UNITED STATES
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
For the fiscal year ended December 31, 2000 .
------------------------------------------
OR
{ } TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-14951 .
----------------------
BUTLER INTERNATIONAL, INC. 401(k) PLAN .
---------------------------------------------------------------
(Full name of plan)
BUTLER INTERNATIONAL, INC. .
--------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 06-1154321 .
------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
110 Summit Avenue, Montvale, New Jersey 07645
----------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 573-8000
--------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X . No .
----- -----
BUTLER INTERNATIONAL, INC.
401(k) PLAN
TABLE OF CONTENTS
Page
----
INDEPENDENT AUDITORS' REPORT................................................... 3
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits
as of December 31, 2000 and 1999.......................................... 4
Statement of Changes in Net Assets Available for Benefits for the year
ended December 31, 2000................................................... 5
Notes to Financial Statements............................................. 6-9
SUPPLEMENTAL SCHEDULE:
Schedule of Assets Held for Investment Purposes at December 31, 2000...... 10
All other supplemental schedules are omitted because they are not applicable.
EXHIBIT 1 - Independent Auditors' Consent...................................... 11
2
INDEPENDENT AUDITORS' REPORT
Trustees
Butler International, Inc.
401(k) Plan
Montvale, New Jersey
We have audited the accompanying statements of net assets available for benefits
of the Butler International, Inc. 401(k) Plan ("the Plan") as of December 31,
2000 and 1999, and the related statement of changes in net assets available for
benefits for the year ended December 31, 2000. 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 year
ended December 31, 2000 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 of assets held
for investment purposes as of December 31, 2000 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 2000 financial statements taken as a whole.
/s/ Deloitte & Touche LLP
- -------------------------
Parsippany, New Jersey
June 27, 2001
3
BUTLER INTERNATIONAL, INC. 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 2000 and 1999
(in thousands)
December 31,
-----------------------------------
2000 1999
-------------- --------------
ASSETS
Investments at fair value (Note 4) $ 40,391 $ 46,548
Receivables:
Employer contributions 393 371
Participant contributions 186 77
-------------- --------------
Total receivables 579 448
-------------- --------------
Total assets 40,970 46,996
-------------- --------------
LIABILITIES
Other liabilities 225 -
-------------- --------------
Net assets available for benefits $ 40,745 $ 46,996
============== ==============
The accompanying notes are an integral part of these financial statements.
4
BUTLER INTERNATIONAL, INC. 401(k) PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2000
(in thousands)
Year Ended
December 31, 2000
---------------------
Additions to net assets attributed to:
Investment income:
Net depreciation in fair value of investments (Note 4) $ (8,626)
Interest 87
Dividends 263
-----------
(8,276)
-----------
Contributions:
Participant 7,265
Employer 1,686
-----------
8,951
-----------
Total additions 675
-----------
Deductions from net assets attributed to:
Benefits paid to participants 6,800
Administrative expenses (Note 3) 110
Other 16
-----------
Total deductions 6,926
-----------
Net decrease (6,251)
Net assets available for benefits:
Beginning of year 46,996
-----------
End of year $ 40,745
===========
The accompanying notes are an integral part of these financial statements.
5
BUTLER INTERNATIONAL, INC. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN DESCRIPTION
The following description of the Butler International, Inc. 401(k) Plan (the
"Plan") provides only general information. Participants should refer to the
plan document for a more detailed description.
General:
In November 1989, Butler Service Group, Inc. (the "Company") established the
Plan, which was adopted by its wholly owned subsidiaries. The Plan is a
continuation of the Butler Service Group, Inc. Investment Savings Plan and is
designed to provide an incentive for employees of the Company to save
regularly through payroll deductions and possible matching contributions by
the Company. The Plan is a defined contribution plan covering all employees
of the Company. It is subject to the provisions of the Employee Retirement
Income Security Act ("ERISA").
The Employee Benefits Administrative Committee comprising up to three persons
appointed by the Company's Board of Directors administers the Plan. The trust
department of an independent third-party bank is the Plan's Trustee.
Contributions:
Generally, participants may contribute from 1% to 20%, in whole percentages,
of eligible compensation to the Plan on a pretax basis through automatic
payroll deductions ("elective deferral contributions"). Participants may also
contribute amounts representing distributions from other qualified defined
benefit or defined contribution plans. Participants direct the investments of
their contributions into various investment options offered by the Plan. The
Plan currently offers 15 investment options, which include a bank collective
fund, various mutual funds and the Butler Stock Fund. Total participant
contributions in any calendar year are limited to the applicable limit under
Internal Revenue Code Section 402(g). Such limit is $10,500 and $10,000 for
calendar years 2000 and 1999, respectively. The Plan also provides that
certain limitations may be imposed on participant's contributions in order to
comply with statutory requirements. Other liabilities include refunds of
excess contributions to highly compensated employees. Participants may
request changes to their elective deferral contribution rate or discontinue
their contributions through the Plan's voice response system. The changes or
discontinuance will be effective as soon as it is administratively feasible.
