivable from 2,295,697
participants (4.75% - 10.5%)
* Denotes party in interest to the plan
** Contract value
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated July 10, 2003, accompanying
the financial statements of Mestek, Inc. Savings and Retirement Plan contained
in the annual report on Form 11-K for the year ended December 31, 2002. We
hereby consent to the incorporation by reference of said report in the Mestek,
Inc. Savings & Retirement Plan Registration Statement on Form S-8 (File Number
333-82067).
/s/ Grant Thornton LLP
Boston, Massachusetts
July 10, 2003
Exhibit 99.1
Certification of Chief executive Officer and Treasurer
Pursuant to 18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
Solely for the purpose of complying with 18 U.S.C. Section 1350, each of the
undersigned hereby certifies in his or her capacity as an officer of Mestek,
Inc. (the "Company") that the Annual Report of Form 11-K of the Retirement
Savings Plan and the Savings & Retirement Plan (the "Plans") for the year ended
December 31, 2002 fully complies with the requirement of Section 15(d) of the
Securities Exchange Act of 1934 and that information contained in such report
fairly presents, in all material respects, the financial condition of the Plans
at the end of such period and the results of operations of the Plans for such
period.
A signed original of this written statement required by Section 906 has been
provided to the Company and will be retained by the Company and furnished to the
Securities and Exchange Commission or its staff upon request.
Dated: July 15, 2003
/s/ John E. Reed
-----------------------------------------------------
John E. Reed
Chairman and Chief Executive Officer
/s/ Stephen M. Shea
-----------------------------------------------------
Stephen M. Shea
Senior Vice President-Finance