1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 2000
ROCKWELL INTERNATIONAL CORPORATION RETIREMENT SAVINGS PLAN
FOR REPRESENTED HOURLY EMPLOYEES
ROCKWELL INTERNATIONAL CORPORATION
777 East Wisconsin Avenue, Suite 1400
Milwaukee, Wisconsin 53202
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ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR
REPRESENTED HOURLY EMPLOYEES
TABLE OF CONTENTS
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PAGE NO.
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INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits
December 31, 2000 and 1999 2
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2000 and 1999 3
Notes to Financial Statements 4
FORM 5500 SUPPLEMENTAL SCHEDULE:
Schedule of Assets Held for Investment Purposes,
December 31, 2000 10
SIGNATURE S-1
EXHIBIT:
Independent Auditors' Consent S-2
3
INDEPENDENT AUDITORS' REPORT
To the Rockwell International Corporation Retirement Savings Plan for
Represented Hourly Employees and to Participants therein:
We have audited the accompanying statements of net assets available for
benefits of Rockwell International Corporation Retirement Savings Plan for
Represented Hourly Employees (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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2000 and 1999, 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.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents 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. This schedule is the responsibility of the Plan's management. Such
schedule has been subjected to the auditing procedures applied in our audit of
the basic 2000 financial statements and, in our opinion, is fairly stated in
all material respects when considered in relation to the basic financial
statements taken as a whole.
/s/ Deloitte & Touche LLP
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Deloitte & Touche LLP
Milwaukee, Wisconsin
June 25, 2001
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ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR REPRESENTED HOURLY EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2000 AND 1999
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2000 1999
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ASSETS
INVESTMENTS:
Master Defined Contribution Trust $ 7,377,434 $ 7,039,089
Loan Fund 147,836 49,078
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Total investments 7,525,270 7,088,167
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TOTAL NET ASSETS
AVAILABLE FOR BENEFITS $ 7,525,270 $ 7,088,167
============== ============
See notes to financial statements.
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ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR REPRESENTED
HOURLY EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 2000 AND 1999
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2000 1999
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NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR $ 7,088,167 $ 457,874
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INCOME:
Earnings from investments:
Net earnings in Master Defined Contribution Trust 326,407 112,989
Interest 7,588 4,760
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Total earnings from investments 333,995 117,749
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Contributions:
Employer 209,834 167,230
Employee 796,223 474,546
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Total contributions 1,006,057 641,776
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Total income 1,340,052 759,525
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EXPENSES:
Payments to participants or beneficiaries 866,627 57,008
Administrative expenses 25,236 25,681
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Total expenses 891,863 82,689
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NET INCOME 448,189 676,836
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NET TRANSFERS (FROM) TO THE PLAN (11,086) 5,953,457
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NET INCREASE 437,103 6,630,293
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NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 7,525,270 $ 7,088,167
================ ==============
See notes to financial statements.
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ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR
REPRESENTED HOURLY EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2000 AND 1999
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1. DESCRIPTION OF THE PLAN
The following brief description of the Rockwell International
Corporation Retirement Savings Plan for Represented Hourly Employees
(the "Plan") is provided for general information purposes only.
Participants should refer to the Plan document for complete information.
a. General - The Plan is a defined contribution plan sponsored by
Rockwell International Corporation ("Rockwell"). The Central
Retirement Committee and the Plan Administrator control and manage
the operation and administration of the Plan. Wells Fargo N.A. (the
"Trustee") is the trustee of the Plan. The assets of the Plan are
managed by the Trustee and several other investment managers. The
Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"). See Notes 6 and 7 which describe
changes to the Plan.
Participants in the Plan may invest in any of the following investment
funds:
Diversified Fund - Invests principally in common stocks and
convertible securities.
Aggregate Bond Index Fund - Invests in fixed income securities
included in the Lehman Brothers Aggregate Bond Index.
Stable Value Fund - Invests in insurance contracts and fixed
income securities.
Balanced Fund - Invests in a diversified mix of fixed income
and equity securities.
S&P 500 Index Fund - Invests principally in the stocks of
companies that comprise the Standard & Poor's 500 Index.
Mid-Cap Equity Fund - Invests principally in equity securities
of companies with medium market capitalizations.
International Equity Fund - Invests in equity securities of
companies outside the United States.
Stock Fund B (employee contributions) - Effective November 1,
1999 invests principally in the common stock of Rockwell but
may hold Rockwell common stock and cash.
High Yield Bond Fund - Invests principally in debt instruments
and convertible securities, with an emphasis on lower quality,
higher yielding securities.
Large-Cap Value Equity Fund - Invests principally in equity
securities of companies with large market capitalizations that
are generally viewed as "under valued" by the market.
