UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
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FORM 11-K
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(Mark One)
[X] Annual Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934
For the fiscal year ended December 31, 2009
OR
[ ] Transition Report Pursuant to Section 15(d) of the Securities
Exchange Act of 1934
For the transition period from ____________ to ________________
Commission File Number 33-26115
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
PATRIOT TRANSPORTATION HOLDING, INC.
PROFIT SHARING AND DEFERRED EARNINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Patriot Transportation Holding, Inc.
501 Riverside Avenue, Suite 500
Jacksonville, Florida 32202
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TABLE OF CONTENTS
Page(s)
Report of Independent Registered Public Accounting Firm 2
Financial Statements
Statements of Net Assets Available for Benefits 3
Statement of Changes in Net Assets Available for Benefits 4
Notes to Financial Statements 5-12
Supplemental Schedule
Schedule H, Line 4i - Schedule of Assets (Held at End of Year) 13
Note: Other schedules required by 29 CFR 2520.103-10 of the Department
of Labor's Rules and Regulations for Reporting and Disclosure under
ERISA have been omitted because they are not applicable, or are not
required for participant directed investment transactions.
Report of Independent Registered Public Accounting Firm
To the Participants and Administrator of
Patriot Transportation Holding, Inc.
Profit Sharing and Deferred Earnings Plan
We have audited the accompanying statements of net assets available for
benefits of the Patriot Transportation Holding, Inc. Profit Sharing and
Deferred Earnings Plan (the Plan) as of December 31, 2009 and 2008, and the
related statement of changes in net assets available for benefits for the
year ended December 31, 2009. 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. We were
not engaged to perform an audit of the Plan's internal control over
financial reporting. Our audits included consideration of internal control
over financial reporting as a basis of designing audit procedures that are
appropriate in the circumstances, but not for expressing an opinion on the
effectiveness of the Plan's internal control over financial reporting.
Accordingly, we express no such opinion. 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
at December 31, 2009 and 2008, and the changes in net assets available for
benefits for the year ended December 31, 2009, in conformity with accounting
principles generally accepted in the United States of America.
Our audit was performed for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying supplemental
schedule of assets (held at end of year) as of December 31, 2009 is
presented for purposes of additional analysis and is not a required part of
the 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 financial statements and, in our opinion, is fairly stated in all
material respects in relation to the financial statements taken as a whole.
Savannah, Georgia
June 29, 2010
Patriot Transportation Holding, Inc.
Profit Sharing and Deferred Earnings Plan
Statements of Net Assets Available for Benefits
December 31, 2009 and 2008
2009 2008
ASSETS
Investments, at fair value
Investments $ 21,022,925 $ 20,705,159
Participant loans 1,170,626 1,394,988
Total investments, at fair value 22,193,551 22,100,147
Contributions receivable
Employer 11,336 3,809
Employee 26,260 13,404
Total contributions receivable 37,596 17,213
Total assets, at fair value 22,231,147 22,117,360
LIABILITIES
Distributions payable 90,000 -
Total liabilities 90,000 -
Net assets available for benefits, at fair value 22,141,147 22,117,360
Adjustment from fair value to contract value for fully
benefit-responsive investment contracts (30,729) (2,020)
Net assets available for benefits $ 22,110,418 $ 22,115,340
The accompanying notes are an integral part of these financial statements.
Patriot Transportation Holding, Inc.
Profit Sharing and Deferred Earnings Plan
Statements of Net Assets Available for Benefits
December 31, 2009 and 2008
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income
Dividend and interest income $ 179,281
Net appreciation in fair value of investments 2,692,420
Other income - loan interest 81,965
Total investment income 2,953,666
Contributions
Employer 714,833
Employee 1,703,879
Rollovers 34,095
Total contributions 2,452,807
Total additions 5,406,473
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Distributions to participants (5,407,781)
Administrative expenses (3,614)
Total deductions (5,411,395)
Net decrease (4,922)
Net assets available for benefits
Beginning of year 22,115,340
End of year $ 22,110,418
The accompanying notes are an integral part of these financial statements.
