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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 June 30, 1997
Commission file number 1-9947
TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
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(Full title of the plan)
TRC COMPANIES, INC.
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(Name of issuer of securities held pursuant to the plan)
5 Waterside Crossing
Windsor, Connecticut 06095
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(Address of principal executive offices)
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TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
FINANCIAL STATEMENTS:
Report of Independent Accountants......................................................................... 3
Statement of Net Assets Available for Benefits at June 30, 1997 and 1996.................................. 4
Statement of Changes in Net Assets Available for Benefits for the Years Ended June 30, 1997 and 1996...... 5
Notes to Financial Statements............................................................................. 6
ADDITIONAL INFORMATION: *
Schedule of Assets Held for Investment Purposes at June 30, 1997 (Schedule I)............................. 11
Schedule of Reportable Transactions for the Year Ended June 30, 1997 (Schedule II)........................ 12
EXHIBITS:
Consent of Independent Accountants........................................................................ 13
</TABLE>
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* 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.
2
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator
of TRC Companies, Inc. 401(k) Retirement and Savings 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 TRC Companies, Inc. 401(k) Retirement and Savings Plan (the
"Plan") at June 30, 1997 and 1996, and the changes in net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles. 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 generally accepted auditing standards 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 opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
schedules I and II 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. 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/ Price Waterhouse LLP
Hartford, Connecticut
December 17, 1997
3
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TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
JUNE 30,
1997 1996
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<S> <C> <C>
Investments, at fair value:
Shares of registered investment
companies (mutual funds) offered
by Barclays Global Investors, N.A.,
as Trustee:
Money Market Fund........................................... $ 918,537 $ 884,985
International Equity Fund................................... 1,632,468 1,518,863
Asset Allocation Fund....................................... 2,727,795 2,463,403
Growth Stock Fund........................................... 3,322,620 3,645,549
S&P 500 Stock Fund.......................................... 4,805,809 3,292,175
U.S. Treasury Allocation Fund............................... 875,287 901,192
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14,282,516 12,706,167
TRC Stock Fund................................................. 1,216,646 1,206,720
Employee Loan Fund............................................. 485,927 436,338
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Net assets available for benefits.............................. $ 15,985,089 $ 14,349,225
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</TABLE>
The accompanying notes are an integral part of these financial statements
4
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TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
1997 1996
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<S> <C> <C>
Additions to net assets:
Contributions:
Employees....................................... $1,298,420 $ 1,459,147
Employer match.................................. 459,028 523,860
Rollovers....................................... 89,058 23,591
--------------- ---------------
1,846,506 2,006,598
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Investment income:
Net realized and unrealized appreciation in
market value of investments.................... 775,945 1,185,325
Interest and dividend income.................... 581,248 652,885
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1,357,193 1,838,210
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Total additions................................. 3,203,699 3,844,808
--------------- ---------------
Deductions from net assets:
Benefits paid to participants................... 1,562,885 2,388,279
Administrative fees and expenses................ 4,950 4,668
--------------- ---------------
1,567,835 2,392,947
--------------- ---------------
Net increase during year........................ 1,635,864 1,451,861
Net assets at beginning of year................. 14,349,225 12,897,364
--------------- ---------------
Net assets at end of year....................... $15,985,089 $ 14,349,225
--------------- ---------------
--------------- ---------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
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TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 -- DESCRIPTION OF THE PLAN
The following description of the TRC Companies, Inc. (the "Company") 401(k)
Retirement and Savings 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 is a defined contribution plan covering substantially all full-time
employees of the Company and its subsidiaries who have completed ninety days of
service. It is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"), as amended.
CONTRIBUTIONS
Generally, participants may contribute up to 15% of their base salary
subject to certain limitations established by government regulations.
Participants may also contribute amounts representing distributions from other
qualified plans. On the first 6% of base salary contributed, the Company may
provide a matching contribution. The amount of the matching contribution is
determined annually by the Compensation Committee of the Company's Board of
Directors based upon operating performance. For the years ended June 30, 1997
and 1996, the Company's matching contributions were equal to $.50 for each $1.00
contributed by the participants. For the year ended June 30, 1996, the Company's
matching contributions were invested in the TRC Stock Fund. For the year ended
June 30, 1997, the Plan was amended to allow participants to direct employer
matching contributions amount investment options.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contribution,
the Company's matching contribution, and allocations of forfeitures of
terminated participants' nonvested accounts and Plan earnings. Allocations are
based upon 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 vested in their contributions plus actual
earnings thereon. Vesting in the Company's matching contributions and actual
earnings thereon is based upon years of continuous service. A participant is
fully vested after four years of credited service.
