<PAGE>
SECURITIES & EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------
FORM 11-K
--------------------------------
[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 REQUIRED PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
Commission file number 1-9065.
Ecology and Environment, Inc. 401(k) Plan
(Full title of the Plan)
368 Pleasant View Drive, Lancaster, New York 14086
(Address of the Plan)
Ecology and Environment, Inc.
(Name of issuer of the securities held pursuant to the plan.)
368 Pleasant View Drive, Lancaster, New York 14086
(Address of principal executive office.)
Page 1 of 18
<PAGE>
REQUIRED INFORMATION
(1) Plan financial statements and schedules prepared in accordance with
financial reporting requirements of ERISA.
See accompanying Index on page 3.
(2) Exhibits:
Exhibit Number Description of Exhibit
(1) Consent of Independent
Accountants
Page 2 of 18
<PAGE>
<TABLE>
Ecology and Environment, Inc.
401(k) Plan
Index to Financial Statements and Additional Information
For the Year Ended December 31, 1997 and 1996
<CAPTION>
Page
<S> <C>
Report of Independent Accountants 1
Financial Statements:
Statement of Net Assets Available for Plan Benefits,
with Fund Information at December 31, 1997 2
Statement of Net Assets Available for Plan Benefits,
with Fund Information at December 31, 1996 3
Statement of Changes in Net Assets Available for Plan Benefits,
with Fund Information for the Year Ended December 31, 1997 4
Statement of Changes in Net Assets Available for Plan Benefits,
with Fund Information for the Year Ended December 31, 1996 5
Notes to Financial Statements 6-10
Additional Information:
Item 27a - Schedule of Assets Held for Investment Purposes
at December 31, 1997 11
Item 27b - Schedule of Loans or Fixed Income Obligations
for the Year Ended December 31, 1997 12
Item 27d - Schedule of Reportable Transactions for the
year Ended December 31, 1997 13
</TABLE>
Page 3 of 18
<PAGE>
Report of Independent Accountants
June 19, 1998
To the Participants and Plan Administrator of
the Ecology and Environment, Inc. 401(k) Plan
In our opinion, the accompanying statement of net assets available for plan
benefits and the related statements of changes in net assets available for
plan benefits present fairly, in all material respects, the net assets
available for plan benefits of the Ecology and Environment, Inc. 401(k) Plan
at December 31, 1997 and 1996, and the changes in net assets available for
plan benefits for the years then ended, in conformity with generally accepted
accounting principles. These financial statements are the responsibility of
the plan administrator; 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 the plan administrator, and evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for the opinion expressed above.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
the schedules of assets held for investment purposes at December 31, 1997, of
loans or fixed income obligations for the year ended December 31, 1997 and of
reportable transactions for the year ended December 31, 1997 is presented for
purposes of additional analysis and is not a required part of the basic
financial statements but is additional information required by ERISA. The
Fund Information in the statement of net assets available for plan benefits
and the statement of changes in net assets available for plan benefits is
presented for purposes of additional analysis rather than to present the net
assets available for plan benefits and changes in net assets available for
plan benefits of each fund. The additional information and the Fund
Information 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
Buffalo, New York
Page 4 of 18
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information at December 31, 1997
<CAPTION>
Fund Information
Growth & Strategic Peoples New Company
Income Investing Index Bond Leaders Stock
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Assets
Investments, at fair value
Shares in Dreyfus Corporation,
Registered Investment Company:
Growth and Income Fund, Inc. $1,808,922 $ --- $ --- $ --- $ --- $ ---
Strategic Investing --- 1,044,259 --- --- --- ---
Peoples Index Fund, Inc. --- --- 1,596,626 --- --- ---
A Bonds Plus, Inc. --- --- --- 380,370 --- ---
New Leaders Fund, Inc. --- --- --- --- 2,310,213 ---
Company Stock Fund --- --- --- --- --- 148,978
Units in LaSalle National
Trust, N.A.:
Capital Preservation Fund
Series E --- --- --- --- --- ---
Employee loans --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Total investments 1,808,922 1,044,259 1,596,26 380,370 2,310,213 148,978
---------- ---------- ---------- ---------- ---------- ----------
Receivables:
Employee contributions 18,192 9,739 19,827 3,840 22,377 983
---------- ---------- ---------- ---------- ---------- ----------
Total assets 1,827,114 1,053,998 1,616,453 384,210 2,332,590 149,961
---------- ---------- ---------- ---------- ---------- ----------
Liabilities
Administrative expenses --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Total liabilities --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Net assets available
for plan benefits $1,827,114 $1,053,998 $1,616,453 $ 384,210 $2,332,590 $ 149,961
========== ========== ========== ========== ========== ==========
The accompanying notes are an integral part of these financial statements.
