1
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
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: June 30, 2002
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Commission file number: 0-12751
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A. Full title of the plan:
DeVry Inc. Profit Sharing Retirement Plan
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B. Name of issuer of the securities held pursuant to the plan and address of
its principal executive office:
DeVry Inc.
ONE TOWER LANE, SUITE 1000
OAKBROOK TERRACE, ILLINOIS 60181
- ------------------------------------------------------------------------------
REQUIRED INFORMATION
The Plan's audited financial statements and other required information are
attached on the following pages.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
following administrator of the DeVry Inc. Profit Sharing Retirement Plan has
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
DeVry Inc. Profit Sharing Retirement Plan
-----------------------------------------
(Name of Plan)
Date: December 23, 2002 By: /s/Marilynn J. Cason
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Marilynn J. Cason - Administrator
Total Number of Pages 15
2
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
REPORT ON AUDITED FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULE
YEARS ENDED JUNE 30, 2002 AND 2001
3
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
TABLE OF CONTENTS
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Pages
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Independent Auditors' Report 1-2
Financial Statements:
Statements of Net Assets Available for Benefits 3
Statements of Changes in Net Assets Available
for Benefits 4
Notes to Financial Statements 5-10
Supplemental Schedule:
Schedule of Assets Held for Investment Purposes 11
4
Independent Auditors' Report
----------------------------
To the Participants and Administrator of
The DeVry Inc. Profit Sharing Retirement Plan
We have audited the accompanying statements of net assets available for
benefits of DeVry Inc. Profit Sharing Retirement Plan (the Plan) as of
June 30, 2002 and 2001 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, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of DeVry Inc.
Profit Sharing Retirement Plan as of June 30, 2002 and 2001 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 of America.
Our audits were performed for the purpose of forming an opinion on the
financial statements taken as a whole. The supplemental schedule of assets
held for investment purposes at June 30, 2002 is presented for the purpose of
additional analysis and is 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. The supplemental schedule is the
responsibility of the Plan's management. The supplemental schedule has been
subjected to the auditing
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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/Hill, Taylor LLC
November 8, 2002
6
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
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JUNE 30, 2002 AND 2001
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2002 2001
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Assets
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Investments, at market value $ 140,587,223 $ 148,801,272
Receivables:
Accrued investment income 7,222 15,274
Employee 401(k) contributions 419,855 391,870
Company contributions 4,443,190 3,819,966
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Net Assets Available for Benefits $ 145,457,490 $ 153,028,382
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The accompanying notes are an integral part of these financial statements.
7
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
----------------------
YEARS ENDED JUNE 30, 2002 AND 2001
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2002 2001
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Additions:
Additions to net assets attributed to:
Employee 401(k) contributions $ 9,835,210 $ 8,810,870
Employer 401(k) matching contributions 2,219,710 1,964,715
Company discretionary contributions 4,348,394 3,733,278
Assets transferred from other plans 457,083 230,635
Interest and dividends on invested funds 3,000,888 3,461,598
Realized and unrealized gains
on invested funds 2,172,945 3,907,879
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Total additions 22,034,230 22,108,975
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Deductions:
Deductions from net assets attributed to:
Investment and administrative expenses 120,939 146,982
Distributions to employees 4,475,126 7,162,205
Realized and unrealized losses
on invested funds 25,009,057 14,224,198
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Total deductions 29,605,122 21,533,385
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Net increase (decrease) (7,570,892) 575,590
Net assets available for benefits:
Beginning of year 153,028,382 152,452,792
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End of year $ 145,457,490 $ 153,028,382
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The accompanying notes are an integral part of these financial statements.
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DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
NOTES TO FINANCIAL STATEMENTS
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YEARS ENDED JUNE 30, 2002 AND 2001
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1. General Description of the Plan:
--------------------------------
The following brief description of the DeVry Inc. Profit Sharing Retirement
Plan (the Plan) is provided for general information purposes only. Participants
should refer to the Plan document for a more complete description of the Plan's
provisions.
