NEU 12.31.13 11K

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
 
FORM 11-K
 
ý
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2013
OR
 
¨
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
Commission File Number 001-32190
 
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 NEWMARKET CORPORATION AND AFFILIATES
 
B.
Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

NEWMARKET CORPORATION
330 SOUTH FOURTH STREET
RICHMOND, VIRGINIA 23219-4350
 
 
 





Savings Plan for the Employees of NewMarket Corporation and Affiliates
Index of Financial Statements and Supplemental Schedule
 
 
 
 Page(s)
 
 
Financial Statements
 
 
 
 
 
 
 
 
 
Supplemental Schedule*
 
 
 
 
*
Other schedules required by 29 CFR 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 are not included because they are not applicable.



Report of Independent Registered Public Accounting Firm


To the Administrator of the
Savings Plan for the Employees of NewMarket Corporation and Affiliates

We have audited the accompanying statements of net assets available for benefits of the Savings Plan for the Employees of NewMarket Corporation and Affiliates (the “Plan”) as of December 31, 2013 and December 31, 2012 and the related statements of changes in net assets available for benefits for the years then ended. 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits 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, 2013 and December 31, 2012, and the changes in its net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States.
Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule, Schedule H, Line 4i – Schedule of Assets (Held at End of Year) as of December 31, 2013, is presented for the purpose of 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. This supplemental schedule is the responsibility of the Plan’s management. The supplemental schedule has been subjected to the auditing procedures applied in our 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.

/s/ Keiter

May 22, 2014
Glen Allen, Virginia
 




1

Savings Plan for the Employees of NewMarket Corporation and Affiliates
Statements of Net Assets Available for Benefits
December 31, 2013 and December 31, 2012
 
 
 
 
2013
 
2012
Assets
 
 
 
 
Cash
 
$
25,789

 
$
24,219

Investments, at fair value (Notes 3 and 4)
 
435,027,058

 
368,447,122

Receivables
 
 
 
 
 Employee contributions
 
294,987

 
0

 Employer contributions
 
132,289

 
0

 Interest and dividends
 
724,422

 
49,461

 Notes receivable from participants
 
2,025,263

 
1,817,218

Total Assets
 
438,229,808

 
370,338,020

 
 
 
 
 
Liabilities
 
 
 
 
Due to trustee
 
294,260

 
0

 
 
 
 
 
Net assets available for benefits
 
$
437,935,548

 
$
370,338,020


 
 
 
 




The accompanying notes are an integral part of the financial statements.

2

Savings Plan for the Employees of NewMarket Corporation and Affiliates
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2013 and December 31, 2012
 
 
 
 
2013
 
2012
Additions to net assets attributed to
 
 
 
 
Net appreciation in fair value of investments (Note 4)
 
$
67,578,947

 
$
53,787,653

Investment income—interest and dividends
 
13,328,983

 
24,534,542

Interest income on notes receivable from participants
 
82,944

 
67,095

Contributions
 
 
 
 
Employees
 
10,061,382

 
9,223,801

Employer
 
4,041,089

 
3,756,777

Total additions
 
95,093,345

 
91,369,868

Deductions from net assets attributed to
 
 
 
 
Benefit payments
 
(27,495,817
)
 
(26,383,620
)
Total deductions
 
(27,495,817
)
 
(26,383,620
)
Net increase
 
67,597,528

 
64,986,248

Net assets available for benefits
 
 
 
 
At beginning of year
 
370,338,020

 
305,351,772

At end of year
 
$
437,935,548

 
$
370,338,020


 
  

 




The accompanying notes are an integral part of the financial statements.