1. Description of the Plan
The following description of the Patriot Transportation Holding, Inc.
(the "Company") Profit Sharing and Deferred Earnings Plan (the "Plan")
provides only general information. Participants should refer to the Plan
agreement for a more complete description of the Plan's provisions.
General
The Plan is a defined contribution plan available to all eligible employees
of the Company, as defined in the Plan agreement. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions
Each year, participants may contribute up to 100% of pretax annual
compensation, as defined in the Plan. Participants may also contribute
amounts representing distributions from other qualified defined benefit
plans, defined contribution or other qualified plans. The Company matches
50% of the first 6% of the participant's deferred earnings contributions. In
addition, the Company may make a discretionary contribution to the Plan each
year in an amount determined by the Board of Directors of the Company
subject to certain limitations relating to the aggregate compensation of
participants. No discretionary contributions were made by the Company for
the 2008 or 2009 Plan years.
Participant Accounts
Each participant's account is credited with the participant's contributions,
the employer's matching contribution, an allocation of the employer's
discretionary contributions (if any) and Plan earnings. The benefit to which
a participant is entitled is the benefit that is available in the
participant's vested account.
Participants direct the investment of their contributions into various
investment options offered by the Plan. The Plan currently offers a money
market fund, common/collective trust, mutual funds, and Company stock as
investment options for participants. All participants who have not made an
election are deemed to have elected to have contributions made to their
accounts invested in the SunTrust Retirement Stable Asset Fund.
Vesting
Participants are fully vested in their voluntary contributions plus actual
earnings thereon. If participants are employed on or after their retirement
age, the company's matching and discretionary contributions are fully
vested. In the event of termination by retirement, death or disability of
the participant, 100% of the employer contributions will be distributed to
the participant or the participant's designated beneficiary.
Vesting (cont.)
Vesting in the Company's matching and discretionary contributions plus
actual earnings thereon is determined for each plan year based on years of
service according to the following schedule. A year of service is defined
by the Plan as any Plan year in which the participant worked more than 1,000
hours.
Matching Contributions
Vested
Years of Service Percentage
Less than 1 0%
1 20%
2 40%
3 60%
4 80%
5 100%
Profit Sharing Contributions
Vested
Years of Service Percentage
Less than 3 0%
3 20%
4 40%
5 60%
6 80%
7 100%
Payment of Benefits
On termination of employment, death or disability of a participant, or upon
a participant election for an in-service distribution after age 59 1/2,
benefits for distribution shall be determined based upon the participant's
vested account balance on the date of distribution, which shall be made as
soon as administratively feasible or later if so elected by the participant
in amounts as provided in the Plan.
Forfeited Accounts
The non-vested portion of a terminated participant's account shall be
forfeited and reallocated to the accounts of the remaining participants in
the same manner as employer contributions were originally allocated to such
participants. Any forfeiture from an employer discretionary account shall be
allocated in the plan year in which the forfeiture occurs. Any forfeiture
from an employer matching account shall be reallocated in the following plan
year. Unallocated forfeitures totaled $227,026 and $117,294 at December 31,
2009 and 2008, respectively. $117,294 was reallocated to eligible
participants in 2009.
Participant Loans
Participants may borrow from their accounts a minimum of $1,000 and a
maximum equal to the lesser of $50,000 or 50% of their vested account
balance. Loans bear interest at the prevailing rate used by commercial
lending institutions. Participants may have only two loans outstanding at
any time. Loans are secured by the participant's remaining vested account
balance. Loan terms are limited to five years except residential loans,
which are payable up to 15 years. Loan repayment will be deducted from the
participant's payroll over the term of the loan. Upon termination of
employment with the Company, the outstanding balance of the loan, including
accrued interest, is due immediately and if not repaid, is considered a
distribution.
When a participant defaults on a loan obtained from the Plan, the Plan
administrator will report the amount of default to the IRS as a distribution
from the Plan. Loans in the amount of $128,741 defaulted and were included
in participant distributions for the Plan year ended December 31, 2009.
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting in conformity with accounting principles generally accepted in
the United States of America.
