UNITED STATES
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, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File Number 0-18984
REYNOLDS, SMITH AND HILLS, INC.
EMPLOYEES 401(k) PROFIT SHARING PLAN
(Full title of the plan)
REYNOLDS, SMITH AND HILLS, INC.
(Name of issuer of the securities held pursuant to the plan)
4651 Salisbury Road, Jacksonville, Florida 32256
(Address of principal executive office of issuer and plan)
REYNOLDS, SMITH AND HILLS,
INC. EMPLOYEES 401(k) PROFIT
SHARING PLAN
Financial Statements for the Years Ended
December 31, 2001 and 2000 and Supplemental
Schedule for the Year Ended December 31, 2001
and Independent Auditors' Report
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k) PROFIT SHARING PLAN
TABLE OF CONTENTS
- --------------------------------------------------------------------------------------------------
Page
INDEPENDENT AUDITORS' REPORT 1
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
SUPPLEMENTAL SCHEDULE:
Form 5500 Schedule H Part IV Line 4i - Schedule of Assets Held for Investment
Purposes as of December 31, 2001 10
Deloitte
& Touche
Certified Public Accountants
Suite 2801
One Independent Drive
Jacksonville, Florida 32202-5034
Tel: (904) 665 1400
Fax: (904) 355 9104
www.us.deloitte.com
INDEPENDENT AUDITORS' REPORT
To the Trustees and Participants of
Reynolds, Smith and Hills, Inc. Employees
40l(k) Profit Sharing Plan
Jacksonville, Florida
We have audited the accompanying statements of net assets available for benefits
of Reynolds, Smith and Hills, Inc. Employees 401(k) Profit Sharing Plan (the
"Plan") as of December 31, 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 December 31,
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.
As discussed in Note 2 to the financial statements, the 2001 and 2000 financial
statements include securities valued at $1,697,433 (9 percent of net assets) and
$1,437,555 (7 percent of net assets), respectively, whose values have been
estimated by an independent appraiser in the absence of readily ascertainable
market values. We have examined the procedures used by an independent appraiser
in arriving at its estimate of value of such securities and have inspected
underlying documentation, and, in the circumstances, we believe that such
procedures are reasonable and the documentation appropriate. However, because of
the inherent uncertainty of valuation, those estimated values may differ
significantly from the values that would have been used had a ready market for
the securities existed, and the differences could be material.
Our audits were conducted 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 for 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.
Such supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic 2001 financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
DELOITTE & TOUCHE LLP
June 21, 2002
- 2 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2001 AND 2000
- -----------------------------------------------------------------------------------------------------------------------
2001 2000
ASSETS:
Investments, at fair value:
Collective funds $ 17,262,892 $ 17,982,198
Short-term investments 53,191 39,946
Investments, at estimated fair value:
Reynolds, Smith and Hills, Inc. common stock 1,697,433 1,437,555
Loans to participants 544,919 677,742
------------ ------------
Total investments 19,558,435 20,137,441
Contributions receivable 120,255 56,937
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 19,678,690 $ 20,194,378
============ ============
The accompanying notes are an integral part of these financial statements.
- 3 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 2001 AND 2000
- -----------------------------------------------------------------------------------------------------------------------
2001 2000
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income $ 532,390 $ 1,257,969
Net depreciation in fair value of investments (2,829,586) (2,201,853)
------------ ------------
Net investment loss (2,297,196) (943,884)
Contributions from employer 637,075 550,081
Contributions from employees 2,082,974 2,022,467
------------ ------------
Total additions 422,853 1,628,664
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Administrative expenses 31,251 33,841
Distributions 907,290 2,070,162
------------ ------------
Total deductions 938,541 2,104,003
------------ ------------
Net decrease (515,688) (475,339)
NET ASSETS AVAILABLE FOR BENEFITS
AT BEGINNING OF YEAR 20,194,378 20,669,717
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS
AT END OF YEAR $ 19,678,690 $ 20,194,378
============ ============
The accompanying notes are an integral part of these financial statements.
- 4 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
The following description of the Reynolds, Smith and Hills, Inc. Employees
401(k) Profit Sharing Plan (the "Plan") provides general information to
participants. Participants should refer to the pamphlet, Summary Plan
Description and Prospectus for the April 1,1996 Amendment and Restatement
of the Reynolds, Smith and Hills, Inc. Employees 401(k) Profit Sharing
Plan, for a more complete description of the Plan. Copies of the pamphlet
are available from the Plan Coordinator.
