-----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, I1ho650rL7bw1EB/aUyLtxLc8hybaPCgRsmtOEGII51VPnfnmg7YLdXKFQx9M/QC SgPpRkmt+RXYLe1acuo5Qw== 0001005150-04-001669.txt : 20040628 0001005150-04-001669.hdr.sgml : 20040628 20040628110212 ACCESSION NUMBER: 0001005150-04-001669 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031231 FILED AS OF DATE: 20040628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RECKSON ASSOCIATES REALTY CORP CENTRAL INDEX KEY: 0000930548 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 113233650 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13762 FILM NUMBER: 04883551 BUSINESS ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 6316946900 MAIL ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 11-K 1 form11k.txt ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 11-K Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2003 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ___________ Commission file number 1-13762 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: RECKSON 401(k) PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: RECKSON ASSOCIATES REALTY CORP. 225 BROADHOLLOW ROAD MELVILLE, NEW YORK 11747 (631) 694-6900 ================================================================================ FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE Reckson 401(k) Plan Year ended December 31, 2003 with Report of Independent Auditors Reckson 401(k) Plan Financial Statements and Supplemental Schedule Year ended December 31, 2003 CONTENTS Report of Independent Auditors............................................... 1 Financial Statements Statements of Net Assets Available for Benefits as of December 31, 2003 and December 31, 2002................................... 2 Statement of Changes in Net Assets Available for Benefits for the Year ended December 31, 2003 ............................................. 3 Notes to Financial Statements................................................ 4 Supplemental Schedule Schedule H, Line 4(i)--Assets (Held at End of Year) at December 31, 2003..... 9 Report of Independent Registered Public Accounting Firm Plan Administrator Reckson 401(k) Plan Retirement and Benefits Committee We have audited the accompanying statements of net assets available for benefits of Reckson 401(k) Plan (the "Plan") as of December 31, 2003 and 2002, and the related statement of changes in net assets available for benefits for the year ended December 31, 2003. 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 the standards of the Public Company Accounting Oversight Board (United States). 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, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2003 and 2002, and the changes in its net assets available for benefits for the year ended December 31, 2003, in conformity with U.S. generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) at December 31, 2003 is presented for the purpose of additional analysis and is not a required part of the 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 supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. /s/ Ernst & Young LLP - ----------------------- Ernst & Young New York, New York June 9, 2004 1 Reckson 401(k) Plan Statements of Net Assets Available for Benefits DECEMBER 31 ------------------------------ 2003 2002 ----------- ---------- ASSETS Investments (Note 3) $ 4,754,776 $2,940,203 Receivables: Participant contributions 11,430 26,216 Participant loans 157,715 151,893 Cash and cash equivalents 709,771 624,496 ----------- ---------- Net assets available for benefits $ 5,633,692 $3,742,808 =========== ========== See accompanying notes. 2 Reckson 401(k) Plan Statement of Changes in Net Assets Available for Benefits Year ended December 31, 2003 Additions: Additions to net assets attributed to: Net realized and unrealized appreciation in fair value of investments (Note 3) $ 986,550 Interest and dividends 76,287 Participant contributions 1,015,664 ----------- Total additions 2,078,501 ----------- Deductions: Benefits paid to participants (187,617) ----------- Net increase in net assets available for benefits 1,890,884 Net assets available for benefits: Beginning of the year 3,742,808 ----------- End of year $ 5,633,692 =========== See accompanying notes. 