Investments Valuation and Income Recognition
Plan investments are reported at fair value. The relevant accounting
standard for defined contribution plans defines the circumstances in which
an investment contract is considered fully benefit responsive and provides
certain reporting and disclosure requirements for fully benefit responsive
investment contracts. As required by the standard, investments in the
accompanying Statements of Net Assets Available for Benefits include fully
benefit responsive investment contracts recognized at fair value in the
Plan's Statement of Net Assets Available for Benefits with a corresponding
adjustment to reflect these investments at contract value.
Investments in common stock are stated at fair value based upon quoted
market prices at year-end. Units or shares of mutual funds (registered
investment companies) are stated at fair value based upon the net asset
value of shares held by the Plan at year-end. The fair value of the
underlying assets of the common/collective trust fund is based upon the fair
value of the underlying assets of the trust according to the Trustee's
valuation. The contract value of participation units owned in the
common/collective trust fund are based on quoted redemption values, as
determined by the Trustee, on the last business day of the Plan year.
Loans to participants are recorded at the unpaid balance of the individual
loans as of year-end, which approximate fair value.
Net appreciation or depreciation in fair value of investments consists of
the realized gains or losses and the unrealized appreciation or depreciation
on these investments.
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis when it is earned.
Dividends are recorded on the basis of the ex-dividend date.
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 significant estimates and assumptions that affect the
reported amounts of assets and liabilities and changes therein, and
disclosure of contingent assets and liabilities. Actual results could differ
from those estimates.
Benefit Payments
Benefits are recorded when paid.
3. Investments
Investments which exceeded 5% or more of the Plan's net assets at December
31 are summarized as follows:
2009 2008
Ridgeworth Prime Quality Money Market Fund $ 6,788,847 $ 8,877,206
Vanguard 500 Index Signal 1,589,017 1,268,531
SunTrust Retirement Stable Asset Fund 1,468,262** 1,642,938**
Ridgeworth Select Large Cap Grth Stock 1,475,987 *
Participant Loans 1,170,626 1,394,988
T. Rowe Price Growth Stock Fund-R * 1,134,212
*Investment did not represent 5% or more of Plan's net assets at
the respective year end
**SunTrust Stable Asset Fund is shown at fair value. The contract value
is $1,437,533 at December 31, 2009 and $1,640,918 at December 31, 2008.
During 2009 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:
Common stock $ 197,989
Mutual funds 2,458,515
Common/collective trust 35,916
Net appreciation in fair value of investments $ 2,692,420
4. Investment Contracts
The Plan, through the SunTrust Stable Value Fund (the Fund), holds
investments in fixed income securities, which consist of common collective
trusts, short-term securities and bonds. The Fund is considered a
traditional Guaranteed Investment Contract (GIC), as the participants hold
interests in shares of the fund and not in the underlying assets. The Fund
enters into wrapper contracts with financial institutions or insurance
companies, which enable the participants to transact at a specified contract
value by protecting the principal amount invested over a specified period of
time.
The Fund earns interest at interest crediting rates that are typically reset
on a monthly or quarterly basis. These interest crediting rates use a
formula that is based on the characteristics of the underlying fixed income
portfolio. The minimum interest crediting rate for all investment contracts
is zero percent. Factors that can influence the future average crediting
rates are (i) the level of market interest rates; (ii) the amount and timing
of participant contributions, transfers and withdrawals into/out of the
investment contract; (iii) the investment returns generated by the fixed
income investments that underlie the investment contracts; or (iv) the
duration of the investments underlying the investment contracts. The
crediting rate formula amortizes the realized and unrealized market value
gains and losses over the duration of the underlying investments.
The crediting yield earned by the participants at December 31, 2009 was
2.53% and the average yield of the underlying assets at December 31, 2009
was 1.92%.
In certain events, the amounts withdrawn from investment contracts may be
payable at fair value rather than contract value. These events may include
termination of the Plan or a material adverse change to the provisions of
the Plan. Based upon experience to date, the Company does not believe the
events described above are probable of occurring.