Page 5 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information at December 31, 1997
<CAPTION>
Fund Information (Continued)
Capital Templeton
Preservation Foreign Loan
Fund Fund Fund Total
<S> <C> <C> <C> <C>
Assets
Investments, at fair value
Shares in Dreyfus Corporation,
Registered Investment Company:
Growth and Income Fund, Inc. $ --- $ --- $ --- $1,808,922
Strategic Investing --- --- --- 1,044,259
Peoples Index Fund, Inc. --- --- --- 1,596,626
A Bonds Plus, Inc. --- --- --- 380,370
New Leaders Fund, Inc. --- --- --- 2,310,213
Company Stock Fund --- --- --- 148,978
Shares in LaSalle National
Trust, N.A.:
Capital Preservation Fund
Series E 819,944 --- --- 819,944
Shares in Franklin Templeton
Group of Funds:
Templeton Foreign Fund --- 174,435 174,435
Employee loans --- --- 141,867 141,867
---------- ---------- ---------- ----------
Total investments 819,944 174,435 141,867 8,425,614
---------- ---------- ---------- ----------
Receivables:
Employee contributions 6,075 4,319 --- 85,352
---------- ---------- ---------- ----------
Total assets 826,019 178,354 141,867 8,510,966
---------- ---------- ---------- ----------
Liabilities
Administrative expenses 24,454 --- --- 24,454
---------- ---------- ---------- ----------
Total liabilities 24,454 --- --- 24,454
---------- ---------- ---------- ----------
Net assets available
for plan benefits $ 801,565 $ 178,754 $ 141,867 $8,486,512
========== ========== ========== ==========
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 5 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information at December 31, 1996
<CAPTION>
Fund Information
Growth & Strategic Peoples New Company
Income Investing Index Bond Leaders Stock
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Assets
Investments, at fair value
Shares in Dreyfus Corporation,
Registered Investment Company:
Growth and Income Fund, Inc. $1,517,656 $ --- $ --- $ --- $ --- $ ---
Strategic Investing --- 878,315 --- --- --- ---
Peoples Index Fund, Inc. --- --- 800,375 --- --- ---
A Bonds Plus, Inc. --- --- --- 363,754 --- ---
New Leaders Fund, Inc. --- --- --- --- 1,872,613 ---
Company Stock Fund --- --- --- --- --- 73,282
Units in LaSalle National
Trust, N.A.:
Capital Preservation Fund
Series E --- --- --- --- --- ---
Employee loans --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Total investments 1,517,656 878,315 800,375 363,754 1,872,613 73,282
Receivables:
Employee contributions 20,008 10,536 10,851 4,935 25,251 2,287
Cash equivalents --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Total assets 1,537,664 888,851 811,226 368,689 1,897,864 75,569
---------- ---------- ---------- ---------- ---------- ----------
Liabilities
Administrative expenses --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Total liabilities --- --- --- --- --- ---
---------- ---------- ---------- ---------- ---------- ----------
Net assets available
for plan benefits $1,537,664 $ 888,851 $ 811,226 $ 368,689 $1,897,864 $ 75,569
========== ========== ========== ========== ========== ==========
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 5 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information at December 31, 1996
<CAPTION>
Fund Information (Continued)
Capital
Preservation Loan Holding
Fund Fund Account Total
<S> <C> <C> <C> <C>
Assets
Investments, at fair value
Shares in Dreyfus Corporation,
Registered Investment Company:
Growth and Income Fund, Inc. $ --- $ --- $ --- $1,517,656
Strategic Investing --- --- --- 878,315
Peoples Index Fund, Inc. --- --- --- 800,375
A Bonds Plus, Inc. --- --- --- 363,754
New Leaders Fund, Inc. --- --- --- 1,872,613
Company Stock Fund --- --- --- 73,282
Units in LaSalle National
Trust, N.A.:
Capital Preservation Fund
Series E 569,060 --- --- 569,060
Employee loans --- 112,759 --- 112,759
---------- ---------- ---------- ----------
Total investments 569,060 112,759 --- 6,187,814
Receivables:
Employee contributions 5,138 --- --- 79,006
Cash equivalents --- --- 32,443 32,443
---------- ---------- ---------- ----------
