-----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, UIoMgU1/l3jTCWwcq2Oz9Wh/PTdnW5J2SBsVuWJ4BHTAD2X2DqhG4vXovxjh52W4 HoXp3rwLRB6Y05Eb6738DA== 0000009779-99-000022.txt : 19990629 0000009779-99-000022.hdr.sgml : 19990629 ACCESSION NUMBER: 0000009779-99-000022 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FAIRCHILD CORP CENTRAL INDEX KEY: 0000009779 STANDARD INDUSTRIAL CLASSIFICATION: BOLTS, NUTS, SCREWS, RIVETS & WASHERS [3452] IRS NUMBER: 340728587 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-06560 FILM NUMBER: 99653328 BUSINESS ADDRESS: STREET 1: 45025 AVIATION DR STREET 2: STE 300 CITY: DULLES STATE: VA ZIP: 20166 BUSINESS PHONE: 7034785800 MAIL ADDRESS: STREET 1: 45025 AVIATION DRIVE STREET 2: SUITE 300 CITY: DULLES STATE: VA ZIP: 20166 FORMER COMPANY: FORMER CONFORMED NAME: BANNER INDUSTRIES INC /DE/ DATE OF NAME CHANGE: 19901118 11-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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, 1998 OR TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-6560 A. Full title of the plan and the address of the plan, if different from that of issuer named below: Amended and Restated Banner Aerospace, Inc. Profit Sharing/401(k) Plan and Trust B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Banner Aerospace, Inc. 45025 Aviation Drive Suite #400 Dulles, VA 20166 Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust Financial Statements As of December 31, 1998 and 1997 Together With Report of Independent Public Accountants Report of Independent Public Accountants To the Plan Administrator of the Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust: We have audited the accompanying statements of net assets available for benefits of the Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust as of December 31, 1998 and 1997, and the related statement of changes in net assets available for benefits for the year ended December 31, 1998. These financial statements and the schedules referred to below are the responsibility of the plan administrator. Our responsibility is to express an opinion on these financial statements and schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. 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 as of December 31, 1998 and 1997, and the changes in net assets available for benefits for the year ended December 31, 1998, in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental schedules of investments 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 of Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. 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. Arthur Andersen LLP Washington, D.C. May 21, 1999 Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust Table of Contents Page Statements of Net Assets Available for Plan Benefits As of December 31, 1998 and 1997 1 Statement of Changes in Net Assets Available for Plan Benefits For the Year Ended December 31, 1998 2 Notes to Financial Statements and Schedules As of December 31, 1998 and 1997 3 Item 27(a) - Schedule of Assets Held for Investment Purposes As of December 31, 1998 8 Item 27(d) - Schedule of Reportable Transactions For the Year Ended December 31, 1998 9 Schedules Omitted Because There Were No Such Items For the Year Ended December 31, 1998: Item 27(b) - Loans or Fixed Income Obligations in Default Item 27(c) - Leases in Default or Classified as Uncollectable Item 27(e) - Non-Exempt Transactions Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust Statements of Net Assets Available for Plan Benefits As of December 31, 1998 and 1997
1998 1997 Investments, at market value: Common/Collective Trusts- PNC Bank Investment Contract Fund $ 347,318 $ 935,287 Mutual Funds- BlackRock Managed Income Portfolio 615,843 1,280,132 Fidelity Advisor Balanced Portfolio 3,004,741 5,516,145 Fidelity Advisor Equity Growth Portfolio 2,875,853 4,203,496 Fidelity Advisor Overseas Portfolio 495,504 827,771 Fidelity Advisor High Yield Portfolio 1,719,164 3,335,034 Common Stock- Banner Aerospace, Inc. 330,950 920,678 Participant loans 156,207 702,912 Total investments 9,545,580 17,721,455 Receivables: Dividends receivable 49,383 80,582 Contributions receivable 108,036 174,990 Total receivables 157,419 255,572 Net assets available for plan benefits $9,702,999 $17,977,027 The accompanying notes are an integral part of these statements
Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust
Statement of Changes in Net Assets Available for Plan Benefits For the Year Ended December 31, 1998 Fidelity PNC Bank BlackRock Fidelity Advisor Fidelity Investment Managed Advisor Equity Advisor Contract Income Balanced Growth Overseas Increases: Contributions- Employees $ 36,175 $ 59,783 $ 216,669 $ 324,608 $ 82,635 Employer 10,341 18,710 63,495 94,587 19,491 Assets of merged plan and other (2,895) (112) 8,645 16,214 7,034 Interest and dividend income 769 58,200 357,038 321,515 5,773 Unrealized appreciation (decline) in market value of investments 10,079 (2,877) 29,667 410,309 33,325 Realized gain (loss) on the sale of investments 29,043 (2,628) 211,010 322,386 66,224 Total increases 83,712 131,076 886,524 1,489,619 214,482 Decreases: Distributions to participants 758,935 822,447 3,313,815 3,017,502 526,780 Net increase (decrease) (675,223)(691,371) (2,427,291)(1,527,883) (312,298) Transfers between funds 151,417 14,323 (111,363) 157,246 (32,274) Net assets available for plan benefits, beginning of period 947,153 1,299,816 5,555,059 4,258,367 842,302 Net assets available for plan benefits, end of period $423,347 $622,768 $3,016,405 $2,887,730 $ 497,730 Fidelity Advisor Banner High Common Participant Yield Stock Loans Total Increases: Contributions- Employees $ 177,451 $ 67,075 $ -- $ 964,396 Employer 50,920 19,987 -- 277,532 Asset of merged plan and other 16,627 5,498 (27) 50,984 Interest and dividend income 216,461 1,556 -- 961,312 Unrealized appreciation (decline) in market value of investments (192,542) (56,583) -- 231,378 Realized gain (loss) on the sale of investments 53,031 20,917 -- 700,183 Total increases 321,948 58,450 (27) 3,185,784 Decreases: Distributions to participants 2,031,636 572,657 416,040 11,459,812 Net increase (decrease) (1,709,688) (514,207) (416,067)(8,274,028) Transfers between funds 36,259 (84,970) (130,638) -- Net assets available for plan benefits, beginning of period 3,438,383 933,035 702,912 17,977,027 Net assets available for plan benefits, end of period $1,764,954 $333,858 $156,207 $9,702,999
Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust Notes to Financial Statements and Schedules As of December 31, 1998 and 1997 1.Summary of Plan: The following description of the Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust (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 is a defined contribution plan which was established July 1, 1990 by Banner Aerospace, Inc. and Subsidiaries ("the Company"). The purpose of the Plan is twofold as it serves as a profit-sharing plan and a 401(k) salary reduction benefit plan. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan covers certain employees of the Company not covered by a collective bargaining agreement, who have completed at least three consecutive months of service provided the employee also completes 250 hours of service during the three-month period. Participation in the Plan shall commence on the earlier of January 1, April 1, July 1, or October 1 concurrent with or immediately following the eligibility date. Contributions Participants may elect to contribute up to 16 percent of their total salary or wages, including bonuses, commissions and overtime pay. The Company will make a matching contribution equal to 50 percent of the participant's contribution, provided that such matching contribution shall only apply to that portion of such participant's elective contribution which does not exceed 6 percent of the participant's compensation. Each fiscal year, the Company may also contribute an amount determined at the discretion of the Board of Directors. Plan Merger During 1997, the PB Herndon Company Profit-Sharing Plan and Trust was merged into the Plan, increasing net assets available for plan benefits. PB Herndon is a subsidiary of Banner Aerospace, Inc., that was acquired in 1997. Plan Distributions On January 13, 1998, the Company transferred 100 percent of the assets of certain subsidiaries to AlliedSignal, Inc. ("Allied"). Those participants who were effected by the transfer of assets to Allied were fully vested in their benefits under the Plan. During March and April 1998, assets totaling approximately $7,011,347 were distributed to participants whose employment transferred to Allied. Vesting Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Vesting in the remainder of their accounts is based on years of completed service, as follows:
Completed Years Vested of Service Percentage Less than 3 years - % 3 years 20 4 years 40 5 years 60 6 years 80 7 years or more 100
