SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF
1934 (NO FEE REQUIRED) for the fiscal year ended December 31, 2000.
or
[_] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (NO FEE REQUIRED) for the transition period from
____________ TO ______________.
Commission file number ............................................0-7282
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
Computer Horizons Corp. Employee Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the address
of its principle executive office:
Computer Horizons Corp.
49 Old Bloomfield Avenue
Mountain Lakes, New Jersey 07046-1495
FINANCIAL STATEMENTS AND REPORT OF
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
COMPUTER HORIZONS CORP.
EMPLOYEE SAVINGS PLAN
December 31, 2000 and 1999
C O N T E N T S
PAGE
Report of Independent Certified Public Accountants 3
Financial Statements
Statements of Net Assets Available for Benefits 4
Statements of Changes in Net Assets Available for Benefits 5
Notes to Financial Statements 6 - 11
Supplemental Schedule
Report of Independent Certified Public Accountants on
Supplementary Information 13
Schedule H, Item 4i - Schedule of Assets Held for Investment Purposes 14
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Trustees
COMPUTER HORIZONS CORP. EMPLOYEE SAVINGS PLAN
We have audited the accompanying statements of net assets available for benefits
of Computer Horizons Corp. Employee Savings Plan (the "Plan") as of December 31,
2000 and 1999, 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 the Plan as of
December 31, 2000 and 1999 and 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.
Edison, New Jersey
May 25, 2001
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Computer Horizons Corp. Employee Savings Plan
STATEMENTS OF NET ASSETS AVAILABLE
FOR BENEFITS
December 31,
2000 1999
------------ -----------
ASSETS
Investments $40,431,430 $40,913,998
Participant loans 836,550 1,018,080
------------ -----------
41,267,980 41,932,078
------------ -----------
Contributions receivable
Employee 246,213 243,403
Employer 50,356 46,144
------------ -------------
Total receivables 296,569 289,547
------------ ------------
Net assets available for benefits $41,564,549 $42,221,625
============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
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Computer Horizons Corp. Employee Savings Plan
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS
Year ended December 31,
2000 1999
------------ -------------
Additions
Employees' contributions $ 9,060,264 $ 10,150,773
Employer's contributions 1,567,138 1,457,819
Interest/dividend income 2,178,369 1,743,189
Net (depreciation)
appreciation in fair
value of investments (5,875,976) 1,218,935
Other 33,467
------------ -------------
-
6,929,795 14,604,183
------------ -------------
Deductions
Withdrawals (7,400,918) (5,350,823)
Deemed distribution (183,053) -
Expenses (2,900) (3,650)
------------ -------------
(7,586,871) (5,354,473)
------------ -------------
NET (DECREASE) INCREASE IN NET
ASSETS AVAILABLE FOR BENEFITS (657,076) 9,249,710
------------ -------------
Net assets available for benefits at
beginning of year 42,221,625 32,971,915
------------ -------------
Net assets available for benefits at
end of year $41,564,549 $42,221,625
============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
NOTE A - DESCRIPTION OF THE PLAN
The following description of Computer Horizons Corp. Employee Savings 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 as amended is a defined contribution employee profit-sharing plan,
covering all full-time employees of the Company who have completed at least
six months service and part-time employees who have completed a minimum of
one thousand (1,000) hours of service within a year.
The Plan was established effective April 1, 1983, and amended as of January
1, 1984 and May 31, 1989, to be a qualified profit-sharing plan under
Internal Revenue Code Section 401(a), with a qualified cash or deferred
arrangement under Internal Revenue Code Section 401(k).
The Plan was further amended and restated effective January 1, 1990 to comply
with the requirements of the Tax Reform Act of 1986 and all applicable
Federal laws subsequently enacted and relating thereto. A favorable
determination letter dated September 1995 was received from the Internal
Revenue Service ("IRS").
On January 1, 1998, the Plan was further amended to reflect the appointment
of Merrill Lynch as Plan Trustee. Merrill Lynch also acts as the
recordkeeper. Other modifications to the Plan included (1) a reduction in the
eligibility service period from one year to six months, (2) a change in the
vesting period from 25% after three years of service and 100% after five
years to 100% after three years, and (3) a change in investment options.
CONTRIBUTIONS
Each year participants may contribute from 3 to 15 percent of pretax annual
compensation, defined as base pay (regular earnings plus overtime) plus
commissions, not to exceed a maximum threshold as specified in the agreement.
Participants may also contribute amounts representing distributions from
other qualified defined-benefit or contribution plans. The Company
contributes 25 percent of the first 4 percent of base compensation that a
participant contributes to the Plan. On April 1, 1999, the Company raised
this contribution amount to 50 percent of the first 4 percent of the base
pay.
In order to pass the required IRS Non-Discriminatory Tests for the Plan,
participants who exceeded the maximum contribution amounts for 1999 were
refunded the excess amounts. The total amount refunded in March 2000 was
approximately $253,000.
