FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-812
UNITED TECHNOLOGIES CORPORATION
REPRESENTED EMPLOYEE SAVINGS PLAN
(Full title of the plan)
UNITED TECHNOLOGIES CORPORATION
United Technologies Building
One Financial Plaza
Hartford, Connecticut 06101
(Name of issuer of the securities held pursuant to
the plan and the address of its principal executive office)
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FINANCIAL STATEMENTS OF THE UNITED TECHNOLOGIES CORPORATION
REPRESENTED EMPLOYEE SAVINGS PLAN
REPORT OF INDEPENDENT ACCOUNTANTS
To the Pension Administration
and Investment Committee of
United Technologies Corporation
and Members of the United Technologies
Corporation Represented Employee Savings Plan
In our opinion, the accompanying statements of financial condition and the
related statement of income and changes in plan equity present fairly, in all
material respects, the financial position of the United Technologies Corporation
Represented Employee Savings Plan at November 30, 1993 and 1992, and the results
of its operations and the changes in its plan equity for the year ended November
30, 1993, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Plan Administrator; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
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.
PRICE WATERHOUSE
Hartford, Connecticut
May 19, 1994
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UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Financial Condition
November 30, 1993
(Thousands of Dollars, except unit values)
UTC
Income Fund Equity Fund Stock Fund
Assets:
Investments:
Beneficial interests in contracts issued by insurance
companies, at cost plus accrued interest $ 342,013 $ - $ -
Beneficial interests in Bankers Trust Company Pyramid
Fixed Income Index Fund, at market - - -
Beneficial interests in Bankers Trust Company Pyramid
Equity Index Fund, at market - 58,256 -
Beneficial interests in Bankers Trust Company Pyramid
International Securities Index Fund, at market - - -
United Technologies Corporation Common Stock, at market
plus accrued dividends ($40) - - 5,396
Participant loans, at cost plus accrued interest - - -
Temporary investments, at cost plus accrued interest 8 1 126
Total Investments 342,021 58,257 5,522
Contributions and fund transfers receivable 984 1 68
Accrued investment sales - - 42
Total Assets 343,005 58,258 5,632
Less - Liabilities:
Contributions and fund transfers payable - 812 62
Loans payable, net 330 69 13
Total Liabilities 330 881 75
Plan Equity $ 342,675 $ 57,377 $ 5,557
Units of participation 74,930,510 6,349,254 1,173,881
Unit value $ 4.57 $ 9.04 $ 4.73
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Financial Condition
November 30, 1993
(Thousands of Dollars, except unit values)
Funds
Global Fund Loan Fund Combined
Assets:
Investments:
Beneficial interests in contracts issued by insurance
companies, at cost plus accrued interest $ - $ - $ 342,013
Beneficial interests in Bankers Trust Company Pyramid
Fixed Income Index Fund, at market 751 - 751
Beneficial interests in Bankers Trust Company Pyramid
Equity Index Fund, at market 956 - 59,212
Beneficial interests in Bankers Trust Company Pyramid
International Securities Index Fund, at market 797 - 797
United Technologies Corporation Common Stock, at market
plus accrued dividends ($40) - - 5,396
Participant loans, at cost plus accrued interest - 5,616 5,616
Temporary investments, at cost plus accrued interest 159 - 294
Total Investments 2,663 5,616 414,079
Contributions and fund transfers receivable 31 55 1,139
Accrued investment sales - - 42
Total Assets 2,694 5,671 415,260
Less - Liabilities:
Contributions and fund transfers payable - - 874
Loans payable, net 2 (382) 32
Total Liabilities 2 (382) 906
Plan Equity $ 2,692 $ 6,053 $ 414,354
Units of participation 1,857,271 6,053,000
Unit value $ 1.45 $ 1.00
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Financial Condition
November 30, 1992
(Thousands of Dollars, except unit values)
UTC
Income Fund Equity Fund Stock Fund
Assets:
Investments:
Beneficial interests in contracts issued by insurance
companies, at cost plus accrued interest $ 312,318 $ - $ -
Beneficial interests in Bankers Trust Company Pyramid
Fixed Income Index Fund, at market - - -
Beneficial interests in Bankers Trust Company Pyramid
Equity Index Fund, at market - 50,949 -
Beneficial interests in Bankers Trust Company Pyramid
International Securities Index Fund, at market - - -
United Technologies Corporation Common Stock, at market
