SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORT OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 33-41313
A. Full title of the plan and the address of the plan,
if different from that of the issuer named below:
Bairnco Corporation 401(k)
Savings Plan and Trust
B. Name of issuer of the securities held pursuant to
the plan and the address of its principal executive office:
Bairnco Corporation
300 Primera Boulevard, Suite 432
Lake Mary, Florida 32746
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Advisory Committee of
Bairnco Corporation 401(k) Savings Plan and Trust:
We have audited the accompanying statements of net assets available for benefits of Bairnco Corporation 401(k) Savings Plan and Trust as of December 31, 2000 and 1999, and the related statement of changes in net assets available for benefits for the year ended December 31, 2000. These financial statements and the supplemental schedule referred to below are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and supplemental schedule based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States. 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 the Plan as of December 31, 2000 and 1999, and the changes in its net assets available for benefits for the year ended December 31, 2000, in conformity with accounting principles generally accepted in the United States.
Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment 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. The supplemental schedule 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.
/s/Arthur Andersen LLP
Orlando, Florida,
June 28, 2001
BAIRNCO CORPORATION
401(k) SAVINGS PLAN AND TRUST
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 2000 AND 1999
2000 | 1999 | |
ASSETS | ||
CASH | $ -- | $ 300,000 |
INVESTMENTS, at fair market value | ||
Bairnco Corporation common stock fund | 205,068 | 179,432 |
Money market fund | 632,572 | 826,741 |
Mutual funds | 7,313,046 | 7,871,466 |
Participant notes receivable | 455,665 | 482,552 |
Total Investments | 8,606,351 | 9,360,191 |
PARTICIPANTS' CONTRIBUTIONS RECEIVABLE | 82,343 | 92,387 |
ACCRUED INTEREST AND DIVIDENDS | 7,870 | -- |
TOTAL ASSETS | 8,696,564 | 9,752,578 |
NET ASSETS AVAILABLE FOR BENEFITS | $ 8,696,564 | $ 9,752,578 |
The accompanying notes are an integral part of these financial statements.
BAIRNCO CORPORATION
401(k) SAVINGS PLAN AND TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2000
2000 | |
NET ASSETS AVAILABLE FOR BENEFITS, beginning of year | $ 9,752,578 |
ADDITIONS: | |
Participants' contributions | 1,431,476 |
Interest and dividends | 514,456 |
Net realized and unrealized depreciation on investments | (1,630,068) |
315,864 | |
DEDUCTIONS: | |
Distributions | 1,365,630 |
Administrative expenses | 6,248 |
1,371,878 | |
NET DECREASE | (1,056,014) |
NET ASSETS AVAILABLE FOR BENEFITS, end of year | $ 8,696,564 |
The accompanying notes are an integral part of this financial statement.
BAIRNCO CORPORATION
401(k) SAVINGS PLAN AND TRUST
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
1. PLAN DESCRIPTION:
The following description of the Bairnco Corporation 401(k) Savings Plan and Trust (the "Plan") provides only general information. Participants of the Plan should refer to the Plan document for a complete description of the Plan's provisions. The Plan document is available from Bairnco Corporation ("Bairnco" or the "Corporation") at its offices in Lake Mary, Florida.
General
Bairnco established the Plan effective July 1, 1991. The Plan is a defined contribution plan under which all full-time employees become eligible for participation on the first day of the month following completion of thirty days of service. Once an employee becomes eligible for participation, salary deferrals (contributions) may commence on any subsequent date. The Plan excludes non-resident aliens, leased employees and independent contractors from participating in the Plan. Union employees of the Corporation are permitted to participate in the Plan. The Plan is subject to the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 ("ERISA").
Contributions
Under the terms of the Plan, allowable contributions are outlined as follows:
Participant Contributions - The participants may elect to defer a minimum of 1 percent and a maximum of 20 percent of compensation, as defined in the Plan, not to exceed $10,500 for 2000. The maximum dollar amount that may be deferred is adjusted annually by the Internal Revenue Service. The amount of the compensation that is deferred, plus any earnings or losses on that amount, is not subject to federal income tax until the funds are actually distributed to the participant by the Plan. However, contributions are subject to FICA (Social Security and Medicare Taxes).
Employer Contributions - The Corporation does not match elective deferrals pursuant to the Plan.
