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Exhibit Index on Page 2
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Annual Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED].
For the fiscal year ended: December 31, 1993
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 number 1- 3208
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
Brown Printing Company Profit Sharing Retirement Plan
B. Name of issuer of the securities held pursuant to the plan and
the address of the principal executive office:
National Service Industries, Inc.
1420 Peachtree Street, NE
Atlanta, Georgia 30309
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REQUIRED INFORMATION
The following documents are filed as a part of this report:
1. Financial Statements
Plan financial statements prepared in accordance with
the financial reporting requirements of ERISA include the following:
Report of Independent Public Accountants
Statements of Net Assets Available for Plan Benefits as of December
31, 1993 and August 31, 1993
Statements of Changes in Net Assets Available for Plan Benefits for
the Four-Month Period Ended December 31, 1993 and the Year Ended
August 31, 1993
Notes to Financial Statements
2. Exhibits
Sequentially
Numbered
The following exhibit is filed with this report: Page
23 Consent of Arthur Andersen & Co. 11
SIGNATURES
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.
Brown Printing Company
Profit Sharing Retirement Plan
Date: June 28, 1994 By: National Service Industries, Inc.
Plan Administrator
By: /s/ D. Raymond Riddle
Name: D. Raymond Riddle
Title: President and Chief Executive Officer
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of the
Brown Printing Company
Profit Sharing Retirement Plan:
We have audited the accompanying statements of net assets available
for plan benefits of the BROWN PRINTING COMPANY PROFIT SHARING
RETIREMENT PLAN as of December 31, 1993 and August 31, 1993 and the
related statements of changes in net assets available for plan
benefits for the four-month period ended December 31, 1993 and the
year ended August 31, 1993. 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 amd 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 Brown Printing Company Profit Sharing Retirement Plan
as of December 31, 1993 and August 31, 1993 and the changes in net
assets available for plan benefits for the four-month period ended
December 31, 1993 and the year ended August 31, 1993 in conformity
with generally accepted accounting principles.
/s/ Arthur Andersen & Co.
ARTHUR ANDERSEN & CO.
Atlanta, Georgia
June 6, 1994
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BROWN PRINTING COMPANY
PROFIT SHARING RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1993 AND AUGUST 31, 1993
December 31, 1993 August 31, 1993
EMPLOYER CONTRIBUTION RECEIVABLE $ 22,510 $ 92,510
--------- ---------
INVESTMENTS, at market value
(Note 1):
NSI DC Fixed Income Fund 3,323,295 3,326,462
NSI Common Stock 358,711 356,961
Loans to Participants 117,277 131,388
--------- ---------
3,799,283 3,814,811
--------- ---------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 3,821,793 $ 3,907,321
========= =========
The accompanying notes are an integral
part of these statements.
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BROWN PRINTING COMPANY
PROFIT SHARING RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE FOUR MONTH PERIOD ENDED DECEMBER 31, 1993
AND THE YEAR ENDED AUGUST 31, 1993
Four Month
Period Ended Year Ended
December 31, 1993 August 31, 1993
CONTRIBUTIONS (Note 3) $ 0 $ 115,032
--------- ---------
NET GAIN FROM INVESTMENTS IN:
NSI DC Fixed Income Fund (Note 1) 90,904 148,025
NSI Common Stock (Note 1) 1,750 20,998
FIF Units (Note 1) 0 85,105
--------- ---------
92,654 254,128
--------- ---------
DIVIDENDS ON COMMON STOCK (Note 1) 3,663 14,419
INTEREST INCOME 4,000 13,007
--------- ---------
7,663 27,426
--------- ---------
AMOUNTS PAID TO PARTICIPANTS <185,845> <234,529>
--------- ---------
(DECREASE) INCREASE IN NET ASSETS
AVAILABLE FOR PLAN BENEFITS <85,528> 162,057
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF PERIOD 3,907,321 3,745,264
--------- ---------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF PERIOD $ 3,821,793 $ 3,907,321
========= =========
The accompanying notes are an integral
part of these statements.
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BROWN PRINTING COMPANY
PROFIT SHARING RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1993 AND AUGUST 31, 1993
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting -
The accounts of the Brown Printing Company (a division of National
Service Industries, Inc. (NSI)) Profit Sharing Retirement Plan (the
"Plan") are maintained by the trustee on the cash basis of accounting.
The accompanying financial statements have been prepared using the
accrual method of accounting by application of memorandum entries.
Investment in NSI Fixed Income Fund -
A portion of the Plan's assets were commingled in a Fixed Income Fund
(FIF) together with the assets of pension and profit sharing plans of
other NSI divisions. Investments of the FIF were reflected at market
values determined by the custodian from publicly stated price
information. These investments are subject to certain administrative
guidelines and limitations as to type and amount of securities held.
The net gain from investments in FIF units in the accompanying
Statements of Changes in Net Assets Available for Plan Benefits
reflects interest income on guaranteed investment contracts and master
notes. On January 1, 1993, investments of this fund were reinvested in
the NSI Defined Contribution Fixed Income Fund.
Summarized financial information of the FIF for the period September 1,
1992 to December 31, 1992 is presented as follows:
1992
Net gain from investments in
FIF units during the period $ 1,774,924
=========
Allocation to NSI plans (based on
number of units owned):
Brown Printing Company Profit Sharing
Retirement Plan $ 85,105
All other NSI plans 1,689,819
---------
Total $ 1,774,924
=========
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Investment in NSI Defined Contribution Fixed Income Fund -
As of January 1, 1993, the Plan's portion of the FIF assets were
commingled in a Defined Contribution Fixed Income Fund (DC Fixed
Income Fund) together with the assets of certain profit sharing plans
of other NSI divisions. Investments of the DC Fixed Income Fund are
reflected at market values determined by the custodian from publicly
stated price information. These investments are subject to certain
administrative guidelines and limitations as to type and amount of
securities held. Certain fund assets are allocated to selected
independent investment managers to invest under the general DC Fixed
Income Fund guidelines.