Total assets 574,198 112,759 32,443 6,299,263
---------- ---------- ---------- ----------
Liabilities
Administrative expenses --- --- 32,443 32,443
---------- ---------- ---------- ----------
Total liabilities --- --- 32,443 32,443
---------- ---------- ---------- ----------
Net assets available
for plan benefits $ 574,198 $ 112,759 $ --- $6,266,820
========== ========== ========== ==========
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 5 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Changes in Net Assets Available for Plan Benefits, with Fund Information for the Year Ended December 31, 1997
<CAPTION>
Fund Information
Growth & Strategic Peoples New Company
Income Investing Index Bond Leaders Stock
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets
attributed to:
Investment income (loss) -
Net appreciation/(depreciation)
in fair value of investments $ 218,916 $ 140,568 $ 310,532 $ 13,986 $ 343,017 $ 41,747
Interest --- --- --- --- --- ---
Dividends 26,126 4,710 16,357 20,401 25,899 5,219
------------ ------------ ---------- ---------- ---------- ----------
245,042 145,278 326,889 34,387 368,916 46,966
Contributions
Employee 380,621 199,534 331,353 81,821 458,546 15,828
Rollovers 3,627 3,209 8,696 3,209 4,279 34
------------ ------------ ---------- ------------ ------------ ------------
Total Additions 629,290 348,021 666,938 119,417 831,741 62,828
------------ ------------ ---------- ------------ ------------ ------------
Deductions from net assets
attributed to:
Benefits paid to participants 158,856 123,285 39,561 43,900 222,552 2,310
Administrative expenses --- --- --- --- --- ---
------------ ------------ ---------- ------------ ------------ ------------
Total Deductions 158,856 123,285 39,561 43,900 222,552 2,310
------------ ------------ ---------- ------------ ------------ ------------
Net increase (decrease) prior
to interfund transfers 470,434 224,736 627,377 75,517 609,189 60,518
Interfund transfers (180,984) (59,589) 177,850 (56,996) (174,463) 13,874
------------ ------------ ---------- ------------ ------------ ------------
Net increase 289,450 165,147 805,227 15,521 434,726 74,392
Net assets available
for plan benefits:
Beginning of year 1,537,664 888,851 811,226 368,689 1,897,864 75,569
------------ ------------ ---------- ------------ ------------ ------------
End of year $1,827,114 $1,053,998 $1,616,453 $ 384,210 $2,332,590 $ 149,961
============ ============ ========== ============ ============ ============
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 7 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information For the Year Ended December 31, 1997
<CAPTION>
Fund Information (Continued)
Capital Templeton
Preservation Foreign Loan Holding
Fund Fund Fund Account Total
<S> <C> <C> <C> <C> <C>
Additions to net assets
attributed to:
Investment income (loss) -
Net appreciation/(depreciation)
in fair value of investments $ --- $ (16,309) $ --- $ --- $1,052,457
Interest 33,685 --- 8,569 --- 42,254
Dividends --- 14,432 --- 1,675 114,819
----------- ----------- ---------- ---------- ----------
33,685 (1,877) 8,569 1,675 1,209,530
Contributions
Employee 107,118 67,632 --- --- 1,642,453
Rollovers 4,279 --- --- --- 27,333
----------- ----------- ---------- ---------- ----------
Total Additions 145,082 65,755 8,569 1,675 2,879,316
----------- ----------- ---------- ---------- ----------
Deductions from net assets
attributed to:
Benefits paid to participants 35,996 12,798 --- --- 639,258
Administrative expenses 3,716 --- --- 16,650 20,366
----------- ----------- ---------- ---------- ----------
Total Deductions 39,712 12,798 --- 16,650 659,624
----------- ----------- ---------- ---------- ----------
Net increase (decrease) prior
to interfund transfers 105,370 52,957 8,569 (14,975) 2,219,692
Interfund transfers 121,997 125,797 20,539 14,975 ---
----------- ----------- ---------- ---------- ----------
Net increase 227,367 178,754 29,108 --- 2,219,692
Net assets available
for plan benefits:
Beginning of year 574,198 --- 129,759 --- 6,266,820