3


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012


1. Description of Plan    

General
The Savings Plan for the Employees of NewMarket Corporation and Affiliates (the Plan) is a defined contribution plan covering all eligible employees of NewMarket Corporation and certain subsidiaries (the Company or NewMarket). Employees become eligible to participate on their date of hire. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974. Information regarding Plan benefits, priority of distributions upon termination of the Plan, and vesting is provided in the Plan document, which is available at the main office of the Plan administrator at 330 South Fourth Street, Richmond, Virginia 23219.
Bank of America, N.A. is the Plan's investment manager and trustee and Merrill Lynch, Pierce, Fenner & Smith, Inc. is the Plan's record-keeper.
Contributions
Participants in the Plan may make pre-tax contributions from 1% to 50% of their base pay, as defined in the Plan document. Participants may make after-tax contributions from 1% to 15% of their base pay. Through December 31, 2013, participants who are deemed “highly compensated” are limited to contributions of 10% of their base pay on both a pre-tax and after-tax basis. Any combination of pre-tax and after-tax contributions is subject to the 10%, 15%, or 50% limits. Effective for payroll periods beginning on or after January 1, 2014, highly compensated employees are no longer subject to the 10% limits on pre-tax contributions and after-tax contributions. In addition, federal law places a dollar limit on the amount of pre-tax contributions an individual can make to 401(k) plans during a calendar year. NewMarket may also impose an annual Plan contribution limitation that is lower than the maximum federal limitation. The maximum pre-tax federal limit was $17,500 for 2013 and $17,000 for 2012. Participants who have attained age 50 may make “catch-up” contributions in a dollar amount established by the Internal Revenue Service ($5,500 for each of 2013 and 2012).
NewMarket contributes 50% of the first 10% of base pay that a participant contributes to the Plan. Contributions made by NewMarket are invested in the NewMarket Corporation Common Stock Fund. Participants may also contribute amounts representing distributions from other qualified defined benefit or defined contribution plans. Participant contributions are 100% vested at all times while contributions made by NewMarket are 40% vested after two years of service, 60% vested after three years of service, 80% vested after four years of service and 100% vested after five years of service.

Effective for pay periods beginning on or after January 1, 2012, base pay includes the straight-time portion of an employee’s regularly scheduled overtime, plus pay for any other overtime or extended work week pay, and any premium pay related to hours actually worked. Base pay does not include any type of bonus payment, reimbursement of moving expenses, reimbursement of educational expenses, or similar payments, or any other supplemental payments which an employee may receive in addition to base salary or wage regardless of the term used to designate such increment.
Administrative Expenses
Costs of administering the Plan are paid from investment-related compensation received by the record-keeper from the various mutual funds held in the Plan.
 
Participant Accounts
Each participant’s account is credited with the participant’s contributions, the Company’s contributions, trading fees, as well as allocations of Plan earnings or losses. Allocations of Plan earnings or losses are based on account balances, as defined by the Plan. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account.



4


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012

Benefit Payments
Benefits are recorded when paid. Participants may decide whether benefits will be received directly in the form of cash proceeds or in whole shares of common stock.
Notes Receivable from Participants
Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Loan transactions are treated as transfers between the investment fund and the loan fund. Loans are made over a period not to exceed five years. The loans are collateralized by the balance in the participant’s account and bear a reasonable fixed rate of interest determined by the Plan administrator based on a rate of return commensurate with the prevailing interest rate charged on similar commercial loans by persons in the business of lending money. Interest rates are determined as of the date of the loan. Notes receivable from participants are reported at their unpaid principal balances plus accrued but unpaid interest. Interest rates on participant loans ranged from 4.25% to 5.50% at December 31, 2013 and 4.25% to 8.25% at December 31, 2012. Principal and interest are paid through payroll deductions. Management has evaluated notes receivable from participants for collectability and has determined that no allowance is necessary.
Forfeitures
Participants who leave NewMarket before becoming fully vested in NewMarket contributions forfeit the value of their nonvested account. Forfeitures during a Plan year can serve to reduce required Company contributions and/or to cover Plan administrative expenses. Forfeitures that reduced the Company’s contributions were $114,982 for 2013 and $583,484 for 2012. The forfeiture balance at both December 31, 2013 and December 31, 2012 was immaterial.
Employee Stock Ownership Plan Feature
Effective October 22, 2009, NewMarket amended the Plan to designate a portion of the Plan’s assets as an employee stock ownership plan (ESOP), comprised of the NewMarket Corporation Common Stock Fund. All dividends with a record date on or after December 1, 2009, declared on NewMarket Corporation common stock held in the ESOP are fully vested without regard to whether any other portion of the ESOP or any participant’s account is vested. In addition, with respect to those dividends, participants are permitted to make an election to receive those dividends or to have those dividends reinvested in the ESOP. Under the amendment and effective January 1, 2010, a participant may request the liquidation and transfer of all or a portion of his or her investment in the ESOP to an alternate investment fund at any time. Further, a participant may request that his or her ESOP benefits be distributed in the form of NewMarket Corporation common stock. In addition to a participant’s after-tax, pre-tax and rollover accounts, loans are available under the ESOP from the portion of a participant’s account attributable to dividends with a record date on or after December 1, 2009, declared on shares of NewMarket Corporation common stock held in the ESOP.

