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 Period Ended December 31, 2001
-----------------
Commission File Number 1-11373
--------
PROFIT SHARING PLAN OF BINDLEY WESTERN INDUSTRIES, INC.,
--------------------------------------------------------
AND SUBSIDIARIES
----------------
(Full Title of Plan)
Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
(Name of Issuer of the Securities Held Pursuant to the Plan and
Address of its Principal Executive Office)
TABLE OF CONTENTS
-----------------
SIGNATURE...........................................................1
INDEPENDENT AUDITORS' REPORT........................................2
FINANCIAL STATEMENTS:
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS,
WITH FUND INFORMATION, AT DECEMBER 31, 2001 AND 2000..............3-4
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR
PLAN BENEFITS, WITH FUND INFORMATION,
FOR THE YEAR ENDED DECEMBER 31, 2001................................5
NOTES TO FINANCIAL STATEMENTS....................................6-10
SCHEDULES:*
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT
DECEMBER 31, 2001..................................................11
*NOTE - OTHER SCHEDULES HAVE BEEN OMITTED BECAUSE THEY
ARE NOT APPLICABLE.
EXHIBITS:
EXHIBIT 23 - CONSENT OF INDEPENDENT ACCOUNTANTS
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the members
of the Plan Committee have duly caused this annual report to be signed on its
behalf by the undersigned thereunto duly authorized.
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.,
AND SUBSIDIARIES
Date: June 28, 2002 /s/ Richard J. Miller
-------------------------------------------------
Richard J. Miller, Plan Committee Member
1
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Administrator and
Administrative Committee of
The Profit Sharing Plan of Bindley
Western Industries, Inc. and Subsidiaries:
We have audited the accompanying statements of net assets available for
plan benefits, with fund information, of the Profit Sharing Plan of Bindley
Western Industries, Inc. and Subsidiaries as of December 31, 2001 and 2000, and
the related statement of changes in net assets available for plan benefits, with
fund information, 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 the financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audits 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 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 accounting principles
generally accepted in the United States of America.
Our audits were conducted 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 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 supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audits 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/ ENT & IMLER CPA GROUP, PC
Indianapolis, Indiana
June 14, 2002
2
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.
AND SUBSIDIARIES
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION
--------------------------------------------------------------------------
DECEMBER 31, 2001
-----------------
Fund Information
-------------------------------------------------------------------------------------------------
Cardinal Victory Victory American
Health Investment Victory U.S. Gov't American Washington PHC
Common Quality Bond Balanced Obligations EuroPacific Mutual Investors Common
Stock Fund Fund Fund Fund Growth Fund Fund Stock
------------ --------- ------------ --------- ------------ ------------ ------------
ASSETS:
Investments, at fair value $ 16,056,341 $ - $ 3,010,905 $ - $ 966,511 $ 4,667,038 $ 6,726,244
Receivables:
Employer contributions 1,016,522 - 361,132 - 170,471 529,331 -
Employee contributions 9,207 - 2,467 - 1,945 4,441 -
Accrued investment income 6,330 - - - - - 15
------------ --------- ------------ --------- ------------ ------------ ------------
Net assets available
for plan benefits $ 17,088,400 $ - $ 3,374,504 $ - $ 1,138,927 $ 5,200,810 $ 6,726,259
============ ========= ============ ========= ============ ============ ============
Fund Information
-------------------------------------------------------------------------------------------------
Franklin Victory Fidelity Victory Victory
Small Cap Stock Adv Equity Intermediate Govt
Growth Index Growth Income Reserves Loan
Fund Fund Fund Fund Fund Fund Total
------------ ---------- ------------ ------------ ------------ ------------ ------------
ASSETS:
Investments, at fair value $ 1,864,972 $ 750,294 $ 869,877 $ 1,422,545 $ 7,692,201 $ 161,585 $ 44,188,513
Receivables:
Employer contributions 338,332 213,786 224,595 199,234 1,063,734 - 4,117,137
Employee contributions 3,615 2,332 2,432 1,443 867 - 28,749
Accrued investment income - - - - - - 6,345
------------ --------- ------------ --------- ------------ ------------ ------------
Net assets available
for plan benefits $ 2,206,919 $ 966,412 $ 1,096,904 $ 1,623,222 $ 8,756,802 $ 161,585 $ 48,340,744
============ ========== ============ ============ ============ ============ ============
See auditors' report and accompanying notes to the financial statements
3
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.