Payment of Benefits Upon termination of service, at the direction of the plan administrator, a participant can receive a lump-sum payment. Any participant who remains in the employ of the Company, yet is required to receive a distribution, shall have that distribution made over a fixed term designated by the participant which satisfies both the minimum distribution rules and the minimum distribution incidental benefit rules of Code Section 401(a)(9) and which does not exceed the joint and last survivor life expectancy of the participant and a designated beneficiary. Forfeited Accounts Forfeited non-vested accounts totaled $74,934 during 1998, which were used to reduce employer contributions. Participant's Accounts Each participant's account is credited with the participant's contribution and an allocation of (a) the Company's contribution and (b) plan earnings. Allocations are based on participant earnings or account balances, as defined in the Plan. Investments As specified by the Plan, participants have a choice of investing all or a portion of their contributions into seven investment funds - the PNC Bank Investment Contract Fund, the BlackRock Managed Income Portfolio, the Fidelity Advisor Balanced Portfolio, the Fidelity Advisor Equity Growth Portfolio, the Fidelity Advisor Overseas Portfolio, the Fidelity Advisor High Yield Portfolio and/or the Banner Common Stock Fund. PNC Bank acts as trustee of all investments of the Plan. The PNC Bank Investment Contract Fund buys investment contracts from insurance companies and banks on behalf of its investors. These contracts are designed to pay a specified rate of interest to the fund while providing for the return of principal. The BlackRock Managed Income Portfolio invests primarily in a wide range of bonds. The Fidelity Advisor Balanced Portfolio seeks both income and growth of capital by investing in a diversified portfolio of equity and fixed income securities. The Fidelity Advisor Equity Growth Portfolio seeks capital appreciation through investments in the stocks of companies that are experiencing or have above average growth potential. The Fidelity Advisor Overseas Portfolio seeks growth of capital primarily through investments in foreign securities. The Fidelity Advisor High Yield Portfolio seeks a combination of a high level of income and the potential for capital gains. The Banner Common Stock Fund invests in the common stock of Banner Aerospace, Inc. Significant Assets The following assets individually represent 5 percent or more of the Plan's total assets as of December 31:
1998 1997 PNC Bank Investment Contract Fund $ * $ 935,287 BlackRock Managed Income Portfolio 615,843 1,280,132 Fidelity Advisor Balanced Portfolio 3,004,741 5,516,145 Fidelity Advisor Equity Growth 2,875,853 4,203,496 Portfolio 2,875,853 4,203,496 Fidelity Advisor Overseas Portfolio 495,504 * Fidelity Advisor High Yield Portfolio 1,719,164 3,335,034 Banner Aerospace, Inc. Common Stock * 920,678 *Less than 5 percent of the Plan's total assets in the respective period.
Loans to Participants The Trustee may make loans to participants at the direction of the plan administrator. The loan program is equally applied to all participants on a uniform and nondiscriminatory basis. The maximum loan allowed to a participant (when added to the outstanding balance of any existing loans of such participant) may not be greater than 50 percent of the participant's vested account or $50,000, if less. The minimum loan is $1,000. Loan payments are to be made not less frequently than quarterly. The loan period shall not be in excess of five years from the date of the loan unless the proceeds are used for the purpose of acquiring, constructing or rehabilitating the principal residence of the participant or a member of his family. The plan administrator shall determine the length of these loan terms. Loans granted shall bear a reasonable rate of interest commensurate with the interest rates charged by persons in the business of lending money for loans, which would be made under similar circumstances, taking into consideration such factors as creditworthiness of the borrower and security given for the loan. 2.Summary of Significant Accounting Policies: Basis of Accounting and Use of Estimates The accompanying financial statements and schedules have been prepared on the accrual basis of accounting. The preparation of the financial statements in conformity with generally accepted accounting principles requires the Plan's management to use estimates and assumptions that affect the accompanying financial statements and disclosures. Actual results could differ from these estimates. Investments Investments are stated at the current market value. Changes in the current market value throughout the year are reflected in the statements of changes in net assets available for plan benefits as they occur. Realized and unrealized gains and losses on investments are based on the market value of the investments at the beginning of the plan year or initial cost if purchased during the year. The PNC Bank Investment Contract Fund is a collective investment fund of PNC Bank, not a portfolio of the PNC Fund. Investments in the guaranteed investment contracts ("GIC"s) are valued at fair value as determined in good faith by the Trustee, based on contractual terms, creditworthiness of the GIC issuer, current market conditions, and comparison to similar instruments with readily ascertainable market values. The fair value of the GICs was determined by the Trustee to be equal to cost plus accrued interest. Benefit Payments Benefit payments are recorded when paid. 3.Administrative Expenses: Expenditures for trustee fees, audit fees, legal fees and other administrative expenses of the Plan are to be paid by the Plan to the extent that the Company does not pay such expenses. The Company paid all administrative expenses in the years ended December 31, 1998 and 1997. 