----------- ------------ ---------- ---------- ----------
End of year $ 801,565 $ 178,754 $141,867 $ --- $8,486,512
=========== ============ ========== ========== ==========
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 7 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Changes in Net Assets Available for Plan Benefits, with Fund Information for the Year Ended December 31, 1996
<CAPTION>
Fund Information
Growth & Strategic Peoples New Company
Income Investing Index Bond Leaders Stock
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets
attributed to:
Investment income (loss) -
Net appreciation/(depreciation)
in fair value of investments $ (56,485) $ (6,906) $ 69,974 $ (7,300) $ (99,439) $ (2,383)
Interest --- --- --- --- --- ---
Dividends 216,349 128,958 35,040 17,521 131,267 2,486
------------ ------------ ---------- ---------- ---------- ----------
159,864 122,052 105,014 10,221 230,706 103
Contributions
Employee 438,243 235,815 192,408 112,377 526,673 14,305
Rollovers 252,124 111,887 211,978 73,963 288,790 20,459
------------ ------------ ---------- ------------ ------------ ------------
Total Additions 850,231 469,754 509,400 196,561 1,046,169 34,867
------------ ------------ ---------- ------------ ------------ ------------
Deductions from net assets
attributed to:
Benefits paid to participants 160,364 63,201 44,699 36,556 153,834 ---
Administrative expenses --- --- --- --- --- ---
------------ ------------ ---------- ------------ ------------ ------------
Total Deductions 160,364 63,201 44,699 36,556 153,834 ---
------------ ------------ ---------- ------------ ------------ ------------
Net increase (decrease) prior
to interfund transfers 689,867 406,553 464,701 160,005 892,335 34,867
Interfund transfers (64,475) (40,481) 76,119 (43,580) (23,160) (21,860)
------------ ------------ ---------- ------------ ------------ ------------
Net increase 625,392 366,072 540,820 116,425 869,175 13,007
Net assets available
for plan benefits:
Beginning of year 912,272 522,779 270,406 252,264 1,028,689 62,562
------------ ------------ ---------- ------------ ------------ ------------
End of year $1,537,664 $ 888,851 $ 811,226 $ 368,689 $1,897,864 $ 75,569
============ ============ ========== ============ ============ ============
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 7 of 18
</TABLE>
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Statement of Net Assets Available for Plan Benefits, with Fund Information For the Year Ended December 31, 1996
<CAPTION>
Fund Information (Continued)
Capital
Preservation Loan Holding
Fund Fund Account Total
<S> <C> <C> <C> <C>
Additions to net assets
attributed to:
Investment income (loss) -
Net appreciation/(depreciation)
in fair value of investments $ --- $ --- $ --- $ 96,339
Interest 20,680 2,963 --- 23,643
Dividends --- --- 1,175 532,796
------------ ----------- ---------- ----------
20,680 2,963 1,175 652,778
Contributions
Employee 106,866 --- --- 1,626,687
Rollovers 325,812 --- --- 1,285,013
------------ ----------- ---------- ------------
Total Additions 453,358 2,963 1,175 3,564,478
------------ ----------- ---------- ------------
Deductions from net assets
attributed to:
Benefits paid to participants 62,207 --- --- 520,861
Administrative expenses --- --- 47,810 47,810
------------ ----------- ---------- ------------
Total Deductions 62,207 --- 47,810 568,671
------------ ----------- ---------- ------------
Net increase (decrease) prior
to interfund transfers 391,151 2,963 (46,635) 2,995,807
Interfund transfers (12,648) 83,450 46,635 ---
------------ ----------- ---------- ------------
Net increase 378,503 86,413 --- 2,995,807
Net assets available
for plan benefits:
Beginning of year 195,695 26,346 --- 3,271,013
------------ ------------ ---------- ------------
End of year $ 574,198 $ 112,759 $ --- $6,266,820
============ ============ ========== ============
<PAGE>
The accompanying notes are an integral part of these financial statements.
Page 7 of 18
</TABLE>
<PAGE>
Ecology and Environment, Inc.
