-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Vyz2JHbq11Xvf0GKlKNp0AS4qP6Cw/vry8WCPQJjGj87+OYeSKDpr49FVg64jmgS nZIRSuu1q4sfGt6fhoj69w== 0000950152-02-005871.txt : 20020802 0000950152-02-005871.hdr.sgml : 20020802 20020802101617 ACCESSION NUMBER: 0000950152-02-005871 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20011231 FILED AS OF DATE: 20020802 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BAKER MICHAEL CORP CENTRAL INDEX KEY: 0000009263 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 250927646 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-06627 FILM NUMBER: 02717902 BUSINESS ADDRESS: STREET 1: AIRPORT OFFICE PARK BLDG 3 STREET 2: 420 ROUSER RD CITY: CORAOPOLIS STATE: PA ZIP: 15108 BUSINESS PHONE: 4122696300 MAIL ADDRESS: STREET 1: P O BOX 12259 CITY: PITTSBURGH STATE: PA ZIP: 15231-0259 FORMER COMPANY: FORMER CONFORMED NAME: BAKER MICHAEL JR INC DATE OF NAME CHANGE: 19720526 FORMER COMPANY: FORMER CONFORMED NAME: EUTHENICS SYSTEMS CORP DATE OF NAME CHANGE: 19750527 11-K 1 j9569201e11vk.txt MICHAEL BAKER CORPORATION FORM 11-K 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, 2001 Commission file number 33-14058 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Michael Baker Corporation Employee Stock Ownership Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Michael Baker Corporation Airport Office Park, Building 3 420 Rouser Road Coraopolis, PA 15108 MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION DECEMBER 31, 2001 AND 2000 MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN INDEX TO FINANCIAL STATEMENTS AND ADDITIONAL INFORMATION DECEMBER 31, 2001 AND 2000 - ------------------------------------------------------------------------------- PAGE Report of Independent Accountants 1 Financial Statements: Statements of Net Assets Available for Benefits December 31, 2001 and 2000 2 Statements of Changes in Net Assets Available for Benefits Years Ended December 31, 2001 and 2000 3 Notes to Financial Statements 4-9 Additional Information:* Schedule of Assets (Held at End of Year) December 31, 2001 10 Schedule of Reportable Transactions Year Ended December 31, 2001 11 * Other schedules required by Section 2520.103-10 of the Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA have been omitted because they are not applicable. REPORT OF INDEPENDENT ACCOUNTANTS To the Participants and Administrator of the Michael Baker Corporation Employee Stock Ownership Plan In our opinion, the accompanying statements of net assets available for benefits and the related statements of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Michael Baker Corporation Employee Stock Ownership Plan (the Plan) at 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. 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 of these statements in accordance with auditing standards generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the our opinion. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of Assets (Held at End of Year) and Reportable Transactions 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 audits 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/ PricewaterhouseCoopers LLP - ------------------------------ Pittsburgh, PA July 26, 2002 MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 2001 AND 2000 - -------------------------------------------------------------------------------
2001 2000 ASSETS Investments, at fair value: Investments in common stock of Michael Baker Corporation $ 49,517,528 $ 26,688,174 Investments in mutual funds 67,399,289 72,438,934 Participant loans (market value approximates cost) 388,974 328,618 ------------ ------------ Total investments 117,305,791 99,455,726 ------------ ------------ Total assets 117,305,791 99,455,726 ------------ ------------ LIABILITIES Accounts payable -- 2,667 ------------ ------------ Total liabilities -- 2,667 ------------ ------------ Net assets available for benefits $117,305,791 $ 99,453,059 ============ ============
The accompanying notes are an integral part of these financial statements. - 2 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP 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: Interest and dividends $ 1,425,653 $ 6,246,320 Net appreciation (depreciation) in fair value of investments 10,044,226 (10,416,883) ------------- ------------- Total investment income (loss) 11,469,879 (4,170,563) ------------- ------------- Participant contributions 10,187,194 9,552,169 Employer contributions 4,513,439 4,668,605 ------------- ------------- Total contributions 14,700,633 14,220,774 ------------- ------------- Total additions 26,170,512 10,050,211 ------------- ------------- Deductions from net assets attributed to: Participant withdrawals 8,314,583 8,356,853 Transfers out of Plan -- 3,860,832 Administrative fees 3,197 26,117 ------------- ------------- Total deductions 8,317,780 12,243,802 ------------- ------------- Net increase (decrease) 17,852,732 (2,193,591) ------------- ------------- Net assets available for benefits: Beginning of year 99,453,059 101,646,650 ------------- ------------- End of year $ 117,305,791 $ 99,453,059 ============= =============