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 2000 and 1999
NOTE A (CONTINUED)
PARTICIPANT ACCOUNTS AND VESTING
Separate accounts are maintained for each participant's contributions and
earnings thereon. The participant may direct that the account be invested in
one or more Funds permitted by the Plan (Note C). Upon termination of
employment, a participant is entitled to 100% of the value of his Salary
Deferral Account balance (pretax contributions of three to fifteen percent of
compensation not to exceed a maximum threshold as specified in agreement),
and Rollover Account balance (participants' qualifying rollover
distributions), plus a specified percentage of his Employer Matching Account
balance (participants' share of employer matching contributions) based upon
the vesting provisions of the Plan (100% vested after three years of
service). Forfeitures resulting from application of the vesting provisions
are maintained separately by the Plan and are used to pay plan expenses or
future employer contributions. Plan forfeitures approximate $243,000 and
$141,000 for 2000 and 1999, respectively.
WITHDRAWALS AND DISTRIBUTIONS UPON
TERMINATION OF EMPLOYMENT
Upon termination of employment for any reason, a participant's account
balance or periodic payments thereof will be distributed to the participant
or designated beneficiary, at his or her option. However, if the value of a
participant's account is greater than $5,000, the participant's account will
not be distributed before his normal retirement date without the written
election of the participant. A participant may modify an election thereafter.
If a participant's account balance is less than $5,000 the Plan may
distribute the amount upon termination.
LOANS TO PARTICIPANTS
The Plan provides for loans to participants to a maximum of the lesser of (1)
$50,000 or (2) 50% of the participant's account balance (a minimum $1,000
vested balance required). The loans are payable over a maximum of five years
unless the loan is used to acquire a principal residence, in which case the
maximum term is fifteen years with interest as specified in the Plan.
The loans are secured by one-half of the balance in the participant's
vested account and bear interest at a rate commensurate with local
prevailing rates as determined by the Plan. Interest rates ranged from
8.78% to 11.00% and 5.5% to 10.78% in 2000 and 1999, respectively.
Principal and interest are paid ratably through payroll deductions.
During 2000, the Plan noted approximately $183,000 of defaulted loans. At
December 31, 2000, the Plan classified these outstanding balances as deemed
distributions within the statement of changes in net assets available for
benefits.
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 2000 and 1999
NOTE A (CONTINUED)
TERMINATION
Although it has not expressed any intent to do so, the Company reserves the
right to terminate the Plan at any time. Termination of the Plan shall result
in discontinuance of all future Plan contributions and in full and immediate
vesting for each participant of the entire amount standing to his or her
credit; there shall not be any forfeitures with respect to any participant
for any reason.
ADMINISTRATIVE EXPENSES
All administrative expenses, charged by the Plan's recordkeeper, Merrill
Lynch, are borne by the Plan. Any expense not covered by the forfeitures is
paid by the Plan Sponsor.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan have been prepared on the accrual basis
of accounting in accordance with accounting principles generally accepted in
the United States of America as applied to profit-sharing plans and in
accordance with the terms of the trust agreement. The assets of the Plan are
valued at quoted market value, at close on the last trade date of the year,
except for the Guaranteed Fund which is valued at contract value, which
approximates fair value. Dividends are recorded on the ex-dividend date. The
Plan is subject to certain provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
USE OF ESTIMATES IN FINANCIAL STATEMENTS
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 and liabilities and changes therein, and disclosure
of contingent assets and liabilities. Actual results could differ from
those estimates.
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 2000 and 1999
NOTE B (CONTINUED)
SIMPLIFIED DISCLOSURES FOR 401(K)
The American Institute of Certified Public Accountants has issued Statement
of Position 99-3 ("SOP 99-3"), "Accounting for and Reporting of Certain
Defined Contribution Plan Investments and Other Disclosure Matters," which
eliminates the need for certain disclosures. The Plan has adopted SOP 99-3.
Certain reclassifications have been made to the 1999 financial statements to
conform to the current presentation.
NOTE C - INVESTMENT OF FUNDS
All contributions are remitted to the respective fund managers and invested,
at the election of the participant, in one or a combination of funds. The
funds available to participants are the Guaranteed Fund, various mutual funds
and the Computer Horizons Corp. Common Stock Fund. All investments are
participant-directed.
GUARANTEED FUND
The Guaranteed Fund is intended to provide fixed income with minimal risk.
Contributions to the Guaranteed Fund are invested primarily under guaranteed
investment contracts or contracts with an insurance company guaranteeing an
annual effective interest rate for specified periods.
The guaranteed investment contracts are included in the financial statements
at contract value, which approximates fair value, as reported to the Plan by
the insurance company. The interest rate is guaranteed for the life of the
contract. The initial contract term ranges from 3 to 5 years. There have been
no new contracts purchased during 2000 and 1999. The average yield and
crediting interest rate was 5.60% for The Travelers Insurance Company for
2000 and 1999. The amounts remitted to the insurance company for guaranteed
income contracts become the assets of those companies, which, in turn, assume
an obligation to fulfill the contract terms. The ultimate ability to repay
principal and interest is dependent upon the financial stability of the
insurance company.