plus accrued dividends ($37) - - 3,801
Participant loans, at cost plus accrued interest - - -
Temporary investments, at cost plus accrued interest 1 - 215
Total Investments 312,319 50,949 4,016
Contributions and fund transfers receivable 669 2 57
Total Assets 312,988 50,951 4,073
Less - Liabilities:
Contributions and fund transfers payable 2 890 1
Loans payable, net 433 66 15
Accrued investment purchases - - 62
Total Liabilities 435 956 78
Plan Equity $ 312,553 $ 49,995 $ 3,995
Units of participation 73,875,419 6,101,343 1,198,740
Unit value $ 4.23 $ 8.19 $ 3.33
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Financial Condition
November 30, 1992
(Thousands of Dollars, except unit values)
Funds
Global Fund Loan Fund Combined
Assets:
Investments:
Beneficial interests in contracts issued by insurance
companies, at cost plus accrued interest $ - $ - $ 312,318
Beneficial interests in Bankers Trust Company Pyramid
Fixed Income Index Fund, at market 346 - 346
Beneficial interests in Bankers Trust Company Pyramid
Equity Index Fund, at market 428 - 51,377
Beneficial interests in Bankers Trust Company Pyramid
International Securities Index Fund, at market 327 - 327
United Technologies Corporation Common Stock, at market
plus accrued dividends ($37) - - 3,801
Participant loans, at cost plus accrued interest - 2,808 2,808
Temporary investments, at cost plus accrued interest 18 - 234
Total Investments 1,119 2,808 371,211
Contributions and fund transfers receivable 15 26 769
Total Assets 1,134 2,834 371,980
Less - Liabilities:
Contributions and fund transfers payable - - 893
Loans payable, net (2) (422) 90
Accrued investment purchases - - 62
Total Liabilities (2) (422) 1,045
Plan Equity $ 1,136 $ 3,256 $ 370,935
Units of participation 903,131 3,256,000
Unit value $ 1.26 $ 1.00
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Income and Changes in Plan Equity
Plan Year Ended November 30, 1993
(Thousands of Dollars)
UTC
Income Fund Equity Fund Stock Fund
Contributions:
Members $ 31,128 $ 5,754 $ 921
Employer 10,430 1,509 255
Total Contributions 41,558 7,263 1,176
Investment Income:
Interest 25,171 - 5
Dividends - - 158
Total Investment Income 25,171 - 163
Repayments on loans 1,078 239 58
Unrealized appreciation of investments - 3,433 1,116
Gain on sale of investments - 1,771 380
Deduct:
Distributions to members:
In cash 33,562 4,899 443
In shares of United Technologies Corporation Common Stock - - 10
Loans to participants 3,539 730 84
Earned and unapplied forfeitures 7 - 1
Total Deductions 37,108 5,629 538
Inter-fund and inter-plan transfers (577) 305 (793)
Net Increase in Plan Equity 30,122 7,382 1,562
Plan Equity November 30, 1992 312,553 49,995 3,995
Plan Equity November 30, 1993 $ 342,675 $ 57,377 $ 5,557
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION REPRESENTED EMPLOYEE SAVINGS PLAN
Statement of Income and Changes in Plan Equity
Plan Year Ended November 30, 1993
(Thousands of Dollars)
Funds
Global Fund Loan Fund Combined
Contributions:
Members $ 720 $ - $ 38,523
Employer 205 - 12,399
Total Contributions 925 - 50,922
Investment Income:
Interest 1 261 25,438
Dividends - - 158
Total Investment Income 1 261 25,596
Repayments on loans 47 (1,419) 3
Unrealized appreciation of investments 167 - 4,716
Gain on sale of investments 18 - 2,169
Deduct:
Distributions to members:
In cash 111 436 39,451
In shares of United Technologies Corporation Common Stock - - 10
Loans to participants 33 (4,391) (5)
Earned and unapplied forfeitures - - 8
Total Deductions 144 (3,955) 39,464
Inter-fund and inter-plan transfers 542 - (523)
Net Increase in Plan Equity 1,556 2,797 43,419
Plan Equity November 30, 1992 1,136 3,256 370,935
Plan Equity November 30, 1993 $ 2,692 $ 6,053 $ 414,354
(See accompanying Notes to Financial Statements)
UNITED TECHNOLOGIES CORPORATION
REPRESENTED EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
NOTE 1 - DESCRIPTION OF THE PLAN
The United Technologies Corporation Represented Employee Savings Plan (the Plan)
is a defined contribution savings plan sponsored by United Technologies
Corporation (United). Employees of United are eligible to participate in the
Plan if the employees have completed at least one year of service and their
employment is covered by a collective bargaining agreement that provides that
such employees may participate in the Plan. Below is a brief description of the
Plan. More complete information is provided in the plan document which is
available from the Plan sponsor.
