SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal year ended: December 31, 2001
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____ to ____
Commission File Number: 1-12709
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TOMPKINS TRUSTCO, INC. EMPLOYEE STOCK OWNERSHIP PLAN
------------------------------------------------------
(Full title of plan)
TOMPKINS TRUSTCO, INC.
(Name of issuer of the securities held pursuant to the plan)
P.O. Box 460, The Commons
Ithaca, New York 14851
(607) 273-3210
(Address of principal executive offices)
TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
-----------------------------
FINANCIAL STATEMENTS
--------------------
AND
---
SUPPLEMENTAL SCHEDULES
----------------------
* * *
DECEMBER 31, 2001
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TABLE OF CONTENTS
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Page No.
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INDEPENDENT AUDITOR'S REPORT 1
FINANCIAL STATEMENTS
Statements of Net Assets Available for Benefits
as of December 31, 2001 2
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 2001 3
Notes to Financial Statements 4
SUPPLEMENTAL SCHEDULES
Schedule of Assets Held for Investment Purposes at End
of Year as of December 31, 2001 (Schedule I) 8
Schedule of Investment Assets That Were Both Acquired and
Disposed of Within the Plan Year for the Year Ended
December 31, 2001 (Schedule II) 9
Schedule of Reportable Transactions for the Year Ended
December 31, 2001 (Schedule III) 10
Independent Auditor's Report
----------------------------
June 24, 2002
To the Compensation and Personnel Committee and Board of Directors of Tompkins
Trustco, Inc. Employee Stock Ownership Plan
We have audited the accompanying statement of net assets available for
benefits of the Tompkins Trustco, Inc. Employee Stock Ownership Plan ("the
Plan") as of December 31, 2001, and the related statement of changes in net
assets available for benefits for the year 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 audit.
We conducted our audit 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 audit provides 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, 2001, and the changes in net assets available for
benefits for the year then ended in conformity with accounting principles
generally accepted in the United States of America.
Our audit was performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules of
Assets Held for Investment Purposes at End of Year as of December 31, 2001,
Investment Assets That Were Both Acquired and Disposed of Within the Plan Year
for the Year Ended December 31, 2001, and Reportable Transactions for the Year
Ended December 31, 2001, are presented for the purpose of additional analysis
and are not a required part of the basic financial statements, but are
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. These supplemental schedules are the responsibility of the
Plan's management. The supplemental schedules have been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ Dannible & McKee, LLP
TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
-----------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
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DECEMBER 31, 2001
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Assets
------
Allocated Unallocated Total
------------ ------------ ------------
Investments, at fair value (Notes 2 and 5):
Money market funds $ 514 $ 36 $ 550
Corporate stock of Tompkins Trustco, Inc. 17,046,398 1,298,505 18,344,903
------------ ------------ ------------
Total investments 17,046,912 1,298,541 18,345,453
------------ ------------ ------------
Receivables:
Employer contributions 584,810 - 584,810
Accrued interest and dividends 5 - 5
------------ ------------ ------------
Total receivables 584,815 - 584,815
------------ ------------ ------------
Total assets 17,631,727 1,298,541 18,930,268
------------ ------------ ------------
Liabilities
-----------
Term loan payable (Note 6) - 150,344 150,344
------------ ------------ ------------
Total liabilities - 150,344 150,344
------------ ------------ ------------
Net assets available for benefits $ 17,631,727 $ 1,148,197 $ 18,779,924
============ ============ ============
See accompanying notes to financial statements.
- 2 -
TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
-----------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
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FOR THE YEAR ENDED DECEMBER 31, 2001
------------------------------------
Allocated Unallocated Total
------------ ------------ ------------
Additions to net assets attributed to:-
Investment income:
Net appreciation in fair value of
investments (Note 5) $ 4,358,221 $ 395,197 $ 4,753,418
Dividends 394,730 35,639 430,369
Gain on sale of investments 1,037,690 - 1,037,690
------------ ------------ ------------
Total investment income 5,790,641 430,836 6,221,477
------------ ------------ ------------
Contributions:
Employer contributions 584,810 - 584,810
Employer contributions for loan principal - 48,666 48,666
Employer contributions for loan interest - 29,808 29,808
------------ ------------ ------------
Total contributions 584,810 78,474 663,284
------------ ------------ ------------
Transfers from other plans (Note 8) 12,911,570 668,695 13,580,265
------------ ------------ ------------
Total additions 19,287,021 1,178,055 20,465,026
------------ ------------ ------------
Deductions from net assets attributed to:
Transfer to other plan (Note 9) 260,464 - 260,464
Benefits paid to participants 1,394,830 - 1,394,830
Interest expense - 29,808 29,808
------------ ------------ ------------
Total deductions 1,655,294 29,808 1,685,102
------------ ------------ ------------
Net increase 17,631,727 1,148,197 18,779,924
Net assets available for benefits:
Beginning of year - - -
End of year $ 17,631,727 $ 1,148,197 $ 18,779,924
============ ============ ============
See accompanying notes to financial statements.