The accompanying notes are an integral part of these financial statements. - 3 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 AND 2000 - ------------------------------------------------------------------------------- 1. DESCRIPTION OF PLAN GENERAL The following description of the Michael Baker Employee Stock Ownership Plan (the ESOP, or the Plan) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. The ESOP is a defined contribution plan that provides all eligible employees of Michael Baker Corporation (the Company) with an opportunity to accumulate additional retirement benefits as well as invest in Company stock. The Plan is subject to provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA). PARTICIPANT ACCOUNTS Each participant's account is credited with the participant's contribution and allocations of (a) the Company's contribution and (b) Plan earnings or losses, and charged with an allocation of certain administrative fees. 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. CONTRIBUTIONS Participants contribute to the ESOP through a Section 401(k) Employee Salary Redirection Election, whereby participants may choose to have a percentage of their salaries (including commissions and overtime) withheld and contributed to the ESOP up to the lower of 18% of the participant's salary or the annual limitation established by the Internal Revenue Service in both 2001 and 2000. The maximum amount of a participant's salary which may be eligible for withholding for any Plan year cannot exceed $170,000. The ESOP also allows participants to roll over funds from a previous employer's tax-qualified plan or tax-qualified individual retirement account. Effective January 1, 2002, the Plan participants may choose to contribute up to the lower of 50% of their salaries or the annual limitation established by the Internal Revenue Service. COMPANY MATCHING CONTRIBUTIONS Under the provisions of the Plan, the Company will make a matching contribution to the participants' accounts in an amount of 100% of the first 5% and 50% of the next 1% of eligible salary (including commissions but excluding overtime) contributed by each participant. Contribution amounts over the 6% limit are not required to be matched by the Company. The Company's matching contributions are invested in not less than 25% of Michael Baker Corporation Common Stock or Series B Common Stock with the remaining 75% invested in accordance with the participants' investment elections for participant contributions. The Board of Directors of the Company is authorized to make additional discretionary contributions to the ESOP from time to time. However, no discretionary contributions were made in 2001 or 2000. - 4 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 AND 2000 - ------------------------------------------------------------------------------- VESTING Participants are vested immediately in their contributions plus actual earnings thereon. All amounts in the participants' ESOP accounts that are attributable to the transfer of funds from a previously terminated retirement plan, the rollover from a previous employer's tax-qualified plan, and participant contributions are 100% vested and nonforfeitable at all times. All Company matching contributions will become 100% vested upon attainment of 3 years of service with the Company or earlier, upon attainment of normal retirement date, disability or death. If a participant leaves employment with the Company before attaining a vested interest in his or her Company contribution, the contributions are forfeited and will reduce future Company matching contributions. DISTRIBUTIONS The Plan provides for distribution of benefits upon retirement, total and permanent disability, death, or termination of employment for any other reason. The amount of distribution the participant or his or her beneficiary is entitled to is based on the vesting requirements discussed above. All distributions will be made in the form of a single, lump-sum distribution or in substantially equal annual installments over a period not exceeding 5 years. Distributions may be made in cash and/or shares of common stock, at the discretion of the participant. PARTICIPANT LOANS A participant may borrow money from the portion of his or her account attributable to his or her own 401(k) plan contributions. Participant loans may be obtained in the sole event of immediate and heavy financial need, where the participant lacks other available resources. Loan amounts shall not exceed the lesser of: (a) 50% of the participant's account attributable to his or her own contributions, including rollovers, (b) $50,000 adjusted for pre-existing loans, or (c) such amount as may be determined by the plan administrator. All loans will be drawn against the participant's account among the respective investment options as directed, and are secured by the assets within the participant's accounts. Interest rates on outstanding notes receivable ranged from 9.5% to 10.5% at December 31, 2000 and 6% to 10.5% at December 31, 2001. FORFEITED ACCOUNTS At December 31, 2001 and 2000, forfeited nonvested accounts totaled $68,168 and $89,621, respectively. These accounts will be used to reduce future employer contributions. Also, in 2001 and 2000, employer contributions were reduced by $829,880 and $296,245, respectively, from forfeited nonvested accounts. COMMON STOCK The ESOP enables participating employees to acquire an equity interest in Michael Baker Corporation (the Company); as such, contributions to the ESOP can be invested in the Company's common stock (Common Stock and Series B Common Stock). The ESOP's investment in the Company's Common Stock comprises 2,038,031 shares (cost of $14,232,668) and 2,220,159 shares (cost of $14,065,803) at December 31, 2001 and 2000, respectively. - 5 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 AND 2000 - ------------------------------------------------------------------------------- The ESOP's investment in the Company's Series B Common Stock comprises 1,217,221 shares (cost of $7,401,968) and 1,223,477 shares (cost of $7,436,107) at December 31, 2001 and 2000, respectively. INVESTMENT OPTIONS Each participant may direct Putnam Investments, Inc. (Putnam) to invest certain portions of his or her account in investment funds. Investment funds available to participants are the Michael Baker Common Stock Fund (invests in common stock of the Company), the Putnam New Opportunities Fund (invests in long-term growth stocks within emerging industries), the Putnam International Growth Fund (invests in diversified corporate stocks outside of North America), the Putnam Voyager Fund (invests in diversified corporate stocks), the Putnam Money Market Fund (invests in short-term money market securities), the Putnam Investors Fund (invests in large capitalization stocks), the Putnam S&P 500 Index Fund (invests with the objective of achieving a return that approximates the return of the S&P 500 Composite Stock Price Index), the AIM Balance Fund (invests in equity and fixed-income securities), the MFS Massachusetts Investors Trust (invests primarily in common stock, seeking current income and long-term growth of capital and income), the PIMCO Total Return Fund (invests in debt securities, seeking a total return consistent with the preservation of capital), the Franklin Small Cap Growth Fund (invests in equity securities of small companies, seeking long-term capital growth) and the Putnam Asset Allocation Funds (includes the Growth Portfolio, which invests with the goal of seeking maximum growth of an investment over time, the Balanced Portfolio, which invests with the goal of seeking a total return for investors in their peak accumulation years and the Conservative Portfolio, which invests primarily in domestic fixed-income securities). PLAN ADMINISTRATION AND FEES The Company provides certain administrative and accounting services to the ESOP at no cost. In addition, the Company pays the cost of services provided to the ESOP by Putnam, legal counsel and independent accountants. Certain reasonable distribution and loan processing fees charged by Putnam are deducted from the respective participant account balances. TRANSFERS OUT OF PLAN In connection with the sale of Baker Heavy & Highway and Baker Support Services, Inc. during 2000, $3.9 million was transferred out of the Plan to other qualifying plans. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING Putnam Investments, Inc. (Putnam) performs the recordkeeping function for the ESOP and the records are maintained on a cash basis. The financial statements included herein include all adjustments to reflect the financial statements on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America. Certain plan investments are shares of mutual funds managed by Putnam. These transactions qualify as party-in-interest transactions. INVESTMENTS Investments are stated at fair value based upon quoted market values. Purchases and sales of securities are recorded on a trade-date basis. The investment in common stock of the Company is - 6 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 AND 2000 - ------------------------------------------------------------------------------- stated at publicly-traded closing market values as of December 31, 2001 and 2000. As of December 31, 2001 and 2000, the ESOP owned approximately 39% and 40%, respectively, of the outstanding shares of the Company's common stock; therefore, such valuation might be subject to significant fluctuation in the event of a substantial liquidation of such holdings by the ESOP. The difference between the cost and current market value of investments purchased since the beginning of the period and the increase or decrease in such stated market value of investments held at the beginning of the period reported is included in the net depreciation in fair market value of investments in the statements of changes in net assets available for benefits. CONTRIBUTIONS Employee and employer contributions are recorded in the period during which the Company makes payroll deductions from Plan participants' earnings. DISTRIBUTIONS Distributions to participants are recorded when paid. USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make certain estimates and assumptions that may affect the reported amounts of assets, liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. CONCENTRATION OF RISK Investments are exposed to various risks, such as interest rate, market and credit. Due to the level of risk associated with these investments and the level of uncertainty related to changes in the value of these investments, it is at least reasonably possible that changes in the near term could materially affect participants' account balances and the amounts reported in the statement of net assets available for benefits and the statements of changes in net assets available for benefits. - 7 - 3. INVESTMENTS The following presents the fair value of investments that represent 5% or more of the Plan's net assets at the end of either December 31, 2001 or 2000:
DECEMBER 31, 2001 2000 Michael Baker Common Stock* $31,015,773 $17,206,232 Michael Baker Series B Common Stock* 18,501,755 9,481,942 Putnam New Opportunities Fund 14,883,585 18,251,044 Putnam Voyager Fund 11,543,018 13,721,862 Putnam International Growth Fund 5,825,878 6,200,048 AIM Balanced Fund 7,313,919 8,481,429 MFS Massachusetts Investors Trust 12,786,204 15,546,456
