FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 2000
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OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________________ to __________________
Commission file number 0-3488
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Apogee Enterprises Tax-Relief Investment Plan
Apogee Enterprises, Inc.
7900 Xerexes Avenue South
Suite 1800
Minneapolis, MN 55431
Apogee Enterprises, Inc.
Tax-Relief Investment Plan
Financial statements as of
December 31, 2000 and 1999
together with report of
independent public accountants
Index to financial statements Page
Report of independent public accountants 1
Statements of net assets available for benefits 2
Statements of changes in net assets available for benefits 3
Notes to financial statements 4
Schedule H, line 4i -- Schedule of Assets (Held At End of Year) 8
Report of independent public accountants
To the Plan Administrator of Apogee Enterprises, Inc. Tax-Relief Investment
Plan:
We have audited the accompanying statements of net assets available for benefits
of Apogee Enterprises, Inc. Tax-Relief Investment Plan as of December 31, 2000
and 1999, and the related statements of changes in net assets available for
benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 audit provides 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 Apogee
Enterprises, Inc. Tax-Relief Investment Plan as of December 31, 2000 and 1999,
and the changes in net assets available for benefits for the years then ended,
in conformity with accounting principles generally accepted in the United
States.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedule of Assets (Held
at End of Year) is presented for the purpose of additional analysis and is not a
required part of the basic financial statements, but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplementary schedule is the responsibility of the Plan's
management. The supplement schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
Arthur Andersen LLP
Minneapolis, Minnesota,
May 16, 2001
1
APOGEE ENTERPRISES, INC. TAX-RELIEF INVESTMENT PLAN
Statements of net assets available for benefits
As of December 31
2000 1999
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INVESTMENTS $96,326,076 $103,172,751
CONTRIBUTIONS RECEIVABLE:
Employer's contributions receivable 41,548 41,586
Participants' contributions receivable 171,943 172,621
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Total contributions receivable 213,491 214,207
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NET ASSETS AVAILABLE FOR BENEFITS $96,539,567 $103,386,958
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The accompanying notes are an integral part of these financial statements.
2
APOGEE ENTERPRISES, INC. TAX-RELIEF INVESTMENT PLAN
Statements of changes in net assets available for benefits
For the years ended December 31
2000 1999
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NET ASSETS AVAILABLE FOR BENEFITS, beginning of year $103,386,958 $ 89,995,799
INCREASES (DECREASES) DURING THE YEAR:
Net realized and unrealized appreciation (depreciation) of investments (4,682,658) 13,368,890
Interest and dividend income 1,533,872 2,193,637
Loan interest 443,848 382,202
Employee contributions 8,852,789 9,479,267
Employer contributions 2,119,226 2,249,757
Rollover contributions 1,523,129 277,289
Distributions to participants (15,871,886) (9,385,774)
Transfer of plan assets (726,911) (5,174,109)
Administrative expenses (38,800) -
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NET ASSETS AVAILABLE FOR BENEFITS, end of year $ 96,539,567 $103,386,958
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The accompanying notes are an integral part of these financial statements.
3
APOGEE ENTERPRISES, INC. TAX-RELIEF INVESTMENT PLAN
Notes to financial statements
December 31, 2000 and 1999
1 Summary description of the plan
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General
Apogee Enterprises, Inc. Tax-Relief Investment Plan (the Plan) is a defined
contribution plan sponsored and administered by Apogee Enterprises, Inc. (the
Company). The Plan is a multiple employer plan including Apogee Enterprises,
Inc. and Terrasun. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA). The following description of the
Plan is provided for information purposes only. Participants should refer to the
plan agreement for a more complete description of the Plan's provisions.
Plan administrator
The Company has appointed a committee consisting of company officers and
employees to be the administrator of the Plan (the Plan Administrator). State
Street Bank and Trust (the Trustee) holds the plan investments in a commingled
trust, executes investment transactions, and collects and allocates the related
investment income based on employee elections.
Eligibility
Under the terms of the Plan, a regular employee (who is not a member of a group
of employees covered by a collective bargaining unit) scheduled to work 1,000
hours in a calendar year shall be eligible to participate in the Plan upon
attaining age 21 and completing 90 days of qualified service.
Contributions
Participants may elect to have 1 percent to 13 percent of their compensation
withheld and contributed to their basic account in the Plan. Participants are
automatically enrolled into the Plan at a deferral rate of 2 percent.
Participants can choose at anytime to discontinue contributions. For the years
ended December 31, 2000 and 1999, the Company contributed an amount equal to 30
percent of the first 6 percent of base compensation that a participant
contributes to the Plan. While none have been made to date, the Company may also
make additional discretionary profit-sharing contributions to all eligible
participants. The Plan also allows participants to roll over lump-sum payments
from other qualified plans.
