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 (NO FEE REQUIRED) FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999 or
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (NO FEE REQUIRED) for the transition period from
________to________
Commission File No. 1-5519
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
CDI CORPORATION 401(k) SAVINGS PLAN
B. Name of the issuer of the securities held pursuant to the plan and the
address of its principal executive office:
CDI CORP.
1717 Arch Street, 35th Floor
Philadelphia, Pennsylvania 19103-2768
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Savings
Plan Committee has duly caused this annual report to be signed on its behalf
by the undersigned thereunto duly authorized.
CDI CORPORATION 401(K) SAVINGS PLAN
Date: June 27, 2000 By: /s/ JOSEPH R. SEIDERS
-----------------------------
Joseph R. Seiders
Member, Savings Plan Committee
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CDI CORPORATION 401(k) SAVINGS PLAN
Financial Statements
and
Supplemental Schedule
December 31, 1999
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CDI CORPORATION 401(k) SAVINGS PLAN
Table of Contents
Page
Independent Auditors' Report 1
Financial Statements:
Statement of Net Assets Available for Plan Benefits 2
Statement of Changes in Net Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedule
1. Schedule of Assets Held for Investment Purposes 10
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Independent Auditors' Report
The Savings Plan Committee
CDI Corporation:
We have audited the accompanying statements of net assets available for plan
benefits of the CDI Corporation 401(k) Savings Plan (the Plan) as of December
31, 1999 and 1998, and the related statements of changes in net assets available
for plan benefits for the years 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 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 plan benefits of the Plan as
of December 31, 1999 and 1998, and the changes in net assets available for plan
benefits for the years then ended in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for the purpose of additional analysis and
is not a required part of the basic 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 the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
/s/ KPMG LLP
Philadelphia, Pennsylvania
June 19, 2000
1
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CDI CORPORATION 401(k) SAVINGS PLAN
Statement of Net Assets Available for Plan Benefits
December 31, 1999 and 1998
1999 1998
-------- --------
Cash $ 5 12,206
Investments:
Guaranteed Income Fund 31,935,921 29,934,026
CDI Corp. Stock 2,769,857 1,943,158
Fidelity Advisors Fund 22,994,623 25,725,281
Fidelity Growth & Income Fund 5,881,763 3,505,728
George Putnam Fund 7,255,884 8,649,269
Janus Worldwide Fund 11,615,061 2,266,134
Asset Allocation Fund 4,456,659 4,283,212
Capital Appreciation Fund 7,447,588 9,127,162
International Growth Fund 1,686,603 134,288
Putnam Investors Fund 17,916,352 12,095,158
S&P Index Fund 16,451,692 12,321,825
Putnam Voyager Fund 71,562,359 51,187,708
Oppenheimer Fund 12,134,907 13,578,469
Participant Loans 4,990,994 4,079,467
----------- -----------
Total investments $ 219,100,263 178,830,885
Contribution Receivable 942,983 871,037
------------ -----------
Net assets available for plan benefits $ 220,043,251 179,714,128
============= ===========
See accompanying notes to financial statements.
2
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CDI CORPORATION 401(k) SAVINGS PLAN
Statement of Changes in Net Assets Available for Plan Benefits
Years ended December 31, 1999 and 1998
1999 1998
---------- ------------
Additions
Investment income ....................... $ 12,633,954 6,873,121
Net appreciation ........................ 31,805,770 20,848,808
Employee contributions .................. 28,049,852 10,634,704
Employer contributions .................. 550,559 460,355
----------- ------------
Total additions ......................... $ 73,040,135 38,816,988
Deductions
Withdrawals ............................. (32,711,012) (4,358,023)
Transfers (to) affiliated plans ............... -- (106,249)
Transfers from merged plans ................... -- 122,803,492
------------ -------------
Net increase .................................. 40,329,123 157,156,208
Net assets available for plan benefits:
Beginning of year ....................... 179,714,128 22,557,920
End of year ............................. ------------- -------------
$ 220,043,251 179,714,128
============= =============
See accompanying notes to financial statements
3
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(1) Description of Plan
The following description of the CDI Corporation 401(k) 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.
(a) Eligibility
The Plan is for the benefit of all employees of CDI Corporation
and those subsidiaries designated a Participating Employer (the
Company). Employees who have attained age 18 are eligible to
participate on the first day of the month following their date
of hire. The Plan, adopted May 1, 1985, was Amended and Restated
on October 1, 1998, and is a defined contribution plan subject
to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA) and Section 401(k) of the Internal Revenue Code.