The Plan, as amended, is a participant-directed defined contribution plan with
elective employee participation on a before-tax basis under Section 401(k) of
the Internal Revenue Code and is subject to the Employee Retirement Income
Security Act of 1974 (ERISA). The Plan covers all United States of America
employees of DeVry Inc. (the Company), and its subsidiaries, eligible on the
date of hire to make employee contributions. Participants are eligible for the
Company's matching contributions and profit sharing contributions after
completing one year of service with 1,000 or more hours worked. New employees
who were participants in other qualified retirement plans are permitted to
transfer their vested account balances to the Plan. The Plan covered 3,679 and
3,176 of the Company's employees at June 30, 2002 and 2001, respectively. This
includes 987 and 839 former employees for whom benefits had not yet been
distributed as of June 30, 2002 and 2001, respectively. The Plan was last
amended to be effective as of January 1, 2002, to reflect the adoption of
certain provisions of the Economic Growth and Tax Relief Reconciliation Act of
2001.
The Company is the administrator of the Plan. Effective July 1, 2000, the
Company engaged American Express Retirement Services as trustee of the Plan to
perform certain administrative and record keeping services.
Pursuant to the Plan, eligible employees may elect to contribute from 1-15% of
their annual eligible compensation on a before-tax basis as limited by the
Internal Revenue Code. Highly compensated employees of the Company, as defined
by the Internal Revenue Code, are limited to contributing a maximum of 10% of
their compensation. In accordance with the Internal Revenue Code, eligible
employees could contribute a maximum of $11,000 and $10,500 during calendar
years 2002 and 2001, respectively.
The Company makes a matching contribution for all participants who have elected
to make 401(k) contributions. This matching contribution is equal to 1% of
gross pay if a participant contributes 1% of his or her eligible compensation.
The matching contribution is 2% if a participant contributes 2% or more of his
or her eligible compensation. The Company may also make a discretionary
contribution in an amount determined annually by its board of directors.
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1. General Description of the Plan (Continued):
--------------------------------------------
Participants in the Plan may elect each month to invest their contributions and
previous account balances in 1% increments in any of the funds described below.
However, investments in the DeVry Inc. Stock Fund may be made only with current
period contributions and are limited to 25% of these contributions. Prior
account balances may not be allocated to this fund.
U.S. Government Securities Fund II - Invests in direct U.S. Government
obligations including Treasury bills and other short-term securities backed by
the full faith and credit of the U.S. Government. The assets are managed by
American Express Trust Company as part of the American Express Trust U.S.
Government Securities Fund II.
Income Fund - Invests in commercial mortgages and privately placed and publicly
traded fixed income securities, including corporate bonds, asset-backed
securities and residential mortgage bonds. The assets are invested in the CIGNA
Income Fund.
Bond Fund - Invests in high-quality, highly liquid fixed income securities. The
Fund may invest in investment grade fixed-income securities, including U.S.
Government (and agency) securities, corporate bonds, mortgage-related
securities, and asset backed securities. The assets are invested in the
American Express Bond Fund (Class Y).
Balanced Fund - Invests in a broadly diversified portfolio of high yielding
securities including common stocks, preferred stocks, convertible securities
and bonds. Emphasis is placed principally on current income with capital growth
a secondary consideration. The assets are invested in the AIM Balanced Fund
(Class A).
Equity Index Fund - Invests in a portfolio consisting of common stocks of the
S&P 500 Index, an unmanaged index. The assets are managed by American Express
Trust Company as part of the American Express Trust Equity Index Fund I.
Income and Growth Fund - Invests primarily in common stocks selected from a
universe of the 1,500 largest companies traded in the United States. The assets
are invested in the American Century Income & Growth Fund (Advisor Class).
Growth Fund - Invests in a portfolio of companies with significant growth
potential due to superiority in technology, marketing, or management. Stocks
of these companies may be subject to more price volatility than the stock
market as a whole. The assets are invested in the American Express New
Dimensions Fund (Class Y).
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1. General Description of the Plan (Continued):
--------------------------------------------
Large Cap Core Fund - Typically owns between 90 and 120 different stocks
diversified across industry sectors similar to the S&P 500 Index. The assets
are invested in the Bank of America Large Cap Core Equity Fund.
International Fund - Invests in common stocks of issuers outside the United
States with expected high growth rates, financial strength, a high current
valuation, management expertise and innovation. The assets are invested in the
Janus Overseas Fund.