Supplementary contributions of after-tax compensation were allowed through
December 31, 1986. Participants may make a monthly election as to the investment
of their basic, supplementary and company-match contributions. Participants have
the opportunity to direct all money allocated to their accounts. Participants
can choose among 11 mutual funds plus company stock. These investment elections
must be made in 1 percent increments with no more than 10 percent invested in
the Apogee Stock Fund.
Vesting
Participants' basic and supplementary contribution accounts are 100 percent
vested at all times. Participants become 100 percent vested in their company
contribution accounts after completing three years of qualified service with the
Company or in the event of death, disability or retirement. Forfeitures of
nonvested discretionary employer accounts and employer matching accounts are
used to reduce the Company's contribution. Forfeitures from participants were
approximately $141,000 in 2000 and $20,000 in 1999.
Loans
The Plan allows participants employed by the Company to borrow up to 50 percent
of the participant's vested account balance, with a minimum of $500 and a
maximum of $50,000 reduced by the highest outstanding loan balance in the
previous 12-month period. A participant's loan is financed proportionately from
the account balances held in each of the funds. Loan terms can be repaid in 1,
2, 3, 4 or 5 years, or in the case of a home purchase, up to 15 years. The
interest rate on the loans is 1 percent above the prime rate as represented in
The Wall Street Journal on the last business day of the calendar month preceding
the calendar month in which the loan is granted. Loans are repaid through
payroll deductions and are secured by the participant's remaining account
balance. If the participant terminates employment with the Company, either the
outstanding loan balance must be repaid in a lump sum or distributions to the
participant will be reduced accordingly.
4
Interest rates ranged from 9.50 percent to 10.50 percent in 2000. Participant
loans of $5,423,027 were outstanding as of December 31, 2000.
Distributions
Upon death, disability, termination of employment or retirement, participants
may elect either a lump-sum payment or a series of installment payments from the
Plan.
A participant can elect to retain his or her account balance over $5,000 with
the Plan until he or she attains age 70 1/2. Account balances under $5,000 will
be paid in a single lump sum.
Employees may make withdrawals upon attainment of age 59 1/2. Early withdrawal
from employee basic contributions is permitted only if financial hardship is
demonstrated and other financial resources are not available. Hardship
withdrawals shall be made in compliance with safe harbor regulations established
by the Internal Revenue Service. Employees may make one withdrawal per year from
their supplementary contribution accounts without any reason being given.
Transfer of plan assets
On June 30, 1999, participant balances were transferred to the CH Holdings, Inc.
401(k) Savings and Profit Sharing Plan upon sale of Harmon LTD (a former
subsidiary of the Company).
On April 28, 2000, assets of $2,564,230 were transferred to the Plan from the
Portland Glass 401(k) Retirement Plan upon the acquisition of American
Management Group d/b/a Portland Glass. On July 3, 2000 and July 28, 2000,
participant balances totaling $3,291,141 were transferred to the Compudyne
Corporation 401(k) Retirement Savings Plan upon the sale of Norment Industries
(a former subsidiary of the Company).
2 Summary of significant accounting policies
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Basis of accounting
The Plan maintains its accounting records on the accrual basis of accounting.
Transactions and assets of the Commingled Trust are accounted for using the
following accounting policies:
a. Investments are valued at fair value based on quoted market prices obtained
from national securities exchanges and other published sources.
b. Investment income is recorded on the accrual basis and dividend income on a
cash basis. The pro rata share of each fund's investment income from the
Commingled Trust represents the Plan's proportionate share of investment
income from the Commingled Trust for each fund. Investment income includes
recognition and allocation of interest income, dividend income, and
realized and unrealized gains and losses, based upon each participating
plan's share of the underlying net assets of the Trust.
c. Deposits, withdrawals and transfers by the participating plans are made at
fair value when the transactions occur.
Use of estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires the plan administrator 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 additions and deductions
during the reporting period. Ultimate results could differ from those estimates.
Reclassification
Certain 1999 numbers were reclassified to conform to the 2000 presentation.
5
3 Investments
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The following presents investments that represent 5 percent or more of the
Plan's net assets as of December 31:
2000 1999
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State Street Global Advisor Principle Accumulation Fund $14,473,917 $15,560,874
State Street Global S&P 500 Index Fund 10,848,261 11,999,069
State Street Global Large Cap Value Fund 8,485,902 9,029,663
Franklin Small Cap Growth Fund 12,216,816 13,587,026
State Street Global Advisor International Growth Opportunities Fund 9,078,761 11,465,211
State Street Global Advisor Moderate Asset Accumulation Fund 23,912,217 27,399,049
Loans to Participants 5,423,027 5,322,292
4 Apogee Enterprises, Inc. Retirement Trust
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The Plan, together with the Apogee Enterprises, Inc. Retirement Plan, invests
its assets on a commingled basis in the Apogee Enterprises, Inc. Retirement
Trust (the Commingled Trust).
