11-K 1 doc1.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001 COMMISSION FILE NUMBER 0-11688 A. American Ecology Corporation 401(k) Savings and Retirement Plan and Trust B. American Ecology Corporation 805 W. Idaho Street Suite 200 Boise, Idaho 83702 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. AMERICAN ECOLOGY CORPORATION 401(K) SAVINGS AND RETIREMENT PLAN AND TRUST Date: 6/26/2002 /s/ James R. Baumgardner ---------------- ------------------------- James R. Baumgardner As Trustee for the Plan FINANCIAL STATEMENTS AMERICAN ECOLOGY CORPORATION 401(K) SAVINGS AND RETIREMENT PLAN AND TRUST DECEMBER 31, 2001 AND 2000
TABLE OF CONTENTS Page No. -------- INDEPENDENT AUDITORS' REPORT. . . . . . . . . . . . . . . . 1 FINANCIAL STATEMENTS Statements of Net Assets Available for Benefits. . . . . 2 Statement of Changes in Net Assets Available for Benefits . . . . . . . . . . . . . . . . . . . . . 3 Notes to Financial Statements. . . . . . . . . . . . . . 4 SUPPLEMENTAL INFORMATION Schedule of Assets Held (At Year End). . . . . . . . . . 12
INDEPENDENT AUDITORS' REPORT To the Administrative Committee American Ecology Corporation 401(k) Savings and Retirement Plan and Trust Boise, Idaho We have audited the accompanying statements of net assets available for benefits of American Ecology Corporation 401(k) Savings and Retirement Plan and Trust as of December 31, 2001 and 2000 and the related statement of changes in net assets available for benefits for the year ended December 31, 2001. 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 U. S. 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 American Ecology Corporation 401(k) Savings Plan as of December 31, 2001 and 2000 and the changes in net assets available for benefits for the year ended December 31, 2001 in conformity with U.S. generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes is presented for purposes 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. The supplemental schedule has been subjected to the auditing procedures applied in our 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. /s/ Balukoff, Lindstrom & Co., P.A. May 31, 2002 Boise, Idaho -1-
AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS December 31, 2001 and 2000 2001 2000 ---------- ----------- ASSETS Investments, at fair value $8,871,572 $ 9,596,153 Participant loans 385,404 480,691 ---------- ----------- TOTAL ASSETS 9,256,976 10,076,844 LIABILITIES - - ---------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $9,256,976 $10,076,844 ========== ===========
See accompanying notes -2-
AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS Year Ended December 31, 2001 ADDITIONS TO NET ASSETS ATTRIBUTED TO Investment income Interest $ 41,827 Dividends 23,651 ------------------- 65,478 Contributions Employer 209,234 Employee 535,134 Rollover 1,004,551 ------------------- 1,748,919 ------------------- TOTAL ADDITIONS 1,814,397 DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO Net depreciation in fair value of investments 1,244,118 Administration expense 27,535 Withdrawals and benefit payments 1,362,612 ------------------- TOTAL DEDUCTIONS 2,634,265 ------------------- NET DECREASE IN NET ASSETS AVAILABLE FOR BENEFITS (819,868) NET ASSETS AVAILABLE FOR BENEFITS, BEGINNING OF YEAR 10,076,844 ------------------- NET ASSETS AVAILABLE FOR BENEFITS, END OF YEAR $ 9,256,976 ===================
See accompanying notes -3- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 NOTE A - DESCRIPTION OF THE PLAN General ------- American Ecology Corporation 401(k) Savings and Retirement Plan and Trust ("the Plan"), was adopted effective January 1, 1987, as a defined contribution plan. The Plan covers all employees of American Ecology Corporation and its subsidiaries ("the Company"), hired in a job category which will result in 1,000 hours of service during any consecutive 12-month period and who have attained the age of 18. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Participants should refer to the Plan agreement for a more complete description of the Plan. An administrative committee, appointed by the board of directors of the Company, is responsible for the general administration of the Plan. The administrative committee is given all powers necessary to enable it to carry out its duties including, but not limited to, the power to interpret the Plan, decide on all questions of eligibility and the status and rights of participants and direct disbursements of benefits in accordance with the provisions of the Plan. Pinnacle Pension Service is the plan administrator and Manulife Financial is the recordkeeper of the plan. In 1999, Wilmington Trust Company was appointed as the trustee of the Plan. As plan trustee, Wilmington Trust Company has the authority to control the assets of the Plan in accordance with the terms of the Plan. Employee Contributions ---------------------- Participants may defer up to 15 percent of their compensation as defined by the Plan, up to the maximum deferrable amount allowed