3 Reckson 401(k) Plan Notes To Financial Statements December 31, 2003 1. DESCRIPTION OF THE PLAN The following description of the Reckson 401(k) 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 created on January 1, 2001 for the purpose of providing eligible employees of Reckson Management Group, Inc. (the "Employer") and its related companies (collectively, the "Affiliates") that participate in the Plan (collectively, the "Participating Employers") with an opportunity to increase their savings on a tax-favored basis. Shares of the common stock of Reckson Associates Realty Corp. ("Reckson") are among the investment options offered to participants pursuant to the Plan. The Plan is a defined contribution plan sponsored by the Employer covering all eligible full-time employees of the Participating Employers who have completed six months of service and are age twenty-one or older. Effective January 1, 2004, an employee is considered an eligible participant upon the completion of three months of service and is age twenty-one or older. The following Participating Employers participated in the Plan during the years ended December 31, 2003 and 2002: Reckson Management Group, Inc. Reckson Construction Group, Inc. RANY Management Group, Inc. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). 4 Reckson 401(k) Plan Notes To Financial Statements (continued) 1. DESCRIPTION OF THE PLAN (CONTINUED) CONTRIBUTIONS During calendar years prior to 2004, participants were able to contribute up to 15% of pretax annual compensation, as defined in the Plan. Commencing January 1, 2004, participants may contribute up to 30% of their pretax annual cash compensation and up to 15% of their pretax cash bonus, as defined in the Plan. Participants may also roll over amounts representing distributions from other qualified benefit or defined contribution plans. In addition, the Plan permits individuals who are at least age 50 before the end of the calendar year to make a catch-up contribution. Participants direct the investment of their contributions into various investment options offered by the Plan. As of December 31, 2003, the Plan offered 13 mutual funds and the common stock of Reckson as investment options for participants. Additional discretionary matching contributions may be contributed at the option of the Participating Employers. Contributions are subject to certain limitations. The aggregate of all employee contributions are subject to the limitations of Section 401(k) of the Internal Revenue Code. Employer contributions are based on a discretionary amount determined by the Participating Employer's management. During the years ended December 31, 2003 and 2002, the Participating Employers did not contribute to the Plan. Commencing with the calendar year beginning January 1, 2004, the Participating Employers have elected to match 50% to eligible participants deferral contribution up to 3% of their annual compensation, as defined, up to an aggregate of $1,000 per employee per year. PARTICIPANT ACCOUNTS Each participant's account is credited with the participant's contributions and allocations of Plan earnings, and charged with an allocation of the Plan's administrative expenses, if not paid by the Participating Employer. 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. VESTING Participants are immediately 100% vested in their contributions and earnings thereon. Additionally, a participant is eligible for employer matching contributions, if any, after one year of credited service, which then vests ratably based on five years of credited service. 5 Reckson 401(k) Plan Notes To Financial Statements (continued) 1. DESCRIPTION OF THE PLAN (CONTINUED) PARTICIPANT LOANS Participants may generally borrow from their accounts up to 50 percent of their vested account balance. The loans are secured by the balance in the participant's account and bear interest at the U.S. prime lending rate plus one-half percentage point. PLAN TERMINATION Although it has not expressed any intent to do so, the Participating Employers have the right under the Plan to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100 percent vested in their accounts. PAYMENT OF BENEFITS On termination of service, a participant may elect to receive a lump-sum amount equal to the value of the participant's vested interest in his or her account. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the Plan are prepared under the accrual basis of accounting in accordance with U.S. generally accepted accounting principles. INVESTMENT VALUATION AND INCOME RECOGNITION The Plan's investments are stated at fair value. Quoted market prices are used to value investments. Shares of mutual funds are valued at the net asset value of shares held by the Plan at year-end. The participant loans are valued at their outstanding balances, which approximate fair value. Purchases and sales of securities are recorded on a trade-date basis. Dividends are recorded on the ex-dividend date. USE OF ESTIMATES The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that effect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. 