Emerging Growth Fund - Invests in common stocks of small or medium-sized
companies. Stocks of these companies may be subject to abrupt or erratic price
movements. Some of these companies may also have fewer financial resources. The
assets are managed by American Express Trust Company as part of the American
Express Trust Emerging Growth Fund II.
DeVry Inc. Stock Fund - Invests only in the common stock, $0.01 par value, of
the Company. The assets are managed by the Plan's trustee, American Express
Trust Company.
The number of participants in each of the Plan's funds was as follows:
June 30
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2002 2001
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U.S. Government Securities Fund II 1,520 1,172
Income Fund 1,214 1,075
Bond Fund 660 490
Balanced Fund 1,182 1,125
Equity Index Fund 454 250
Income and Growth Fund 387 218
Growth Fund 458 314
Large Cap Core Fund 1,674 1,736
International Fund 527 408
Emerging Growth Fund 1,510 1,492
DeVry Inc. Stock Fund 1,569 1,527
Participants are fully vested in their 401(k) contributions and related
investment earnings or losses. Participants vest in the Company's matching
and discretionary contributions and related investment earnings and losses
based upon the following vesting schedule:
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1. General Description of the Plan (Continued):
--------------------------------------------
Years of Service Vesting %
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1 20%
2 40%
3 60%
4 80%
5 100%
Participant contributions and the Company's contribution for its 1% or 2% match
of compensation of participants who make 401(k) contributions on a before-tax
basis are allocated after each payroll to participants' accounts. The Company's
discretionary contribution, if any, is allocated to participants' accounts
following the end of the plan year for which the contribution is declared. As
of June 30, 2002, the discretionary contribution of $4,348,394 for the plan
year 2002 has not yet been allocated to participants' accounts. Interest,
dividends and investment gains or losses are allocated to participants'
accounts daily. Allocations are based upon participants' earnings, seniority
or account balances as defined in the Plan. Forfeitures of the unvested or
unclaimed portions of former participants' balances are annually allocated to
the accounts of the remaining participants.
Former employees may elect to receive a lump sum distribution or, under certain
circumstances, to maintain their vested account balances in the Plan but they
are not eligible to receive any future Company matching or discretionary
contributions.
Active participants may, under certain circumstances, withdraw a portion of
their 401(k) account balance. These withdrawals may be in the form of loans,
which are to be repaid with interest over a period not to exceed five years
(ten years under certain limited circumstances). Participants may borrow from
their accounts a minimum of $1,000 up to a maximum equal to the lesser of
$50,000 or 50% of their account balance, whichever is less. The interest rate
is based on the prime rate plus 1%. Loans are repaid through payroll
deductions. Permanent withdrawals of contributions, but not earnings, may also
be made if the Internal Revenue Service (IRS) defined hardship conditions are
met. A permanent withdrawal is treated as a taxable distribution to the
participant. Upon retirement or after age 591/2, participants may elect a lump
sum distribution or one of several annuity payment plans.
The Company anticipates that the Plan will continue without interruption but
reserves the right to terminate or freeze the Plan at any time. In the event
the Plan is terminated or frozen, all amounts not yet allocated to the
participants' accounts will be allocated in accordance with the provisions of
the Plan. The resultant participants' accounts then become fully vested. If the
Plan is terminated, the assets in the Plan will be completely distributed. If
the Plan is frozen, the assets of the Plan will be retained in the Plan for
distribution at such time and in such a manner as the Plan provides.
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2. Summary of Significant Accounting Policies:
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(a) Basis of Accounting
-------------------
The financial statements of the Plan are prepared on the accrual basis
of accounting.
(b) 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 certain
reported amounts and disclosures. Accordingly, actual results may differ
from those estimates.
(c) Risk and Uncertainties
----------------------
The Plan provides for various investment options in several mutual
funds. Investing in mutual funds presents various risks, such as
interest rate and market volatility. Due to the level of risk associated
with certain investment options and the level of uncertainty related to
changes in the value of investment securities, it is possible that
changes in risks in the near term would materially affect participants'
account balances and the amounts reported in the statements of net asset
available for benefits and the statements of changes in net assets
available for benefits.