General - The Plan was commenced and made effective January 1, 1990. The
Plan is a defined contribution plan established under Section 401(k) of
the Internal Revenue Code. The Plan was established for the benefit of
employees of Reynolds, Smith and Hills, Inc. (the "Company") and
subsidiaries. The Plan is subject to the provisions of the Employees
Retirement Income Security Act of 1974 (ERISA).
Investment Options - Participating employees have the right to choose the
investment funds in which contributions to their accounts are invested,
and may choose to allocate and reallocate amounts credited to their
accounts among all or any combination of the investment funds. A
participating employee may change his investment decision at any time by
contacting the Trustee. Changes involving Reynolds, Smith and Hills, Inc.
common stock are handled by the plan administrator on a quarterly basis.
Earnings on the investment funds are allocated among the accounts of
participants that have elected to invest in each such fund.
Accounts may be invested among the following:
(i) INVESCO Retirement Trust Stable Value Fund
(ii) INVESCO Select Income Fund
(iii) INVESCO Retirement Trust Total Return Fund
(iv) INVESCO Value Equity Fund
(v) INVESCO Dynamics Fund
(vi) INVESCO Small Company Growth Fund
(vii) Janus Overseas Fund
(viii) MFS Growth - Stock Fund
- 5 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000 (Continued)
- --------------------------------------------------------------------------------
(ix) American Washington Mutual Investors Fund
(x) Reynolds, Smith and Hills, Inc. common stock
Plan participants may direct the investment of all funds credited to their
account to any or all investment funds in increments of 1%.
Contributions - The Plan allows participating employees to contribute from
2% to 15% of their earned compensation with a total amount not to exceed
$10,500 in 2001 and 2000. The dollar limit is indexed yearly for
inflation. The Company matches 50% of the employee's annual contribution
up to 6% of an employee's contribution level. In addition, the Company may
make discretionary contributions to the Plan in cash, company stock, or a
combination of the two. No discretionary contributions were made in 2001
or 2000.
Participant Accounts - Each participant's account is credited with the
participant's contribution, the Company's contributions, Plan earnings,
and the allocation of associated administrative expenses.
Vesting - Participants are fully vested in their voluntary contributions
plus actual earnings thereon. Participants vest in the remainder of the
account balances at a rate of 20% per year of continuous service. A
participant is 100% vested after five years of credited service.
Withdrawals - Participants may withdraw all of the vested amounts credited
to their accounts. Also, a participant may elect to withdraw certain
amounts from his deferral contribution account due to financial hardship.
Loans - Participants may request loans from the Plan subject to allowable
available participant balances and other conditions.
Payment of Benefits - On termination of employment, a participant with an
account balance of $5,000 or less will receive a lump sum payment of the
participant's account balance. The Plan provides other payment schedules
for payment of participant balances in excess of $5,000. As of December
31, 2001, $3,307,763 in benefits was owed to participants that had
withdrawn from the plan.
In the event of death or disability of a participant, payment may be made
in a lump sum amount equal to the value of the participant's account as of
the next quarterly valuation date.
Forfeited Accounts - During 2001 and 2000, forfeited balances were
accumulated in the Plan. During February 2002, the accumulated balances
were distributed to remaining participants based upon total employer
matching contributions plus accumulated earnings on these contributions
since inception of the Plan.
- 6 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000 (Continued)
- --------------------------------------------------------------------------------
Plan Termination - Although the Company 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 100% vested in their accounts.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The accounts of the Plan are maintained on the
accrual basis except for benefit payments, which are reported on a cash
basis in accordance with guidelines of the American Institute of Certified
Public Accountants' Audit and Accounting Guide, Audits of Employee Benefit
Plans.
Investments - Shares of registered investment companies are valued at
quoted market prices which represent the net asset value of shares held by
the Plan at year-end. Short-term investments are carried at cost which
approximates fair value. Investments in the common stock of the Plan's
sponsor, Reynolds, Smith and Hills, Inc., are recorded at an estimated
fair value as there is no active market for the stock. The Plan's loans to
participants are stated at estimated fair value.
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 and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
The Plan invests in various mutual funds that, in turn, may invest in
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 benefits.
3. INVESTMENTS
Except for the Plan's investments in loans to participants and common
stock of the Company, the Plan's investments are held in a trust fund
administered by the Trust Department of INVESCO Trust Company. Such
investments consist primarily of the Plan's short-term investments and
investments in mutual funds and collective trust funds.