6 Reckson 401(k) Plan Notes To Financial Statements (continued) 3. INVESTMENTS The following investments represent 5% or more of the Plan's net assets available for benefits at December 31, 2003 and 2002: DECEMBER 31, -------------------------- 2003 2002 ---------- --------- Growth Fund of America $1,518,473 $913,412 Reckson Associates Realty Corp.--Common Stock 495,458 401,346 MFS International New Discovery Fund 699,227 398,850 INVESCO Balanced Fund (a) 267,036 BlackRock Index Equity Fund-- Class A 340,852 227,643 Federated U.S. Government Bond Fund 335,695 202,510 INVESCO Technology Fund 317,490 * American Balanced Fund 519,934 * - ---------------- * Investment was less than 5% of the Plan's net assets available for benefits. During the year ended December 31, 2003, the investments of the Plan appreciated (depreciated) in fair value as follows: BlackRock Money Market Fund $ 3,002 Federated US Government Bond Fund (8,773) INVESCO Balanced Fund (5,113)(a) Growth Fund of America 361,784 American Century International Growth Fund 28,866 Reckson Associates Realty Corp.--Common Stock 69,805 FrontLine Capital Group-- Common Stock 41 MFS International New Discovery Fund 221,863 BlackRock Index Equity Fund-- Class A 66,419 Cohen & Steers Realty Shares 2,599 Royce Low Price Stock 276 INVESCO Growth Fund (4,255)(a) Janus Advisor Capital Fund 16,553 INVESCO Technology Fund 85,417 MFS Value Fund 17,277 American Balanced Fund 90,182 Fidelity Advisor Mid-cap Fund 39,696 AIM Global Healthcare Fund 911 -------- Net realized and unrealized appreciation in fair value of investments $986,550 ======== - --------------- (a) These investment options were terminated during 2003. Any amounts in the INVESCO Balanced Fund and the INVESCO Growth Fund not transferred by employees to another investment alternative were transferred to the American Balanced Fund and Growth Fund of America, respectively. 7 Reckson 401(k) Plan Notes To Financial Statements (continued) 4. RELATED PARTY TRANSACTIONS During the years ended December 31, 2003 and 2002, the Plan received $34,063 and $31,078, respectively, in common stock dividends from Reckson. 5. INCOME TAX STATUS The Plan has not received a determination letter from the Internal Revenue Service stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code. However, the Plan Administrator believes that the Plan is qualified and, therefore, the related trust is exempt from taxation. 8 Supplemental Schedule Reckson 401(k) Plan Schedule H, Line 4(i)-Assets (Held at End of Year) December 31, 2003 FAIR INVESTMENT MARKET VALUE - ---------- ------------ Federated U.S. Government Bond Fund $ 335,695 Growth Fund of America 1,518,473 American Century International Growth Fund 156,229 Reckson Associates Realty Corp.-- Common Stock* 495,458 FrontLine Capital Group Common Stock 58 MFS International New Discovery Fund 699,227 BlackRock Index Equity Fund-- Class A* 340,852 Janus Advisor Capital Fund 121,604 INVESCO Technology Fund 317,490 American Balanced Fund 519,934 Fidelity Advisor Mid-cap Fund 144,091 MFS Value Fund 84,617 Cohen & Steers Realty Shares 13,403 AIM Global Health Care Fund 5,773 Royce Low Price Stock 1,872 ---------- $4,754,776 ========== Loans to participants at per annum interest rates ranging between 4.5% and 8.75%. $ 157,715 ========== - ------------------ (*) Indicates party-in-interest to the Plan. 9 RECKSON 401(K) PLAN Exhibits - -------- 23.0 Consent of Independent Auditors SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Administrator has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Reckson 401(k) Plan By: Reckson Management Group, Inc., as Plan Administrator Date: June 28, 2004 By: /s/ Michael Maturo ----------------------------------- Michael Maturo Executive Vice President, Treasurer and Chief Financial Officer of Reckson Associates Realty Corp. EX-23 2 ex23.txt EXHIBIT 23.0 RECKSON 401(K) PLAN Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-102163), pertaining to the Reckson 401(k) Plan, of our report dated June 9, 2004, with respect to the financial statements and supplemental schedule of the Reckson 401(k) Plan included in this Annual Report (Form 11-K) for the year ended December 31, 2003. New York, New York June 28, 2004 -----END PRIVACY-ENHANCED MESSAGE-----