5. Fair Value Measurement
The fair value measurement standard establishes a fair value hierarchy that
prioritizes the inputs to valuation techniques used to measure fair value.
The hierarchy gives the highest priority to unadjusted quoted prices in
active markets for identical assets or liabilities (level 1 measurements)
and the lowest priority to unobservable inputs (level 3 measurements). The
three levels of the fair value hierarchy are described below:
Level 1 . Unadjusted quoted prices in active markets that are
accessible at the measurement date for identical, unrestricted assets or
liabilities;
Level 2 . Quoted prices in markets that are not considered to be active
or financial instruments for which all significant inputs are observable,
either directly or indirectly;
Level 3 . Prices or valuations that require inputs that are both
significant to the fair value measurement and unobservable.
A financial instrument's level within the fair value hierarchy is based on
the lowest level of any input that is significant to the fair value
measurement.
The following table sets forth by level, within the fair value hierarchy,
the Plan's assets at fair value as of December 31, 2009 and December 31,
2008.
Investment assets at Fair Value as of December 31, 2009
-------------------------------------------------------
Level 1 Level 2 Level 3 Total
-------------------------------------------------------
Assets:
Money market $ 6,788,847 $ - $ - $ 6,788,847
Mutual funds 11,299,506 - - 11,299,506
Common stock 1,466,310 - - 1,466,310
Collective
investment trusts - 1,468,262 - 1,468,262
Participant loans - 1,170,626 - 1,170,626
----------- ---------- --------- -----------
Totals assets $19,554,663 $2,638,888 $ - $22,193,551
=========== ========== ========== ===========
Investment assets at Fair Value as of December 31, 2008
-------------------------------------------------------
Level 1 Level 2 Level 3 Total
-------------------------------------------------------
Assets:
Money market $ 8,877,206 $ - $ - $ 8,877,206
Mutual funds 8,532,626 - - 8,532,626
Common stock 1,652,389 - - 1,652,389
Collective
investment trusts - 1,642,938 - 1,642,938
Participant loans - 1,394,988 - 1,394,988
----------- ---------- --------- -----------
Totals assets $19,062,221 $3,037,926 $ - $22,100,147
=========== ========== ========== ===========
6. Related Party Transactions
Certain Plan investments are managed by SunTrust. SunTrust is the trustee as
defined by the Plan and, therefore, these transactions qualify as party-in-
interest transactions. Fees to the trustee are deducted from investment
income. Additionally, the plan holds an investment in the common stock of
the Company.
7. Plan Termination
While the Company has not expressed any intent to do so, it may cease
matching contributions or terminate the Plan at any time. In the event of
termination, the accounts of all participants would become fully vested and
the Company, by written notice to the Trustee and the Committee, may direct
either complete distribution of the assets in the Trust Fund to the
participants or, continue the Trust and the distribution of benefits at such
time and in such manner as though the Plan had not been terminated.
8. Income Tax Status
The prototype Plan, adopted by the Company, obtained its latest
determination letter on August 26, 2002, in which the Internal Revenue
Service stated that the prototype Plan, was in compliance with the
applicable requirements of the Internal Revenue Code ("IRC"). The Plan
administrator believes that the Plan is currently designed and being
operated in compliance with the applicable requirements of the IRC.
9. Risks and Uncertainties
The Plan provides for investment options in various investment securities.
Investment securities are exposed to risks, such as interest rate, market
risk and credit risk. Due to the level of risk associated with certain
investment securities and the level of uncertainty related to changes in the
value of investment securities, it is reasonably possible that changes in
risks in the near term would materially affect participants' account
balances and the amounts reported in the statement of net assets available
for benefits and the statement of changes in net assets available for
benefits.
Certain financial instruments potentially subject the Plan to concentrations
of credit risk. The Plan limits its credit risk by maintaining its accounts
with what the plan administrator believes to be high quality financial
institutions.