- 7 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000 (Continued)
- -------------------------------------------------------------------------------------------------------------
The following table summarizes all investments held, by fund, at December
31, 2001 and 2000:
December 31
----------------------------------
2001 2000
Investments at Fair Value as Determined by Quoted Market Prices
INVESCO mutual funds:
Value Equity Fund; 202,475 and 178,901 units $ 3,972,561 * $ 3,844,585 *
Dynamics Fund; 198,693 and 202,470 units 3,165,185 * 4,812,714 *
Small Company Growth Fund; 138,916 and 145,071 units 1,686,444 * 2,226,846 *
Select Income Fund; 237,299 and 188,022 units 1,276,667 * 1,114,969 *
------------ ------------
10,100,857 11,999,114
Janus mutual fund:
Janus Overseas fund; 39,854 and 39,431 units 809,041 1,046,495 *
------------ ------------
809,041 1,046,495
MFS mutual fund:
MFS Growth - Stock Fund; 37,108 and 38,135 units 478,316 653,635
------------ ------------
478,316 653,635
American Washington Mutual Investors mutual fund:
American Washington Mutual Investors Fund;
11,743 and 0 units 331,740
------------ ------------
331,740
INVESCO collective trust funds:
Retirement Trust Stable Value Fund; 4,136,226 and
3,275,513 units 4,136,226 * 3,275,513 *
Retirement Trust Total Return Fund; 38,257 and
27,060 units 1,406,712 * 1,007,441
------------ ------------
5,542,938 4,282,954
INVESCO money market fund:
Stock Liquidity Fund; 53,191 and 39,946 units 53,191 39,946
------------ ------------
53,191 39,946
Investments at Estimated Fair Value
Reynolds, Smith and Hills, Inc. common stock;
99,849 shares 1,697,433 * 1,437,555 *
Loans to participants 544,919 677,742
------------ ------------
2,242,352 2,115,297
------------ ------------
Total investments $ 19,558,435 $ 20,137,441
============ ============
* Investment exceeds 5% of net assets available for benefits.
- 8 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000 (Concluded)
- --------------------------------------------------------------------------------
Net appreciation (depreciation) in the fair value of investments for the
years ended December 31, 2001 and 2000 is comprised of the following:
December 31
---------------------------------
2001 2000
Investments with fair values as determined
by quoted market prices $ (3,025,029) $ (2,201,853)
Investment with estimated fair value 195,443 -
------------ ------------
Net depreciation in the fair value of investments $ (2,829,586) $ (2,201,853)
============ ============
4. INCOME TAX STATUS
The Plan obtained its latest determination letter on June 10, 2002, in
which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue
Code. The Plan has been amended since receiving the determination letter.
However, the plan administrator believes that the Plan is currently
designed and being operated in compliance with the applicable requirements
of the Internal Revenue Code. Therefore, they believe that the Plan was
qualified and the related trust was tax-exempt as of the financial
statement date.
* * * * * *
- 9 -
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES
401(k) PROFIT SHARING PLAN
FORM 5500 SCHEDULE H PART IV LINE 4i -
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2001
- -----------------------------------------------------------------------------------------------------------------------
Market
Units Value
--------- ------------
INVESCO mutual funds:
Value Equity Fund 202,475 $ 3,972,561
Dynamics Fund 198,693 3,165,185
Small Company Growth Fund 138,916 1,686,444
Select Income Fund 237,299 1,276,667
Janus mutual fund:
Janus Overseas Fund 39,854 809,041
MFS mutual fund:
MFS Growth - Stock Fund 37,108 478,316
American Washington Mutual Investors mutual fund:
American Washington Mutual Investors Fund 11,743 331,740
INVESCO collective trust funds:
Retirement Trust Stable Value Fund 4,136,226 4,136,226
Retirement Trust
Total Return Fund 38,257 1,406,712
INVESCO money market fund:
Stock Liquidity Fund 53,191 53,191
Stock fund:
Reynolds, Smith and Hills, Inc. common stock 99,849 1,697,433
Loan fund:
Loans to participants 544,919
------------
TOTAL $ 19,558,435
============
- 10 -
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 on its behalf by the undersigned
hereunto duly authorized.
REYNOLDS, SMITH AND HILLS, INC.
EMPLOYEE 401(k) PROFIT SHARING PLAN
By: /s/ Darold F. Cole
------------------
Darold F. Cole
Chairman, Administrative Committee
and Senior Vice President and Director
Reynolds, Smith and Hills, Inc.
Date: August 27, 2002
---------------