The Company may make matching contributions or other additional
discretionary contributions to the Plan in amounts determined by the Employee
Benefits Administrative Committee. Any such contributions are allocated to
the participants' accounts as provided by the Plan and invested directly in
the Butler Stock Fund or, as specified under a customer contract, allocated in
proportion to the elective deferral contributions. In 2000 and 1999, the
Company made matching contributions of approximately $596,000 and $544,000,
respectively. In 2000 and 1999, the Company also made contributions of
approximately $1,090,000 and $1,129,000, respectively, to the Plan in
accordance with a customer contract, which was funded by the customer.
Participant Accounts:
Each participant's account is credited with the participant's contributions
and allocations of (a) the Company's contribution and (b) Plan earnings, and
charged with an allocation of administrative expenses. Allocations are based
on participant earnings or account balances, as defined. The benefit to which
a participant is entitled is the benefit that can be provided from the
participant's vested account.
Participant Loans:
Participants may borrow from their fund accounts a minimum of $1,000 up to a
maximum equal to the lesser of $50,000 or 50 percent of the vested portion of
their account balance. The loans are secured by the balance in the
participant's account and bear interest at a rate of Prime plus 1 percent.
Principal and interest is paid ratably through payroll deductions. Loans must
be repaid within an agreed period but no more than five years. However, if
the loan is made for the purchase or construction of the participant's
principal place of residence, the repayment period may be longer than five
years. Only one loan will be granted at a time and must be repaid in full
before another loan can be requested.
6
BUTLER INTERNATIONAL, INC. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS, Continued
Vesting:
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting in the Company's matching and discretionary
contribution portion of their accounts plus the actual earnings thereon is
based on years of service. The matching and discretionary contributions vest
according to the following schedule:
Percentage of
Completed Years of Service Contribution Vested
- --------------------------------------------------------------------------------
Matching Contributions:
Less then 2 years 0%
2 years 20%
3 years 40%
4 years 60%
5 years 80%
6 or more years 100%
Discretionary Contributions:
Less than 3 years 0%
3 years or more 100%
A participant is also 100% vested if termination of employment is due to
retirement after age 65, total disability or death.
Forfeited Accounts:
When certain terminations of participation in the Plan occur, the nonvested
portion of the participant's account, as defined by the plan, represents a
forfeiture. Forfeitures are utilized to reduce the Company's future
contributions. At December 31, 2000, forfeited nonvested accounts totaled
approximately $4,000. Also, in 2000, employer contributions were reduced by
$15,000 from forfeited nonvested accounts.
Payment of Benefits:
On termination of services, a participant may elect to: (1) receive a lump-sum
payment; (2) roll over funds to another qualified plan or an Individual
Retirement Plan; or (3) defer receipt of funds that exceed $5,000 until April
1 following the later of the calendar year the participant reaches age 70 1/2
or the calendar year of participant's retirement. Participants may withdraw
funds while employed only from accounts in which they are fully vested after
attaining age 59 1/2. Prior to attaining age 59 1/2 a withdrawal may be made
for financial hardship. Only one withdrawal may be requested during any Plan
year for reasons other than financial hardship. The minimum amount available
for a withdrawal is $500. If the participant has an outstanding loan, the
amount of funds available for withdrawal may be limited. A participant will
have a 100% vested interest in all accounts upon retirement at or after age
65, in the event of a permanent disability or in the event of death prior to
termination of employment. Upon termination of employment, the value of the
vested accounts will be paid in a lump sum.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements are prepared on the accrual basis of
accounting and are presented in accordance with the financial reporting
requirements of ERISA.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles 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.
7
BUTLER INTERNATIONAL, INC. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS, Continued
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. Quoted market prices are
used to value investments except for its collective trust fund. Investments
in collective trust fund are stated at estimated fair values, which have been
determined based on the unit values of the funds. The bank sponsoring the
collective trust fund determines the unit value by dividing the fund's net
assets at fair value by its units outstanding at the valuation dates. Shares
of mutual funds are valued at the net asset value of shares held by the Plan
at year-end. Participant loans are valued at cost, which approximates fair
value.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the ex-
dividend date.
Net Appreciation (Depreciation) in Fair Value of Investments
Net realized and unrealized appreciation (depreciation) is recorded in the
accompanying financial statements as net appreciation (depreciation) in fair
value of investments.
Payment of Benefits
Benefits are recorded when paid.
3. RELATED-PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by Prudential Bank
and Trust Company ("Prudential"). Prudential is the trustee as defined by the
Plan and, therefore, these transactions qualify as party-in-interest
transactions. For the year ended December 31, 2000, fees paid by the Plan for
administrative services amounted to $110,000, which includes application and
processing fees for participant loans. Officers and employees of the Company
perform certain administrative functions for the Plan. No such officer or
employee receives compensation from the Plan.
