SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________________ to ________________.
Commission File No.: 0-12954
A. Full title of the plan and the address of the plan, if different from
that of the issuer below:
Cadmus Thrift Savings Plan
B. Name of the issuer of the securities held pursuant to the plan and the
address of the principal executive office:
Cadmus Communications Corporation
6620 West Broad Street
Richmond, Virginia 23230
REQUIRED INFORMATION
The following financial statements are furnished for the Cadmus Thrift
Savings Plan:
Report of Independent Public Accountants
Statements of Net Assets Available for Plan Benefits - Modified Cash Basis
as of December 31, 1999 and 1998
Statement of Changes in Net Assets Available for Plan Benefits - Modified Cash
Basis
for the Year Ended December 31, 1999
Notes to Financial Statements and Schedule December 31, 1999 and 1998
Schedule of Assets Held for Investment Purposes - Modified Cash Basis
as of December 31, 1999
Consent of Independent Public Accountants
Cadmus Thrift Savings Plan
Financial Statements
As of December 31, 1999 and 1998
Together With Auditors' Report
Report of Independent Public Accountants
To the Plan Administrator and Participants of
the Cadmus Thrift Savings Plan:
We have audited the accompanying statements of net assets available for plan
benefits - modified cash basis, of the Cadmus Thrift Savings Plan (the "Plan")
as of December 31, 1999 and 1998, and the related statement of changes in net
assets available for plan benefits - modified cash basis, for the year ended
December 31, 1999. These financial statements and the schedule referred to
below are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements and schedule based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
As described in Note 2, these financial statements and schedule were prepared on
the modified cash basis of accounting, which is a comprehensive basis of
accounting other than generally accepted accounting principles.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan as
of December 31, 1999 and 1998, and the changes in its net assets available for
plan benefits for the year ended December 31, 1999, on the modified cash basis
of accounting as described in Note 2.
Our audits were 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 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.
June 20, 2000 /s/ Arthur Andersen LLP
Richmond, Virginia
Cadmus Thrift Savings Plan
Table of Contents
Page
Statements of Net Assets Available for Plan Benefits - Modified Cash Basis
As of December 31, 1999 and 1998 1
Statement of Changes in Net Assets Available for Plan Benefits -
Modified Cash Basis
For the Year Ended December 31, 1999 2
Notes to Financial Statements and Schedule
December 31, 1999 and 1998 3
Schedule of Assets Held for Investment Purposes - Modified Cash Basis
As of December 31, 1999 8
Cadmus Thrift Savings Plan
Statements of Net Assets Available for Plan Benefits - Modified Cash Basis As
of December 31, 1999 and 1998
1999 1998
----------- ------------
Assets:
Investments, participant-directed, at fair value (Note 3)- $95,047,464 $89,196,977
Participant loans receivable 2,696,495 2,544,563
----------- -----------
Net assets available for plan benefits $97,743,959 $91,741,540
=========== ===========
The accompanying notes are an integral part of these statements.
1
Cadmus Thrift Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits - Modified Cash
Basis For the Year Ended December 31, 1999
Additions:
Investment income-
Interest $ 226,898
Dividends 5,499,406
Net appreciation in the fair value of investments 4,532,771
Contributions:
Employer 729,822
Participants 5,167,293
Rollovers 1,671,338
Loan offsets (243,588)
-----------
Total additions 17,583,940
-----------
Deductions:
Benefits paid to participants 11,484,872
Fiduciary and investment manager fees 96,649
-----------
Total deductions 11,581,521
-----------
Net additions 6,002,419
Net assets available for plan benefits:
Beginning of year 91,741,540
-----------
End of year $97,743,959
===========
The accompanying notes are an integral part of this statement.
2
Cadmus Thrift Savings Plan
Notes to Financial Statements and Schedule
December 31, 1999 and 1998
1. Plan Description:
General
The following description of the Cadmus Thrift Savings Plan (the "Plan") is
provided for general information purposes only. More complete information
regarding the Plan's provisions may be found in the Plan document.
The Plan is a defined contribution thrift savings plan established by Cadmus
Communications Corporation and its subsidiary companies that have adopted the
Plan (collectively, the "Company") under the provisions of Section 401(a) of the
Internal Revenue Code (the "Code"). The provisions include a qualified cash or
deferred arrangement as described in Section 401(k) of the Code for the benefit
of eligible employees of the Company. All employees of the Company who have
completed one month of service, as defined, are eligible to participate. The
Plan is subject to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA"), as amended.
Plan Administration
Overall responsibility for administering the Plan rests with the Benefits and
Investment Committee (the "Committee") of the Board of Directors of the Company.
The Plan administrator is responsible for the daily operation of the Plan. T.
Rowe Price Trust Company ("T. Rowe Price") is trustee for the Plan.