Large-Cap Growth Equity Fund - Invests principally in equity
securities of growth companies with large market
capitalizations.
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Small-Cap Stock Fund - Invests principally in equity securities
of companies with small market capitalizations.
Horizon Retirement Fund - Invests principally in Plan stable
value and fixed income funds but will also invest in Plan
equity funds.
Horizon 2010 Fund - Invests principally in Plan equity funds
but will also invest in Plan fixed income and stable value
funds.
Horizon 2020 Fund - Invests principally in Plan equity funds
but will also invest in Plan fixed income funds.
Horizon 2030 Fund - Invests principally in Plan equity funds
but will also invest in Plan fixed income funds.
Other funds of the Plan include:
Stock Fund A (employer contributions) - Invests principally in
the common stock of Rockwell but may hold Rockwell common stock
and cash.
ArvinMeritor Stock Fund - Holds the common stock of
ArvinMeritor Automotive, Inc. ("ArvinMeritor").
Conexant Stock Fund - Holds the common stock of Conexant
Systems, Inc. ("Conexant")
Loan Fund - Represents outstanding participant loan balances.
The ArvinMeritor and Conexant Stock Funds are closed to any
additional employer and employee contributions. Additionally, there
are special rules regarding distributions from such funds. Any
dividends received on behalf of these funds are paid to the Stable
Value Fund.
b. Participation - The Plan provides that eligible employees electing
to become participants may contribute up to a maximum of 16% of
base compensation, as defined in the Plan document. Participant
contributions can be made either before or after United States
federal taxation of a participant's compensation. However, pre-tax
contributions by highly compensated participants are limited to 12%
of the participant's base compensation.
The Rockwell matching contribution is 50% of participant
contributions up to the first 5% of the participant's contribution
for the Allen-Bradley IAM Union participant group and up to the
first 6% of the participant's contributions for the Madison,
Indiana participant group. No Rockwell contributions are made to
the participant accounts of the Chicago Service Center, Hamilton,
and Euclid participant groups. The Rockwell matching contributions
are made to Rockwell Stock Fund A, which holds a combination of
cash and Rockwell common stock. Participants who are vested may
elect once per year to transfer a maximum of 25% of the
participant's interest Rockwell Stock Fund A to one or more of the
investment funds.
c. Investment Elections - Participants may elect to have their
contributions made to any of the funds indicated in Note 1.a. that
are available to participant contributions in 5% increments among
any or all these funds. Participants may change such investment
elections on a daily basis. If a participant does not have an
investment election on file, contributions will be made to the
Stable Value Fund.
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d. Unit Values - Participants do not own specific securities or other
assets in the various funds, but have an interest therein
represented by units valued as of the end of each business day.
However, voting rights are extended to participants in proportion
to their interest in Rockwell common stock held in Stock Fund A and
Stock Fund B, as represented by common units. Participants'
accounts are charged or credited, as the case may be, with the
number of units properly attributable to each participant.
e. Vesting - Each participant is fully vested at all times in the
portion of the participant's account that relates to the
participant's contribution and earnings thereon. Rockwell's
matching contributions and earnings thereon for the participants in
the Allen-Bradley IAM Union are vested 20% after the participant
has completed one year of service, 40% after two years of service
and are fully vested after the participant has completed three
years of vested service. Rockwell's matching contributions and
earnings thereon for the Madison, Indiana groups of participants
are vested after the participant has completed three years of
vesting service.
f. Loans - A participant may obtain a loan in an amount as defined in
the Plan document (not less than $1,000 and not greater than
$50,000 reduced by the participant's highest outstanding loan
balance during the 12 month period before the date of the loan or
50% of the participant's vested account balance less any
outstanding loans) from the balance of the participant's account.
Loans are secured by the remaining balance in the participant's
account. Interest is charged at a rate equal to the prime rate
plus 1%. The loans can be repaid through payroll deductions over
terms of 12, 24, 36, 48 or 60 months or up to 120 months for the
purchase of a primary residence, or repaid in full after a minimum
of one month. Payments of principal and interest are credited to
the participant's account. Participants may have up to two
outstanding loans at a time.
g. Forfeitures - When certain terminations of participation in the
Plan occur, the nonvested portion of the participant's account
represents a forfeiture, as defined in the Plan document.
