UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2001
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[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________________ to _______________________
Commission file number 1-12541
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A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
ATCHISON CASTING CORPORATION HOURLY EMPLOYEES 401(k) PLAN
B. Name of the issuer of the securities held pursuant to the plan and the
address of its principal executive office:
ATCHISON CASTING CORPORATION
400 South Fourth Street
Atchison, Kansas 66002
Atchison Casting Corporation Hourly Employees' 401(k) Plan
Financial Statements as of and for the Years Ended
June 30, 2001 and 2000, Supplemental Schedules as of
and for the Year Ended June 30, 2001, and Independent
Auditors' Report
ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) Plan
TABLE OF CONTENTS
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Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-8
SUPPLEMENTAL SCHEDULES AS OF AND FOR THE YEAR ENDED JUNE 30, 2001:
Form 5500, Schedule G, Part III - Schedule of Nonexempt Transactions 9
Form 5500, Schedule H, Part IV, Line 4i - Schedule of Assets Held for Investment Purposes at
the End of Year 10
Note: Certain supplemental schedules required by rules and regulations of the
Department of Labor are omitted because of the absence of the conditions under
which they are required.
INDEPENDENT AUDITORS' REPORT To the Trustees and Participants of Atchison Casting Corporation Hourly Employees' 401(k) Plan Atchison, Kansas We have audited the accompanying statements of net assets available for benefits of Atchison Casting Corporation Hourly Employees' 401(k) Plan (the "Plan") as of June 30, 2001 and 2000, 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 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, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of June 30, 2001 and 2000, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules listed in the Table of Contents are presented for the purpose of additional analysis and are not a required part of the basic financial statements, but are 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. These schedules are the responsibility of the Plan's management. Such schedules have been subjected to the auditing procedures applied in our audit of the basic financial statements for the year ended June 30, 2001, and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/ Deloitte & Touche LLP Kansas City, Missouri December 27, 2001
ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
JUNE 30, 2001 AND 2000
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ASSETS 2001 2000
INVESTMENTS:
Mutual funds $1,330,410 $1,228,847
Guaranteed interest account 185,085 95,070
Common stock of Atchison Casting Corporation 12,424 13
Participant loans 62,561 55,620
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Total investments 1,590,480 1,379,550
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CONTRIBUTIONS RECEIVABLE:
Employer's 14,214 14,119
Participants' 34,365 34,279
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Total contributions receivable 48,579 48,398
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NET ASSETS AVAILABLE FOR BENEFITS $1,639,059 $1,427,948
========== ==========
See notes to financial statements.
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ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED JUNE 30, 2001 AND 2000
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2001 2000
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income:
Interest and dividend income $ 24,704 $ 26,829
Net (depreciation) appreciation in fair value of investments (195,758) 153,378
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Net investment (loss) income (171,054) 180,207
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Contributions:
Employer's, net of forfeitures 142,995 152,191
Participants' 362,612 366,768
Rollover 6,502
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Total contributions 512,109 518,959
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Total additions 341,055 699,166
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DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Distributions to participants 85,255 185,741
Distributed loans 5,299 12,331
Administrative expenses 45
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Total deductions 90,554 198,117
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TRANSFER TO ATCHISON CASTING CORPORATION
HOURLY DEFINED CONTRIBUTION PLAN (39,390) (629,339)
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NET INCREASE (DECREASE) 211,111 (128,290)
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 1,427,948 1,556,238
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End of year $ 1,639,059 $ 1,427,948
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See notes to financial statements.
-3-
ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2001 AND 2000
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1. DESCRIPTION OF THE PLAN
The following description of the Atchison Casting Corporation Hourly
Employees' 401(k) Plan, (the "Plan") provides only general information.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
General - The Plan is a defined contribution plan covering hourly
employees of Atchison Casting Corporation (the "Plan Sponsor" or "Plan
Administrator" or "Atchison") provided they meet the prescribed
eligibility requirements. The Plan was formed by the Plan Sponsor on July
1, 1993. Prudential Investments ("Prudential") serves as custodian of the
Plan. Individuals employed by the Plan Sponsor serve as trustees (the
"Trustees") of the Plan. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA").