Members may elect, through payroll deductions, to make after-tax contributions
of between $2 per week and the amount permitted by the related collective
bargaining agreement. Certain members, depending on their collective bargaining
agreement, may also make tax-deferred contributions. Member contributions are
fully vested at all times under the Plan. The employer will make contributions
with respect to each member equal in amount to 50 percent of the members
contributions, up to specified limits. Generally, employer contributions become
fully vested two years after first joining the Plan.
All contributions are credited to a member account maintained by the Plan
Administrator. Contributions will be invested, pursuant to each member's
direction, in one or more of the following funds: the Income Fund, the Equity
Fund, the UTC Stock Fund, and the Global Fund, where permitted. Members may
elect to have 100 percent of their contributions invested in one investment fund
or may allocate the contributions in multiples of 25 percent among two or more
of the funds. Members are permitted to transfer their accounts between
investment funds once per quarter (in multiples of 10 percent).
The Income Fund is invested in contracts issued by five insurance companies
designated by the Pension Investment Committee. Under these contracts, each
insurance company guarantees repayment in full of the principal amount invested
plus interest credited at a fixed rate for a specified period. Interest is
credited to each contract based on an annual interest rate set each year by the
individual insurance carriers. This rate, which differs among contracts, takes
into account any difference between prior year credited interest and the actual
amount of investment earnings allocable to the contract in accordance with the
established allocation procedures of the insurance carrier. The weighted
average rate set for the 1993 calendar year was 8.0 percent.
The Equity Fund may be invested in common or capital stocks of corporations,
bonds or securities convertible into such stocks, or shares of any federally
registered mutual fund or similar type of investment fund, including investment
in any commingled trust fund managed by the Trustee, Bankers Trust Company,
which is invested primarily in similar types of equity securities. During 1993
and 1992, the Equity Fund was invested principally in the Trustee's BT Pyramid
Equity Index Fund, which is a portfolio of common stocks replicating the
Standard & Poor's Composite Index of 500 stocks. Interest and dividends earned
by this investment are reinvested and increase market value.
The UTC Stock Fund consists principally of 86,564 and 83,887 shares of Common
Stock of United at November 30, 1993 and 1992, respectively.
The Global fund may be invested in almost equal proportion in three different
funds managed by the Trustee: the Pyramid International Securities Index Fund,
the Pyramid Fixed Income Index Fund and the Pyramid Equity Index Fund. The
International Securities Index Fund invests in four other international index
funds managed by the Trustee. The Fixed Income Index Fund invests primarily in
obligations of the U.S. Government and its agencies and other publicly traded,
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high-grade domestic debt instruments. Interest and dividends earned by these
investments are reinvested and increase market value.
Effective June 1, 1992, where permitted, members with at least two years of plan
participation are allowed to borrow up to 50 percent of their account balances
(excluding individual medical account contributions). Loan amounts can range
from $1,000 to $50,000 and must be repaid in 5 years or less with interest.
Members may also make limited tax-deferred or after-tax contributions to an
individual medical account (IMA), where permitted. The employer will contribute
with respect to each member an amount equal to 75 percent of the member's IMA
contribution. All contributions to an IMA will be invested 100 percent in the
Income Fund and may not be withdrawn until retirement or termination.
Forfeitures of employer contributions are used to reduce employer contributions;
earned but unapplied forfeitures will be applied against future employer
contributions and are shown separately in the Statement of Income and Changes in
Plan Equity.
Members who transfer to a new location of United which is covered by a different
savings plan have the option of transferring their account balances in
accordance with the provisions of the new savings plan, including available
investment funds. Transfer of balances to the new savings plan will be governed
by the terms of the collective bargaining agreements.
Employees participating in the Plan at year end were as follows:
November 30,
1993 1992
Income Fund 21,299 23,426
Equity Fund 6,248 6,433
UTC Stock Fund 1,317 1,407
Global Fund 824 831
The participants above may have investments in more than one of the investment
funds.