401(k) Plan
Notes to Financial Statements
1. Description of Plan
The following description of the Ecology and Environment, Inc. 401(k) Plan
(the Plan) is provided for general information purposes only.
Participants should refer to the Plan agreement for a more comprehensive
description of the Plan's provisions.
General
The Plan was established January 1, 1994 as a defined-contribution plan to
cover all eligible employees of Ecology and Environment, Inc. (the
Company). In accordance with the Plan agreement, eligibility is defined
as an employee who has completed a minimum of 1,000 hours of service and
is age twenty-one or older. Contributions to the Plan were not permitted
prior to July 1, 1994. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
Contributions
Participants may elect to make voluntary contributions up to 15% of their
annual compensation subject to certain limitations. The elective deferral
percentage may be modified the first day of any month.
The Company may make contributions in the form of matching contributions
and/or an annual discretionary contribution fixed by appropriate action of
the Company. There were no Company contributions for the 1997 and 1996
plan years.
Rollover contributions during 1996 were $1,285,000. Of this amount,
approximately $1,265,000 were contributed by employees of the Company as a
result of the termination of the Ecology and Environment, Inc. Defined
Benefit Pension Plan as of November 30, 1995.
Participant accounts
Each participant's account is credited with the participant's contribution
and allocations of the Company's contribution (if any) and the Plan
earnings, and charged with an allocation of administrative expenses.
Allocations are based on participant account balances, as defined in the
Plan document. The benefit to which a participant is entitled is the
participant's vested account balance.
Page 9 of 18
<PAGE>
Vesting
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting on the Company's matching and discretionary
contribution portion of their accounts plus actual earnings thereon is
based on years of continuous service. A participant is 100% vested in the
Company contributions after five years of credited service.
Investment options
Upon enrollment in the Plan, a participant may direct their contributions
in any combination of the seven investment options in at least 10 percent
increments in each option selected. The investment options are as
follows:
Dreyfus Growth and Income Fund, Inc.
This fund's main goals are long-term capital growth, current income and
growth of income while maintaining reasonable investment risk. The Fund
may invest in securities of U.S. and foreign companies.
Dreyfus Strategic Investing
This fund is invested primarily in publicly issued common stock with the
objective of high capital growth.
Dreyfus Peoples Index Fund, Inc.
This fund invests in a portfolio of common stocks included in the
Standard & Poor's 500 Composite Index and attempts to match as closely
as possible the performance of that Index.
Dreyfus A Bonds Plus, Inc.
This fund seeks to provide the maximum amount of current income while
also preserving capital and maintaining liquidity through high current
yields from a portfolio made up mainly of high quality fixed income
securities.
Dreyfus New Leaders Fund, Inc.
This fund is invested in a portfolio primarily comprised of emerging
small to mid-sized growth company common stocks and seeks to maximize
capital growth.
Company Stock Fund
This fund invests solely in the common stock of Ecology and Environment,
Inc.
Page 10 of 18
<PAGE>
Capital Preservation Fund Series E
This fund is a collective investment fund investing primarily in
Guaranteed Investment Contracts (GICs) and similar investments, managed
by LaSalle National Trust, N.A. The fund seeks high current income with
stability of principal.
Templeton Foreign Fund
This fund is a long term capital growth fund investing in stocks and
debt obligations of companies and governments outside the United States.
This fund became available to participants on May 1, 1997.
Participants may change their investment options on a daily basis.
Effective March 1, 1997, participants may invest in the Templeton
Foreign Fund. This fund's investment objective is long-term capital
growth through investing in stocks and debt obligations of companies and
governments outside the United States.
Employee loans
Participants may borrow from their account a minimum of $1,000 with a
maximum equal to the lesser of $50,000 or 50% of their vested account
balance. Loan transfers are treated as a transfer to (from) the
investment fund from (to) the Loan Fund. Loan terms range from one to
five years or a reasonable period of time determined when the loan is made
for the purchase of a primary residence. The loans are secured by the
balance in the participant's account and bear interest at a rate
commensurate with local prevailing rates as determined by the Plan
administrator. Principal and interest are paid ratably through bi-weekly
payroll deductions.
Payment of benefits
On termination of service due to death, disability, or retirement, a
participant may elect to receive either a lump-sum amount equal to the
value of the participant's vested interest in his or her account, or
monthly, quarterly, semi-annual or annual installments over a period not
to exceed the life of the participant or the life of a designated
beneficiary.
