Income earned by the four investment funds described above is credited quarterly
to the participants in that fund on a pro rata basis, based on the balances of
the participants' accounts at the beginning of each quarter, increased by
contributions and loan repayments and reduced by distributions, withdrawals and
loans during the current quarter.
Refunds payable to participants of $34,300 and $41,029 at September 30, 1993 and
1992, respectively, are excess contributions which were returned to Plan
participants during December 1993 and 1992, respectively. Excess contributions
resulted from the "Plan's highly compensated group," as defined by the
applicable provisions of the Code, contributing more than they were allowed by
the Code regulations.
Benefits payable to withdrawing participants are included within net assets
available for Plan benefits and are not reflected as a liability in the
financial statements. As of September 30, 1993 and 1992, the benefits payable
to withdrawing participants were $113,791 and $81,721, respectively.
Administrative expenses, brokerage fees and transfer taxes are paid by the
Federal Income Taxes
The Plan obtained its latest determination letter during 1987, in which the
Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
Committee and the Company's tax counsel believe that the Plan is currently
designed and being operated in compliance with the applicable requirements of
the Internal Revenue Code. Therefore, they believe that the Plan was qualified
and the related trust was tax-exempt as of the financial statement date.
Certain reclassifications to the 1992 amounts have been made to conform to 1993
2. SUMMARY OF SIGNIFICANT
PROVISIONS OF THE PLAN:
The Plan is administered by the Committee appointed by the board of directors of
Zapata. Among other duties, it is the responsibility of the Committee to
interpret the Plan, decide all questions of eligibility and determine the
amount, manner and time of payment of any benefits.
Pursuant to the terms of the Plan, the Company entered into the Master Trust
agreement with First City, Texas. In October 1992, the board of directors of
Zapata removed First City, Texas, as trustee and appointed NationsBank of Texas,
N.A., as the successor trustee. All of the Plan's assets are maintained in the
Master Trust with the assets of the Zapata Plan. Among other duties, the
trustee is to invest assets in the Zapata Common Stock Fund, upon the direction
of the Committee, and to receive contributions and distribute benefits of the
Plan. An independent investment manager, Fayez-Sarofim, directs investments in
the Equity Fund and the Fixed Income Fund. The Committee directs all
investments made in the Money Market/Guaranteed Investment Contract Fund.
Hewitt Associates maintains the participating employees' account balances.