AND SUBSIDIARIES
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION
--------------------------------------------------------------------------
DECEMBER 31, 2000
-----------------
Fund Information
-------------------------------------------------------------------------------------------
Victory Victory American
BWI Investment Victory U.S. Gov't American Washington
Common Quality Bond Balanced Obligations EuroPacific Mutual Investors
Stock Fund Fund Fund Growth Fund Fund
------------ ------------ ------------ ------------ ------------ ------------
ASSETS:
Investments, at fair value $ 15,113,504 $ 1,192,174 $ 2,788,702 $ 9,520,792 $ 1,095,152 $ 4,318,533
Receivables:
Employer contributions 883,439 145,302 344,308 422,339 206,304 507,604
Employee contributions 32,866 3,061 8,222 7,032 5,938 12,774
Accrued investment income 1,435 - - - - -
------------ ------------ ------------ ------------ ------------ ------------
Total assets 16,031,244 1,340,537 3,141,232 9,950,163 1,307,394 4,838,911
LIABILITIES:
Other liabilities - (2,721) (6,930) (5,853) (4,943) (10,691)
------------ ------------ ------------ ------------ ------------ ------------
Net assets available
for plan benefits $ 16,031,244 $ 1,337,816 $ 3,134,302 $ 9,944,310 $ 1,302,451 $ 4,828,220
============ ============ ============ ============ ============ ============
Fund Information
-------------------------------------------------------------------------------------------
Franklin Victory Fidelity
PHC Small Cap Stock Adv Equity
Common Growth Index Growth Loan
Stock Fund Fund Fund Fund Total
------------ ------------ ------------ ------------ ------------ ------------
ASSETS:
Investments, at fair value $ 9,725,189 $ 2,017,599 $ 651,810 $ 1,082,023 $ 52,819 $ 47,558,297
Receivables:
Employer contributions - 369,645 141,177 191,974 - 3,212,092
Employee contributions - 10,904 2,868 4,909 - 88,574
Accrued investment income 75 - - - - 1,510
------------ ------------ ------------ ------------ ------------ ------------
Total assets 9,725,264 2,398,148 795,855 1,278,906 52,819 50,860,473
LIABILITIES:
Other liabilities - (9,357) (2,399) (4,241) - (47,135)
------------ ------------ ------------ ------------ ------------ ------------
Net assets available
for plan benefits $ 9,725,264 $ 2,388,791 $ 793,456 $ 1,274,665 $ 52,819 $ 50,813,338
============ ============ ============ ============ ============ ============
See auditors' report and accompanying notes to the financial statements
4
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.
AND SUBSIDIARIES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND
-------------------------------------------------------------------------
INFORMATION
-----------
FOR THE YEAR ENDED DECEMBER 31, 2001
------------------------------------
Fund Information
---------------------------------------------------------------------------------------
Cardinal Victory Victory American
Health Investment Victory U.S. Gov't American Washington
Common Quality Bond Balanced Obligations EuroPacific Mutual Investors
Stock Fund Fund Fund Fund Growth Fund Fund
------------ ----------- ----------- ----------- ------------ ------------
Contributions:
Employer $ 1,016,522 $ - $ 361,132 $ - $ 170,471 $ 529,331
Employee 758,737 92,112 291,963 220,296 170,756 451,961
Rollover 62,151 3,005 2,386 1,270 11,774 2,404
------------ ----------- ----------- ----------- ------------ ------------
Total contributions 1,837,410 95,117 655,481 221,566 353,001 983,696
------------ ----------- ----------- ----------- ------------ ------------
Investment Income:
Interest and dividends 37,715 58,685 232,382 14 23,082 195,291
Realized gains/(losses) 4,494,477 22,874 (38,791) 684,457 (116,694) (10,415)
Net appreciation (depreciation) in
fair value of investments (4,031,479) 416 (329,198) (422,798) (62,068) (144,897)
------------ ----------- ----------- ----------- ------------ ------------
Total investment income 500,713 81,975 (135,607) 261,673 (155,680) 39,979
------------ ----------- ----------- ----------- ------------ ------------
Total additions (deductions) 2,338,123 177,092 519,874 483,239 197,321 1,023,675
Distributions to participants (934,151) (96,981) (328,604) (4,504,402) (121,258) (517,580)
Administrative expenses (52,204) (744) (2,313) (5,794) (1,183) (3,389)
Net transfers (to) from other funds (294,612) (1,417,183) 51,245 (5,917,353) (238,404) (130,116)
------------ ----------- ----------- ----------- ------------ ------------
