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<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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, 1997
--------------------------------
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File Number 0-14951
-------
BUTLER SERVICE GROUP, INC. 401(K) PLAN
--------------------------------------
(Full name of plan)
BUTLER INTERNATIONAL, INC.
--------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 06-1154321
------------------------------ ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
110 Summit Avenue, Montvale, New Jersey 07645
--------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 573-8000
--------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X . No .
---- ----
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
Page
----
INDEPENDENT AUDITORS' REPORT 3
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits as of December 31,
1997 and 1996 4
Statement of Changes in Net Assets Available for Benefits for the
year ended December 31, 1997 5
Notes to Financial Statements 6-12
SUPPLEMENTAL SCHEDULES:
Item 27a of Form 5500 - Schedule of Assets Held for Investment
Purposes at December 31, 1997 13-19
Item 27d of Form 5500 - Schedule of Reportable Transactions
for the year ended December 31, 1997 20
Supplemental schedules not included herein are omitted due to
the absence of conditions under which they are required.
EXHIBIT 1 - Independent Auditors' Consent 21
2
<PAGE>
INDEPENDENT AUDITORS' REPORT
Trustees
Butler Service Group, Inc.
401(k) Plan
Montvale, New Jersey
We have audited the accompanying statements of net assets available for benefits
of the Butler Service Group, Inc. 401(k) Plan ("the Plan") as of December 31,
1997 and 1996, and the related statement of changes in net assets available for
benefits for the year ended December 31, 1997. 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 benefits of the Plan as of
December 31, 1997 and 1996 and the changes in net assets available for benefits
for the year ended December 31, 1997 in conformity with generally accepted
accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of (1) assets
held for investment purposes as of December 31, 1997 and (2) reportable
transactions for the year ended December 31, 1997 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. These schedules are the responsibility
of the Plan's management. Such schedules have been subjected to the auditing
procedures applied in the audits of the basic 1997 financial statements and, in
our opinion, are fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
- -------------------------
Parsippany, New Jersey
June 26, 1998
3
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997 AND 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1997 1996
---- ----
<S> <C> <C>
ASSETS:
Investments at fair value / face value (Note C) $33,406,373 $24,769,775
Contributions receivable, employees 599,772 562,881
Contributions receivable, employer 355,694 878,691
Accrued interest 111,114 92,646
------------------- -------------------
Total Assets 34,472,953 26,303,993
------------------- -------------------
LIABILITIES:
Accrued expenses 16,663 23,238
------------------- -------------------
Total Liabilities 16,663 23,238
------------------- -------------------
NET ASSETS AVAILABLE FOR BENEFITS $34,456,290 $26,280,755
=================== ===================
</TABLE>
See notes to financial statements.
4
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1997
- --------------------------------------------------------------------------------
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Contributions from employees $ 9,122,426
Contributions from employer
1,401,568
Investment income 802,313
Net realized and unrealized appreciation in
fair value of investments 4,791,438
-----------------
Total Additions 16,117,745
-----------------
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Distributions to participants 7,575,208
Investment and administrative management fees 367,002
-----------------
Total Deductions 7,942,210
-----------------
NET INCREASE IN NET ASSETS AVAILABLE FOR
BENEFITS 8,175,535
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 26,280,755
-----------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 34,456,290
=================
See notes to financial statements.
5
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
- --------------------------------------------------------------------------------
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements are prepared on the accrual basis of
accounting and are presented in accordance with the Employee Retirement Income
Security Act of 1974 ("ERISA").
Certificates of deposit are stated at face value. US Government obligations
and equity investments are stated at fair value as determined by quoted market
prices. Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
B. PLAN DESCRIPTION
The following description provides general information, refer to the plan
document for a more detailed description.
On July 1, 1990, Butler Service Group, Inc. ("the Company") established a
401(K) Plan which was adopted by its wholly-owned subsidiaries. The 401(K) Plan
is a continuation of the Butler Service Group, Inc. Investment Savings Plan and
is designed to provide an incentive for employees of the Company to save
regularly through payroll deductions and possible matching contributions by the
Company. Effective January 1, 1992, all employees were eligible to participate
in the Butler Service Group, Inc. 401(K) Plan.
There are seven investment funds offered under the 401(K) Plan - the Fixed
Income Fund, which invests primarily in FDIC insured certificates of deposit and
money market funds, the Small to Mid-Cap Equity Fund, which invests in a
diversified common stock portfolio of representative industries and
corporations, primarily small to mid-capitalization in size, the Mid to Large-
Cap Equity Fund, which invests in a diversified common stock portfolio of growth
companies, primarily large and medium capitalization, the Enhanced Large-Cap
Index Fund, which maintains industry and sector weightings similar to the S&P
500 Index, but seeks to enhance returns with fewer, but stronger stocks within
the various sectors, the Butler International ("BI") Stock Fund which is a
qualified employer security under ERISA, the Balanced Fund, which invests 60 to
65% in equities and 35 to 40% in government bonds and cash equivalents, and the
International Fund which generally invests in securities of foreign issuers
located in Europe, the Pacific Rim, Canada and Central and South America.