- 3 -
TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
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NOTES TO FINANCIAL STATEMENTS
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Note 1 - Description of the Employee Stock Ownership Plan
- ---------------------------------------------------------
The following description of the Tompkins Trustco, Inc. (the "Company")
Employee Stock Ownership 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 was adopted, effective January 1, 2001. The Plan is
an employee stock ownership plan covering eligible full and part-time employees
who have completed one year of service. It is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA). The Plan is
administered by the Compensation and Personnel Committee appointed by the
Company's Board of Directors (the "Board"). The Trust Department of Tompkins
Trustco, Inc. is the Plan's Trustee.
Effective December 31, 1999, Tompkins Trustco, Inc acquired Letchworth
Independent Bancshares Corporation, holding corporation for the Bank of Castile.
Letchworth Independent Bancshares Corporation operated a leveraged employee
stock ownership plan known as Letchworth Independent Bancshares Corporation
Employee Stock Ownership Plan. Effective January 1, 2001, Letchworth Independent
Bancshares Corporation Employee Stock Ownership Plan merged with Tompkins
Trustco, Inc. Employee Stock Ownership Plan (see Note 8).
As described in Note 6, the Plan purchased voting common stock of
Tompkins Trustco, Inc. using the proceeds of a borrowing from the Company. The
borrowing is collateralized by unallocated shares of stock and is to be repaid
over a period of not more than ten years by company contributions to the Plan.
As the Plan makes each payment of principal, an appropriate percentage of stock
will be released and allocated to eligible employees' accounts in accordance
with applicable regulations under the Internal Revenue Code (IRC). Shares vest
fully upon allocation. Accordingly, the financial statements of the Plan for
2001 present separately, the assets and liabilities and changes therein
pertaining to the accounts of employees with vested rights in allocated stock
(allocated) and stock not yet allocated to employees (unallocated). Under the
Plan agreement, the Trustee shall vote all common stock of the Company unless
otherwise directed by agreement.
Company contributions - The Company shall, for each plan year,
contribute to the stock ownership plan out of profits a discretionary amount,
which shall not exceed five (5) percent of participant compensation. This
discretionary contribution is in addition to the required non-elective
contribution (See Note 4).
Participants' accounts - Each participant's account is credited with an
allocation of the Company's discretionary and non-elective contributions and an
allocation of Plan earnings. Allocations of Company contributions are based upon
the participant's compensation and the allocations of Plan earnings are based
upon participant account balances. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's account.
Forfeitures on non-vested account balances are allocated to participants
accounts as Company contributions.
- 4 -
Eligibility - An employee shall become eligible for participation in
the Plan on the first day of the month coinciding with completing one (1) year
of employment and attaining the age of twenty-one (21). However, any employee of
Tompkins Trustco, Inc. or its affiliated entities on December 31, 2000,
automatically became a participant of the plan on January 1, 2001. Leased
employees, employees covered under a collective bargaining agreement and "On
call" employees are not eligible to participate.
Vesting - Participants whose account balances transferred into the Plan
on January 1, 2001 are fully vested. Employees who became eligible to
participate in the Plan after January 1, 2001 will become vested in the Plan
over a five-year period.
Payments of benefits - Upon retirement or disability, a participant may
elect to receive either a lump sum amount equal to the value of their account or
payments on an instalment method. Distributions to participants upon termination
of employment other than for retirement or disability may be made in one lump
sum.
Note 2 - Summary of significant accounting policies
- ---------------------------------------------------
Basis of presentation - The accompanying financial statements have been
prepared on the accrual basis and present the net assets available for benefits
and changes in those assets.
Use of estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the United States of
America requires the Plan administrator to make estimates and assumptions that
affect the reported amounts of assets, liabilities and changes therein, and
disclosure of contingent assets and liabilities. Actual results may differ from
those estimates.
Participant loans - The Plan may make loans to participants in an
amount equal to the lesser of $50,000 or one-half of the value of the
participant's vested account balance. Loans will be payable over a five year
period and bear interest at the prime rate.