*Includes nonparticipant-directed investments The Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value by $10,044,226 and depreciated in value by $(10,416,883) for the respective years ended December 31, as follows:
2001 2000 Mutual funds $(14,912,442) $(14,312,270) Common stock 24,956,668 3,895,387 ------------ ------------ $ 10,044,226 $(10,416,883) ============ ============
4. NONPARTICIPANT-DIRECTED INVESTMENTS Information about the net assets and the significant components of the changes in net assets relating to investments having nonparticipant-directed components is as follows:
DECEMBER 31, 2001 2000 Net assets: Common stock $49,517,528 $26,685,507 ----------- ----------- $49,517,528 $26,685,507 =========== ===========
- 8 - Net assets available for benefits as of December 31, 2000 $ 26,685,507 Changes in net assets: Contributions 2,028,767 Interest and dividends 14,097 Net appreciation in fair value of investment 24,956,668 Benefits paid to participants (2,960,917) Transfers to participant-directed investments (1,206,531) Fees (63) ------------- Net assets available for benefits as of December 31, 2001 $ 49,517,528 =============
5. TAX STATUS The Internal Revenue Service has determined and informed the Company by a letter dated June 21, 2000, that the Plan and related trust are designed in accordance with the applicable sections of the Internal Revenue Code (IRC). The Plan has been amended since receiving the determination letter. However, the plan administrator and the Plan's counsel believe that the Plan is designed and is currently being operated in compliance with applicable requirements of the IRC. In 2002, the Company filed for a new determination letter for the Plan. 6. PLAN TERMINATION Although it has not expressed an intention 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. 7. SUBSEQUENT EVENTS During the fourth quarter of 2001, the Company entered into discussions with the ESOP Trustee concerning the possible exchange of its Series B Common Stock for Common Stock. The Trustee retained a valuation professional and subsequently agreed that the ESOP would be willing to exchange each Series B share held by the ESOP for 1.018 shares of Common Stock. This exchange was completed on February 28, 2002. Immediately following this exchange, the Company's remaining Series B shares were automatically converted into Common equivalents in accordance with provisions of the Company's Articles of Incorporation. - 9 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN ADDITIONAL INFORMATION SCHEDULE OF ASSETS (HELD AT END OF YEAR) DECEMBER 31, 2001 - -------------------------------------------------------------------------------
COST OF CURRENT IDENTITY OF ISSUER DESCRIPTION OF INVESTMENT ASSET VALUE Michael Baker Corporation* Michael Baker Corporation Common Stock** $14,232,668 $31,015,773 Michael Baker Corporation* Michael Baker Corporation Common Stock - Series B** 7,401,968 18,501,755 AIM Management Group Inc. AIM Balanced Fund 7,313,918 MFS Investment Management Inc. MFS Massachusetts Investors Trust 12,786,204 PIMCO Funds Distributors LLC PIMCO Total Return Fund 3,702,743 Putnam Investments* Putnam Voyager Fund 11,543,018 Putnam Investments* Putnam New Opportunities Fund 14,883,585 Putnam Investments* Putnam International Growth Fund 5,825,878 Putnam Investments* Putnam Money Market Fund 5,559,759 Putnam Investments* Putnam Asset Allocation - Growth Portfolio 598,757 Putnam Investments* Putnam Asset Allocation - Balanced Portfolio 825,584 Putnam Investments* Putnam Asset Allocation - Conservative Portfolio 393,362 Franklin Templeton Investments Franklin Small Cap Growth Fund 1,173,462 Putnam Investments* Putnam Investors Fund 1,096,706 Putnam Investments* Putnam S&P 500 Index Fund 1,696,313 Participant Loans* 6% to 10.5%, due February 22, 2002 to December 14, 2015 388,974 ------------ $117,305,791 ------------
* Party-in-interest. ** Includes nonparticipant-directed investments. - 10 - MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN ADDITIONAL INFORMATION SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 2001 - -------------------------------------------------------------------------------
NUMBER NET PARTY DESCRIPTION OF PURCHASE SELLING GAIN INVOLVED OF ASSET TRANSACTIONS PRICE PRICE (LOSS) Putnam Michael Baker 241 $ 4,151,790 $ $ Investments, Inc.* Corporation Common Stock** 418 $ $5,639,340 $1,974,602
* Party-in-interest. ** Nonparticipant directed. - 11 - SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Senior Vice President, Corporate Controller and Treasurer of Michael Baker Corporation, the plan sponsor, has duly caused this annual report to be signed by the undersigned thereunto duly authorized. MICHAEL BAKER CORPORATION EMPLOYEE STOCK OWNERSHIP PLAN Date: August 2, 2002 By: /s/ Craig O. Stuver ------------------------------ Craig O. Stuver Senior Vice President, Corporate Controller and Treasurer of Michael Baker Corporation, the Plan Sponsor EX-23.1 3 j9569201exv23w1.txt EX-23.1 CONSENT OF INDEPENDENT ACCOUNTANTS Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-05987; No. 333-59941; No. 33-62887; and No. 33-69306) of Michael Baker Corporation of our report dated July 26, 2002 relating to the financial statements of the Michael Baker Corporation Employee Stock Ownership Plan, which appears in this Form 11-K. /s/ PricewaterhouseCoopers LLP - ------------------------------ Pittsburgh, Pennsylvania July 31, 2002 -----END PRIVACY-ENHANCED MESSAGE-----