6
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INVESTMENT OPTIONS
Upon enrollment in the Plan, participants may direct contributions into
mutual funds offered by Barclays Global Investors or into the TRC Stock Fund.
Participants may change their investment options at any time.
PAYMENT OF BENEFITS
If a participant's employment terminates before their account balances
become fully vested, the nonvested portion of their account is forfeited and
proportionately redistributed annually to remaining Plan participants. For the
year ended June 30, 1997, forfeitures of $59,462 were redistributed. In the
event of death or permanent disability, the participant or beneficiary becomes
fully vested in their account balances.
Because of the tax deferred status of the Plan, participants generally may
not withdraw, without incurring additional taxes and penalties, amounts from the
Plan until retirement, death, permanent disability or termination of employment
if such occurs prior to age 59-1/2. All distributions from the Plan are made in
a lump sum.
LOANS AND OTHER IN-SERVICE WITHDRAWALS
A participant may obtain a loan from the Plan repayable in a reasonable
period of time and at a reasonable rate of interest. The amount of any loan
is limited by government regulations to a portion of the participant's vested
account balance. A participant may qualify for an in-service withdrawal. Such
withdrawals are limited to a portion of their vested account balance and are
generally subject to taxes and penalty.
NOTE 2 -- SUMMARY OF ACCOUNTING POLICIES
The significant accounting and reporting policies followed by the Plan are
summarized as follows:
METHOD OF ACCOUNTING
The financial statements of the Plan are prepared on the accrual basis of
accounting.
INVESTMENTS
Investments of the Plan are stated at fair value, primarily by reference to
published market data. Employee loans are stated at cost which approximates fair
value.
PAYMENT OF BENEFITS
Benefits to participants are recorded when paid.
7
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ADMINISTRATIVE EXPENSES
Generally, all fees and expenses related to the administration of the Plan
are paid by the Company or its subsidiaries. Participants with loans from the
Plan are charged a monthly loan administrative fee.
NOTE 3 -- TAX STATUS OF THE PLAN
The Internal Revenue Service has determined and informed the Company by
letter dated October 1, 1997 that the Plan, as amended, is designed in
accordance with applicable sections of the Internal Revenue Code. Accordingly,
no provision for income taxes has been included in the Plan's financial
statements.
NOTE 4 -- PLAN TERMINATION
Although it has not expressed any interest to do so, the Company has the
right to discontinue contributions at any time and to terminate the Plan subject
to the provisions of ERISA. In the event of Plan termination, participants will
become fully vested in their accounts.
NOTE 5--INVESTMENTS COMPRISING 5% OR MORE OF PLAN ASSETS
Plan investments managed by Barclays Global Investors, as Trustee, that
represent 5% or more of the Plan's assets at June 30, 1997 are as follows:
<TABLE>
<S> <C>
Money Market Fund.............................................................. $ 918,537
International Equity Fund...................................................... 1,632,468
Asset Allocation Fund.......................................................... 2,727,795
Growth Stock Fund.............................................................. 3,322,620
S&P 500 Stock Fund............................................................. 4,805,809
U.S. Treasury Allocation Fund.................................................. 875,287
TRC Stock Fund................................................................. 1,216,646
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$15,499,162
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</TABLE>
8
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NOTE 7 -- NET ASSETS AVAILABLE FOR BENEFITS
The net assets available for benefits applicable to each investment fund at
June 30, 1997 and the changes in net assets for the year then ended are as
follows:
<TABLE>
<CAPTION>
INTER- U.S.