Net increase (decrease) in net assets
available for plan benefits 1,057,156 (1,337,816) 240,202 (9,944,310) (163,524) 372,590
Beginning of year 16,031,244 1,337,816 3,134,302 9,944,310 1,302,451 4,828,220
------------ ----------- ----------- ----------- ------------ ------------
End of year $ 17,088,400 $ - $ 3,374,504 $ - $ 1,138,927 $ 5,200,810
============ =========== =========== =========== ============ ============
Fund Information
--------------------------------------------------------------------------------
Franklin Victory Fidelity Victory
PHC Small-Cap Stock Adv Equity Intermediate
Common Growth Index Growth Income
Stock Fund Fund Fund Fund
------------ ------------ ------------ ------------ ------------
Contributions:
Employer $ - $ 338,332 $ 213,786 $ 224,595 $ 199,234
Employee - 318,878 144,402 180,848 27,116
Rollover - 18,755 6,230 15,550 37
------------ ------------ ------------ ------------ ------------
Total contributions - 675,965 364,418 420,993 226,387
------------ ------------ ------------ ------------ ------------
Investment Income:
Interest and dividends 449 4,942 68,601 908 15,568
Realized gains/(losses) 1,081,966 (438,070) (248,296) (209,831) 1,293
Net appreciation (depreciation) in
fair value of investments (2,759,385) (31,422) 25,806 (15,811) (17,486)
------------ ------------ ------------ ------------ ------------
Total investment income (1,676,970) (464,550) (153,889) (224,734) (625)
------------ ------------ ------------ ------------ ------------
Total additions (deductions) (1,676,970) 211,415 210,529 196,259 225,762
Distributions to participants (295,705) (149,502) (58,599) (115,318) (18,631)
Administrative expenses (18,034) (1,685) (984) (1,291) (255)
Net transfers (to) from other funds (1,008,296) (242,100) 22,010 (257,411) 1,416,346
------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net assets
available for plan benefits (2,999,005) (181,872) 172,956 (177,761) 1,623,222
Beginning of year 9,725,264 2,388,791 793,456 1,274,665 -
------------ ------------ ------------ ------------ ------------
End of year $ 6,726,259 $ 2,206,919 $ 966,412 $ 1,096,904 $ 1,623,222
============ ============ ============ ============ ============
Fund Information
---------------------------------------------
Victory
Govt
Reserves Loan
Fund Fund Total
------------ ------------ ------------
Contributions:
Employer $ 1,063,734 $ - $ 4,117,137
Employee 49,880 - 2,706,949
Rollover 10,159 - 133,721
------------ ------------ ------------
Total contributions 1,123,773 - 6,957,807
------------ ------------ ------------
Investment Income:
Interest and dividends 3 6,810 644,450
Realized gains/(losses) 2,439 - 5,225,409
Net appreciation (depreciation) in
fair value of investments 25,079 - (7,763,243)
------------ ------------ ------------
Total investment income 27,521 6,810 (1,893,384)
------------ ------------ ------------
Total additions (deductions) 1,151,294 6,810 5,064,423
Distributions to participants (300,777) (5,768) (7,447,276)
Administrative expenses (1,865) - (89,741)
Net transfers (to) from other funds 7,908,150 107,724 -
------------ ------------ ------------
Net increase (decrease) in net assets
available for plan benefits 8,756,802 108,766 (2,472,594)
Beginning of year - 52,819 50,813,338
------------ ------------ ------------
End of year $ 8,756,802 $ 161,585 $ 48,340,744
============ ============ ============
See auditors' report and accompanying notes to the financial statements
5
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.
AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
-----------------------------
AS OF DECEMBER 31, 2001 AND 2000
--------------------------------
NOTE 1 - DESCRIPTION OF THE PLAN
--------------------------------
The following brief description of the Profit Sharing Plan of Bindley
Western Industries, Inc. and Subsidiaries is provided for general information
purposes only. Participants should refer to the plan agreement for more complete
information.
General
-------
The Profit Sharing Plan of Bindley Western Industries, Inc. and
Subsidiaries (the "Plan") is a combined profit sharing and pre-tax savings plan.
The purpose of the Plan is to provide retirement income and other benefits to
eligible employees of Bindley Western Industries, Inc. and its Subsidiaries
("Bindley").
Effective January 1, 1994, Bindley adopted the Prism Prototype Plan
and Trust (the "Prism Plan"), thereby amending and restating the Plan, which had
originally been established January 1, 1979.