A participant in the 401(K) Plan has the choice of saving on a before-tax
basis, by payroll deduction, any amount from 1% to 20% (in whole percentages) of
total payroll each payroll period, an "elective deferral contribution." By law,
the elective deferral contribution, per participant, under this Plan and all
similar plans is limited during any calendar year. In addition, the elective
deferral contribution for a highly compensated employee (an employee earning
over $80,000 for 1997), during the year relative to the elective deferral
contributions of other participants of the Plan could exceed the amount
permitted by law. Should this occur, the elective deferral contributions of the
highly compensated employees may be reduced during the Plan year to the extent
necessary to satisfy the legal limitation or any excess deferral contributions
may be recharacterized or refunded after the end of the Plan year. Refunds to
highly compensated employees for the Plan years 1997 and 1996 were $293,132 and
$1,061,532, respectively.
A participant may allocate a specified percentage of the contribution in any
or all of the seven funds in multiples of 10%.
The Company is not required to make any contributions to the Plan, but the
Company may decide, at its sole discretion, to make a matching contribution for
a Plan year. For any Plan year that the Company decides to make a matching or
partial contribution, it will deposit in the BI Stock Fund an amount which will
be allocated in proportion to the elective deferral contributions made by the
Plan participants for that Plan year. In 1997 and 1996 the Company made
contributions of $1,073,892 and $878,691, respectively, to the Plan in
accordance with a customer contract, which was funded by the customer. In 1997,
the Company made matching contributions of approximately $328,000.
6
<PAGE>
Each participant is permitted to change the elective deferral contribution
rate by completing the Change in Status Form and filing it with the Plan's
Administrative Committee. The elective deferral contribution rate is adjusted
after the Committee receives and processes the Change in Status Form.
A participant may fully discontinue the elective deferral contribution as of
the first day of any month by written notice to the Plan's Administrative
Committee at least fifteen days before the date on which the discontinuance is
to take effect. A discontinuance of the elective deferral contribution is only
permitted once during any Plan year and will automatically require the
discontinuance of any Company matching contributions to the Matching
Contribution Account. The elective deferral contribution may be resumed as of
any January, April, July, or October 1 by written notice to the Committee at
least fifteen days before a participant intends for the contributions to be
resumed.
Participants may withdraw funds while employed only from accounts in which
they are fully vested after attaining age 59 1/2. Prior to attaining age 59 1/2
a withdrawal may be made for financial hardship. Only one withdrawal may be
requested during any Plan year for reasons other than financial hardship. The
minimum amount available for a withdrawal is $500. If the participant has an
outstanding loan, the amount of funds available for withdrawal may be limited.
Withdrawals may be made as of any January 1, April 1, July 1, or October 1 from
any of the funds in which the participant's accounts are invested. A
participant will have a 100% vested interest in all accounts upon retirement at
or after age 65, in the event of a permanent disability or in the event of death
prior to termination of employment. Upon termination of employment, the value
of the vested accounts will be paid in a lump sum. After completing three years
of service with the Company, a participant is entitled to the full value of the
Matching Contribution Account, if any.
Participants may borrow up to 50% of the vested portion of their account
balance, subject to a maximum of $50,000. Only one loan will be granted at a
time and must be repaid in full before another loan can be requested. The
minimum loan amount is $1,000. Loans are subject to an interest rate based on
the rate charged, as of the date the loan is granted, by the Company's principal
banking institution for loans granted under similar circumstances. Loans must
be repaid within such period as agreed to by the participant and the Plan's
administrative committee, up to a maximum of five years. However, if the loan
is made for the purchase or construction of the participants principal place of
residence, the repayment period may be longer than five years. Repayments will
normally be made through payroll deductions.
Although the Company has not expressed any intent to do so, in the event the
Plan is terminated, all participants will be 100% vested in all their accounts
and benefits will be payable strictly under the terms of the Plan. Benefits
under defined contribution plans of the 401(K) type are not insured by the
Pension Benefit Guaranty Corporation.
