UNITED STATES
SECURITIES AND 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, 1998
OR
[ ] Transition report pursuant to section 15(d)
of The Securities Exchange Act of 1934
For the transition period from _____ to _____
Commission File Number 0-18984
REYNOLDS, SMITH AND HILLS, INC.
EMPLOYEES 401(k) PROFIT SHARING PLAN
(Full title of the plan)
REYNOLDS, SMITH AND HILLS, INC.
(Name of the issuer of the securities held pursuant to the plan)
4651 Salisbury Road, Jacksonville, Florida 32256
(Address of principal executive office of issuer and plan)
<PAGE>
REYNOLDS, SMITH AND HILLS, INC.
EMPLOYEES 401(k) PROFIT SHARING PLAN
Financial Statements and Supplemental Schedules
for the Year Ended December 31 1998, and
Independent Auditors' Report
<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k) PROFIT SHARING PLAN
TABLE OF CONTENTS
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Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Benefits 3
Statements of Changes in Net Assets Available for Benefits 7
Notes to Financial Statements 9
SUPPLEMENTAL SCHEDULES:
Item 27a - Assets Held for Investment Purposes 13
Item 27d - Schedule of Reportable Transactions 14
<PAGE>
Deloitte & Touche LLP
Certified Public Accountants
Suite 2801
Independent Square
One Independent Drive
Jacksonville, Florida 32202-5034
Telephone: (904) 665-1400
Facsimile: (904) 355-9104
INDEPENDENT AUDITORS' REPORT
Trustees
Reynolds, Smith and Hills, Inc. Employees
401(k) Profit Sharing Plan
Jacksonville, Florida
We have audited the accompanying statements of net assets available for benefits
of Reynolds, Smith and Hills, Inc. Employees 401(k) Profit Sharing Plan (the
"Plan") as of December 31, 1998 and 1997, and the related statement of changes
in net assets available for benefits for the year ended December 31, 1998. 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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for the year
ended December 31, 1998, in conformity with generally accepted accounting
principles.
As explained in Note 1 to the financial statements, the 1998 and 1997 financial
statements include securities valued at $1,394,428 (8 percent of net assets
available for benefits) and $1,341,719 (8 percent of net assets available for
benefits), respectively, whose values have been estimated by the Board of
Trustees in the absence of readily ascertainable market values. We have examined
the procedures used by the Board of Trustees in arriving at its estimate of
value of such securities and have inspected underlying documentation, and, in
the circumstances, we believe the procedures are reasonable and the
documentation appropriate. However, because of the inherent uncertainty of
valuation, those estimated values may differ significantly from the values that
would have been used had a ready market for the securities existed, and the
differences could be material.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Assets Held
for Investment Purposes and Reportable Transactions 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 for Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental
information by fund in the statements of net assets available for benefits and
the statement of changes in net assets available for benefits is presented for
purposes of additional analysis rather than to present the net assets available
for benefits and changes in net assets available for benefits of each fund. The
supplemental schedules and supplemental information by fund is the
responsibility of the Plan's management. Such supplemental schedules and
supplemental information by fund 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/Deloitte & Touche LLP
July 15, 1999
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Supplemental Information by Fund
--------------------------------
Value Select Stable
Equity Income Value
Fund Fund Fund
----- ------ ------
<S> <C> <C> <C>
Assets:
Investments, at fair value (Note 3):
INVESCO collective trust funds $7,770,562 $1,406,348 $2,823,818
Short-term investments
Investments, at estimated fair value (Note 3):
Reynolds, Smith and Hills, Inc. Common stock
Loans to participants
---------- ---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $7,770,562 $1,406,348 $2,823,818
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements
- 3 -
<PAGE>
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Emerging Combined
Flex Dynamics Growth Loan RS&H Total
Fund Fund Fund Fund Stock All Funds
---- ---- ---- ---- ----- ---------
$1,088,704 $2,068,659 $899,695 $16,057,786
$ 102 102
1,394,428 1,394,428
$632,258 632,258
-------- ---------- -------- -------- ---------- -----------
$1,088,704 $2,068,659 $899,695 $632,258 $1,394,530 $18,084,574
========== ========== ======== ======== ========== ===========
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Supplemental Information by Fund
--------------------------------
Value Select Stable
Equity Income Value
Fund Fund Fund
----- ------ ------
<S> <C> <C> <C>
Assets:
Investments, at fair value (Note 3):
INVESCO collective trust funds $7,280,738 $1,336,077 $2,884,844
Short-term investments
Investments, at estimated fair value (Note 3):
Reynolds, Smith and Hills common stock
Loans to participants
---------- ---------- ----------
NET ASSETS AVAILABLE FOR BENEFITS 7,280,738 1,336,077 2,884,844
</TABLE>
The accompanying notes are an integral part of these financial statements.