Forfeitures remain in the Plan and subsequently are used to reduce
Rockwell's contributions to the Plan. However, if the participant
is reemployed and fulfills certain requirements, as defined in the
Plan document, the participant's account will be restored.
h. Plan Termination - Although Rockwell has not expressed any current
intent to terminate the Plan, Rockwell has the authority to
terminate or modify the Plan or suspend contributions to the Plan
in accordance with ERISA. In the event the Plan is terminated or
contributions by Rockwell are discontinued, each participant's
employer contribution account will be fully vested. Benefits under
the Plan will be provided solely from the Plan assets.
i. Withdrawals and Distributions - Active participants may withdraw
certain amounts up to their entire vested interest when the
participant attains the age of 59-1/2 or is able to demonstrate
financial hardship. Participant vested amounts are payable upon
retirement, death, or other termination of employment.
Upon termination of employment, other than retirement, participants
receive the vested portion of their account balance (employee and
employer contributions) in the form of a lump sum.
Upon retirement, participants may elect to receive the vested
portion of their account balance (employee and employer
contributions) in the form of a lump sum or in annual installment
payments for up to 10 years.
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Valuation of Investments - Investment in the Master Defined
Contribution Trust is stated at fair value. Purchases and sales on
securities are recorded on trade date basis. Interest is recorded
as earned. Dividends are accrued upon Rockwell Board of Directors'
approval. See Note 3. The loan fund is stated at cost which
approximates fair value.
b. Expenses - The Plan fees and expenses, including fees and expenses
connected with the provision of administrative services by external
service providers, are paid from Plan assets.
c. Use of Estimates - Estimates and assumptions made by the Plan's
management affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of increases and
decreases to the Plan during the reporting period. Actual results
could differ from those estimates.
3. MASTER DEFINED CONTRIBUTION TRUST
At December 31, 2000, and 1999, with the exception of the participant
loan fund, all of the Plan's investment assets were held in the Master
Defined Contribution Trust ("Master Trust") account, at Wells Fargo, N.A.
Use of the Master Trust permits the commingling of the trust assets of a
number of benefit plans of Rockwell and its subsidiaries for investment
and administrative purposes. Although assets are commingled in the Master
Trust, Wells Fargo, N.A. maintains supporting records for the purpose of
allocating the net (loss) earnings of the investment accounts to the
various participating plans.
The Master Trust investments are valued at fair value at the end of each
day. If available, quoted market prices are used to value investments at
fair value. If quoted market prices are not available, the fair value of
investments is estimated primarily by independent investment brokerage
firms and insurance companies. The investment funds held by the Master
Trust are the same as those discussed in Note 1.
The net earnings or loss of the accounts for each day is allocated by the
trustee to each participating plan based on the relationship of the
interest of each plan to the total of the interests of all participating
plans.
The net assets of the Master Trust at December 31, 2000 and 1999 are
summarized as follows:
2000 1999
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Cash and equivalents $ 42,606,035 $ 57,771,160
Corporate bonds and debentures 49,898,290 42,402,523
Common stocks 2,443,409,074 4,428,191,177
Mutual funds 629,966,165 503,123,568
Preferred/convertible securities 3,548,531 -
Stable value fund 555,014,288 547,797,792
Diversified fund 1,323,597 -
Guaranteed investment contracts 47,284,912 147,012,701
Accrued income - 4,091,896
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Net assets available for benefits $ 3,773,050,892 $ 5,730,390,817
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The net (loss) earnings of the Master Trust for the years ended December
31, 2000 and 1999 is summarized as follows:
2000 1999
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Interest $ 42,346,692 $ 49,441,701
Dividends 71,814,777 57,083,001
Net (depreciation) appreciation in fair value
of investments:
U. S. Government securities - (375,707)
Corporate bonds and debentures 1,615,477 (1,899,587)
Common stocks (1,247,539,797) 2,074,314,661
Mutual Funds (25,188,187) 151,108,840
Other (354,963) (392,165)
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Net (loss) earnings $ (1,157,306,001) $2,329,280,744
================ ==============
The Plan's interest in the total Master Trust as a percentage of net
assets of the Master Trust was less than 1% at December 31, 2000 and
1999. While the Plan participates in the Master Trust, the portfolio of
investments is not ratable between the various participating plans. As a
result, those plans with smaller participation in the common stock funds
recognized a disproportionately lesser amount of net depreciation and net
appreciation in 2000 and 1999, respectively. Prior to the transfer of
assets to the Master Trust in April 1999, net appreciation of $5,495
occurred in the various investment funds.
4. TAX STATUS
The Plan has not yet obtained a determination letter from the Internal
Revenue Service. Rockwell, however, believes that the Plan currently is
designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code and that the Plan qualifies
under Section 401(a) to be tax-exempt as of December 31, 2000. Therefore,
no provision for income taxes has been included in the Plan's financial
statements.