Participant Accounts
Each participant's account is credited with their contribution and allocation of Plan earnings or losses, and charged with an allocation of administrative expenses. Allocations are based on participant account balances, as defined in the Plan. The benefit to which a participant is entitled is the amount that can be provided from the participant's vested account.
Vesting
A participant shall at all times have a 100 percent nonforfeitable interest in the value of his/her account attributable to all contributions made plus or minus investment earnings and losses thereon and related administrative costs.
Transfers From Other Qualified Plans
Participants who have an interest in any other qualified employee benefit plan (as described in Section 401(a) of the Internal Revenue Code) may transfer the distributions from these plans directly into the Plan at the discretion of the Administrative Committee (see Note 4).
Distributions
A participant who has attained age 59-1/2 may elect, by filing a written application with the Administrative Committee, to withdraw any amount up to 100 percent of the vested portion of his/her account, for any reason. For participants who have not attained age 59-1/2, the reasons for such withdrawals are restricted to those defined in the Plan.
Upon termination of employment, a participant can elect to have their account balance distributed in a single lump sum cash distribution or a partial distribution, if requested in writing by the participant. As an alternative, the participant may also elect to leave the related funds in the Plan or transfer the related funds into another qualified plan.
Participant Notes Receivable
An active participant may borrow from his/her account a minimum of $1,000 up to a maximum equal to the lesser of (1) a total of $50,000 of borrowings within one year or (2) 50 percent of the participant's account balance.
Loan transactions are treated as transfers between the investment fund and the participant notes receivable account. Loan terms range from 1-5 years or up to 10 years for the purchase of a primary residence. The loans are secured by the balance in the participant's account and bear interest at the prime rate at the time of borrowing plus 2 percent. As of December 31, 2000, interest rates ranged from 9.5 percent to 11.5 percent. Principal and interest are paid each pay-period through payroll deductions.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of additions to and deductions from the net assets available for benefits during the reporting period. Actual results could differ from those estimates.
Basis of Accounting
For the year ended December 31, 2000, the accounting records of the Plan and the Plan's assets were maintained by Schwab Retirement Plan Services, Inc. ("Schwab"), a subsidiary of the Charles Schwab Corporation. The participants' account balances are determined on the cash basis of accounting; however, the Plan's financial statements contained herein are presented on the accrual basis.
Investment Valuation and Income Recognition
Investments are stated at fair market value. Securities that are traded on a national securities exchange are valued at the last reported sales price on the last business day of the year. Any unlisted securities are valued at the bid price preceding the close of business on the valuation date. Participant notes receivable are valued at cost, which approximates fair market value.
Any unrealized appreciation/depreciation on investments represents the difference between fair market value of investments at the beginning of the Plan year or when acquired, whichever is later, and the fair market value of investments at the end of the Plan year.
Interest income is recognized on the accrual basis of accounting.
Administrative Expenses
Certain administrative expenses of the Plan are paid directly by Bairnco on behalf of the Plan. During the year ended December 31, 2000, Bairnco paid administrative expenses of approximately $27,200.
Benefit Payments
Benefits are recorded when paid.
Reclassifications
Certain amounts in the 1999 financial statements have been reclassified to conform with the 2000 presentation.
3. INVESTMENTS:
There are currently eight investment options into which participants may direct the investment of their accounts. These are Bairnco Corporation Common Stock Fund, Schwab Retirement Money Fund, and INVESCO Technology II Fund, Dreyfus Founders Growth Fund, Schwab 1000 Fund, Strong Government Securities Fund, Neuberger Berman Partners Fund and Neuberger Berman Guardian Fund (collectively the "mutual funds"). Participants invest in units of participation of the fund that represent an undivided interest in the underlying assets of the fund. Participants may separately direct the investment of future deferrals and existing account balances into these eight investment options in increments of 5 percent. Participants are permitted to modify their elections for future deferrals and existing account balances between investment funds on a daily basis.