Under the terms of the trust agreement, the Trustee maintains custody of the
funds on behalf of the Commingled Trust and is also responsible for participant
accounting. The Trustee granted certain advisory responsibilities to State
Street Global Advisors and Franklin Templeton.
All plan and trust expenses, except for investment management fees, brokerage
commissions and certain loan fees, are paid by the Company. Administrative
expenses of approximately $563,000 in 2000 and $174,000 in 1999 were paid by the
Company for the Commingled Trust.
The following presents the fair values of investments for the Master Trust as of
December 31, 1999:
Investments at fair value:
Mutual funds $153,112,270
Participant loans 5,322,293
Apogee Enterprises, Inc. stock 4,257,552
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$162,692,115
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The Plan's interest in the Master Trust as a percentage of net assets of the
Master Trust was 63 percent for the year ended December 31, 1999.
The fair value of the Plan's interest in the Master Trust is based on the
beginning of the year value of the Plan's interest in the Master Trust, plus
actual contributions and allocated investment income, less actual distributions
and allocated administrative expenses.
5 Tax status
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The Company received a favorable determination letter dated January 30, 1996
from the Internal Revenue Service (IRS) stating that the Plan is designed in
compliance with applicable sections of the Internal Revenue Code (the IRC). The
Plan has been amended since the date of the letter; however, the Company
believes the Plan continues to operate in accordance with the IRC.
6 Plan termination
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The Company and its subsidiaries have voluntarily agreed to make contributions
to the Plan as specified in the plan documents. Although the Company has not
expressed any intent to terminate the plan agreement, it may do so at any time,
subject to such provisions of the law as may be applicable. In the event that
the Plan is terminated, all participants will be fully vested.
7 Party-in-interest transactions
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The Plan engages in transactions involving the acquisition and disposition of
investments with parties in interest, including the Trustee and the plan
sponsor. These transactions are considered exempt party-in-interest transactions
under ERISA.
6
8 Reconciliation to the Form 5500
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At December 31, 2000, net assets available for plan benefits in the accompanying
financial statements differ from the Form 5500 as filed with the IRS as follows:
Net assets available for plan benefits per the Form 5500 $96,507,627
Benefits payable as of December 31, 2000 31,940
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Net assets available for plan benefits per the accompanying financial statements $96,539,567
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At December 31, 2000, distributions to participants in the accompanying
financial statements differ from the Form 5500 as filed with the IRS as follows:
Distributions per the Form 5500 $15,002,286
Benefits payable December 31, 1999 91,615
Benefits payable December 31, 2000 (31,940)
Deemed distributions per the Form 5500 809,925
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Distributions to participants per the accompanying financial statements $15,871,886
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7
APOGEE ENTERPRISES, INC. TAX-RELIEF INVESTMENT PLAN
(Employer identification number: 41-0919654) (Plan number: 001)
Schedule H, line 4i -- Schedule of Assets (Held At End of Year)
As of December 31, 2000
Current
Description Cost value
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State Street Global Advisors Principle Accumulation Fund* ** $14,473,917
State Street Global Advisors Daily Bond Market Fund* ** 742,417
State Street Global Advisors S&P 500 Index Fund* ** 10,848,261
State Street Global Advisors Large Cap Value Fund* ** 8,485,902
State Street Global Advisors Large Cap Growth Fund* ** 2,372,310
State Street Global Advisors Mid Cap Fund* ** 2,314,118
Franklin Small Cap Growth Fund ** 12,216,816
State Street Global Advisors International Growth Opportunities Fund* ** 9,078,761
State Street Global Advisors Conservative Asset Accumulation Fund* ** 332,833
State Street Global Advisors Moderate Asset Accumulation Fund* ** 23,912,217
State Street Global Advisors Aggressive Asset Accumulation Fund* ** 2,063,057
Apogee Enterprises, Inc. common stock* ** 4,062,440
Loans to participants, with interest ranging from 9.5% to 10.5% ** 5,423,027
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Total investments $96,326,076
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*Denotes party in interest.
**Historical cost has been omitted for participant-directed investments.
8
EXHIBIT 23.1
Consent of independent public accountants
As independent public accountants, we hereby consent to the incorporation of our
report dated May 16, 2001 included in this Form 11-K into the Company's
previously filed Registration Statement (Form S-8 No. 333-95855).
Arthur Andersen LLP
Minneapolis, Minnesota,
June 29, 2001