7
<PAGE>
<TABLE>
<CAPTION>
C. PLAN INVESTMENTS
Plan investments are summarized as follows:
December 31, December 31,
1997 1996
---- ----
<S> <C> <C>
Fixed Income Fund:
Fixed Income Fund - Certificates of
deposit at fair value $ 8,922,000 7,867,000
PW Retirement Money Fund 139,331 359,407
Loans to participants 231,991 178,416
----------------- ----------------
Total Fixed Income Fund 9,293,322 8,404,823
----------------- ----------------
Balanced Fund:
Equity Account - US Government
obligations at fair value 599,986 1,021,570
Equity Account - Stocks & Bonds
at fair value 2,847,402 1,514,513
Sansom Money Market Portfolio 261,455 131,520
Loans to participants 57,557 18,231
----------------- ----------------
Total Balanced Fund 3,766,400 2,685,834
----------------- ----------------
Mid to Large Cap Equity Fund:
Equity Account - Stocks
at fair value 1,409,818 355,565
PaineWebber Cashfund 141,061 136,160
Loans to participants 9,148 (275)
----------------- ----------------
Total Mid to Large Cap Equity Fund 1,560,027 491,450
----------------- ----------------
Small to Mid Cap Equity Fund:
Equity Account - Stocks
at fair value 8,891,839 6,189,732
Sansom Money Market Portfolio 592,737 1,603,679
Loans to participants 165,466 76,193
----------------- ----------------
Total Small to Mid Cap Equity Fund 9,650,042 7,869,604
----------------- ----------------
International Fund:
Equity Account - Stocks
at fair value 2,503,822 2,069,038
Sansom Money Market Portfolio 268,805 152,988
Loans to participants 35,082 17,487
----------------- ----------------
Total International Fund 2,807,709 2,239,513
----------------- ----------------
Large Cap Equity Fund:
Equity Account - Stocks
at fair value 234,452 -
Cash 8,650 -
Loans to participants 1,010 -
----------------- ----------------
Total International Fund 244,112 -
----------------- ----------------
</TABLE>
8
<PAGE>
<TABLE>
<S> <C> <C>
Butler International ("BI") - Stock Fund:
BI Common Stock at fair value,
334,934 shares at December 31, 1997
and 288,678 shares at December 31, 1996 5,861,345 2,958,950
PW Retirement Money Fund 29,159 415
Loans to participants 113,482 52,980
----------------- ------------------
Total BI - Stock Fund 6,003,986 3,012,345
----------------- ------------------
Distribution Account:
PW Retirement Money Fund
Cash 80,775 66,206
- -
----------------- ------------------
Total Distribution Account 80,775 66,206
----------------- ------------------
Total Investments, at fair value/contract value $ 33,406,373 $ 24,769,775
================= ==================
Year Ended
December 31,
Net realized and unrealized appreciation 1997
----------------
(depreciation) in investments:
US government obligations $ 41,330
Certificates of deposit (4,510)
Equity investments 4,754,618
=================
Total $ 4,791,438
=================
Investment income:
Interest $ 555,507
Dividends 246,597
Cash in lieu of fractional shares 209
=================
Total $ 802,313
=================
</TABLE>
9
<PAGE>
D. BENEFITS PAYABLE
The amounts payable to the Plan participants who have terminated or withdrawn
from the plan were $1,273,758 and $562,916 at December 31, 1997 and 1996,
respectively.
E. TAX STATUS
The Internal Revenue Service has determined that the Plan is a qualified plan
under Section 401(a) of the Code with an associated trust exempt from tax under
Section 501(a). The most recent favorable letter of determination on the
qualified status of the Plan was issued by the Internal Revenue Service ("IRS")
on April 22, 1996. The Plan sponsor and the Plan's tax counsel believe that the
Plan as currently designed and operated is in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, there is no provision for
income taxes in the financial statements.
F. ADMINISTRATION OF PLAN ASSETS
Through June 1998, contributions were held and managed by PaineWebber, Inc.
("the trustee"), which invests cash received, interest and dividend income and
makes distributions to participants. The trustee also administers the payment
of interest and principal on the participant loans. Effective June 1998, the
Plan trustee was changed to the Prudential Bank and Trust Company.
Certain administrative functions are performed by officers or employees of the
Company. No such officer or employee receives compensation from the Plan.