Investments that represent 5 percent or more of the Plan's net assets available for benefits, as of December 31, 2000 and 1999 are as follows:
December 31, | ||
2000 | 1999 | |
INVESCO Technology II Fund | $ 1,513,341 | $ 1,619,941 |
Dreyfus Founders Growth Fund | 1,384,054 | 1,950,554 |
Schwab 1000 Fund | 3,246,883 | 3,399,751 |
Strong Government Securities Fund | 999,719 | 730,935 |
Schwab Retirement Money Fund | 632,572 | 826,741 |
During 2000, the Plan's investments (including gains and losses on investments bought, sold and held during the year) depreciated in value as follows:
Amount | |
Mutual Funds | $ (1,675,770) |
Bairnco Corporation Common Stock Fund | 45,702 |
$ (1,630,068) |
4. TRUST AGREEMENT:
Schwab is the Plan's Trustee pursuant to the Plan document which is signed by the Corporation and Plan Trustee. Schwab manages the Plan assets and makes distributions to participants as directed by the Administrative Committee of the Corporation (the "Plan Administrator"). Expenses incurred by the Plan Trustee or the Plan Administrator in the performance of their duties may be paid by the Plan or the Corporation at the Corporation's discretion. During 2000, all investment managers' fees were paid directly by the Plan.
5. PLAN TERMINATION:
Although it has not expressed any intent to do so, the Corporation reserves the right under the Plan to terminate the Plan, in whole or in part, at any time. In the event of the Plan's termination, the Plan assets will be distributed to the participants in lump sum distributions or transferred to another qualified plan at the direction of the participant.
6. TRANSACTIONS WITH PARTIES IN INTEREST:
Under ERISA, the Plan is required to report investment transactions with and compensation paid to a "party in interest". The term "party in interest" is broadly defined but includes Bairnco as the Plan's sponsor, Schwab, as Plan Trustee, and any person or corporation which renders services to the Plan. Certain fees for legal and accounting services provided in connection with the Plan were paid by the Plan sponsor on behalf of the Plan during these years and are not included in the accompanying financial statements. Additional fees paid by the Plan during 2000 for services rendered by parties in interest were based on rates which the Plan's Administrator believes were customary and reasonable.
7. INCOME TAX STATUS:
The Plan obtained its latest determination letter on April 29, 1997, 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 administrator and legal counsel believe that the Plan is currently being operated in compliance with the applicable requirements of the Internal Revenue Code.
8. RECONCILIATION TO FORM 5500
The following is a reconciliation of the net assets available for benefits as of December 31, 1999 to the Form 5500:
Net assets available for benefits for financial reporting purposes | $ 9,752,578 |
Accrued interest and dividends | 3,044 |
Net assets available for benefits for Form 5500 purposes | $ 9,755,622 |
The following is a reconciliation of interest and dividends and net realized and unrealized depreciation on investments for the year ended December 31, 2000 to the Form 5500:
Interest and dividends and net realized and unrealized depreciation on investments for financial reporting purposes | $(1,115,612) |
Accrued interest and dividends | (3,044) |
Total interest and dividends and net realized and unrealized depreciation on investments for Form 5500 purposes | $(1,118,656) |
9. SUPPLEMENTAL SCHEDULE
The following supplemental schedule of assets held for investment is included as a required schedule under ERISA.
SCHEDULE I
BAIRNCO CORPORATION
401(k) SAVINGS PLAN AND TRUST
SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT
AS OF DECEMBER 31, 2000
Description | Fair Market Value |
Bairnco Corporation Common Stock Fund | |
Schwab Money Market Fund * | $ 1 |
Bairnco Corporation Common Stock | 205,067 |
Total Bairnco Corporation Common Stock Fund | 205,068 |
Money Market Fund | |
Schwab Retirement Money Fund * | 632,572 |
Mutual Funds | |
INVESCO Technology II Fund | 1,513,341 |
Dreyfus Founders Growth Fund | 1,384,054 |
Schwab 1000 Fund * | 3,246,883 |
Strong Government Securities Fund | 999,719 |
Neuberger & Berman Partners Fund | 65,399 |
Neuberger & Berman Guardian Fund | 103,650 |
Total Mutual Funds | 7,313,046 |
Other Investments | |
Participant Notes Receivable, collateralized by vested account balances, principal and interest repayable each pay period in terms ranging from one to ten years, bearing interest from 9.5% to 11.5% |
455,665 |
Total | $ 8,606,351 |
* - Managed by the trustee, a party in interest
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Administrative Committee has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
BAIRNCO CORPORATION 401(K)
SAVINGS PLAN AND TRUST
(Name of Plan)
Date: June 28, 2001 By: /s/ James W. Lambert
JAMES W. LAMBERT
Administrative Committee Member