Guaranteed investment contracts at December 31 consist of the following:
2000 1999
-------- --------
The Travelers Insurance Company $856,017 $923,235
======== ========
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 2000 and 1999
NOTE C (CONTINUED)
Investments in mutual funds are valued at quoted market value and at December
31 consist of the following:
2000 1999
------------ ------------
Merrill Lynch Retirement Preservation Trust $ 6,339,568* $ 5,580,675*
Merrill Lynch International Equity Fund 979,720 803,758
Merrill Lynch S&P 500 Index Fund 10,536,300* 10,592,033*
Merrill Lynch Small Cap Index Fund 1,493,659 961,428
Merrill Lynch Global Allocation Fund 1,017,174 692,385
Massachusetts Investors Trust 10,933,786* 11,934,410*
MFS Research Fund 2,867,841* 1,712,254*
Merrill Lynch Capital Fund 3,822,538* 3,711,236*
Merrill Lynch Intermediate Corporate Bond Fund 783,636 599,829
------------ ------------
$ 38,774,222 $ 36,588,008
============ ============
*Denotes investments which exceed 5% of net assets available for Plan
benefits at the beginning of the year.
COMPUTER HORIZONS CORP. COMMON STOCK FUND
Effective January 1, 1996, participants were able to invest contributions in
the Computer Horizons Corp. Common Stock Fund, which invests in the common
stock of the Plan Sponsor, Computer Horizons Corp. Merrill Lynch, as an
independent agent, invests in the Company shares that are obtained by
Merrill Lynch directly from the Company out of its authorized but unissued
shares of common stock, out of its treasury shares, or on the open market.
Total value of investments in Computer Horizons Corp. common stock at
December 31, 2000 and 1999 valued at quoted market value is $670,837 and
$3,079,066*, respectively.
The Plan's investment in mutual funds and common stock (including gains and
losses on investments bought and sold, as well as being held during the
year) (depreciated) appreciated for 2000 and 1999 as follows:
2000 1999
----------- ----------
Mutual funds $(2,854,078) $2,054,071
Common Stock - Computer Horizons Corp. (3,021,898) (835,136)
----------- ----------
$(5,875,976) $1,218,935
=========== ==========
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Computer Horizons Corp. Employee Savings Plan
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 2000 and 1999
NOTE D - RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of Mutual Funds managed by Merrill Lynch.
Merrill Lynch is the Plan's Recordkeeper and Trustee and, therefore, these
transactions qualify as party-in-interest transactions. Fees for the
investment management services are borne by the Plan, and were not
significant at December 31, 2000 and 1999.
NOTE E - TAX STATUS OF THE PLAN
The Internal Revenue Service has determined and informed the Company by a
letter dated September 1995, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code ("IRC"). The
Plan has been amended since receiving the determination 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.
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SUPPLEMENTAL SCHEDULE
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
ON SUPPLEMENTARY INFORMATION
Board of Trustees
COMPUTER HORIZONS CORP. EMPLOYEE SAVINGS PLAN
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes 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 audit 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.
Edison, New Jersey
May 25, 2001
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Computer Horizons Corp. Employee Savings Plan
EIN: 13-2638902, Plan # 001
SCHEDULE H, ITEM 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 2000
(a) (b) Identity of issuer, borrower,
lessor or similar party (c) Description of investment (e) Current value
---------------------------- ------------------------- -------------
Group Annuity Contracts, Provide a guaranteed interest rate
at contract value for a specified period of time.
The Travelers Insurance Co.,
5.60% $ 856,017
=============
Mutual Funds
ML Retirement Preservation Trust A low risk fund which provides preservation of capital, liquidity
6,339,567.91 shares* and current income at levels that are typically higher than those
provided by money market funds. $ 6,339,568
ML International Equity Fund A stock fund that seeks capital appreciation and income through
99,262.47 shares* investment primarily in stocks located in countries other than the
United States. 979,720
ML S&P 500 Index Fund A stock fund that invests in individual stocks
651,192.91 shares* corresponding with the Standard & Poor's 500 Index. 10,536,300
ML Small Cap Index Fund A stock fund that includes smaller capitalization stocks from
142,933.81 shares* various industrial sectors. 1,493,659
ML Global Allocation Fund A growth and income fund which seeks high total investment
77,528.56 shares* return consistent with prudent risk. 1,017,174
Massachusetts Investors Trust A conservative growth and income fund which invests primarily in
546,143.19 shares* stocks and seeks reasonable current income and long-term growth
of income and capital. 10,933,786
MFS Research Fund A moderate growth fund which primarily invests in stocks and
119,593.00 shares* seeks long-term growth of capital and future income. 2,867,841
ML Capital Fund A growth and income fund which seeks the highest total
125,865.61 shares* investment return consistent with prudent risk. 3,822,538
ML Intermediate Corporate Bond Fund An income fund which invests over 80% in domestic bonds and
70,281.27 shares* seeks a high level of current income. 783,636
-------------
$ 38,774,222
=============
Cash $ 130,354
=============
Stocks
Computer Horizons Corp. Common stock $ 670,837
275,215.52 shares * =============
Participant loans, with interest which
ranges from 8.78% to 11.00% $ 836,550
=============
*Party-in-interest
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