Administration
The Plan is administered by the Company. The Company has selected The
Dreyfus Trust Company to be the Trustee of the Plan. The Trustee is
responsible for maintaining the assets of the Plan and reporting on
the earnings and assets of the Plan.
Administrative expenses are paid by the participants and the Company. An
asset based fee is paid by the participants on an annual basis. This
amount is deducted from participant accounts and placed in the Holding
Account to be used to pay administrative expenses submitted for payment to
the Trustee from the Company. Any remaining administrative expenses
in excess of the amounts which are set aside by the Plan are paid by the
Company.
2. Summary of Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting.
Page 11 of 18
<PAGE>
Investments and Related Transactions
The Plan's investments are reflected at current market value as measured
by quoted market prices in an active market or as determined in good faith
by the Trustee, except for investment contracts within the Capital
Preservation Fund which are reflected at contract value which approximates
market value. Net appreciation/(depreciation) in fair value of
investments includes both realized gains and losses and unrealized
appreciation/(depreciation) in the fair value of investments. Interest
and dividend income is recognized as earned. Investment transactions are
accounted for on the trade date. Net unrealized appreciation at December
31, 1997 and 1996 was $1,135,931 and $229,474, respectively. Participant
loans are valued at cost, which approximates fair value.
Payment of Benefits
Benefits are recorded when paid.
Use of Estimates
The preparation of the Plan's financial statements in conformity with
generally accepted accounting principles requires the Plan Administrator
to make estimates and assumptions that affect the reported amounts of net
assets and disclosures of contingent net assets at the date of
the financial statements and the reported amounts of changes in net assets
during the reporting period. Actual results could differ from those
estimates.
3. Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue at any time and to terminate the Plan
subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100 percent vested in their accounts.
4. Reconciliation of Financial Statements to Form 5500
<TABLE>
The following is a reconciliation of net assets available for plan
benefits according to the financial statements to Form 5500:
<CAPTION>
December 31, December 31,
1997 1996
----------- -----------
<S> <C> <C>
Net assets available for plan benefits
per the financial statements $8,486,512 $6,266,820
Amounts allocated to withdrawing
participants (418,577) (180,074)
----------- -----------
Net assets available for benefits
per Form 5500 $8,067,935 $6,086,746
=========== ===========
</TABLE>
Page 12 of 18
<PAGE>
<TABLE>
The following is a reconciliation of benefits paid to participants
according to the financial statements to Form 5500:
<CAPTION>
Year Ended
December 31,
1997
------------
<S> <C>
Benefits paid to participants per the financial
statements $639,258
Add: Amounts allocated to withdrawing participants
at December 31, 1997 418,577
Less: Amounts allocated to withdrawing participants
at December 31, 1996 (180,074)
-----------
Benefits paid to participants per Form 5500 $877,761
===========
</TABLE>
Amounts allocated to withdrawing participants are recorded on the Form
5500 for benefit claims that have been processed and approved for payment
prior to December 31 but not yet paid as of that date.
5. Tax Status
The Plan Administrator has not applied to the Internal Revenue Service for
a determination letter for the Plan. The Plan Administrator and Plan's
tax counsel believe that the Plan, which is based upon a prototype plan
designed by the Dreyfus Corporation that received a favorable
determination letter dated September 1, 1994, is being operated in
compliance with the applicable requirements of ERISA and the Internal
Revenue Code and therefore fulfills the criteria for exemption from
federal and state income taxes.
Page 13 of 18
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Item 27a - Schedule of Assets Held for Investment Purposes at December 31, 1997
<CAPTION>
Shares Fair
Units Description Cost Value
POOLED INVESTMENT FUNDS:
Dreyfus Corporation:
<S> <C> <C> <C>
102,780 Growth and Income Fund, Inc. $1,946,914 $1,808,922
50,447 Strategic Investing 1,107,001 1,044,259
55,632 Peoples Index Fund, Inc. 1,171,545 1,596,626
25,911 A Bonds Plus, Inc. 363,536 380,370
52,090 New Leaders Fund, Inc. 1,431,888 2,310,213
12,469 Company Stock Fund 108,108 148,978
---------- ----------
6,128,992 7,289,368
OTHER INVESTMENTS:
LaSalle National Trust, N.A.