Certain plan administration expenses are borne by the Plan.
10
<PAGE>
G. STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS BY FUND
(in thousands)
<TABLE>
<CAPTION>
Mid to Small to
December 31, 1997 Fixed Balanced Lg. Cap Mid Cap Int'l Lg. Cap BI- Distribution
- ----------------- Income Fund Fund Fund Fund Fund Stock Account Total
------ ---- ---- ---- ---- ---- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Net investments, at fair
value / face value $9,154 $3,505 $1,419 $9,057 $2,539 $235 $5,975 $0 $31,884
Cash and cash equivalents 139 261 141 593 269 9 29 81 1,522
Contributions receivable:
Employees 122 94 90 144 66 6 78 - 600
Employer 155 28 11 46 21 - 95 - 356
Accrued interest 111 - - - - - - - 111
------- ------- -------- ------- ------- ------- ------- ------- -------
Total Assets 9,681 3,888 1,661 9,840 2,895 250 6,177 81 34,473
------- ------- -------- ------- ------- ------- ------- ------- -------
Liabilities:
Accrued expenses 6 2 1 6 2 - - - 17
------- ------- -------- ------- ------- ------- ------- ------- -------
Total Liabilities 6 2 1 6 2 - - - 17
------- ------- -------- ------- ------- ------- ------- ------- -------
Net assets available
for benefits $9,675 $3,886 $1,660 $9,834 $2,893 $250 $6,177 $81 $34,456
======= ======= ======== ======= ======= ======= ======= ======= =======
<CAPTION>
Mid to Small to
December 31, 1997 Fixed Balanced Lg. Cap Mid Cap Int'l Lg. Cap BI- Distribution
- ----------------- Income Fund Fund Fund Fund Fund Stock Account Total
------ ---- ---- ---- ---- ---- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Net investments, at fair
value / face value $8,045 $2,554 $355 $6,266 $2,087 $0 $3,012 $0 $22,319
Cash and cash equivalents 359 132 136 1,604 153 - - 66 2,450
Contributions receivable:
Employees 151 95 50 160 65 - 42 - 563
Employer 449 98 17 193 66 - 56 - 879
Accrued interest 93 - - - - - - - 93
------- ------- -------- ------- ------- ------- ------- ------- -------
Total Assets 9,097 2,879 558 8,223 2,371 - 3,110 66 26,304
------- ------- -------- ------- ------- ------- ------- ------- -------
Liabilities:
Accrued expenses 9 3 1 8 2 - - - 23
------- ------- -------- ------- ------- ------- ------- ------- -------
Total Liabilities 9 3 1 8 2 - - - 23
------- ------- -------- ------- ------- ------- ------- ------- -------
Net assets available
for benefits $9,088 $2,876 $557 $8,215 $2,369 $0 $3,110 $66 $26,281
======= ======= ======== ======= ======= ======= ======= ======= =======
</TABLE>
11
<PAGE>
H. STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY FUND
<TABLE>
<CAPTION>
Mid to Small to
Year Ended December 31, 1997 Fixed Balanced Lg. Cap Mid Cap Int'l Lg. Cap BI- Distribution
- ---------------------------- Income Fund Fund Fund Fund Fund Stock Account Total
------ ---- ---- ---- ---- ---- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Contributions from employees $2,215 $1,414 $899 $2,365 $1,017 $9 $932 $271 $9,122
Contributions from employers 578 125 38 171 91 - 399 - 1,402
Investment income 493 91 18 143 53 - 1 3 802
Net realized and unrealized
appreciation (depreciation)
in investments (5) 483 213 1,506 396 4 2,194 - 4,791
------- ------- ------- ------- ------- ------- ------- ------- -------
Total Additions 3,281 2,113 1,168 4,185 1,557 13 3,526 274 16,117
------- ------- ------- ------- ------- ------- ------- ------- -------
Deductions:
Distribution to participants 2,132 860 279 2,445 827 1 772 259 7,575
Investment management and
administrative fees 36 63 17 167 49 1 34 - 367
------- ------- ------- ------- ------- ------- ------- ------- -------
Total Deductions 2,168 923 296 2,612 876 2 806 259 7,942
------- ------- ------- ------- ------- ------- ------- ------- -------
Net Transfers (526) (180) 231 46 (157) 239 347 - -
------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase in assets 587 1,010 1,103 1,619 524 250 3,067 15 8,175
Net assets available for
benefits, beginning of year 9,088 2,876 557 8,215 2,369 - 3,110 66 26,281
------- ------- ------- ------- ------- ------- ------- ------- -------
Net assets available for
benefits, end of year $9,675 $3,886 $1,660 $9,834 $2,893 $250 $6,177 $81 $34,456
======= ======= ======= ======= ======= ======= ======= ======= =======
</TABLE>
12