Since July 1, 2011, a participant who transfers all or part of their investment in the NewMarket Corporation Common Stock Fund into another investment fund cannot liquidate and transfer amounts held in such other investment funds into the NewMarket Corporation Common Stock Fund until 90 days after the date of the most recent liquidation and transfer out of the NewMarket Corporation Common Stock Fund. This restriction does not apply to the investment of future after-tax, pre-tax and rollover contributions made by the participant, or future matching and discretionary contributions made by the Company.
 
2. Summary of Significant Accounting Policies

Basis of Accounting
The accompanying financial statements of the Plan have been prepared in conformity with accounting principles generally accepted in the United States of America.


5


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012

Investment Valuation and Income Recognition
All investments of the Plan are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants at the measurement date. Investments are reflected at fair value in the financial statements. Security transactions are recorded as of the trade date. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
Accounting Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan’s management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
Risks and Uncertainties
The Plan provides for various mutual fund and commingled trust fund investment options in stocks, bonds and fixed income securities, as well as direct common stock investments. Investment securities are exposed to various risks such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the statement of net assets available for benefits. 

3. Fair Value Measurements

The following is a description of valuation methodologies used for fair value measurement of investments:
Common stock
 
Common stock is valued at the closing price reported on the New York Stock Exchange.
 
 
Mutual funds
 
Mutual funds are valued at the closing price reported on the NASDAQ.
 
 
Commingled trust fund
 
The commingled trust fund is valued daily at the net asset value of shares or units held by the Plan based on quoted market value of the underlying assets. There are no redemption or frequency restrictions as of December 31, 2013 or December 31, 2012.
The valuation methodologies described above may generate a fair value calculation that may not be indicative of net realizable value or future fair values. While the Plan’s management believes the valuation methodologies used are appropriate, the use of different methodologies or assumptions in calculating fair value could result in different amounts.

6


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012

The following tables provide information by level on the fair value of the Plan’s investments.

 
 
 
 
 
December 31, 2013
 
 
 
 
 
Fair Value Measurements Using
 
 
 
Fair Value
Level 1
 
Level 2
 
Level 3
Mutual funds:
 
 
 
 
 
 
 
 
 
Blend funds
 
$
67,480,279

 
$
67,480,279

 
$
0

 
$
0

 
Fixed income funds
 
36,423,499

 
36,423,499

 
0

 
0

 
Value funds
 
34,987,049

 
34,987,049

 
0

 
0

 
Growth funds
 
28,763,039

 
28,763,039

 
0

 
0

 
Balanced funds
 
4,523,404

 
4,523,404

 
0

 
0

Total mutual funds
 
172,177,270

 
172,177,270

 
0

 
0

 
 
 
 
 
 
 
 
 
Common stock
 
218,332,988

 
218,332,988

 
0

 
0

 
 
 
 
 
 
 
 
 
Commingled trust fund-fixed income
 
44,516,800

 
0

 
44,516,800

 
0

 
 
 
 
 
 
 
 
 
Total investments, at fair value
 
$
435,027,058

 
$
390,510,258

 
$
44,516,800

 
$
0


 