- 5 -
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Emerging Combined
Flex Dynamics Growth Loan RS&H Total
Fund Fund Fund Fund Stock All Funds
---- ---- ---- ---- ----- ---------
<S> <C> <C> <C> <C> <C>
$ 855,515 $ 1,264,789 $ 530,329 $14,152,292
$ 19,027 19,027
1,341,719 1,341,719
611,672 611,672
- ----------- ----------- ----------- ----------- ----------- -----------
$ 855,515 $ 1,264,789 $ 530,329 $ 611,672 $ 1,360,746 $16,124,710
=========== =========== =========== =========== =========== ===========
</TABLE>
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
WITH FUND INFORMATION
YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Supplemental Information by Fund
--------------------------------
Value Select Stable
Equity Income Value
Fund Fund Fund
---- ---- ----
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
<S> <C> <C> <C>
Investment income $ 158,869 $ 115,059 $ 191,154
Net appreciation in value of RS&H, Inc. common stock
Net appreciation (depreciation) in fair value of investments 929,648 (18,443)
--------- --------- ---------
Net investment income 1,088,517 96,616 191,154
Contributions from employer 74,240 14,012 12,539
Contributions from employees 714,156 114,539 130,588
--------- --------- ---------
Total additions 1,876,913 225,167 334,281
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Administrative expenses 12,469 1,545 1,909
Distributions, net 921,265 108,148 400,962
--------- --------- ---------
Total deductions 933,734 109,693 402,871
PARTICIPANTS' TRANSFERS BETWEEN FUNDS IN (OUT) (453,355) (45,203) 7,564
--------- --------- ---------
Net increase (decrease) 489,824 70,271 (61,026)
NET ASSETS AVAILABLE FOR BENEFITS AT BEGINNING OF YEAR 7,280,738 1,336,077 2,884,844
--------- --------- ---------
NET ASSETS AVAILABLE FOR BENEFITS AT END OF YEAR $ 7,770,562 $ 1,406,348 $ 2,823,818
========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
- 7 -
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Emerging Combined
Flex Dynamics Growth Loan RS&H Total
Fund Fund Fund Fund Stock All Funds
---- ---- ---- ---- ----- ---------
<S> <C> <C> <C> <C> <C>
$ 3,132 $ 159,725 $ 85,920 $ 713,859
$ 55,119 55,119
152,748 142,255 (6,318) 1,199,890
------- --------- ------- --------- ----------
155,880 301,980 79,602 55,119 1,968,868
12,285 28,614 19,128 16,485 177,303
203,172 259,768 142,960 62,160 1,627,343
------- --------- ------- --------- ----------
371,337 590,362 241,690 133,764 3,773,514
13,986 5,028 2,655 287 37,879
149,258 62,192 45,060 $ 51,013 37,873 1,775,771
------- --------- ------- ------- --------- ----------
163,244 67,220 47,715 51,013 38,160 1,813,650
25,096 280,728 175,391 71,599 (61,820)
------- --------- ------- ------- --------- ----------
233,189 803,870 369,366 20,586 33,784 1,959,864
855,515 1,264,789 530,329 611,672 1,360,746 16,124,710
------- --------- ------- ------- --------- ----------
$ 1,088,704 $ 2,068,659 $ 899,695 $ 632,258 $ 1,394,530 $18,084,574
======= ========= ======= ======= ========= ==========
</TABLE>
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1998
- --------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
The following description of the Reynolds, Smith and Hills, Inc. Employees
401(k) Profit Sharing Plan (the "Plan") provides general information to
participants. Participants should refer to the pamphlet, Summary Plan
Description for the April 1, 1996 Amendment and Restatement of the Reynolds,
Smith and Hills, Inc. Employees 401(k) Profit Sharing Plan, for a more complete
description of the Plan. Copies of the pamphlet are available from the Plan
Coordinator.
General - The Plan was commenced and made effective January 1, 1990. The Plan is
a defined contribution plan established under Section 401(k) of the Internal
Revenue Code. The Plan was established for the benefit of certain employees of
Reynolds, Smith and Hills, Inc. (the "Company") and eligible subsidiaries and
affiliates with 480 hours of service within the eligibility computation period.
The Plan is subject to the provisions of the Employees Retirement Income
Security Act of 1974 (ERISA).