Investments - Investments are recorded at fair value. The investment in
the Company's common stock is valued at December 31, 2001, at market value as
listed on the NASDAQ stock exchange for publicly traded securities. The current
value per share of common stock at December 31, 2001 was $40.25.
Economic dependency and concentration of risk - The Plan has
approximately 98% of its assets invested in Tompkins Trustco, Inc. Common Stock
as of December 31, 2001. Accordingly, the Plan is dependent upon the financial
condition of Tompkins Trustco, Inc.
Note 3 - Administration of plan assets
- --------------------------------------
The Trustee of the Plan holds the Plan's assets, which consist
principally of Tompkins Trustco, Inc. common shares. Dividends on the stock are
paid in cash to the participants or reinvested to buy more shares of common
stock for a participant account, or used to make loan payments.
- 5 -
Certain administrative functions are performed by officers or employees
of the Company or its subsidiaries. No such officer or employee receives
compensation from the Plan. Administration expenses for the Trustee's fees are
paid directly by the Company.
Note 4 - Employer non-elective contributions
- --------------------------------------------
In addition to the Company discretionary contribution the Company is
obligated to make contributions in cash to the Plan which, when aggregated with
the dividends and interest earnings of the Plan's unallocated fund, equal the
amount necessary to enable the Plan to make payments of principal and interest
due on its term loan.
Note 5 - Investments
- --------------------
The Plan's investments are held by the Company's administered trust
fund. The fair values of investments at December 31, 2001 are as follows:
Tompkins Trustco, Inc. Company Common Stock -
Allocated (423,513 shares) $ 17,046,398
Tompkins Trustco, Inc. Company Common Stock -
Unallocated (32,261 shares) 1,298,505
Money market funds - Allocated 514
Money market funds - Unallocated 36
------------
Total investments at fair value $ 18,345,453
============
In March 2002, the Plan allocated 22,091 shares which had previously
been released but not allocated.
Investments that represent 5% or more of the Plan's net assets are
separately identified above.
The Plan's investments appreciated in fair value for the year ended
December 31, 2001 is as follows:
Tompkins Trustco, Inc. Company Common Stock -
Allocated $ 4,358,221
Tompkins Trustco, Inc. Company Common Stock -
Unallocated 395,197
------------
Net appreciation in fair value $ 4,753,418
============
Note 6 - Term loan payable
- --------------------------
The Plan has a $486,661 term loan agreement with the Company, which is
collateralized by unallocated shares of Company stock. The term loan agreement
provides for the loan to be repaid over a period not to exceed ten years,
requiring a minimum annual payment of principal of $48,666 with interest payable
annually at prime rate plus 1.0%, currently at 5.75%. The outstanding balance on
the loan at December 31, 2001, is $150,344. During 2001, the Plan utilized
certain plan assets to pay additional principal of approximately $106,000.
- 6 -
Note 7 - Termination of the Plan
- --------------------------------
The Company reserves the right to terminate the Plan at any time,
subject to plan provisions and provisions of ERISA. Upon plan termination, all
assets would be used to pay the administrative expenses, liquidation expenses
and participant claims until all fund assets have been expended. The Company
would not be entitled to receive any assets or other benefits upon termination
of the Plan.
Note 8 - Plan mergers and transfers
- -----------------------------------
Effective January 1, 2001, The Tompkins Trustco, Inc. Investment and
Stock Ownership Plan spun off and transferred $9,563,019 of assets to a new tax
qualified plan named the Tompkins Trustco, Inc. Employee Stock Ownership Plan
for the purpose of providing a discretionary profit sharing contribution to
employees which consists mainly of Company stock. Furthermore, the Plan merged
with the Bank of Castile Employee Stock Ownership Plan and $4,017,245 of net
assets were transferred into the Plan.
Note 9 - ESOP diversification and transfers
- -------------------------------------------
Under the Plan document, participants meeting certain age and service
requirements may elect to diversify an eligible portion of Company stock held in
their account within 90 days after the close of each Plan year. The participants
may make this election over a six (6) year period. In the first five years a
participant may diversify up to 25% of the number of shares allocated to their
account. In the sixth year, the percentage changes to 50%. The funds elected to
be diversified, are transferred to Tompkins Trustco, Inc. Investment and Stock
Ownership Plan ("ISOP") and invested in funds as chosen by the participant.
During 2001, the Plan transferred $260,464 to the ISOP.