Plan Amendment - The Plan was amended on July 1, 1999. Prior to July 1,
1999, the Plan had a profit sharing feature allowing Plan participants to
receive a profit sharing contribution based on net profits, as defined by
the Plan document, of Atchison. On July 1, 1999, the Atchison Casting
Corporation Hourly Defined Contribution Plan (the "Defined Contribution
Plan") was created, to administer the profit sharing contributions that
were previously handled by the Plan. On August 31, 2000 and June 26, 2000,
assets of $39,390 and $629,339, respectively, were transferred to the
Defined Contribution Plan, which represent the participants' profit
sharing account balances that were eligible to enroll in the Defined
Contribution Plan.
Eligibility and Participation - Hourly employees are eligible for
participation in the Plan after completing at least three months of
service, provided they meet the prescribed eligibility requirements set
forth in the Plan document.
Contributions - Plan participants may contribute a portion of their
pre-tax or after-tax base compensation, subject to certain Internal
Revenue Code ("IRC") limitations. Effective May 11, 1999 the Company will
make a matching contribution of 50% of the first 6% of base compensation
that a participant contributes to the Plan. Effective July 1, 1999 there
will be no profit sharing contributions made to this plan.
Participant Accounts - Each participant's account is credited with the
participant's contributions and withdrawals, as applicable, and
allocations of the Company's contributions and Plan earnings. The benefit
to which a participant is entitled is the benefit that can be provided
from the participant's vested account balance.
Vesting - Participants are immediately vested in their contributions plus
actual earnings thereon. Vesting in the Company's matching and profit
sharing contribution (prior to July 1, 1999) portions of their accounts
plus actual earnings thereon is based on years of service. A participant
is 100% vested after five years of credited service.
-4-
Investment Options - Upon enrollment in the Plan, a participant may direct
contributions in investment options offered by Prudential. During 2001 and
2000, the investment options were as follows:
o MFS Massachusetts Investors Trust
o Oppenheimer Global Fund
o Van Kampen Emerging Growth Fund
o Prudential Stock Index Fund
o AIM Balanced Fund
o The Prudential Insurance Company of America Guaranteed Interest Account
o Prudential Government Securities Trust - Money Market Series
o Fidelity Advisor Equity Income Fund
o Prudential High Yield Fund
o MFS Massachusetts Investors Growth Stock Fund
o Prudential Jennison Growth Fund
o Fidelity Advisor Equity Growth Fund
o Atchison Casting Corporation Common Stock
o Prudential Small Company Fund
o Prudential Government Income Fund
o Franklin Convertible Securities Fund
o Prudential Value Fund
For more information regarding the Plan's investment alternatives and fund
performance, participants should refer to the Plan agreement and published
information provided by such funds.
Participants may change investment elections for future contributions at
any time and may transfer any existing balances among the offered funds,
subject to exchange limitations imposed by the funds.
Participant Loans - Participants may borrow from their fund accounts a
minimum of $1,000 up to the lesser of $50,000 or 50 percent of their
vested account balance. Loan terms range from 1 to 5 years, except for
loans obtained for the purpose of acquiring a primary residence for which
the loan term is determined by the employer. The loans are secured by the
balance in the participant's account and bear interest at a rate
commensurate with the local prevailing rates as determined quarterly by
the Plan administrator. Interest rates range from 8.75% to 10.50%.
Principal and interest are paid ratably through payroll deductions.
Payment of Benefits - Distributions from the Plan are made upon death,
retirement, termination, or permanent disability pursuant to the Plan
provisions and as permitted by law. If a participant's vested account is
less than $5,000, the account balance must be distributed as a lump sum as
soon as administratively possible after separation from service. If the
account balance is $5,000 or greater, distributions can be in the form of
a lump sum, installments, qualified joint and 50% survivor annuities or
the account balance can remain in the Plan.
-5-
Forfeitures - Forfeitures occur upon termination of employment by a
participant who is not fully vested in the Plan. Forfeiture amounts are
used to reduce subsequent contributions by the Plan Sponsor. At June 30,
2001 and June 30, 2000 forfeited unallocated nonvested accounts totaled
$13,767 and $390, respectively. In 2001, $1,556 of these and other
forfeited nonvested accounts arising in fiscal 2001 were allocated to
participant accounts.
Expenses - Expenses of the Plan are paid by either the Plan or the Plan
Sponsor, as provided by the Plan agreement. Expenses of $45 were paid by
the Plan for the year ended June 30, 2000, and none were paid by the Plan
for the year ended June 30, 2001.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The financial statements of the Plan are prepared
under the accrual method of accounting.