(b) Plan Mergers
Effective October 1, 1998, participants in the CDI Corporation
Retiremen Savings Plan for Non-Staff Employees and the Modern
Engineering, Inc. Retirement Savings Plan (the "merged plans")
were merged with the Employees' Savings Plan of CDI
Corporation. The surviving plan was renamed the CDI Corporation
401(k) Savings Plan. The assets of the CDI Corporation
Retirement savings Plan for Non-Staff Employees and the Modern
Engineering, Inc. Retirement Savings Plan were merged into the
Plan in October 1998. The terms of the plan eligibility
requirements under the merged plans were replaced in favor
of those outlined in the provisions of the CDI Corporation
401(k) Savings Plan. The provisions for Company
contributions under the merged plans remained the same as
they were prior to the merger into the Plan.
(c) Contributions
Eligible employees may make voluntary, tax deferred
contributions of a specified percentage of their compensation to
the Plan subject to the limitations established by the Internal
Revenue Code. Each Participating Employer may, at the discretion
of its board of directors, make matching contributions, which
are added to the employee's elective contributions. The employer
matching contributions are subject to limitations established by
the Internal Revenue Code and provisions of the Plan.
4
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(d) Investment Income
Interest and dividends earned by each of the investment funds
are reinvested in the same funds. Such amounts are credited to
the participants' accounts based on the terms of the Plan.
(e) Vesting
A participant is vested in 100% of his or her elective deferral
accounts at all times, including the employer contributions and
investment earnings thereon (except for employees of Modern
Engineering, Inc.). Modern employees must be credited with five
years of service to be fully vested in their employer's
contribution.
(f) Withdrawals
A participant can withdraw up to 100% of their deferred
contributions and investment earnings thereon in the event of a
monetary hardship as interpreted in accordance with the
applicable Internal Revenue regulations.
(g) Loans
Participants are permitted to make loan withdrawals against
their individual account balances, with the exception of any
segregated amounts in the accounts of participants, who had
previously participated in another plan, and amounts invested
in the CDI Corp. Stock fund. The loan amount must be a minimum
of $500 and may not exceed one-half of the participant's
vested account balance (or $50,000, reduced by the participant's
highest outstanding loan balance during the previous year,
if lower). Loans are evidenced by a promissory note bearing a
rate of Interest equal to the prime rate plus two
percent, and generally require repayment within five years.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements have been prepared on the
accrual basis of accounting and present the net assets available
for plan benefits and changes in those net assets.
5
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(b) Cash and Cash Equivalents
Cash and cash equivalents represent amounts contributed to the
plan that have not been transferred to the participant's
designated investment vehicle. These funds are held in an
interest-bearing checking account.
(c) Investments
The Guaranteed Income Fund is valued at net share value that is
based on the market value of its underlying investments. The
S&P Index Fund is valued at net share value that is based on the
quoted market value of its underlying investments. All other
mutual funds are valued at quoted net share values. Investments
in CDI stock are valued based on quoted market price. Security
transactions are accounted for on the trade date for securities
purchased or sold. The proceeds from sales of investments are
compared to cost for each investment to determine realized gains
and losses. Dividend Income is recorded on the ex-dividend date.
Interest income is recorded on the accrual basis.
(d) Administrative Expenses
Administrative expenses incurred in the operation of the Plan are
paid by the Company and are not reflected in the accompanying
financial statements.
(e) Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
these estimates.
(3) Investment Options
Participants may invest in the following as of December 31, 1999:
Guaranteed Income Fund
This stable value investment seeks to offer stability while maximizing
current income and provides book value liquidity.
6
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
CDI Corp. Stock
This fund invests exclusively in shares of CDI Corp. common stock for
those investors who want to share in the potential growth of the company.
Fidelity Advisor Fund
This fund seeks capital growth by investing primarily in common stocks
of companies that are believed to have long-term growth potential.
Although the fund invests primarily in stocks, it has the ability to
purchase other securities, such as preferred stocks and bonds.
Fidelity Growth & Income Fund
This fund seeks to provide high total return through a combination of
current income and capital appreciation. It invests primarily in U.S.
and foreign securities of companies that pay current dividends and offer
the potential for increased earnings. It may also invest in bonds.
George Putnam Fund
This fund seeks a balance of capital growth and current income by
investing in a well- diversified portfolio composed mostly of stock
and corporate and U.S. government bonds.
Janus Worldwide Fund
This fund seeks long-term growth of capital by investing primarily in
common stocks of foreign and domestic companies. The Fund is permitted
to invest in companies on a worldwide basis, regardless of country of
organization or place of principal business activity.
Asset Allocation Fund
This fund seeks total return. The fund is designed for investors who
want an investment with moderate risk and the potential for moderate
growth. The balance between the relative stability of bonds and the
fluctuation of stocks is designed to help reduce overall risk.