4. INVESTMENTS
The following presents investments that represent 5 percent or more of the
Plan's net assets (in thousands):
December 31,
--------------------------------
2000 1999
------------ ------------
MFS Emerging Growth Fund - Class A $ 9,942 $12,718
The Stable Value Fund 8,696 8,829
AIM Balanced Fund - Class A 4,901 5,072
Prudential Stock Index Fund - Class Z 3,790 3,707
Templeton Foreign Fund - Class A 3,411 3,959
Fidelity Advisor Growth Opportunities Fund - Class T 3,405 4,192
Butler Stock Fund * 3,062 6,422
* Nonparticipant-directed
During 2000, the Plan's investments (including gains and losses on investment
brought and sold, as well as held during the year) depreciated in value by
$8,625,945 as follows (in thousands):
Mutual funds $ (4,728)
Common stock (3,898)
-------------
$ (8,626)
=============
8
BUTLER INTERNATIONAL, INC. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS, Continued
5. NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of changes in
net assets relating to the nonparticipant-directed investments is as follows
(in thousands):
December 31,
----------------------------------
2000 1999
-------------- -------------
Net Assets:
Butler Stock Fund:
Butler International, Inc. Common Sock $ 3,058 $ 6,419
Money market funds 4 4
Cash balance (cash debt) - (1)
-------------- -------------
$ 3,062 $ 6,422
============== =============
Year Ended
December 31, 2000
-----------------------
Changes in Net Assets:
Butler Stock Fund:
Contributions $ 1,339
Interest 17
Net depreciation (3,898)
Benefits paid to participants (507)
Administrative expenses (14)
Transfer to participant-directed investments (297)
-------------
$ (3,360)
=============
6. TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter dated April 22, 1996, 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 currently designed and being
operated in compliance with the applicable requirements of the IRC.
Therefore, there is no provision for income taxes in the financial statements.
7. 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 provision of ERISA. In the event the Plan is
terminated, all participants will be 100% vested in all their accounts and
benefits will be payable strictly under the terms of the Plan. The Pension
Benefit Guaranty Corporation does not insure benefits under defined
contribution plans of the 401(k) type.
9
BUTLER INTERNATIONAL, INC. 401(k) PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD
AT DECEMBER 31, 2000
- ----------------------------------------------------------------------------------------------------------------------------
(a) (b) Identity of issue (c) Description of investment (d) Cost (e) Current
value
- ----------------------------------------------------------------------------------------------------------------------------
* Prudential Moneymart Asset Fund Money Market Fund $ 4,188 $ 4,188
The Stable Value Fund Bank Collective Trust Fund - 295,870 shares 8,696,288
Selgman Global Smaller Companies Fund - Class A Mutual Fund - 12,696 shares 185,108
* Prudential Equity Fund - Class A Mutual Fund - 16,506 shares 280,445
* Prudential Government Income Fund - Class A Mutual Fund - 18,903 shares 166,916
* Prudential Stock Index Fund - Class Z Mutual Fund - 128,925 shares 3,790,388
Alliance Quasar Fund - Class A Mutual Fund - 9,605 shares 226,009
MFS Emerging Growth Fund - Class A Mutual Fund - 222,026 shares 9,942,306
* Prudential Global Total Return Fund - Class A Mutual Fund - 12,499 shares 88,744
* Prudential Global Growth Fund - Class A Mutual Fund - 31,938 shares 522,825
* Butler International, Inc. Common Stock - 662,777 9,426,202 3,057,412
Fidelity Advisor Value Strategies Fund - Class T Mutual Fund - 20,199 shares 488,005
Fidelity Advisor Growth Opportunities Fund - Class T Mutual Fund - 99,711 shares 3,405,129
Templeton Foreign Fund - Class A Mutual Fund - 329,852 shares 3,410,665
AIM Balanced Fund - Class A Mutual Fund - 162,872 shares 4,900,822
* Prudential High-Yield Fund - Class A Mutual Fund - 29,924 shares 185,527
* The Prudential Insurance - LN AP Fund Money Market Fund 50
* Participant Loans Interest rates ranging from 8.25% to 10.5%; maturity 1,039,984
dates ranging from Februaury 2001 to September 2030
-------------
$ 40,390,812
=============
* A party-in-interest as defined by ERISA
10
EXHIBIT 1
INDEPENDENT AUDITORS' CONSENT
- -----------------------------
We consent to the incorporation by reference in Registration Statements No. 333-
57342, No. 333-69799, No. 333- 69801, No. 333-22263, No. 33-58481 and No. 33-
87012 on Form S-8, Registration Statement No. 33-59427 on Form S-3 and Post-
Effective Amendment No. 4 to Registration Statement No. 33-58278 on Form S-2 of
our report dated June 27, 2001 appearing in this Annual Report on Form 11-K of
Butler International, Inc. 401(k) Plan for the year ended December 31, 2000.
/s/ Deloitte & Touche LLP
- -------------------------
Parsippany, New Jersey
June 27, 2001
11
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the plan) have duly caused this annual
report to be signed on its behalf by the undersigned thereunto duly authorized.
BUTLER INTERNATIONAL, INC.
--------------------------
(Registrant)
June 27, 2001 By: /s/ Michael C. Hellriegel
------------------------------------
Michael C. Hellriegel
Senior Vice President
and Chief Financial Officer
12