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
<TABLE>
<CAPTION>
ITEM 27A OF FORM 5500 - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1997
- ------------------------------------------------------------------------------------------------------------------------------
CURRENT VALUE/
INTEREST PAR FACE
DESCRIPTION RATE MATURES VALUE VALUE COST
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Cash and Cash Equivalents:
Cash $ 11,401 $ 11,401
PW Retirement Money Fund 248,531 248,531
Paine Webber Cashfund 141,061 141,061
Sansom St. Money Market 1,120,980 1,120,980
------------------------------------------
Portfolio
$1,521,973 $1,521,973
==========================================
US GOVERNMENT OBLIGATIONS:
US Treasury Note 6.375% 04/30/99 $135,000 $ 136,266 $ 136,425
US Treasury Note 6.875% 03/31/00 118,000 120,988 121,024
US Treasury Note 7.875% 11/15/04 182,000 203,500 201,423
US Treasury Bond 7.125% 02/15/23 122,000 139,232 133,418
-----------------------------------------------------------
$557,000 $ 599,986 $ 592,290
===========================================================
BONDS:
Ford Mtr Cr Co Global NT 7.000% 09/25/01 $ 74,000 $ 75,759 $ 76,125
Genl Motors Accept Corp 6.625% 10/01/02 75,000 76,120 76,188
Lehman Brothers Sr Sub 7.250% 04/15/03 84,000 86,720 86,958
Amer Home Prods Corp 7.900% 02/15/05 71,000 77,397 76,725
Donaldson Lukfin Jen 6.875% 11/01/05 75,000 76,033 76,054
Untd Parcel Service Amer Inc 8.375% 04/01/20 64,000 78,055 76,486
-----------------------------------------------------------
$443,000 $ 470,084 $ 468,536
===========================================================
CERTIFICATES OF DEPOSIT:
Ponce Fed Bk FSB Pr 5.000% 07/14/98 $ 90,000 $ 90,000
LaSalle National Bank 4.150% 10/28/98 180,000 180,000
Greenwood Tr Co DE 4.950% 11/03/98 90,000 90,000
LaSalle NB 4.550% 11/24/98 90,000 90,000
Greenwood Tr Co DE 5.000% 11/24/98 360,000 360,000
LaSalle Bk NI 5.550% 03/26/99 15,000 15,000
Ocwen Fed Bank 6.250% 04/30/99 30,000 30,000
European American Bk 6.000% 06/22/99 9,000 9,000
Contl Bk Chicago 5.800% 08/19/99 45,000 45,000
Contl Bk Chicago 5.600% 09/23/99 20,000 20,000
Contl Bk Chicago 5.700% 10/07/99 135,000 135,000
Republic B & T 5.600% 10/18/99 6,000 6,000
MBNA America Bk N.A. 5.400% 12/20/99 7,000 7,000
Continental Bk NA 6.150% 01/13/00 30,000 30,000
Continental Bk NA 6.100% 01/20/00 90,000 90,000
Berkely Fed Bk & Tr 5.250% 01/24/00 95,000 95,000
Poncebank Ponce Pr 5.850% 04/03/00 6,000 6,000
Continental Bk NA 5.600% 04/07/00 105,000 105,000
Continental Bk NA 5.650% 04/14/00 126,000 126,000
Continental Bk NA 5.400% 04/21/00 17,000 17,000
Continental Bk NA 5.400% 04/28/00 3,000 3,000
Bank Amer Phoenix 5.500% 05/10/00 275,000 275,000
Continental Bk NA 5.500% 05/26/00 20,000 20,000
LaSalle Bk Northwest 5.850% 08/28/00 12,000 12,000
Berkeley Fed Bk & Tr 5.800% 10/11/00 9,000 9,000
</TABLE>
13
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Greenwood Tr Co DE 5.100% 10/27/00 90,000 90,000
Greenwood Tr Co DE 5.450% 11/17/00 45,000 45,000
Berkely Fed Bk & Tr 5.600% 11/29/00 90,000 90,000
Greenwood Tr Co DE 5.400% 12/15/00 12,000 12,000
Greenwood Tr Co DE 5.400% 12/22/00 270,000 270,000
Ocwen Fed Bank 5.900% 12/26/00 90,000 90,000
Berkely Fed Bk & Tr 5.500% 12/27/00 175,000 175,000
LaSalle NB 5.100% 01/10/01 80,000 80,000
Greenwood Tr Co DE 5.350% 01/19/01 15,000 15,000
Berkely Fed Bk & Tr 5.300% 01/24/01 95,000 95,000
MBNA Amer Bank 6.100% 01/29/01 20,000 20,000
Greenwood Tr Co DE 5.400% 02/02/01 12,000 12,000
Ocwen Fed Bk FSB 5.900% 02/26/01 95,000 95,000
Berkeley Fed Bk & Tr 5.500% 03/06/01 95,000 95,000
Household Bank 6.000% 04/03/01 20,000 20,000
Ocwen Fed Bank 6.350% 05/21/01 100,000 100,000
Ocwen Fed Bank 6.400% 06/04/01 30,000 30,000
LaSalle NB 6.350% 06/08/01 50,000 50,000
Ocwen Fed Bank 6.350% 06/18/01 20,000 20,000
FCC Natl Bk Wilmingtn 6.100% 08/15/01 65,000 65,000
Greenwood Trust Co 6.150% 08/28/01 60,000 60,000
MBNA Amer Bank 6.050% 09/17/01 50,000 50,000
MBNA Amer Bank 6.050% 09/17/01 95,000 95,000
European American Bk 6.250% 09/25/01 30,000 30,000
Bankers Trust Co 6.300% 01/24/02 95,000 95,000
FNB of Com 6.250% 01/29/02 25,000 25,000
Ocwen Fed Bank 6.500% 06/11/02 15,000 15,000
MBNA Bank 6.100% 07/23/02 95,000 95,000
Contl Bk Chicago 6.400% 08/26/02 30,000 30,000