Use of Estimates - The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America requires 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.
The Plan invests in mutual funds that hold various securities including
U.S. Government securities, corporate debt instruments, and corporate
stocks. Investment securities, in general, are exposed to various risks,
such as interest rate, credit, and overall market volatility. Due to the
level of risk associated with certain investment securities, it is
reasonably possible that changes in the values of investment securities
will occur in the near term and that such changes could materially affect
the amounts reported in the statements of net assets available for plan
benefits.
Investment Valuation and Income Recognition - The Plan's investments,
excluding the guaranteed interest account, are stated at fair value as
determined by quoted market prices. Participant loans are stated at cost,
which approximates fair value. Purchases and sales of securities are
recorded on a trade-date basis. Interest income is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date. See Note 3
regarding the valuation of the guaranteed interest contract.
Payment of Benefits - Benefit payments are recorded when paid.
Reclassifications - Certain prior year balances have been reclassified to
conform with current year presentation.
3. INVESTMENT CONTRACT WITH INSURANCE COMPANY
The Plan follows the provisions of Statement of Position ("SOP") 94-4,
"Reporting of Investment Contracts Held by Health and Welfare Benefit
Plans and Defined Contribution Pension Plans." SOP 94-4 requires a defined
contribution plan to report investment contracts at fair value unless such
contract is fully benefit responsive. The contract for this Plan has been
deemed to be fully benefit responsive, according to the provisions of SOP
94-4. As such, the contract is presented at contract value, which
approximates fair value, on the statement of net assets available for
benefits as of June 30, 2001 and 2000. The average yield for the years
ended June 30, 2001 and 2000 are 4.85% and 5.98%, respectively. The
crediting interest rate as of June 30, 2001 and 2000 is 4.35% and 6.30%,
respectively. The crediting interest rate is reset upon the maturity of
the contract.
-6-
4. INVESTMENTS
The following table presents the fair values of those investments that
exceeded 5% of the Plan's net assets available for benefits at June 30,
2001 and 2000:
2001 2000
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Value Value
Shares Per Share Fair Shares Per Share Fair
(rounded) (rounded) Value (rounded) (rounded) Value
MFS Massachusetts Investors Trust 21,623 $ 17.80 $ 384,896 19,936 $ 20.94 $ 417,463
Oppenheimer Global Fund 4,464 48.69 217,334 2,933 68.64 201,316
The Prudential Insurance Company of
America - Guaranteed interest account N/A N/A 185,085 N/A N/A 95,070
Prudential Stock Index Fund 5,604 27.40 153,563 3,984 32.40 129,085
Van Kampen Emerging Growth Fund 3,137 48.91 153,418 1,884 97.14 183,011
Fidelity Advisor Equity Income Fund 4,512 25.37 114,459
AIM Balanced Fund 3,981 27.67 110,156 3,029 32.95 99,791
Prudential Government Securities Trust -
Money Market Series 83,823 1.00 83,823
During 2001 and 2000, the Plan's investments (including gains and losses
on investments bought and sold, as well as held during the year)
(depreciated) appreciated in value as follows:
2001 2000
Mutual Funds $(194,086) $ 153,381
Common Stock (1,672) (3)
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$(195,758) $ 153,378
========= =========
5. PARTY-IN-INTEREST
Certain Plan investments are shares of mutual funds and a guaranteed
interest account managed by Prudential. Prudential is the custodian as
defined by the Plan, and, therefore, these transactions qualify as
party-in-interest.
6. PLAN TERMINATION
Although it has not expressed any intention to do so, the Company has the
right, under the Plan, to discontinue its contributions at any time 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.
7. PLAN TAX STATUS
The Internal Revenue Service has determined and informed the Plan Sponsor
by a letter dated October 4, 2000, that the Plan and related trust are
designed in accordance with applicable sections of the IRC. The Plan has
been amended since receiving the letter. However, the Plan administrator
believes that the Plan is designed and is currently being operated in
compliance with the applicable requirements of the IRC.
-7-
8. NONEXEMPT TRANSACTIONS
During the years ended June 30, 2001 and 2000, employee deferrals of
$51,887 and $25,638, respectively, were withheld from certain payrolls and
not remitted on a timely basis (as defined by the Department of Labor (the
"DOL")) by the Plan Sponsor. All such deferrals were subsequently remitted
to the trust by the Plan Sponsor. These are prohibited transactions
according to the provisions of the DOL.