 
 
 
 
 
December 31, 2012
 
 
 
 
 
Fair Value Measurements Using
 
 
 
Fair Value
Level 1
 
Level 2
 
Level 3
Mutual funds:
 
 
 
 
 
 
 
 
 
Blend funds
 
$
51,581,011

 
$
51,581,011

 
$
0

 
$
0

 
Fixed income funds
 
42,217,946

 
42,217,946

 
0

 
0

 
Value funds
 
26,016,807

 
26,016,807

 
0

 
0

 
Growth funds
 
19,536,663

 
19,536,663

 
0

 
0

 
Balanced funds
 
3,786,957

 
3,786,957

 
0

 
0

Total mutual funds
 
143,139,384

 
143,139,384

 
0

 
0

 
 
 
 
 
 
 
 
 
Common stock
 
189,394,573

 
189,394,573

 
0

 
0

 
 
 
 
 
 
 
 
 
Commingled trust fund-fixed income
 
35,913,165

 
0

 
35,913,165

 
0

 
 
 
 
 
 
 
 
 
Total investments, at fair value
 
$
368,447,122

 
$
332,533,957

 
$
35,913,165

 
$
0


 





7


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012

4. Investments

Participants currently in the Plan may invest their Plan account in any of the active 13 mutual funds, one commingled trust fund, and the NewMarket Corporation Common Stock Fund, or in any combination thereof. Investments also include two common stock funds, in which new investments are prohibited. Participants may invest their own contributions to the Plan in these active investment funds in one percent increments and may transfer among the active funds at any time. Contributions made by NewMarket are invested in the NewMarket Corporation Common Stock Fund.
The following table presents investments held at year-end that represent at least five percent (5%) or more of net assets available for benefits at December 31.
 
 
 
2013
 
2012
NewMarket Corporation Common Stock Fund (Note 7)
 
$
203,799,937

 
$
173,953,544

Invesco Stable Value Retirement Fund
 
44,516,800

 
35,913,165

BlackRock S&P 500 Stock Fund
 
32,596,739

 
24,566,792

PIMCO Total Return Fund
 
29,062,604

 
34,055,275

Oakmark International Fund
 
22,284,733

 
*


* Represents less than 5% of Plan assets

The Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value as follows.
 
 
 
2013
 
2012
Common stock
 
$
46,232,917

 
$
42,206,060

Mutual funds
 
21,346,030

 
9,794,657

Commingled trust fund
 
0

 
1,786,936

 
 
$
67,578,947

 
$
53,787,653


 

5. Tax Status

The Internal Revenue Service has determined and informed the Plan administrator by letter dated September 19, 2013, that the Plan and related trust are designed in accordance with the applicable sections of the Internal Revenue Code. The Plan has been amended since receiving the determination letter; however, the Plan administrator believes the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code.
Management has evaluated the effects of accounting guidance related to uncertain income tax positions and concluded that the Plan had no significant financial statement exposure to uncertain income tax positions at December 31, 2013, or December 31, 2012.
 

6. Plan Termination

Although it has not expressed any intent to do so, NewMarket has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of the Employee Retirement Income Security Act of 1974. In the event of Plan termination, participants will become 100% vested in their account balances and the assets of the Plan shall be allocated to participants in proportion to their account balances as of the effective date of termination.

8


Savings Plan for the Employees of NewMarket Corporation and Affiliates
Notes to Financial Statements
December 31, 2013 and December 31, 2012

 
7. Related-Party Transactions

Plan assets available for benefits include cash funds, which are managed by Bank of America, N.A., the trustee of the Plan, and therefore, qualify as party-in-interest transactions. Investments in the NewMarket Corporation Common Stock Fund represent investments in shares of common stock of NewMarket Corporation, the Plan sponsor. The table below shows the activity in the NewMarket Corporation Common Stock Fund during 2013 and 2012.
 