10. Common Stock Purchase
The Plan previously allowed as an investment option, investment in the
common stock of Florida Rock Industries, Inc., a related party to the
Company. In November 2007, Vulcan Materials Company purchased the common
stock of Florida Rock Industries, Inc. All investments in Florida Rock
Industries, Inc. common stock were exchanged for shares of the Vulcan
Materials Company common stock and any remaining cash balance was invested
in the STI Classic Prime Quality Money Market fund. Effective December 31,
2007, the option to invest in Vulcan Materials Common Stock was frozen to
new contributions. Any existing investments in Vulcan common stock may
remain until the participant elects to make a transfer to another fund or
elects a distribution.
11. Administrative Error
The Employer identified an administrative error related to the Plan that
constituted an operational failure as defined in the Employee Plans
Compliance Resolutions Systems (EPCRS). Certain participants who terminated
services and took distribution from the Plan received incorrect employer
matching contributions because the vesting of such contributions was
calculated incorrectly. The errors were noted to have occurred in the 2009
Plan year. The cumulative amount of the error as of December 31, 2009 is
estimated to be $90,000 and has been included in the accompanying Plan
financial statements.
Management of the Plan and the Employer intend to correct all of the
operational failures in accordance with the EPCRS for the respective Plan
year.
12. Reconciliation of Financial Statements to Form 5500
The reconciliation of net assets available for benefits per the financial
statements to the Form 5500 as of December 31, 2009, is as follows:
December 31, 2009
Net assets available for benefits per the financial statements $ 22,110,418
Distributions payable 90,000
Net assets available for benefits per the Form 5500 $ 22,200,418
The reconciliation of distributions to participants per the financial
statements to the Form 5500 as of December 31, 2009, is as follows:
December 31, 2009
Distributions to participants per the financial statements $ 5,407,781
Distributions payable 90,000
Benefit payments to participants per the Form 5500 $ 5,317,781
Description of investment
including maturity date, rate
Identity of issue borrower of interest, collateral, par or
Current
or similar party maturity date Cost **
value
*Ridgeworth Prime Quality Money Market
1SU-PMM Money Market $ 6,788,847
*Vulcan Materials Co Common Stock Common Stock 390,011
*Patriot Transportation Common Stock Common Stock 1,076,299
*Ridgeworth Select large Cap Grth Stock Mutual Fund 1,475,987
Vanguard 500 Index Signal Mutual Fund 1,589,017
*Ridgeworth Moderate Allocation Strat I Mutual Fund 746,187
AIM International Growth Fund Mutual Fund 479,939
T. Rowe Price Retirement 2010 Fund - R Mutual Fund 414,161
T. Rowe Price New Horizon Mutual Fund 474,458
T. Rowe Price Retirement 2020 Fund - R Mutual Fund 483,865
Chase Growth fund Mutual Fund 569,286
T. Rowe Price US Treasury Intermediate Mutual Fund 342,496
T. Rowe Price Retirement 2030 Fund - R Mutual Fund 993,936
T. Rowe Price Retirement 2040 Fund - R Mutual Fund 816,943
T. Rowe Price Equity Income Fund A Mutual Fund 494,259
Federated Capital Appreciation Fund - A Mutual Fund 524,469
American Century Inflat-Adj Bond Adv Mutual Fund 272,825
*Ridgeworth Investment Grade Bond I Mutual Fund 259,440
Federated Mid Cap Index IS Mutual Fund 1,008,220
MFS International Value Fund - A Mutual Fund 155,815
Perkins Small CapValues - S Mutual Fund 198,203
*SunTrust Retirement Stable Asset Fund Common/Collective Trust 1,468,262
21,022,925
*Participant loans Loans with
interest ranging
from 5.00% to
9.25% 1,170,626
$ 22,193,551
* Party-in-interest as defined by ERISA
** Cost not required for participant-directed investments
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 by the
undersigned hereunto duly authorized.
PATRIOT TRANSPORTATION HOLDING, INC.,
PROFIT SHARING AND DEFERRED
EARNINGS PLAN
By: /s/ John D. Klopfenstein
Controller and Chief Accounting
Officer
EXHIBIT INDEX
Exhibit No.
23.1 Consent of Independent Registered Public Accounting Firm dated
June 29, 2010.