9. SUBSEQUENT EVENTS
Subsequent to June 30, 2001, the domestic and international capital
markets have experienced significant volatility with respect to certain
investments and, as a result, Plan management believes that there has been
significant fluctuations in the values of the Plan's investments.
10. MANAGEMENT PLANS
The financial statements and supplemental schedules have been prepared
assuming that the Plan will continue as a going concern. The Plan's
Sponsor has incurred losses in operations, has a deficiency in working
capital and is not in compliance with certain terms of its debt
agreements. Should the Plan Sponsor not be able to continue as a going
concern, the Plan may not be able to operate as an ongoing plan.
Management of the Plan Sponsor has taken steps in an effort to improve
operating performance and continues to pursue new or revised debt
arrangements. Management believes, however, that certain of the existing
loan arrangements will need to be revised or replaced to provide the Plan
Sponsor with additional borrowing capacity and with financial covenants
within such arrangements that are achievable by the Plan Sponsor.
Management has recently extended and modified their credit agreements
through June 30, 2002 and continues to pursue a long-term credit facility.
******
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ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) PLAN
FORM 5500, SCHEDULE G, PART III - SCHEDULE OF NONEXEMPT TRANSACTIONS
YEAR ENDED JUNE 30, 2001
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(a) (b) (c) (d) (e) (f) (g) (h) (i)
Description of Transactions Expenses
Relationship of Including Maturity Date, Incurred Current
Plan, or Other Rate of Interest, Collateral Purchase Selling Lease with Cost of Value of
Identity of Party Involved Party-in-Interest Par or Maturity Value Price Price Rental Transaction Asset Asset
Atchison Casting Corporation Plan Sponsor Employee contributions not time $51,887* $ 51,887 $ 51,887
remitted to the Trust
* This represents total amount of contributions that were withheld from
employees, but not remitted timely into trust by the Plan Sponsor.
-9-
ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES' 401(k) PLAN
FORM 5500, SCHEDULE H, PART IV, LINE 4j - SCHEDULE OF ASSETS HELD
FOR INVESTMENT PURPOSES AT THE END OF YEAR JUNE 30, 2001
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(a) (b) (c) (d)
Description of
Investment Including
Identity of Issue, Borrower, Maturity Date, Rate of Current
Lessor or Similar Party Interest, Collateral Value
MFS Massachusetts Investors Trust Fund Mutual Fund
(21,623 shares) $ 384,896
Oppenheimer Global Fund Mutual Fund
(4,464 shares) 217,334
* The Prudential Insurance Company of America Guaranteed Interest Account 185,085
* Prudential Stock Index Fund Mutual Fund
(5,604 shares) 153,563
Van Kampen Emerging Growth Fund Mutual Fund
(3,137 shares) 153,418
Fidelity Advisor Equity Income Fund Mutual Fund
(4,512 shares) 114,459
AIM Balanced Fund Mutual Fund
(3,981 shares) 110,156
* Prudential Government Securities Trust - Mutual Fund
Money Market Series (83,823 shares) 83,823
* Prudential High Yield Fund Mutual Fund
(6,864 shares) 40,907
* Prudential Small Company Fund Mutual Fund
(1,892 shares) 29,157
* Prudential Government Income Fund Mutual Fund
(2,584 shares) 22,665
* Atchison Casting Corporation Common Stock
(4,284 shares) 12,424
MFS Massachusetts Investors Growth Fund Mutual Fund
(569 shares) 8,129
Franklin Convertible Securities Fund Mutual Fund
(431 shares) 6,340
* Prudential Value Fund Mutual Fund
(186 shares) 3,394
Fidelity Advisor Equity Growth Fund Mutual Fund
(40 shares) 2,169
* Various Participants Promissory notes, interest rates
from 8.75% to 10.50%, maturity dates
through May 2006 62,561
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Total Investments $ 1,590,480
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* Represents a party-in-interest to the Plan.
-10-
SIGNATURES
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.
ATCHISON CASTING CORPORATION
HOURLY EMPLOYEES 401(k) PLAN
Date January 11, 2002 By: Atchison Casting Corporation, its
---------------- Administrator
By: /s/ Kevin T. McDermed
---------------------------------
Kevin T. McDermed
Vice President, Chief Financial Officer,
Treasurer and Secretary
EXHIBIT INDEX
Exhibit Number Description
23 Consent of Deloitte & Touche LLP