MBNA Bank 6.000% 08/27/02 50,000 50,000
First Dep Natl Bk 6.100% 09/05/02 40,000 40,000
MBNA Amer Bank 6.100% 09/17/02 95,000 95,000
MBNA Amer Bank 6.100% 09/17/02 95,000 95,000
Contl Bk Chicago 6.200% 09/23/02 6,000 6,000
European American Bk 5.650% 11/22/02 45,000 45,000
Signal Bank NA 6.000% 12/03/02 90,000 90,000
FCC Natl Bk Wilmingtn 5.900% 12/17/02 15,000 15,000
Continental Bk NA 6.550% 01/13/03 25,000 25,000
Continental Bk NA 6.400% 02/03/03 18,000 18,000
Continental Bk NA 6.300% 02/10/03 10,000 10,000
Continental Bk NA 6.200% 02/18/03 20,000 20,000
Continental Bk NA 5.700% 03/17/03 165,000 165,000
European American Bk 6.200% 03/27/03 95,000 95,000
Household Bank 6.500% 04/17/03 10,000 10,000
Continental Bk NA 6.000% 06/09/03 220,000 220,000
LaSalle NB 6.600% 09/18/03 15,000 15,000
LaSalle National Bank 6.450% 09/25/03 90,000 90,000
Greenwood Tr Co DE 5.500% 10/27/03 90,000 90,000
Greenwood Tr Co DE 5.750% 11/10/03 45,000 45,000
Greenwood Tr Co DE 5.900% 11/17/03 48,000 48,000
Greenwood Tr Co DE 6.000% 12/22/03 20,000 20,000
Greenwood Tr Co DE 6.000% 12/29/03 10,000 10,000
LaSalle NB 5.300% 01/05/04 12,000 12,000
Greenwood Tr Co DE 5.800% 01/20/04 6,000 6,000
Greenwood Tr Co DE 5.850% 01/26/04 39,000 39,000
LaSalle NB Monthly 5.300% 01/26/04 305,000 305,000
Greenwood Tr Co DE 6.000% 02/17/04 230,000 230,000
LaSalle NB 6.050% 03/16/04 20,000 20,000
LaSalle NB 6.050% 03/23/04 260,000 260,000
LaSalle NB 6.050% 03/30/04 9,000 9,000
LaSalle NB 6.650% 04/27/04 10,000 10,000
LaSalle NB Chi IL 6.350% 06/04/04 90,000 90,000
LaSalle National Bank 6.550% 06/29/04 10,000 10,000
LaSalle National Bank 6.500% 07/27/04 15,000 15,000
</TABLE>
14
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Lasalle Natl Bk 6.100% 09/17/04 95,000 95,000
LaSalle Cragin Bk 6.700% 04/19/05 8,000 8,000
LaSalle NB 6.500% 04/26/05 13,000 13,000
LaSalle Cragin Bk 6.600% 05/03/05 14,000 14,000
LaSalle NB 6.200% 05/24/05 90,000 90,000
LaSalle NB Semi 6.250% 05/31/05 265,000 265,000
LaSalle NB 5.700% 06/14/05 30,000 30,000
LaSalle Nat Bank 6.100% 06/21/05 10,000 10,000
LaSalle NB 5.900% 06/28/05 265,000 265,000
LaSalle NB 5.950% 07/26/05 30,000 30,000
LaSalle NB 6.250% 08/30/05 276,000 276,000
Republic B & T 6.000% 09/20/05 30,000 30,000
LaSalle NB 5.950% 09/27/05 205,000 205,000
European American Bk 6.050% 10/04/05 10,000 10,000
European American Bk 5.750% 11/29/05 86,000 86,000
European American Bk 5.700% 12/06/05 35,000 35,000
LaSalle NB 5.900% 02/28/06 190,000 190,000
LaSalle NB 6.000% 03/13/06 50,000 50,000
European American Bk 6.400% 03/27/06 90,000 90,000
LaSalle National Bank 6.650% 09/25/06 90,000 90,000
European Amern Bk 6.450% 01/22/07 15,000 15,000
Lasalle Natl Bk 6.150% 02/26/07 95,000 95,000
FNB of Ordway 6.300% 07/23/07 95,000 95,000
Lasalle Natl Bk 6.350% 09/04/07 50,000 50,000
Lasalle Natl Bk 6.300% 09/17/07 38,000 38,000
Lasalle Natl Bk 6.300% 09/17/07 95,000 95,000
Lasalle Natl Bk 6.300% 09/17/07 95,000 95,000
LaSalle Natl Bk 5.900% 12/03/07 90,000 90,000
European American Bk 7.000% 12/06/10 20,000 20,000
LaSalle NB Chi IL 7.000% 12/27/10 190,000 190,000
LaSalle NI 7.000% 12/28/10 95,000 95,000
Provident Bank Ohio 6.750% 01/26/11 10,000 10,000
------------------------------------------
$8,922,000 $8,922,000
==========================================
==========================================
Loans to Participants 7%-10.25% 1/98-9/27 $ 613,736 $ 613,736
==========================================
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
CURRENT VALUE/
FACE
DESCRIPTION SHARES VALUE COST
-------------------------------------- -------------------------------------------------------
<S> <C> <C> <C>
Common Stocks:
3COM Corp 9,332 $ 326,041 $ 313,289
ABN Amro Hldg NV 2,605 50,797 49,007
ABT Building Products Corp 3,680 66,240 80,989
Adobe Systems Inc 3,860 159,225 142,838
AES Corp 7,644 356,402 177,723
Aetna Inc 3,530 249,087 282,155
Aktiebolaget Electrolux LTD 765 52,785 45,913
Alcatel Alsthom 3,130 79,230 50,080
Allied Domecq PLC 5,940 53,757 45,200
Allstate Corp 51 4,615 4,480
Aluminum Co America 32 2,252 2,253
AMBAC Financial Group Inc 1,540 70,840 66,146
Amer Greetings A 65 2,543 2,391
Amer Home Products 50 3,825 3,667
Amer Intl Group Inc 600 65,250 52,719
Amer Standard Companies 4,930 188,883 219,649
Amer Stores Co 10,440 214,678 211,745