MONEY NATIONAL ASSET GROWTH S&P 500 TREASURY
MARKET EQUITY ALLOCATION STOCK STOCK ALLOCATION
FUND FUND FUND FUND FUND FUND
---------- ------------ ------------ ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Net assets available for benefits at
June 30,1996.............................. $ 884,985 $ 1,518,863 $ 2,463,403 $ 3,645,549 $ 3,292,175 $ 901,192
Contributions:
Employees/employer match.................... 101,486 168,706 191,479 387,393 349,750 71,322
Rollovers................................... -- 9,722 8,187 58,881 12,268 --
Net realized and unrealized
appreciation (depreciation) in
market value of investments............... -- 177,874 179,202 (279,374) 1,045,550 7,778
Interest and dividend income................ 47,540 -- 255,323 49,373 128,032 55,624
Benefits paid to participants............... (104,344) (153,128) (342,106) (338,917) (449,373) (87,457)
Administrative fees and expenses............ (1,001) (485) (765) (1,249) (1,142) (225)
Transfers (to) from other funds............. (10,129) (89,084) (26,928) (199,036) 428,549 (72,947)
---------- ------------ ------------ ------------ ------------ ----------
Net assets available for benefits at
June 30, 1997............................. $ 918,537 $ 1,632,468 $ 2,727,795 $ 3,322,620 $ 4,805,809 $ 875,287
---------- ------------ ------------ ------------ ------------ ----------
---------- ------------ ------------ ------------ ------------ ----------
<CAPTION>
TRC EMPLOYEE
STOCK LOAN
FUND FUND TOTAL
------------ ---------- -------------
<S> <C> <C> <C>
Net assets available for benefits at
June 30,1996.............................. $ 1,206,720 $ 436,338 $ 14,349,225
Contributions:
Employees/employer match.................... 487,312 -- 1,757,448
Rollovers................................... -- -- 89,058
Net realized and unrealized
appreciation (depreciation) in
market value of investments............... (355,085) -- 775,945
Interest and dividend income................ -- 45,356 581,248
Benefits paid to participants............... (64,605) (22,955) (1,562,885)
Administrative fees and expenses............ (83) -- (4,950)
Transfers (to) from other funds............. (57,613) 27,188 --
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Net assets available for benefits at
June 30, 1997............................. 1,216,646 $ 485,927 $ 15,985,089
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</TABLE>
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The net assets available for benefits applicable to each investment fund at
June 30, 1996 and the changes in net assets for the year then ended are as
follows:
<TABLE>
<CAPTION>
TRC STOCK FUND
INTER- U.S. ------------------------
MONEY NATIONAL ASSET GROWTH S&P 500 TREASURY NON-
MARKET EQUITY ALLOCATION STOCK STOCK ALLOCATION PARTICIPANT PARTICIPANT
FUND FUND FUND FUND FUND FUND DIRECTED DIRECTED
------------ ------------ ------------ ------------ ------------ ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net assets available
for benefits at
June 30,1995...... $ 1,087,045 $ 1,397,156 $ 2,514,241 $ 3,050,132 $ 2,605,687 $ 907,002 $ 589,892 $ 381,836
Contributions:
Employees/ employer
match............. 142,688 193,718 248,044 398,048 359,736 92,906 34,574 513,293
Rollovers........... 2,750 4,590 1,665 7,497 5,911 1,178 -- --
Net realized and
unrealized
appreciation
(depreciation) in
market value of
investments....... -- 177,672 241,704 500,796 568,462 (14,490) (131,685) (140,842)
Interest and
dividend income... 53,720 -- 87,354 317,977 106,947 50,731 -- --
Benefits paid to
participants...... (340,822) (240,123) (439,066) (770,117) (390,776) (75,639) (24,762) (59,861)
Administrative fees
and expenses...... (1,553) (454) (588) (1,000) (790) (206) (75) (2)
Transfers (to) from
other funds....... (58,843) (13,696) (189,951) 142,216 36,998 (60,290) 11,688 32,664
------------ ------------ ------------ ------------ ------------ ---------- ----------- -----------
Net assets available
for benefits at
June 30, 1996..... $ 884,985 $ 1,518,863 $ 2,463,403 $ 3,645,549 $ 3,292,175 $ 901,192 $ 479,632 $ 727,088
------------ ------------ ------------ ------------ ------------ ---------- ----------- -----------
------------ ------------ ------------ ------------ ------------ ---------- ----------- -----------
<CAPTION>
EMPLOYEE
OTHER LOAN
INVESTMENTS FUND TOTAL
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<S> <C> <C> <C>
Net assets available
for benefits at
June 30,1995...... $ 89,820 $ 274,553 $ 12,897,364
Contributions:
Employees/ employer
match............. -- -- 1,983,007
Rollovers........... -- -- 23,591
Net realized and
unrealized
appreciation