 
 
Shares
 
Amount
Balance—January 1, 2012
 
637,766

 
$
126,347,781

Purchases
 
131,539

 
37,846,819

Distributions and sales
 
(105,867
)
 
(28,442,229
)
Appreciation
 
0

 
38,201,173

Balance—December 31, 2012
 
663,438

 
173,953,544

Purchases
 
30,365

 
8,733,190

Distributions and sales
 
(83,897
)
 
(21,444,801
)
Appreciation
 
0

 
42,558,004

Balance—December 31, 2013
 
609,906

 
$
203,799,937



8. Subsequent Events

The Plan Sponsor’s management has evaluated subsequent events through the date the financial statements were issued and has determined there are no subsequent events to be reported in the accompanying financial statements.
 


9

Savings Plan for the Employees of NewMarket Corporation and Affiliates
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2013
 
 
EIN: 20-0812170 PN: 002
(a)
 
(b) Identity of issuer, borrower,
lessor or similar party
 
(c) Description
 
(d) Cost **
 
(e) Current
value
*
 
NewMarket Stock Fund:
 
 
 
 
 
 
 
 
Matching contributions
 
Common stock; no par value (370,118 shares)
 
$
19,226,279

 
$
123,674,739

 
 
Employee deferral
 
Common stock; no par value (239,788 shares)
 
 
 
80,125,198

 
 
Tredegar Corporation
 
Common stock; no par value (40,647 shares)
 
 
 
1,171,031

 
 
Albemarle Corporation
 
Common stock; $.01 par value (210,791 shares)
 
 
 
13,362,020


 
Invesco Stable Value Retirement Fund
 
Commingled trust (44,516,800 units)
 
 
 
44,516,800

 
 
PIMCO Total Return Fund
 
Mutual fund (2,718,672 units)
 
 
 
29,062,604

 
 
Allianz NFJ Small Cap Fund
 
Mutual fund (368,866 units)
 
 
 
12,973,029

 
 
Buffalo Small Cap Fund
 
Mutual fund (142,212 units)
 
 
 
5,307,342

 
 
Dreyfus Bond Market Index
 
Mutual fund (712,575 units)
 
 
 
7,360,895

 
 
Invesco Growth & Income Fund
 
Mutual fund (498,748 units)
 
 
 
13,491,142

 
 
BlackRock Capital Appreciation Fund
 
Mutual fund (384,824 units)
 
 
 
10,971,335

 
 
BlackRock International Index
 
Mutual fund (253,042 units)
 
 
 
3,317,375

 
 
BlackRock S&P 500 Stock Fund
 
Mutual fund (146,839 units)
 
 
 
32,596,739

 
 
BlackRock Balanced Capital Fund
 
Mutual fund (182,912 units)
 
 
 
4,523,404

 
 
Franklin Small-Mid Cap Growth Fund
 
Mutual fund (290,334 units)
 
 
 
12,484,362

 
 
Davis New York Venture Fund
 
Mutual fund (221,461 units)
 
 
 
9,281,432

 
 
Oakmark International Fund
 
Mutual fund (846,684 units)
 
 
 
22,284,733

 
 
Perkins Mid Cap Value Fund
 
Mutual fund (364,849 units)
 
 
 
8,522,878

 
 
 
 
 
 
 
 
435,027,058

*
 
Participant loans
 
Notes receivable from participants bearing interest at 4.25%-5.50% annually, maturity dates of 1/14/2014-1/3/2019
 
0

 
2,025,263

 
 
 
 
 
 
 
 
$
437,052,321

 

*
Denotes a party in interest to the Plan
**
Cost information is not required for employee deferrals invested in the NewMarket Stock Fund
 

10

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 NEWMARKET CORPORATION AND
AFFILIATES
 
 
 
 
Date: May 22, 2014
 
 
 
By:
/s/    D. A. Fiorenza
 
 
 
 
David A. Fiorenza
 
 
 
 
Vice President, Chief Financial Officer,
Member of the Master Trust Committee




EXHIBIT INDEX
 
 
 
 
Exhibit Number
  
Description
 
 
23
  
Consent of Keiter