4.Tax Status: The Internal Revenue Service issued a determination letter dated September 24, 1997, stating that the Plan was designed in accordance with applicable sections of the Internal Revenue Code ("IRC") and, therefore, is not subject to tax under present income tax law. Once qualified, the Plan is required to operate in conformity with the IRC to maintain its qualification. 5.Related Party Transactions: Certain Plan investments are shares of mutual funds managed by PNC Bank. PNC Bank is the trustee as defined by the Plan and, therefore, these transactions qualify as parties-in-interest. 6.Plan Termination: Although it is the intention of the Company to keep the Plan in operation indefinitely, 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 percent vested in their accounts. 7.Information Certified by Trustee: Information as to the Plan's assets as of December 31, 1998 and 1997, and the transactions in such assets for the year ended December 31, 1998, including income on investments, investment transactions, gain or loss on the sale of securities and market values, has been certified as complete and accurate to the plan administrator by PNC Bank. 8.Subsequent Event: On April 8, 1999, a special meeting of the shareholders of the Company was held to approve the exchange of the Company's common stock for common stock of The Fairchild Corporation. As a result of the approval by the shareholders to exchange the Company's common stock with common stock of The Fairchild Corporation, the Banner Common Stock Fund is now The Fairchild Corporation Common Stock Fund. Each share of Banner Aerospace common stock was converted into the right to receive 0.7885 shares of Fairchild Class A Common Stock. Schedule I Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust
Item 27(a) - Schedule of Assets Held for Investment Purposes As of December 31, 1998 Description of Investment Including Maturity Date, Rate of Identity of Issuer, Borrower, Interest, Collateral, and Market Lessor, or Similar Party Par or Maturity Value Value Cost PNC Bank Investment Contract Common/Collective Fund* Trust (Note 2) $ 347,318 308,799 BlackRock Managed Income Mutual Fund 615,843 599,924 Portfolio* Fidelity Advisor Balanced Mutual Fund 3,004,741 2,684,053 Portfolio Fidelity Advisor Equity Mutual Fund 2,875,853 2,332,595 Growth Portfolio Fidelity Advisor Overseas Mutual Fund 495,504 457,082 Portfolio Fidelity Advisor High Yield Mutual Fund 1,719,164 1,809,068 Portfolio Banner Aerospace, Inc.* Common Stock 330,950 290,075 Participant Loans Loans to Plan participants, bearing interest rates ranging from 8.75% to 9.5% 156,207 156,207 $9,545,580 $8,637,803 * Represents a party-in-interest.
Schedule II Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust
Item 27(d) - Schedule of Reportable Transactions For the Year Ended December 31, 1998 Purchases ----------------------- Description of Number of Purchase Identity of Party Involved Asset Transactions Price - ---------------------------- ----------------- ------------ --------- PNC Bank Investment Contract Common/Collective 97 $ 725,134 Fund* Trust BlackRock Managed Income Mutual Fund 42 263,398 Portfolio* Fidelity Advisor Balanced Mutual Fund 49 1,137,385 Portfolio Fidelity Advisor Equity Mutual Fund 51 1,253,940 Growth Portfolio Fidelity Advisor High Yield Mutual Fund 56 698,497 Portfolio Sales ---------------------------------------- Number Identity of Party Description of of Involved Asset Trans- Selling Cost of Net actions Price Assets Gain - ------------------- ----------------- ------ ---------- ---------- ------- PNC Bank Investment Common/Collective 65 $1,352,429 $1,255,065 $ 97,364 Contract Fund* Trust BlackRock Managed Mutual Fund 58 922,182 893,428 28,755 Income Portfolio* Fidelity Advisor Mutual Fund 82 3,889,506 3,208,148 681,318 Balanced Portfolio Fidelity Advisor Mutual Fund 85 3,314,279 2,864,936 449,343 Equity Growth Portfolio Fidelity Advisor Mutual Fund 88 2,174,855 2,031,778 143,077 High Yield Portfolio * Represents a party-in-interest.
SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust By: _/s/ Eugene W. Juris_ Eugene W. Juris Chief Financial Officer Date: June 28, 1999 -----END PRIVACY-ENHANCED MESSAGE-----