Amer Stores Co New 2,390 49,146 59,451
Amerin Corp 1,970 55,160 46,889
Ameritech Corp New 895 72,048 61,235
Ametek Inc New 2,435 65,745 59,833
Amgen Inc 1,200 64,950 67,300
Asia Pulp & Paper LTD 7,860 77,618 88,931
Astra AB 3,277 54,071 57,073
Atmel Corp 3,540 65,713 93,533
AXA - UAP 2,325 90,675 85,153
Baker Hughes Inc 1,000 43,625 35,400
Banc One Corp 1,264 68,652 65,906
BankAmerica Corp 61 4,453 4,686
BankBoston Corp 994 93,374 74,646
Bat Industries PLC 4,355 81,656 76,275
Bear Stearns Cos Inc 67 3,183 2,919
Becton Dickinson & Co 1,410 70,500 68,113
Bell Atlantic Corp 40 3,640 3,487
Bellsouth Corp 79 4,449 4,231
Biogen Inc 2,890 105,124 94,488
Briggs & Stratton Corp 920 44,678 48,070
Bristol Myers Squibb Co 533 50,435 43,306
British Pete PLC 1,035 82,477 89,796
Brunswick Corp 3,050 92,455 75,635
Butler Intl Inc New 334,934 5,861,345 3,792,988
Cadbury Schweppes PLC 1,265 52,339 42,967
Case Corp 2,642 159,677 152,124
Caterpillar Inc 1,385 67,173 68,480
CBS Corp 2,000 58,876 37,638
CDN Pac Ltd New Canada 2,170 59,133 64,575
Chase Manhattan Corp 2,230 244,185 201,946
Chase Manhattan Corp New 585 64,057 69,196
Cigna Corp 1,036 178,580 169,426
Circuit City Stores 830 29,517 28,429
Cisco Sys Inc 741 41,311 31,348
CIT Group Inc Cl A 3,200 103,200 95,800
Citicorp 2,300 290,807 240,404
Coastal Corp 50 3,097 3,027
Coca Cola Co Com 105 7,002 6,443
Columbia Gas Sys 36 2,828 2,660
Compagnie Generale Des Eaux 3,005 83,918 75,179
</TABLE>
16
<PAGE>
<TABLE>
<S> <C> <C> <C>
Compaq Computer Corp 577 32,600 23,243
Computer Assoc Intl Inc 2,062 109,286 90,709
Conagra Inc 67 2,219 2,409
Contl Airlines Cl B 76 3,657 3,422
Daimler Benz A G 770 55,633 54,101
Dallas Semiconductor Corp 2,170 88,428 49,910
Dayton Hudson Corp 2,905 196,088 130,166
Deere and Co 1,830 106,598 76,000
Den Danske Bank A F 435 58,002 36,813
Deutche Bank A G 1,245 87,937 59,278
Diageo Plc 2,085 78,969 66,291
Du Pont De Nemours 1,000 60,063 56,063
Eaton Corp 1,030 91,928 74,448
ECI Telecom LTD 6,320 161,160 134,300
Electronic Data Sys Corp New 2,580 113,360 95,028
Elf Aquitaine 1,514 88,758 70,396
EMC Corp Mass 9,200 252,430 152,375
Endesa S A 4,160 75,662 72,800
ENI Spa 1,445 82,456 75,201
Enron Corp Exch NT 1998 Preferred 1,205 24,853 25,221
Entergy Corp New 71 2,126 1,829
Exel LTD Ord Bermuda 1,820 115,343 68,933
Exxon Corp 1,247 76,301 77,238
Fannie Mae 1,025 58,490 40,966
Federal Mogul Corp 1,600 64,800 60,625
Federated Department Stores Inc New 1,473 63,432 61,875
Fiat SPA 10,356 78,322 78,560
First Chicago NBD Corp 44 3,674 3,385
First Union Corp 3,150 161,437 155,875
Flour Corp 2,380 88,952 137,231
Ford Motor Co Com 1,460 70,902 69,205
Gateway 2000 Inc 2,355 77,127 71,375
Genl Dynamics Corp 760 65,930 65,242
Genl Elec Co PLC 8,025 52,684 50,948
Genl Electric Co 936 68,679 56,486
Genl Re Corp 325 68,900 65,498
Gillette Company 39 3,917 3,700
Goodyear Tire & Rubber 37 2,354 2,361
Greenpoint Financial Corp 960 69,660 61,696
GTech Holdings Corp 2,750 87,829 91,242
Halliburton Co 1,234 64,014 66,858
Hannaford Bros Co 1,460 63,419 50,225
Hartford Fincl Services Group Inc 800 74,850 60,986
Hasbro Inc 2,160 68,040 61,044
HBO & Co GA 64 3,072 2,858
Heineken N V 157 27,338 26,523
Hilton Hotels Corp 3,550 105,612 95,184
Hoechst AG 1,940 68,022 85,778
Hormel Foods Corp 3,600 117,900 94,786
HSBC Hldgs PLC 224 55,218 49,580
Illinois Centl Corp Sr A 2,490 84,817 89,094
Ingersoll Rand 1,705 69,053 70,987
Intel Corp 500 35,125 44,298
Intl Business Mach 651 68,111 59,619
IPC Holdings LTD 3,470 111,689 93,386
Johnson & Johnson Com 900 59,287 50,084
Kimberly Clarck Corp 53 2,614 2,669
KN Energy Inc 2,680 144,720 106,431
Lilly Eli & Co 776 54,029 31,801
Lockheed Martin Corp 3,580 352,630 332,671
LSI Logic Corp 6,600 129,525 196,113
Mannesmann Aktiengesell-Schaft 164 82,910 70,980
Matsushita Elec Ind 401 60,952 63,196
Mattel Inc 3,080 114,730 89,599
</TABLE>
17
<PAGE>
<TABLE>
<S> <C> <C> <C>
McGraw Hill Companies Inc 1,540 113,960 71,908
Medpartners Inc 13,510 302,286 269,038
Medtronic Inc 69 3,622 3,411
MEMC Electr Materials 3,420 52,155 84,388
Mercantile Bancorporation Inc 2,305 141,758 76,650
Merck & Co 600 63,600 55,397
Microsoft Corp 59 7,626 8,177
Mitsui Marine & Fire Ins LTD 1,125 57,625 60,780
Morton Intl Inc 6,930 238,219 216,373
Natl Power PLC 2,052 81,310 69,342