5. NON PARTICIPANT-DIRECTED INVESTMENTS
In the period January 1, 1999 through March 31, 1999, prior to the
inclusion of the Plan's assets in the Master Trust (see Note 3), the
interest accumulation fund was considered to be a nonparticipant-directed
fund under SOP No.99-3. Information about the significant components of
the changes in net assets for the three-month period ended March 31, 1999
relating to nonparticipant-directed investments is as follows:
Contributions $ 48,903
Interest 3,728
Transfers to participant-directed investments (649)
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Changes in net assets $ 51,982
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6. CHANGES IN THE PLAN
In January 1999, Rockwell approved a series of changes to the Plan that
became effective April 1, 1999. These changes included transferring the
Plan's investments into the Master Trust (Note 3), changing the
investment options under the Plan to those discussed in Note 1,
permitting up to two
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concurrent participant loans, permitting participants to invest employee
contributions in 1% increments among different investment options
(described in Note 1c), and allowing employees to elect pre-tax or
after-tax employee contributions daily.
In December 1999, the Reliance Electric Industrial Company Voluntary
Contributory Retirement Savings Plan with total assets of $3,162,659 was
merged with the Plan and $2,708,480 in assets belonging to certain
participant groups of the Rockwell Employee Savings and Investment Plan
for Represented Hourly Employees were transferred into the Plan.
Effective June 1, 2000, Rockwell made changes to the Plan that included:
increasing the number of investment options, payment in cash of quarterly
dividends earned from Rockwell common stock to participants, allowing for
transfers of non-Rockwell stock funds to any of the investment funds,
allowing for cash or stock to be received for distributions or in-service
withdrawals from the Plan and allowing participants who are 55 years old
with at least five years of service to transfer a portion of Rockwell
contribution funds (Stock Fund A) to other investment funds within the
plan.
Effective September 1, 2000, vested participants (three years of service)
are eligible to transfer a portion of Rockwell contribution funds (Stock
Fund A) to other investment funds within the Plan.
Participants should refer to the Plan document for more complete
information regarding changes in the Plan.
7. SUBSEQUENT EVENTS
In December 2000, Rockwell announced its intention to spinoff its
Rockwell Collins avionics and communications business into a separately
traded, publicly held company. The transaction is expected to be
completed on June 29, 2001. After the spinoff, Rockwell Collins, Inc.
and Rockwell Automation will each own a 50% equity interest in the
Rockwell Scientific Company LLC.
Following the transaction, Rockwell will retain sponsorship of the Plan
and the trusts related thereto. Rockwell will cause each Rockwell
Collins, Inc. employee and each Rockwell Scientific Company LLC employee
to have a fully nonforfeitable right to such employee's account balances,
if any, under the Plan. The account balances of each such employee will
be maintained under the Plan. However, such employees will not be
entitled to make additional contributions under the Plan and matching
contributions will no longer be made by either Rockwell, Rockwell
Collins, Inc. or Rockwell Scientific Company LLC to the Plan on behalf of
such employees.
Rockwell Collins, Inc. and Rockwell Scientific Company LLC will
separately establish new savings plans for their active employees. The
Rockwell Collins, Inc. savings plans and Rockwell Scientific Company LLC
savings plans will allow active employees to transfer their account
balances from the Plan to their respective company's savings plans.
* * * * *
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ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR REPRESENTED
HOURLY EMPLOYEES
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES,
DECEMBER 31, 2000
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COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
Description of Investment
Identity of Issuer, Including Collateral, Rate
Borrower, Lessor of Interest, Maturity Date, Current
or Similar Party Par or Maturity Value Cost Value
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* Wells Fargo, N.A. Master Defined
Contribution Trust $ 7,323,646 $ 7,377,434
* Various Participant Loans;
participants prime rate plus 1%,
due 2001 to 2010 147,836 147,836
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Total investments $ 7,471,482 $ 7,525,270
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*Party-in-interest
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administer has duly caused this annual report to be signed on its behalf by
the undersigned, hereunto duly authorized.
ROCKWELL INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR REPRESENTED HOURLY EMPLOYEES
By /s/ Alfred J. Spigarelli
----------------------------
Alfred J. Spigarelli
Plan Administrator
Date: June 28, 2001
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EXHIBIT
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333-89219 of Rockwell International Corporation on Form S-8 and the Prospectus
related thereto of our report dated June 25, 2001, appearing in this Annual
Report on Form 11-K of Rockwell International Corporation Retirement Savings
Plan for Represented Hourly Employees for the year ended December 31, 2000.
/s/ Deloitte & Touche LLP
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Deloitte & Touche LLP
Milwaukee, Wisconsin
June 25, 2001
S-2