by the Internal Revenue Service. Participants may elect to deposit their contributions in any of the investment options available. Employer Contributions ---------------------- The Company contributes a discretionary matching contribution, which is determined by the Employer. For 2001 and 2000, the Company established the discretionary matching contribution for all participants equal to 55 percent of the amount of compensation deferred by each participant for the calendar quarter not exceeding 6 percent of compensation. The Company's matching contributions are subject to the vesting schedule detailed below. -4- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 Vesting ------- The vesting schedule is as follows on Company matching contributions and actual earnings thereon: Union Employees (non-elective contributions):
Percentage of Service Vested Interest ------- --------------- 1 year 0% 2 years 40% 3 years 60% 4 years 80% 5 years or more 100%
Percentage of Service Vested Interest ------- --------------- 1 year 20% 2 years 60% 3 years or more 100%
The Plan provides for participants to be 100% vested upon death, permanent disability or the attainment of age 65. Participant Accounts -------------------- Each participant's account is credited with the participant's elective deferral and the Company's matching contribution. Dividend and interest income, net of administrative expenses with respect to each category of investments, is allocated quarterly to participants' accounts based upon their pro-rata share of equity in each investment fund before allocation. Forfeitures of terminated participant's nonvested benefits are applied to pay administrative expenses and reduce the Company's future contributions to the Plan. The Plan allows the Company to withdraw any excess forfeitures. As of December 31, 2001 and 2000 the Plan had unused forfeitures of $31,614 and $29,140, respectively. The Plan determined $31,614 of forfeitures was available to be returned to the Company. -5- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 Payment of Withdrawals and Benefits --------------------------------------- Upon normal retirement or death, vested benefits due to participants and their beneficiaries may be paid in the form of either a lump-sum distribution or fixed period annuities. Terminated employees who have a vested balance greater than $5,000 and current employees who have discontinued contributions to the Plan are not required to withdraw amounts from their Plan accounts. The Plan has provisions for hardship withdrawals from the participant's deferral account. Matching contributions and allocated earnings are not available for hardship withdrawals. Expenses -------- Expenses of administering the Plan are the responsibility of the Plan. Termination ----------- Although the Company expects to continue the Plan indefinitely, the Company may terminate the Plan in whole or in part at any time upon giving written notice to all parties concerned. If the Plan is terminated, the account of each participant will be 100% vested and nonforfeitable as of the effective date of the Plan termination. Participant Notes Receivable ------------------------------ Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their account balance. Loan transactions are treated as a transfer from the investment to the Participant Notes fund. Payments on loans are treated as a transfer from the Participants Notes fund to the investment fund. Loan terms range from 1-5 years or up to 15 years 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. Interest rates range from 5.0% to 9.5%. Principal and interest is paid ratably through monthly payroll deductions. Plan Amendments ---------------- On February 2, 2000 the Plan was amended effective January 1, 2000 to exclude hardship withdrawals as an eligible rollover distribution in accordance with IRS regulations. On October 1, 2000 the Plan was amended to comply with newly enacted laws. In addition, the following changes to the Plan were made: -6- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 The involuntary lump sum cash out limit was increased to the new maximum allowed by the IRS of $5,000. The exception from ERISA's nonassignment and anti-alienation rule created under the Taxpayer Relief Act of 1997 was incorporated into the Plan. The New Rule Election under the Small Business Job Protection Act of 1996 allows participants (except those who own more than 5% of the Company stock) to begin minimum required distributions on April 1 of the calendar year following the later of (1) the calendar year in which the employees attains age 70 or (2) retires. October 1, 2000, the entry date was changed from the first day of the quarter to the first day of the month following satisfaction of eligibility requirements. NOTE B - SUMMARY OF ACCOUNTING POLICIES Investment Valuation and Income Recognition ----------------------------------------------- Investments in guaranteed interest accounts are carried at contract value, which approximates