Nestle S A 1,086 81,493 59,458
Nintendo LTD 4,205 51,747 37,000
Novartis AG 996 80,920 57,578
NY Times Co A 60 3,967 3,581
OM Group Inc 3,050 111,706 83,496
Omnicom Group 86 3,644 3,072
Oracle Corp 92 2,053 2,679
Pacificare Health Systems Inc 1,140 59,708 85,097
Parker Hannifin Corp 1,310 60,096 33,842
Pep Boys Manny Moe & Jack 5,950 142,056 196,286
Pepsico Inc 1,497 54,266 50,409
Pfizer Inc 86 6,412 6,313
Philip Morris Cos Inc 1,601 72,445 65,455
PNC Bank Corp 64 3,644 3,376
Potash Corp Sask Inc Canada 755 62,665 62,916
Praxair Inc 52 2,340 2,256
Procter & Gamble Co 75 5,986 5,724
Progressive Corp Ohio 620 74,322 66,491
Reading & Bates Corp New 940 39,363 38,775
Reynolds Metals Co 1,650 99,000 95,109
Rhone Poulenc SA Amer 1,790 79,097 60,636
Ricoh LTD 810 50,461 47,398
Rohm Haas Co 29 2,777 2,639
Royal Dutch Petroleum Co New 1,480 80,198 63,178
Sabre Group Holdings Inc Cl A 1,790 51,686 53,516
Santa Fe Intl Corp 2,960 120,620 120,463
SBC Communications Inc 65 4,761 4,574
Schlumberger Ltd 900 72,450 72,794
Sears Roebuck 43 1,946 2,032
SLM Hldg Corp VTG 485 67,476 71,841
Societe Generale France 2,960 80,693 68,991
Sony Corp 943 85,577 61,884
SunAmerica Inc 67 2,864 2,705
Synopsys 3,090 110,467 103,386
Sysco Corp 630 28,705 24,096
Telefonos De Mexico SA 58 3,252 2,791
Tellabs Inc 50 2,644 2,700
Tenet Healthcare Corp 8,605 285,041 221,166
Texaco Inc 1,300 70,687 76,575
Texas Utilities Co 69 2,863 2,690
Thermo Electron Corp 1,000 44,000 36,300
Tidewater Inc 370 20,489 23,000
TJX Cos Inc New 2,074 71,294 64,682
Travelers Group Inc 1,442 77,688 47,374
Travelers Ppty Casualty 2,630 115,720 106,305
UAL Corp New 770 71,225 66,748
Ucar Intl Inc 3,520 140,582 151,367
Ultramar Diamond Shamrock 3,890 123,994 123,276
Unilever NV NY Shs 50 3,122 2,966
Unilever PLC 1,630 56,235 39,731
Union Texas Pete Hldgs Inc 7,055 146,836 161,741
Vastar Res Inc 3,550 126,912 135,184
Vesta Insurance Group Inc 2,230 132,406 78,296
Wallace Computer Services Inc 2,540 98,743 87,855
</TABLE>
18
<PAGE>
<TABLE>
<S> <C> <C> <C>
Walmart Stores Inc 114 4,496 4,542
Walt Disney Co 649 64,251 49,601
Warnaco Group Inc Cl A 2,200 69,025 64,813
Wash Mutual Inc 4,050 258,443 184,182
Weatherford Enterra Inc 2,480 108,500 108,500
Wyman Gordon Co 2,315 45,432 55,105
Xerox Corp 4,682 345,883 247,360
Zebra Technologies Corp Cl A 3,860 114,835 114,833
Zurich Insurance 925 88,279 52,589
----------------------------------------
$21,278,594 $17,553,206
========================================
</TABLE>
19
<PAGE>
BUTLER SERVICE GROUP, INC.
401(K) PLAN
<TABLE>
<CAPTION>
ITEM 27d of FORM 5500 - SCHEDULE OF REPORTABLE
TRANSACTIONS
YEAR ENDED DECEMBER 31, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
Number of Number of
Sales Net Gain Purchase
Asset Description Transactions Proceeds (Loss) Transactions Cost
- ------------------------------------- --------------- ---------------- ----------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Single transactions in excess of 5% of Plan assets:
None - - - - -
Series of transactions in excess of 5% of Plan assets:
PW Retirement Money Fund 191 8,800,415 - 278 8,622,918
Sansom Money Market
Portfolio 200 10,950,975 - 320 10,183,769
Butler International Common Stock 34 608,813 119,745 39 1,334,123
</TABLE>
20
<PAGE>
EXHIBIT 1
INDEPENDENT AUDITORS' CONSENT
- -----------------------------
We consent to the incorporation by reference in Registration Statements No.
333-22263, No. 33-58481 and No. 33-87012 on Form S-8, Registration Statement No.
33-59427 on Form S-3 and Post-Effective Amendment No. 4 to Registration
Statement No. 33-58278 on Form S-2 of our report dated June 26, 1998 appearing
in the Annual Report on Form 11-K of the Butler Service Group, Inc. 401(k) Plan
for the year ended December 31, 1997.
/s/ Deloitte & Touche LLP
- -------------------------
Parsippany, New Jersey
June 29, 1998
21
<PAGE>
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the plan) have duly caused this annual
report to be signed on its behalf by the undersigned thereunto duly authorized.
BUTLER INTERNATIONAL, INC.
- --------------------------
(Registrant)
June 29, 1998 By: /s/ Warren F. Brecht
--------------------------
Warren F. Brecht
Senior Vice President
and Secretary
22
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