(d) Contributions
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Contributions from participants are recorded in the period payroll
deductions are made. The Company's 401(k) matching contributions are
recorded in the same period as the participant contributions are made.
The Company's discretionary contribution, if any, is recorded in the
period for which the contribution is declared.
(e) Valuation and Income Recognition
--------------------------------
The Plan's investments are stated at fair value. Quoted market prices
are used to value investments. Shares of mutual funds and collective
investment trusts are valued at the net asset value of shares or units
held by the plan at year end. Participant loans receivable are stated
at cost which approximates fair market value.
Purchases and sales of securities are recorded on a trade-date basis.
Dividends are recorded on the ex-dividend date.
(f) Expenses
--------
Investment expenses incurred by the manager of the funds and directly
related administrative expenses are deducted from the earnings of the
Plan. Other administrative expenses are paid by the Company.
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3. Investments:
------------
The following presents investments (all are participant-directed) that
represent 5 percent or more of the Plan's net assets.
June 30
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2002 2001
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CIGNA Income Fund (3,349,370.393 and
3,000,809.640 units at June 30, 2002
and 2001, respectively) $ 37,774,199 $ 31,904,608
AIM Balanced Fund (Class A) (362,421.715
and 308,202.690 units at June 30, 2002
and 2001, respectively) 8,223,349 8,527,968
DeVry Inc. Common Stock (2,107,341.729
and 2,278,338.636 units at June 30, 2002
and 2001, respectively) 14,633,381 24,663,016
Bank of America Large Cap Core Fund
(6,004,304.760 and 6,044,609.999 units
at June 30, 2002 and 2001, respectively) 40,144,782 49,396,553
American Express Trust Emerging Growth
Fund II (1,087,253.813 and 945,279.886
units at June 30, 2002 and 2001, respectively) 17,543,928 17,562,355
All other investments 22,267,584 16,746,772
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$ 140,587,223 $ 148,801,272
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4. Tax Status:
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The Plan has received a favorable determination letter from the Internal
Revenue Service dated April 20, 1995. Furthermore, the Company believes the
Plan has been administered in accordance with Internal Revenue Code
requirements and is therefore exempt from federal income taxes.
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Supplemental Schedule
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15
DEVRY INC.
PROFIT SHARING RETIREMENT PLAN
------------------------------
FORM 5500, SCHEDULE H, PART IV, LINE 4(i)
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
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AT JUNE 30, 2002
----------------
(a) (b) (c) (d) (e)
Identity of issue, borrower,
Lessor, or similar party Description of Investments Cost Current Value
---------------------------- -------------------------- -------------- -------------
* American Express Trust U.S. Government Securities
Fund II (6,424,534.770 units) $ 6,424,535 $ 6,424,535
Connecticut General Life CIGNA Income Fund
Insurance Company (3,349,370.393 units) 34,177,762 37,774,199
* American Express Trust AXP Bond Fund (Class Y)
(1,008,336.341 units) 4,835,942 4,749,264
AIM Advisors, Inc. AIM Balanced Fund (Class A)
(362,421.715 units) 11,065,875 8,223,349
* American Express Trust American Express Trust Equity
Index Fund I (70,186.981 units) 2,410,226 2,053,741
American Century American Century Income &
Growth Fund (Advisor Class)
(63,107.139 units) 1,740,379 1,538,552
* American Express Trust AXP New Dimensions Fund
(Class Y) (99,763.981 units) 2,649,562 2,149,914
Bank of America Large Cap Core Fund
(6,004,304.760 units) 58,001,175 40,144,782
Janus Capital Corporation Janus Overseas Fund
(95,826.677 units) 2,289,541 1,734,463
* American Express Trust American Express Trust
Emerging Growth Fund II
(1,087,253.813 units) 23,697,097 17,543,928
* American Express Trust, DeVry Stock Fund
Trustee (2,107,341.729 units) 20,969,925 14,633,381
* American Express Trust, Participant Loans (Interest
Trustee rates of 5.75% to 10.50%) - 3,611,824
* American Express Trust Cash 5,291 5,291
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$ 168,267,310 $ 140,587,223
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*Indicates party-in-interest.