principal amounts contributed to the accounts, plus accrued interest, less distributions from the contract. Investments in all other investment options are carried at their fair value measured and quoted market prices in active markets or by the contracted price. Investment income is recorded as earned. Purchases and sales of securities are recorded on a trade-date basis. Dividends are recorded on the ex-dividend date. Payment of Benefits ------------------- Benefits are recorded when paid. Estimates --------- The preparation of financial statements in conformity with generally accepted accounting principles requires the plan administrator to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results may differ from those estimates. -7- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 NOTE C - GUARANTEED INTEREST ACCOUNTS The guaranteed interest accounts held by the Plan are as follows:
December 31, ------------------ 2001 2000 -------- -------- Guaranteed interest account with interest at rate in effect of date of contribution (rate of 6.5% to 6.6% as of December 31, 2000) maturing on December 31, 2000 $ -- $ 29,496 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 4.1% to 4.45% as of December 31, 2001 and 6.5 to 6.6% as of December 31, 2000) maturing on December 31, 2001 55,590 52,959 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 4.1% as of December 31, 2001 and 6.5% to 6.6% as of December 31, 2000) maturing on December 31, 2002 26,539 25,347 Guaranteed interest account with interest at rate in effect at date of contribution (rate of 4.1% to 4.45% at December 31, 2001 and 6.6% as of December 31, 2000) maturing on December 31, 2003 37,871 1,458 Guaranteed interest account with interest at rate in effect at date of contribution (rate of 6.6% at December 31, 2000) maturing on December 31, 2004 -- 758 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 4.45% to 5.1% as of December 31, 2001 and 6.8% as of December 31, 2000) maturing on December 31, 2005 17,176 3,963 -8- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 5.1% as of December 31, 2001 and 6.8% as of December 31, 2000) maturing on December 31, 2006 985 1,449 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 5.1% as of December 31, 2001 and 6.8% as of December 31, 2000) maturing on December 31, 2007 771 1,054 Guaranteed interest account with interest at rate in effect of date of contribution (rate of 5.1% as of December 31, 2001 and 6.8% as of December 31, 2000) maturing on December 31, 2008 194 524 Guaranteed interest account with interest at rate in effect at date of contribution (rate of 5.1% at December 31, 2001 and 6.8% as of December 31, 2000) maturing on December 31, 2009 225 560 Guaranteed interest account with interest at rate in effect at date of contribution (rate of 5.1% at December 31, 2001) maturing on December 31, 2010 221 -- -------- -------- $139,572 $117,568 ======== ========
-9- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS December 31, 2001 and 2000 NOTE D - INVESTMENTS Investments in collective funds are held by the Trustee and are stated at fair value based on quoted market prices. At December 31, 2001 and 2000 investment balances that were individually greater than 5% of total investments were as follows:
Fund 2001 2000 ---- ---------- ---------- Manulife Lifestyle Balanced $ 680,306 $ 718,452 Manulife Lifestyle Growth 1,338,787 1,864,519 Manulife Lifestyle Aggressive ** 617,334 Manulife Money Market 746,874 685,217 Fidelity Advisor Contrafund 491,290 524,738 T. Rowe Price Science and Technology 466,202 628,346
** The fund does not meet the 5% threshold criteria for the specified year. The Plan presents in the statement of changes in net assets available for benefits the net depreciation in the fair value of its investments, which consists of realized gains or losses, and unrealized appreciation (depreciation) on those investments. NOTE E - INCOME TAX STATUS The Plan obtained its latest determination letter on April 9, 2000 in which the Internal Revenue Service stated that the Plan, as originally, and all amendments through December 11, 2000, were in compliance with the applicable requirements of the Internal Revenue Code ("IRC"). The Plan has been amended since receiving the determination letter. However, the Plan administrator believes the Plan is currently designed and being operated in compliance with the applicable requirements of the IRC. Therefore, no provision for income taxes has been included in the Plan's financial statements. -10- SUPPLEMENTAL INFORMATION
AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST SCHEDULE OF ASSETS HELD (AT YEAR END) December 31, 2001 EIN:95-3889638 PLAN NUMBER:003 (e) Current (a)(b) Identity of Issue (c) Description (d) Cost Value ------------------------------------------- ----------------------------- ---------- ----------- Manulife Lifestyle Conservative $ ** $ 245,377 Manulife Lifestyle Moderate ** 35,098 Manulife Lifestyle Balanced ** 680,306 Manulife Lifestyle Growth ** 1,338,787 Manulife