Contributions
Under the terms of the Plan, participants may make pretax contributions ranging
from 2 to 18 percent of their compensation. The Company will make a quarterly
matching contribution out of its profits in an amount equal to 25 percent of
participants' savings contributions, with matching contributions being based on
the lesser of each participant's contribution or 6 percent of the participant's
compensation as defined in the Plan document. The Company may also, at its
discretion, make an additional annual matching contribution in an amount equal
to a percentage (determined annually) of participants' savings contributions,
with matching contributions being based on the lesser of each participant's
contribution or 6 percent of the participant's compensation as defined in the
Plan document.
3
Vesting
Participants are fully vested in their contributions and the earnings thereon.
Vesting in employer matching contributions is based on years of continuous
service. A participant vests according to the following schedule:
Vested
Number of Years of Thrift Vesting Service Interest
- ----------------------------------------- ----------
Less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years but less than 6 years 80%
6 years or more 100%
Forfeitures are used to reduce Company matching
contributions or to pay administrative expenses of the Plan.
Benefits
Upon termination of service due to death, disability, or
retirement, a participant may elect to receive an amount
equal to the value of the participant's vested interest in
his or her account. The form of payment is a lump-sum
distribution or an annuity to be paid in semi-annual
installments for up to five years or, in certain cases, for
life.
Participant Accounts
Individual accounts are maintained for each of the Plan's
participants to reflect the participant's contributions and
related employer matching contributions, as well as the
participant's share of the Plan's income and any related
administrative expenses. Allocations of income and expenses
are based on the proportion that each participant's account
balance bears to the total of all participant account
balances.
Loans to Participants
Participants in the Plan may borrow from their vested
account balance in the Plan. The minimum that can be
borrowed is $1,000, and loans are in $100 increments. Only
one loan per participant may be outstanding at any time.
Loans are repayable through payroll deductions and must be
repaid to the Plan within five years of the borrowing. The
interest rate is 1.5 percent over The Wall Street Journal's
prime rate at the time of the borrowing and is fixed over
the life of the loan. As of December 31, 1999, interest
rates ranged from 7.5 percent to 11.0 percent.
2. Summary of Significant Accounting Policies:
Basis of Accounting
The accompanying financial statements of the Plan have been prepared on the
modified cash basis of accounting. Investments are adjusted to fair value, while
contributions and expenses are recognized as cash is received or paid.
Receivables, payables, and accrued expenses are not reflected. Such
contributions receivable and fees payable were approximately $1,234,000 and
$31,000, respectively, as of December 31, 1999; the
4
corresponding amounts as of December 31, 1998, were $601,000 and $15,000,
respectively.
Use of Estimates
The preparation of financial statements in conformity with the modified cash
basis of accounting requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the year.
Actual results could differ from those estimates.
Investment Valuation
Cadmus common stock and mutual funds are traded on a national securities
exchange and are valued at the last reported sales price on the last business
day of the plan year; investments traded on the over-the-counter market and
listed securities for which no sale was reported on the last day of the Plan
year are valued at the last reported bid price. The Stable Value Common Trust
Fund is valued at fair value which approximates contract value. The average
yields for the Stable Value Fund were 5.8 and 6.3 percent for the years ended
December 31, 1999 and 1998, respectively. As of December 31, 1999 and 1998, the
interest rates for the Stable Value Common Trust Fund ranged from 5.35 percent
to 10 percent.
Income Recognition
Interest and dividend income are recorded as earned on the modified cash basis.
Net Appreciation in Fair Value of Investments
Net realized and unrealized appreciation is recorded in the accompanying
statement of changes in net assets available for plan benefits - modified cash
basis, as net appreciation in the fair value of investments.
Administrative Expenses
Administrative expenses of the Plan are paid jointly by the Company and
participants in the Plan. Each participant is charged a quarterly fee of $5.00
to be applied to the administrative expenses of the Plan. All investment
advisory fees are paid by the Plan and are reduced by applicable forfeitures.
Certain management, accounting, and audit services are provided to the Plan by
the Company. The Plan is not charged for these services.
Reclassifications
Certain previously reported amounts have been reclassified to conform to
current-year presentation.
3. Investments:
Participants may direct their contributions, employer matching contributions,
and any related earnings into nine investment options offered by the Plan. The
Plan currently offers one common/collective trust, seven mutual funds, and one
fund investing in Cadmus Communications Corporation common stock as investment
options for participants. Participants may change their investment elections at
any time.
5
The fair values of individual assets that represent 5 percent or more of the
Plan's net assets available for plan benefits as of December 31, 1999 and 1998,
are as follows:
1999 1998
------------ -----------
T. Rowe Price Balanced Fund $28,791,758 $27,788,242
T. Rowe Price Stable Value Common Trust Fund 17,604,577 16,986,544
T. Rowe Price Growth Stock Fund 14,866,011 12,468,810
T. Rowe Price Equity Index Fund 18,853,963 16,186,768
T. Rowe Price Small-Cap Value Fund * 5,319,874
* Represents less than 5 percent of net assets available for plan benefits as
of December 31, 1999.