Investment Options - Participating employees have the right to choose the
investment funds in which contributions to their accounts are invested, and may
choose to allocate and reallocate amounts credited to their accounts amoung all
or any combination of the investment funds. A participating employee may change
his investment decision at any time by calling the Trustee. Changes involving
Reynolds, Smith and Hills, Inc. common stock are handled by the plan
administrator on a quarterly basis. Earnings on the investment funds are
allocated among the accounts of participation that have elected to invest in
each such funds.
Accounts may be invested among the following:
(i) INVESCO Retirement Trust Stable Value Fund;
(ii) INVESCO Select Income Fund;
(iii) INVESCO Retirement Trust Flex Fund;
(iv) INVESCO Value Equity Fund;
(v) INVESCO Dynamics Fund;
(vi) INVESCO Emerging Growth Fund; and
(vii) Reynolds, Smith and Hills, Inc. common stock.
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1998 (CONTINUED)
- --------------------------------------------------------------------------------
Plan participants may direct the investment of all funds credited to their
account to any or all investment funds in increments of 1% or multiples thereof.
Contributions - The Plan allows participating employees to contribute from 2% to
15% of their earned compensation with a total amount not to exceed $10,000 in
1998 and $9,500 in 1997. The dollar limit is indexed yearly for inflation. The
employer is required to match 25% of the employee's annual contribution up to 6%
of an employee's compensation. In addition, the employer may make discretionary
contributions to the Plan in cash, company stock or a combination of the two.
Participant Accounts - Each participant's account is credited with the
participant's contributions and allocations of (a) the Company's contribution
and (b) Plan earnings, and charged with an allocation of administrative
expenses. Allocations are based on participant earnings or account balances, as
defined. The benefit to which a participant is entitled is the benefit that can
be provided from the participant's vested account.
Vesting - Participants are fully vested in their voluntary contributions plus
actual earnings thereon. Vesting in the remainder of the account balances is
based on years of participant service. A participant is 100% vested after five
years of credited service.
Withdrawals - Participants may withdraw all of the vested amounts credited to
their accounts, subject to defined years of Plan participation. Also, a
participant may elect to withdraw certain amounts from his deferred contribution
account due to the financial hardship of the participant.
Loans - Participants may request loans from the Plan subject to allowable
available participant balances and other conditions.
Payment of Benefits - On termination of employment, a participant with an
account balance of $3,500 or less may elect a lump sum payment of the
participant's account balance at the date of termination. The Plan provides
other payment schedules for payment of participant balances in excess of $3,500
upon participant termination of employment. As of December 31, 1998, $534,894 in
benefits was owed to participants that had withdrawn from the plan.
In the event of death or disability of a participant, payment may be made in a
lump sum amount equal to the value of the participant's account as of the next
quarterly valuation date.
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1998 (CONTINUED)
- --------------------------------------------------------------------------------
Plan Termination - Although the Company has not expressed any intent to do so,
the Company has the right under the Plan to discontinue its contributions at any
time and to terminate the Plan subject to the provisions of ERISA. In the event
of Plan termination, participants will become 100% vested in their accounts.
2. Summary of Significant Accounting Policies
Basis of Accounting - The financial statements of the Plan are presented on the
accrual basis of accounting.
Investments - Short-term investments and loans to participants are carried at
cost which approximates market value. The Plan's investments are stated at fair
value. Shares of registered investment companies are valued at quoted market
prices which represent the net asset value of shares held by the Plan at
year-end. Investments in the common stock of the Plan's sponsor, Reynolds, Smith
and Hills, Inc., are recorded at an estimated value as there is no active market
for the stock.
Payment of Benefits - Benefits are recorded when paid.
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 and
disclosure of contingent 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 those estimates.
3. Investments
Except for the Plan's investments in loans to participants and common stock of
the plan sponsor, the Plan's investments are held in a trust fund administered
by the Trust Department of INVESCO Trust Company. Such investments consist
primarily of the Plan's short-term investments and investments in INVESCO mutual
funds and collective trust funds.