7
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
Capital Appreciation Fund
This fund seeks capital appreciation by investing mainly in stocks
from a variety of industries and sectors that have the potential for
above-average growth.
International Growth Fund
This fund seeks capital appreciation by investing in a diversified
portfolio of stock of companies located mainly outside the United
States.
Putnam Investors Fund
This fund seeks long-term growth of capital by investing primarily in
blue-chip stock - those of large, well-established companies - selected
from a broad range of industries. The fund targets companies that are
enjoying rising sales and profits and that have dominant positions within
their industries.
S&P Index Fund
This fund is for investors seeking a return, before the assessment of
fees, that closely approximate the return of the S&P 500 Index, which
is an indicator of U.S. stock market performance.
Putnam Voyager Fund
This fund seeks capital appreciation by investing primarily in a
combination of stock of small companies expected to grow over time as
well as in stock of larger, more established corporations.
Oppenheimer Fund
This fund seeks growth of capital over time through investments in a
diversified portfolio of common stocks, bonds, and cash equivalents,
the proportions of which will vary based upon upon management's
assessment of the relative value of each investment under prevailing
market conditions.
8
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CDI CORPORATION 401(k) SAVINGS PLAN
Notes to Financial Statements
December 31, 1999 and 1998
(4) Federal Income Taxes
The Internal Revenue Service has issued a letter of determination
dated February 2, 1996 that the Plan is a qualified plan under Section
501(a) of the Internal Revenue Code and is, therefore, exempt from
federal income taxes. The plan administrator believes that the Plan is
currently in compliance with the applicable requirements of the Internal
Revenue Code. Therefore, the administrator believes that the Plan is
qualified and tax exempt. The plan has submitted a request for a new
determination letter.
(5) Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan provisions to discontinue its contributions at
any time and to terminate the Plan subject to the provisions of ERISA.
(6) Change in Administration of the Plan
Effective October 1, 1998, Putnam Investments took over the record
keeping responsibilities of the Plan from Buck Consultants and Fidelity
Investments. In October 1998, Putnam Fiduciary Trust Company was hired
to function as trustee of the Plan. Prior to this, Riggs Banks N.A. and
Fidelity Investments had acted in the capacity of trustee of the Plan and
the merged plans.
(7) Changes in Reporting Requirements
In September, 1999, the American Institute of Certified Public
Accountants issued Statement of Position 99-3, Accounting for and
Reporting of Certain Defined Contribution Plan Investments and other
Disclosure Matters (SOP 99-3). SOP 99-3 simplifies the disclosure for
certain investments and is effective for plan years ending after December
15, 1999 with earlier application encouraged. The Plan adopted SOP 99-3
during the Plan year ending December 31, 1999. Accordingly, information
previously required to be disclosed about participant-directed fund
investment programs are not presented in the Plan's 1999 financial
statements. The Plan's 1998 financial statements have been reclassified
to conform with the current year's presentation.
9
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Schedule 1
CDI CORPORATION 401(k) SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
December 31, 1999
Identity of Issuer Description Cost Fair Value
------------------------ ---------------------- ------------ ----------
Fidelity Management Fidelity Advisors Fund $ 22,300,135 22,994,623
Company
Fidelity Management Fidelity Growth & Income 5,554,085 5,881,763
Fund
Janus Equity Funds Janus Worldwide Fund 8,185,151 11,615,061
Oppenheimer Funds, Inc. Oppenheimer Fund 12,241,764 12,134,907
*Putnam Investments, Inc. The George Putnam Fund 7,873,049 7,255,884
*Putnam Investments, Inc. Putnam Investors Fund 12,500,107 17,916,352
*Putnam Investments, Inc. Putnam Voyager Fund 46,216,272 71,562,359
*Putnam Investments, Inc. Putnam Capital
Appreciation Fund 5,694,183 7,447,588
*Putnam Investments, Inc. Putnam Asset Allocation 3,791,613 4,456,659
Fund
*Putnam Investments, Inc. Putnam S&P Index Fund 12,471,385 16,451,692
*Putnam Investments, Inc. Putnam International
Growth Fund 1,339,956 1,686,603
PaineWebber Trust PW Trust Company
Company Guaranteed Income Fund 30,347,460 31,935,921
CDI Corp. CDI Corp. Stock 2,912,222 2,769,857
Loans to Participants (a) - 4,990,994
------------ -----------
$171,427,382 219,100,263
============ ===========
(a) Cost of participant loans is $0 as indicated in the instructions to
Form 5500 - Item 27(a)
* Party-in-interest
10
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INDEX TO EXHIBITS
Number Exhibit Page
------ ------------------------------------------- ----
23 Consent of KPMG LLP 12
11
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