During 1999, the Plan's investments appreciated (depreciated) in fair value as
follows:
Mutual funds $ 5,834,288
Common stock (1,301,517)
-----------
Net appreciation $ 4,532,771
===========
4. Tax Status:
The Plan has received a favorable determination letter dated January 17, 1996,
from the Internal Revenue Service ("IRS") stating that the Plan was designed in
accordance with applicable Plan design requirements as of that date, and as a
result, the underlying trust is tax exempt. The Plan administrator is of the
opinion that the Plan continues to operate as designed.
5. Plan Termination:
Although it has not expressed any intent 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 fully vested in their accounts.
6. Reconciliation to Form 5500:
The Plan's Form 5500 reflects the receivables and accruals discussed in Note 2.
In addition, the Plan had $101,979 and $84,304, respectively, of pending
distributions to participants as of December 31, 1999 and 1998. These amounts
are recorded as a liability in the Plan's Form 5500 but are not included in the
liabilities discussed in Note 2.
6
The following table reconciles net assets available for plan benefits per the
financial statements to Form 5500 as filed by the Company for the years ended
December 31, 1999 and 1998.
Additions Deductions Net Assets Available
Plan Plan to Net From Net for Plan Benefits
Assets Liabilities Assets Assets 1999 1998
------------ ----------- ----------- ----------- --------------------------
Per financial statements $97,743,959 $ -- $17,583,940 $11,581,521 $97,743,959 $91,741,540
1999 amounts pending distribution to
participants -- 101,979 -- 101,979 (101,979) --
1998 amounts pending distribution to
participants -- -- -- (84,304) -- (84,304)
1999 contributions receivable 1,233,715 -- 1,233,715 -- 1,233,715 --
1998 contributions receivable -- -- (600,890) -- -- 600,890
1999 fees payable -- 31,210 -- 31,210 (31,210) --
1998 fees payable -- -- -- (15,337) -- (15,337)
----------- -------- ----------- ----------- ----------- -----------
Per Form 5500 $98,977,674 $133,189 $18,216,765 $11,615,069 $98,844,485 $92,242,789
=========== ======== =========== =========== =========== ===========
7. Related-Party Transactions:
The Plan invests in a number of T. Rowe Price mutual funds, a T. Rowe Price
Common/ Collective trust, and Cadmus Communications Corporation common stock.
These are related-party transactions and are identified as parties-in-interest
in the accompanying schedule.
8. New Accounting Pronouncement:
The Accounting Standards Executive Committee issued Statement of Position 99-3,
("SOP") "Accounting for and Reporting of Certain Defined Contribution Plan
Investments and Other Disclosure Matters," which eliminates the requirement for
a defined contribution plan to disclose participant-directed investment
programs. The SOP was adopted for the 1999 financial statements and, as such,
the 1998 financial statements have been reclassified to eliminate the
participant directed fund investment program disclosures.
7
Cadmus Thrift Savings Plan
Schedule of Assets Held for
Investment Purposes - Modified Cash Basis
As of December 31, 1999
Description of Investment Type of Investment Fair Value
- -------------------------------------------------- ----------------------------- --------------
T. Rowe Price Balanced Fund* Mutual fund $28,791,758
T. Rowe Price Stable Value Common Trust Fund* Common/Collective trust 17,604,577
T. Rowe Price Growth Stock Fund* Mutual fund 14,866,011
T. Rowe Price Equity Index Fund* Mutual fund 18,853,963
T. Rowe Price Small-Cap Value Fund* Mutual fund 4,308,975
T. Rowe Price International Stock Fund* Mutual fund 3,997,734
Cadmus Communications Corporation* Common stock (203,489 shares) 1,441,028
T. Rowe Price Reserve Fund* Mutual fund 380,846
T. Rowe Price New Horizons Fund* Mutual fund 2,732,016
T. Rowe Price U.S. Treasury Intermediate Fund* Mutual fund 2,070,556
Participant loans Participant loans, 7.5% to 11.0%, 2,696,495
maturing at various dates
* Represents a party-in-interest
The accompanying notes are an integral part of this schedule.
8
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrator of the Plan has caused this Annual Report to be signed on its
behalf by the undersigned thereunto duly authorized.
CADMUS THRIFT SAVINGS PLAN
Cadmus Communications Corporation
(As Plan Administrator)
June 28, 2000 By: /s/ David E. Bosher
----------------------- ----------------------
(Date) David E. Bosher
Sr. Vice President, Chief
Financial Officer and Treasurer