819,944 Capital Preservation Fund Series E 819,944 819,944
Franklin Templeton Group of Funds
19,867 Templeton Foreign Fund 198,880 174,435
Employee Loans 141,867 141,867
---------- ----------
$7,289,683 $8,425,614
========== ==========
</TABLE>
Page 14 of 18
<PAGE>
<TABLE>
Ecology and Environment, Inc.
401(k) Plan
Item 27b - Schedule of Loans or Fixed Income Obligations for the Year Ended December 31, 1997
<CAPTION>
Amount Received During
Identity and Original the Year Ended
Address of Amount of December 31, 1996 Unpaid Balance Amount Overdue
Obligor Loan Principal Interest December 31, 1996 Description Principal Interest
<S> <C> <C> <C> <C> <C> <C> <C>
Mark L. Riforgiat $1,470 $182 $76 $1,029 Participant loan; $ 85 $ 30
4997 West Main St. Interest rate - 9.75%
Fredonia, NY 14063 Originated on
September 29, 1995
Mark L. Riforgiat 4,079 --- --- 4,079 General loan;
4997 West Main St. Interest rate - 9.50% 250 116
Fredonia, NY 14063 Originated on
July 15, 1997
David M. Tanbouz 6,360 --- --- 5,576 General loan; 1,905 773
2305 Yale Drive Interest rate - 10%
Arlington, TX 76017 Originated on
June 15, 1995
Kilpatrick Woodward 1,100 131 62 847 General loan; 88 33
53 Ruspin Ave. Interest rate - 9.75%
Buffalo, NY 14215 Originated on
September 18, 1995
</TABLE>
Page 15 of 18
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Item 27d - Schedule of Reportable Transactions for the Year Ended December 31, 1997
<CAPTION>
Purchases
Identity of
Party Description of Purchase
Involved Asset Price Transactions
<S> <C> <C> <C>
Dreyfus Corporation Growth & Income Fund, Inc. $ 458,238 65
(DC) --- ---
DC Strategic Investing 246,997 60
--- ---
DC Peoples Index Fund, Inc. 569,324 94
--- ---
DC New Leaders Fund, Inc. 551,294 72
--- ---
LaSalle National Capital Preservation 391,545 86
Trust, N.A. Fund Series E --- ---
</TABLE>
Page 16 of 18
<PAGE>
<TABLE>
ECOLOGY AND ENVIRONMENT, INC.
401(k) Plan
Item 27d - Schedule of Reportable Transactions for the Year Ended December 31, 1997
<CAPTION>
Sales
Current Value
Identity of Expense of Asset on
Party Description of Selling Trans- Incurred with Cost of Transaction Net Gain
Involved Asset Price actions Transaction Asset Date or (Loss)
<S> <C> <C> <C> <C> <C> <C> <C>
Dreyfus Corporation Growth & Income Fund, Inc. $ --- --- $ --- --- $ 458,238 $ ---
(DC) 379,464 76 --- 357,582 379,464 21,882
DC Strategic Investing --- --- --- 246,997 ---
215,079 49 --- 194,947 215,079 20,132
DC Peoples Index Fund, Inc. --- --- --- 569,324 ---
72,830 40 --- 57,425 72,830 15,405
DC New Leaders Fund, Inc. --- --- --- 551,294 ---
448,307 67 --- 368,398 448,307 79,909
LaSalle National Capital Preservation --- --- --- 391,545 ---
Trust, N.A. Fund Series E 173,239 63 --- 172,739 173,239 ---
</TABLE>
Page 16 of 18
<PAGE>
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the Plan Administrator has duly caused this annual report to be
signed by the undersigned thereunto duly authorized.
Ecology and Environment, Inc.
401(k) Plan
(Name of Plan)
By: Ecology and Environment, Inc.
401(k) Plan Committee
Plan Administrator
By: /s/ Ronald L. Frank
Ronald L. Frank
Committee Member
DATE: June 26, 1998
Page 17 of 18
<PAGE>
Exhibit 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 No. 333-30085 of the Ecology and Environment, Inc.
401(k) Plan of our report dated June 19, 1998 appearing on page 4 of this
Form 11-K.
/s/PRICE WATERHOUSE LLP
Price Waterhouse LLP
Buffalo, New York
June 26, 1998
Page 18 of 18