Lifestyle Aggressive ** 315,502 Manulife GICS Maturing December 31, 2001, with interest rates of 4.10% to 4.45% ** 55,590 Maturing December 31, 2002, with interest rates of 4.10% ** 26,539 Maturing December 31, 2003, with interest rates of 4.10% to 4.45% ** 37,871 Maturing December 31, 2005, with interest rates of 4.45% to 5.10% ** 17,176 Maturing December 31, 2006, with interest rates of 5.10% ** 985 Maturing December 31, 2007 with interest rates of 5.10% ** 771 Maturing December 31, 2008 with interest rates of 5.10% ** 194 Maturing December 31, 2009 with interest rates of 5.10% ** 225 Maturing December 31, 2010 with interest rates of 5.10% ** 221 Manulife Money Market Conservative ** 746,874 -12- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST SCHEDULE OF ASSETS HELD (AT YEAR END) December 31, 2001 EIN:95-3889638 PLAN NUMBER:003 (e) Current (a)(b) Identity of Issue (c) Description (d) Cost Value ------------------------------------------- ----------------------------- ---------- ----------- Manulife Short Term Vanguard Short Term Government Fund Federal Fund ** 10,843 Manulife Total Return PIMCO Income Fund ** 63,439 Manulife High-Quality Bond Fund Bonds ** 15,966 Manulife Income Fund T. Rowe Price Spectrum Income Fund ** 101,123 Manulife High Advisor High Yield Yield Fund Fund ** 235,182 Manulife Balanced Balanced Fund ** 18,572 Manulife Equity Income Fund Stock Fund ** 17,767 Manulife Value Fund Neuberger Berman Guardian Trust ** 157,624 Manulife Dividend & American Century Investments Growth Fund Income & Growth ** 42,518 Manulife Mid-Cap Value Fund Mutual Beacon Fund ** 125,279 Manulife Mid Cap Weitz Partners Value Fund Value Fund ** 173,129 Manulife Growth Fidelity Advisor Growth Opportunities Fund Opportunities Fund ** 430,037 Manulife Small Cap Franklin Balance Sheet -13- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST SCHEDULE OF ASSETS HELD (AT YEAR END) December 31, 2001 EIN:95-3889638 PLAN NUMBER:003 (e) Current (a)(b) Identity of Issue (c) Description (d) Cost Value ------------------------------------------- ----------------------------- ---------- ----------- Value Fund Investment Fund ** 159,460 Manulife Discovery Fund Mutual Discovery Fund ** 40,707 Manulife Social Responsibility Fund Domini Social Equity Fund ** 48,852 Manulife Growth & T. Rowe Price Income Fund Growth & Income ** 256,725 Manulife Capital Growth Stock Fund ** 134,866 Manulife Growth Plus Stock Fund ** 92,659 Manulife Large Cap MSDW Institutional Funds Equity Fund Equity Growth Portfolio ** 2,975 Manulife Value & Excelsior Value & Restructuring Fund Restructuring Fund ** 448,694 Manulife Contra Fund Fidelity Contrafund ** 491,290 Manulife Growth Fund Fidelity Advisor Large Cap Fund ** 83,989 Manulife Diversified First Eagle SoGen Capital Fund Global Fund ** 264,799 Manulife Selective Manulife Growth Prudential Jennison Growth Fund ** 749 Manulife Worldwide Janus Advisor Aggressive Growth ** 38,432 -14- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST SCHEDULE OF ASSETS HELD (AT YEAR END) December 31, 2001 EIN:95-3889638 PLAN NUMBER:003 (e) Current (a)(b) Identity of Issue (c) Description (d) Cost Value ------------------------------------------- ----------------------------- ---------- ----------- Manulife Templeton Foreign fund Foreign Fund ** 73,384 Manulife International T. Rowe Price Stock Fund International Stock Fund ** 65,752 Manulife Fidelity Advisor Overseas Fund Overseas Fund ** 15,453 Manulife All Cap Growth Fund AIM Constellation Fund ** 126,727 Manulife Select Janus Twenty Fund Twenty Fund ** 175,361 Manulife Janus Enterprise Fund Enterprise Fund ** 102,587 Manulife Small Company Lord Abbett Developing Stock Fund Growth Fund ** 1,132 Manulife Small Cap Franklin Small Growth Fund Cap Growth Fund ** 40,392 Manulife Aggressive AIM Agrressive Growth Fund Growth Fund ** 214,285 Manulife Emerging Growth Stock Fund ** 45,057 Manulife Passport Dreyfus Founders Passport Aggressive Growth ** 913 Manulife Science & T. Rowe Price -15- AMERICAN ECOLOGY CORPORATION 401(k) SAVINGS AND RETIREMENT PLAN AND TRUST SCHEDULE OF ASSETS HELD (AT YEAR END) December 31, 2001 EIN:95-3889638 PLAN NUMBER:003 (e) Current (a)(b) Identity of Issue (c) Description (d) Cost Value ------------------------------------------- ----------------------------- ---------- ----------- Technology Fund Science & Technology ** 466,202 Manulife Developing Templeton Developing Markets Fund Markets Trust ** 124,105 Manulife NetNet Munder Capital Aggressive Growth ** 18,244 500 Index Fund S&P500 Index ** 211,151 Total Stock Market Growth Index ** 7,223 Mid Cap Index Fund Growth Fund ** 2,588 Growth Stock Fund ** 60,369 International Index Aggressive Growth ** 2,447 Borrower Participant loans 5%-9.5% - 385,404 - 385,404 * American Ecology Corporation Common Stock ** 161,008 ---------- ----------- TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $ ** $9,256,976 ========== ===========
* Known party in interest ** Participant directed, therefore, no cost disclosure is necessary. -16-