Note 10 - Plan amendments
- -------------------------
Effective May 1, 2001, the Plan was amended to allow all affiliated
entities of the Company to participate in the Plan.
Note 11 - Tax status
- --------------------
The Company has filed for a determination letter from the Internal
Revenue Service to determine that the Plan is qualified and the trust
established under the Plan is tax-exempt, under the appropriate sections of the
Internal Revenue Code. The Company has not received its determination letter.
However, the Plan administrator and the Plan's tax counsel believe that the Plan
is currently designed and being operated in compliance with the applicable
requirements of the Code. Therefore, they believe that the Plan was qualified
and the related trust was tax-exempt as of the financial statement date.
- 7 -
SUPPLEMENTAL SCHEDULES
----------------------
SCHEDULE I
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TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
-----------------------------
EIN #16-1601020
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PLAN #003
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
--------------------------------------------------------------
(Required Disclosure of Line 4i on Schedule H of Form 5500)
-----------------------------------------------------------
DECEMBER 31, 2001
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- --------- -------------------------------------- ---------------------------------------- ------------------- -----------------
(c)
(b) Description of investment including
Identity of issue, borrower, lessor maturity date, rate of interest, (d) (e)
(a) or similar party collateral, par or maturity value Cost Current value
- --------- -------------------------------------- ---------------------------------------- ------------------- -----------------
Federated Prime Obligations
Fund Money Market Fund, 514 shares $ 514 $ 514
US Treasury Cash and cash equivalents 36 36
* Tompkins Trustco, Inc. Common Stock, 455,774 shares 6,466,290 18,344,903
----------- -----------
Total investments $ 6,466,840 $18,345,453
=========== ===========
- --------- -------------------------------------- ---------------------------------------- ------------------- -----------------
* A party-in-interest as defined by ERISA.
- 8 -
SCHEDULE II
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TOMPKINS TRUSTCO, INC.
----------------------
EMPLOYEE STOCK OWNERSHIP PLAN
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EIN #16-1601020
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PLAN #003
---------
SCHEDULE OF INVESTMENT ASSETS
-----------------------------
THAT WERE BOTH ACQUIRED AND DISPOSED OF WITHIN THE
--------------------------------------------------
PLAN YEAR (Required Disclosure of Line 4i on Schedule
-----------------------------------------------------
H of Form 5500, Part 2)
-----------------------
FOR THE YEAR ENDED DECEMBER 31, 2001
------------------------------------
- ------------------------------------- ----------------------------------- --------------------- ------------------------
(b)
Description of investment
(a) including maturity date, rate of (c) (d)
Identity of issue, borrower, interest, collateral, par or Costs of Proceeds of
lessor, or similar party maturity value acquisitions dispositions
- ------------------------------------- ----------------------------------- --------------------- ------------------------
- NONE -
- 9 -
SCHEDULE III
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TOMPKINS TRUSTCO, INC.
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EMPLOYEE STOCK OWNERSHIP PLAN
-----------------------------
EIN #16-1601020
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PLAN #003
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SCHEDULE OF REPORTABLE TRANSACTIONS
-----------------------------------
(Required Disclosure of Line 4j on Schedule H of
------------------------------------------------
Form 5500)
----------
FOR THE YEAR ENDED DECEMBER 31, 2001
------------------------------------
- ----------------- -------------- ------------------- ---------- ----------- --------------- --------- ------------------ ---------
(b)
Description
of asset
(include
interest
rate and (f) (h) (i)
(a) maturity in (d) (e) Expense (g) Current value of Net
Identity of case of a (c) Selling Lease incurred with Cost of asset on gain or
party involved loan) Purchase price price rental transaction asset transaction date loss
- ----------------- -------------- ------------------- ---------- ----------- --------------- --------- ------------------ ---------
Tompkins Common $13,768,300 - - - - $13,768,300 -
Trustco, Inc Stock,
490,310
shares
- ----------------- -------------- ------------------- ---------- ----------- --------------- --------- ------------------ ---------
- 10 -
SIGNATURE
Pursuant to the requirements 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 hereunto duly authorized.
TOMPKINS TRUSTCO, INC. EMPLOYEE STOCK OWNERSHIP PLAN
Administrator: TOMPKINS TRUST COMPANY
Date: June 28, 2002 By: /s/ FRANCIS M. FETSKO
-------------------------------------
Francis M. Fetsko
Senior Vice President
Chief Financial Officer
- 11 -
Exhibit Index
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Exhibit Number Description Page
23.1 Consent of Dannible & McKee, LLP
- 12 -