NOTE 2 - SUMMARY OF ACCOUNTING PRINCIPLES
United has entered into a master trust agreement with the Trustee. Under this
agreement, certain employee savings plans of United and its subsidiaries combine
their trust fund investments in the Master Trust. Participating plans purchase
units of participation in the investment funds based on their monthly
contribution to such funds and the unit value of the applicable investment fund
at the end of the month. The value of a unit in each fund is determined at the
end of each month by dividing the sum of uninvested cash, accrued income and the
current market value of investments by the total number of outstanding units in
such funds. The plans receive income from the funds' investments which increase
the unit values. Distributions reduce the number of participation units held by
the plans.
The investments of the Income Fund are valued at cost plus accrued interest.
The investments of the Equity Fund, the UTC Stock Fund, and the Global Fund are
valued at market as determined by the Trustee by reference to published market
data.
The expenses of operating the Plan are payable out of the funds held under the
Plan, unless the employer elects to pay such expenses. The expenses for the
1993 plan year were paid by the employer.
The Plan is not subject to federal income tax as the Plan and its related trust
are considered by United to satisfy the qualification and exemption requirements
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of Sections 401(a) and 501(a) of the Internal Revenue Code. United has received
a favorable determination letter (dated September 9, 1986) from the Internal
Revenue Service (IRS) to the effect that the Plan qualifies under Sections
401(a) and 501(a) of the Code. United intends to apply for a new determination
letter from the IRS indicating that the Plan, as amended since the date of the
most recent IRS determination letter, continues to be exempt from federal income
taxes under Sections 401(a) and 501(a) of the Code. Under these sections,
contributions by United, employees (at their election) and related earnings will
be tax deferred until such amounts are distributed. It is expected, given the
lack of substantive plan amendments, that a favorable determination will be
issued from the IRS, and accordingly, no provision is made for federal income
taxes.
NOTE 3 - INSURANCE CONTRACTS
The following is a summary of the insurance contracts held in the Master Trust
Income Fund and the portion allocable to the Plan:
November 30,
(Thousands of Dollars) 1993 1992
CIGNA $ 1,409,243 $ 1,327,089
Aetna 543,882 543,230
Travelers 455,988 465,195
Prudential 249,747 224,129
Metropolitan Life 328,543 219,295
$ 2,987,403 $ 2,778,938
Amount of the contracts allocable to the Plan $ 342,013 $ 312,318
NOTE 4 - GAIN ON SALE OF INVESTMENTS
The Trustee uses the average cost method in determining the cost of securities
for purposes of calculating the gain or loss on the sale of securities. Gains
and losses of the Master Trust funds are allocated to the participating plans
based upon participation units at the month-end valuation date following the
sale. The gains recognized by the Master Trust funds and amounts allocable to
the Plan are as follows:
UTC
(Thousands of Dollars) Equity Stock Global
Fund Fund Fund
Proceeds from sale of securities $ 25,402 $ 22,566 $ 2,213
Cost basis of securities sold 14,898 13,527 1,828
Gain on sale $ 10,504 $ 9,039 $ 385
Amount of the gain allocable to the Plan $ 1,771 $ 380 $ 18
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NOTE 5 - REQUESTED DISTRIBUTIONS
The following is a summary of distributions requested by participants which had
not yet been paid at the respective plan year end:
November 30, November 30,
1993 1992
(Thousands ofDollars) Dollars Units Dollars Units
Income Fund $ 1,323 289,306 $ 740 174,618
Equity Fund 413 45,752 196 23,856
UTC Stock Fund 24 5,155 26 8,203
Global Fund 5 3,667 2 1,917
Loan Fund 114 114,000 35 35,000
These amounts are reflected as liabilities in the Plan's Form 5500.
The November 30, 1992 Statement of Financial Condition has been restated in
order to reflect requested distributions in the plan year in which paid.
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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.
UNITED TECHNOLOGIES CORPORATION
REPRESENTED EMPLOYEE SAVINGS PLAN
Dated: May 19, 1994 By: Thomas F. O'Connor
Thomas F. O'Connor
Director, Retirement Programs
United Technologies Corporation
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CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of the Registration Statement on Form S-8 (No. 33-26580) of
our report dated May 19, 1994 appearing on page F-1 of United Technologies
Corporation Represented Employee Savings Plan's Annual Report on Form 11-K for
the year ended November 30, 1993. We also consent to the reference to us under
the caption "Interests of Named Experts" in such Prospectus.
PRICE WATERHOUSE
Hartford, Connecticut
May 19, 1994
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