Summarized financial information of the DC Fixed Income Fund is
presented as follows:
September 1, 1993 January 1, 1993
to to
December 31, 1993 August 31, 1993
Interest and dividend income $ 1,464,731 $ 2,507,338
Investment management fees <6,775> <5,631>
--------- ---------
Net gain from investments in the
DC Fixed Income Fund during
the period $ 1,457,956 $ 2,501,707
========= =========
Allocation to NSI plans:
Brown Printing Company Profit
Sharing Retirement Plan $ 90,904 $ 148,025
All other NSI plans 1,367,052 2,353,682
--------- ---------
Total $ 1,457,956 $ 2,501,707
========= =========
DC FIXED INCOME FUND INVESTMENTS:
December 31, 1993 August 31, 1993
Guaranteed Investment Contracts $ 36,541,338 $ 50,929,142
Master Note 16,618,541 1,052,739
Cash 22,953 6,141
Accrued Investment Income 9,817 0
---------- ----------
Total investments $ 53,192,649 $ 51,988,022
========== ==========
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Allocation to NSI Plans (based on
participant balances):
December 31, 1993 August 31, 1993
Brown Printing Company Profit
Sharing Retirement Plan $ 3,323,295 6.25% $ 3,326,462 6.40%
All Other NSI Plans 49,869,354 93.75% 48,661,560 93.60%
----------- ------ ----------- ------
$53,192,649 100.00% $51,988,022 100.00%
=========== ====== =========== ======
Investment in NSI Common Stock -
As of December 31, 1993, approximately 9% of the Plan's net
assets were invested in common stock of NSI, a party-in-
interest. The Plan's investment in NSI common stock was
reflected at market value in the accompanying financial
statements.
Tax Status -
The Plan has received a favorable determination letter from the Internal
Revenue Service dated September 25, 1985, and is qualified under the
Internal Revenue Code (the "Code") as exempt from federal income
taxes. The Plan has been amended since receiving the determination
letter. However, the plan administrator believes that the Plan is
currently designed and is being operated in compliance with the
applicable requirements of the Code. Therefore, the plan administrator
believes that the Plan was qualified and that the related trust was
tax-exempt as of December 31, 1993.
Net Assets Available for Plan Benefits -
At August 31, 1993, $126,500 of net assets available for plan benefits
were allocated to accounts of participants who have withdrawn from
participation in the earnings and operations of the Plan. There were
no such amounts allocated at December 31, 1993.
Loans to Participants -
The Plan permits loans to participants of up to 50% or 75% of each
participant's vested credit, depending on the balance of the vested
amount, not to exceed $50,000. Such loans accrue interest of 1% per
month on the unpaid loan balance and are payable over five years
unless the loan is for the purchase or rehabilitation of a primary
residence, in which case the loan is subject to repayment of at least
10% of the original loan balance each year commencing within three
years of the date of the loan.
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2. TRUST AGREEMENT:
Under a trust agreement dated September 1, 1993, as amended, Wachovia Bank
of Georgia, N.A. was appointed trustee of the NSI Defined Contribution
Plans Master Trust (which includes the DC Fixed Income Fund and Common
Stock discussed in Note 1). Certain officers of NSI were appointed
administrators of the Plan's assets together with the income derived
therefrom.
Prior to September 1, 1993, the assets of the Plan were included in the
NSI General Retirement Trust (GRT). Under a trust agreement dated March
1, 1978, certain officers of NSI were appointed trustee of the GRT and
were administrators of the Plan's assets and Wachovia Bank of Georgia
was the custodian.
3. PLAN DESCRIPTION:
The following brief description of the Plan is provided for informational
purposes only. Participants should refer to the Plan agreement for more
complete information.
The Plan incorporates the required standards under ERISA, as modified from
time to time. The Plan is a voluntary, defined contribution plan
covering employees of Brown Printing Company (the "Company") with 90 or
more days of service. Prior to January 1, 1994,no contributions were
required or permitted by participants. Contributions were made by the
Company in an amount equal to 10% of annual net income, as defined, of
the Company, provided that this amount does not exceed 5% of the
compensation of all participants in the Plan on the last day of the Plan
year. The plan agreement further provides that the contribution may be
increased by any additional discretionary amount determined by the Board
of Directors of NSI as long as the total contribution does not exceed
15% of the compensation of participants plus any permissible carryovers
allowed as deductions for income tax purposes. All expenses of the Plan
were paid by the Company during 1993 and 1992. Vesting of contributions
occurs on an increasing scale ranging from 20% after three years of
service, as defined, to 100% vesting after seven years of service.
During December, 1993, the Plan was amended and restated to allow
participant directed investments effective January 1, 1994. In addition,
the Plan year end was changed from August 31 to December 31. Thus, the
accompanying financial statements are for the year ended August 31, 1993
and the four month period in the short plan year ended December 31,
1993. The Plan, as amended and restated, does not permit employer
contributions during the short plan year.
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Although the Company intends for the Plan to be permanent, the Plan
provides that the Company has the right to discontinue contributions or
to terminate the Plan at any time. In the event of termination, each
participant shall be entitled to receive any amounts then credited to
their account.
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Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report included in this Form 11-K into National Service Industries, Inc.'s
previously filed Registration Statement covering the Brown Printing Company
Profit Sharing Retirement Plan.
/s/ Arthur Andersen & Co.
ARTHUR ANDERSEN & CO.
Atlanta, Georgia
June 28, 1994