<TABLE>
<CAPTION>
The following table summarizes all investments held, by fund, at December 31,
1998 and 1997:
December 31
-------------------------
1998 1997
Investments at Fair Value as Determined by Quoted Market Price
<S> <C> <C>
INVESCO mutual trust funds:
Select Income Fund; 213,730 and 199,241 units $ 1,406,348 * $ 1,336,077 *
Value Equity Fund; 264,214 and 260,992 units 7,770,562 * 7,280,738 *
Dynamics Fund; 131,343 and 90,344 units 2,068,659 * 1,264,789 *
Emerging Growth Fund; 77,694 and 46,765 units 899,695 530,329
----------- -----------
12,145,264 10,411,933
----------- -----------
INVESCO collective trust funds:
Retirement Trust Stable Value Fund; 2,823,819 and
2,884,844 units 2,823,818 * 2,884,844 *
Retirement Trust Flex Fund; 28,786 and 25,394 units 1,088,704 * 855,515 *
----------- -------------
3,912,522 3,740,359
----------- -------------
Stock Liquidity Fund; 102 and 19,027 units 102 19,027
Investments at Estimated Fair Value
RS&H common stock; 95,837 shares 1,394,530 * 1,341,719 *
Loans to participants 632,258 611,672
----------- -----------
2,026,788 1,953,391
----------- -----------
Total Investments $18,084,676 $16,124,710
=========== ===========
*Investments exceeds 5% of net assets available for benefits.
</TABLE>
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<PAGE>
4. Income Tax Status
The Plan obtained its latest determination letter on November 5, 1997, in which
the Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
plan administrator believes that the Plan is currently designed and being
operated in compliance with the applicable requirements of the Internal Revenue
Code. Therefore, they believe that the Plan was qualified and the related trust
was tax-exempt as of the financial statement date.
******
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
SUPPLEMENTAL SCHEDULE
ITEM 27a - ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number of Shares,
Units or Principal Market
Amount Description Cost Value
------ ----------- ---- -----
<S> <C> <C>
INVESCO Mutual Funds
213,730 INVESCO Select Income Fund $1,426,917 $1,406,348
264,214 INVESCO Value Equity Fund 6,366,061 7,770,562
131,343 INVESCO Dynamics Fund 1,857,124 2,068,659
77,694 INVESCO Emerging Growth Fund 931,265 899,695
INVESCO Collective Trust Funds (Commingled Funds)
2,823,819 INVESCO Retirement Trust 2,823,818 2,823,818
Stable Value Fund
28,786 INVESCO Retirement Trust 897,509 1,088,704
Flex Fund
Stock Fund
102 INVESCO Stock Liquidity Fund 102 102
95,837 Reynolds, Smith and Hills, Inc.
Common Stock 872,519 1,394,428
LOAN FUND
632,258 Loans to Participant 632,258 632,258
---------- ----------
TOTAL ALL FUNDS $15,807,573 $18,084,574
========== ==========
</TABLE>
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<PAGE>
REYNOLDS, SMITH AND HILLS, INC. EMPLOYEES 401(k)
PROFIT SHARING PLAN
<TABLE>
<CAPTION>
SUPPLEMENTAL SCHEDULE
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1998
- --------------------------------------------------------------------------------
Series of Transactions in Excess of 5% of Plan Assets
Current Value
of Asset on Net
Purchase Selling Cost of Transaction Gain
Identification of Security Price Price Asset Date (Loss)
-------------------------- ----- ----- ----- ---- ------
<S> <C> <C> <C> <C> <C>
INVESCO Retirement Trust Stable Value Fund $ 890,550 $ 890,550 $ 890,550
INVESCO Value Equity Fund 2,061,274 2,061,274 2,061,274
INVESCO Dynamics Fund 1,206,624 1,306,624 1,206,624
INVESCO IRT Total Return Fund 827,346 827,346 827,346
INVESCO Retirement Trust Stable Value Fund $ 951,575 951,575 951,575
INVESCO Value Equity Fund 1,994,817 1,661,061 1,994,817 $333,756
INVESCO Dynamics Fund 544,995 572,913 544,995 (27,919)
INVESCO IRT Total Return Fund 742,781 689,592 742,781 53,189
</TABLE>
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<PAGE>
SIGNATURES
The Plan. 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.
Reynolds, Smith and Hills, Inc.
Employee 401(k) Profit Sharing Plan
By \s\Darold F. Cole
- --------------------
Darold F. Cole
Chairman, Administrative Committee
and Senior Vice President and Director
Reynolds, Smith and Hills, Inc.
Date: September 28, 1999
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statements
Numbered 33-33536, 33-40554, 33-40553, 33-40552, 33-40551, 33-51100, 33-51102,
33-51320 and 333-40237 of Reynolds, Smith and Hills, Inc. on Form S-8 of our
report dated July 15, 1999 appearing in this Annual Report on Form 11-K of the
Reynolds, Smith and Hills, Inc. Employees 401(k) Profit Sharing Plan for the
year ended December 31, 1998.
/s/Deloitte & Touche LLP
Jacksonville, Florida
September 28, 1999