(depreciation) in
market value of
investments....... (16,292) -- 1,185,325
Interest and
dividend income... -- 36,156 652,885
Benefits paid to
participants...... -- (47,113) (2,388,279)
Administrative fees
and expenses...... -- -- (4,668)
Transfers (to) from
other funds....... (73,528) 172,742 --
----------- ---------- -------------
Net assets available
for benefits at
June 30, 1996..... $ -- $ 436,338 $ 14,349,225
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----------- ---------- -------------
</TABLE>
10
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SCHEDULE I
TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
ITEM 27A--SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT JUNE 30, 1997
<TABLE>
<CAPTION>
IDENTITY OF PARTY NUMBER MARKET
INVOLVED DESCRIPTION OF ASSET OF UNITS COST VALUE
- ------------------------------------ ------------------------------------ --------- ------------ ------------
<S> <C> <C> <C> <C>
Barclays Global Investors........... Money Market Fund 918,537 $ 918,537 $ 918,537
Barclays Global Investors........... International Equity Fund 104,378 1,299,854 1,632,468
Barclays Global Investors........... Asset Allocation Fund 213,610 2,300,774 2,727,795
Barclays Global Investors........... Growth Stock Fund 219,895 2,790,706 3,322,620
Barclays Global Investors........... S&P 500 Stock Fund 253,070 3,128,841 4,805,809
Barclays Global Investors........... U.S. Treasury Allocation Fund 94,831 908,877 875,287
Barclays Global Investors........... TRC Stock Fund 329,714 1,805,535 1,216,646
Barclays Global Investors........... Employee Loan Fund, bearing
interest at 7.0% to 10.0%
repayable over one to ten years 70 485,927 485,927
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$13,639,051 $15,985,089
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</TABLE>
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SCHEDULE II
TRC COMPANIES, INC. 401(k) RETIREMENT AND SAVINGS PLAN
ITEM 27d--SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED JUNE 30, 1997
Transactions with the same person or the same issue aggregating 5% or more
of the current value of Plan assets as of the beginning of the year:
Purchase Transactions:
<TABLE>
<CAPTION>
IDENTITY OF PARTY NUMBER PURCHASE
INVOLVED DESCRIPTION OF ASSET OF UNITS PRICE
- --------------------------------------- ----------------------- ---------- -----------
<S> <C> <C> <C>
Barclays Global Investors.............. Money Market Fund 47 $ 357,729
Barclays Global Investors.............. Asset Allocation Fund 59 504,543
Barclays Global Investors.............. Growth Stock Fund 71 703,061
Barclays Global Investors.............. S&P 500 Stock Fund 72 1,058,566
Barclays Global Investors.............. TRC Stock Fund 45 679,930
</TABLE>
Sales Transactions:
<TABLE>
<CAPTION>
IDENTITY OF PARTY NUMBER SALES REALIZED
INVOLVED DESCRIPTION OF ASSET OF UNITS COST PRICE GAIN/(LOSS)
- --------------------------- ----------------------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Barclays Global
Investors................ Money Market Fund 51 $ 385,714 $ 385,714 $ --
Barclays Global
Investors................ Asset Allocation Fund 68 362,404 419,354 56,950
Barclays Global
Investors................ Growth Stock Fund 92 645,080 746,615 101,535
Barclays Global
Investors................ S&P 500 Stock Fund 70 422,936 590,483 167,547
Barclays Global
Investors................ TRC Stock Fund 96 478,459 314,919 (163,540)
</TABLE>
The purchase and selling price for each reportable transaction represents
its current value at the time of acquisition or disposition. Gains and losses
are calculated based upon historical cost whereas gains and losses in the
financial statements are calculated based upon revalued cost in accordance with
ERISA, see Note 2.
12
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CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-70662) of our report dated December 17, 1997
appearing on page 3 of the TRC Companies, Inc. 401(k) Retirement and Savings
Plan's Annual Report on Form 11-K for the year ended June 30, 1997. We also
consent to the reference to us under the caption "Experts" in such
Registration Statement.
/s/ Price Waterhouse LLP
Hartford, Connecticut
December 29, 1997
13
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Signature
Pursuant to the requirements of the Securities Exchange Act of 1933, 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.
TRC COMPANIES, INC. 401(k)
RETIREMENT AND SAVINGS PLAN
By /s/ Harold C. Elston, Jr.
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Harold C. Elston, Jr.
Vice President and Treasurer
December 29, 1997
14