As of February 14, 2001, Bindley Western Industries, Inc. merged
with Cardinal Health, Inc. As a result of the merger, all Bindley Western
Industries, Inc. common stock held in the participant accounts was converted
into Cardinal Health, Inc. common stock at the applicable exchange ratio.
Currently, there are no intentions of merging Bindley's plan assets into
Cardinal Health, Inc.'s plan assets.
Participation
-------------
Employees are eligible to participate in the Plan on January 1, April
1, July 1, or October 1, whichever comes first, after completing one year of
service and attaining age twenty-one. An employee is considered to have
completed one year of service at the end of the first twelve-month period during
which the employee has completed not fewer than 1,000 hours of service.
Expenses
--------
Certain expenses of the plan were paid by Bindley and approximated
$8,200 in 2001 and $8,700 in 2000.
Administration
--------------
At December 31, 2001 the Plan was administered by a committee (the
"Committee") appointed by the Human Resources and Compensation Committee of the
Board of Directors of Cardinal Health, Inc. ("Cardinal"), the parent corporation
of Bindley. The Plan has a trust agreement with Key Trust (the "Trustee")
whereby the Trustee receives contributions, invests Plan assets and distributes
amounts for benefit payments as directed by the Committee. All trustee's fees
and other administrative expenses, exclusive of those incurred in relation to
the Committee, are paid by the Plan. (See Note 8, "Significant Event")
6
Contributions and Allocations to Participants
---------------------------------------------
Bindley's annual profit sharing contribution to the Plan is a
discretionary amount determined by the Board of Directors of Cardinal for
the 2001 contribution and the Board of Directors of Bindley for the 2000
contribution. The 2001 and 2000 profit sharing contribution approximated
$4,117,000 and $3,212,000, respectively.
Participants may authorize a pre-tax amount between 1% and 13% of their
annual compensation to be contributed on their behalf to the Plan. However, the
annual contribution per employee cannot exceed $10,500 for 2001 and 2000.
Participants may also make qualified rollover contributions to the Plan.
Profit sharing contributions are allocated to participants on the basis
of the ratio that each participant's compensation bears to the total
compensation paid to all Plan participants for the applicable Plan year.
Forfeitures (the non-vested portion of those participant's accounts who
have terminated service with the Company) are used to offset future employer
profit sharing contributions. At December 31, 2001 and 2000, forfeited
non-vested accounts totaled $0 and $378,197, respectively.
Income (net of expenses) is allocated on a daily basis based on the
ratio of each participant's adjusted beginning balance to the total of all
participants' adjusted beginning balances for the applicable investment fund.
Vesting and Distributions
-------------------------
A participant's interest in their pre-tax employee contributions and
the earnings thereon are 100% vested at all times.
A participant's interest in their profit sharing account is vested as
follows:
Number of Years Percentage
of Service Vested
--------------------- -------------
Fewer than 3 0%
3 20%
4 40%
5 60%
6 80%
7 or more 100%
In the event of a participant's retirement on or after his 65th
birthday, total disability or death, his profit sharing account becomes fully
vested.
7
Distributions consist of benefit payments to eligible participants,
payments of vested amounts to terminated participants and payments to
participants who can demonstrate financial hardship. Participants are also able
to obtain loans from the Plan. Loans issued under the Prism Plan bear a rate of
interest of prime plus 1%. Any loans issued prior to the adoption of the Prism
Plan bear interest at a reasonable rate determined by the Committee. The loan
fund is utilized as the disbursement fund for loans granted by the Plan.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
----------------------------------------
Basis of Accounting
-------------------
The accounts of the Plan are maintained on the accrual basis of
accounting.
Investments and Investment Income
---------------------------------
Investments are stated at fair value which equals quoted market value
or unit values based upon quoted market values. Participant loans are valued at
cost, which approximates fair value. Interest and dividends are credited to the
accounts when earned.
Payment of Benefits
-------------------
Upon termination of service, a participant may elect to receive a lump
sum amount equal to the value of their account. Benefits are recorded when paid.
Use of Estimates
----------------
The preparation of the financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that effect the reported
amounts of assets, liabilities, and changes therein, and disclosure of
contingent assets and liabilities. Actual results could differ from those
estimates.
NOTE 3 - INVESTMENTS
--------------------
The Plan's investments are held by a Trustee. The Plan provides that
the contributions will be invested in several different investment programs as
directed by each participant. These investment programs range from money market,
government secured, fixed income, growth, aggressive funds, and Cardinal's own
stock. For the participants who fail to complete the proper investment election
forms, these participant accounts are automatically invested in the low risk
government secured investment. The net appreciation (depreciation) in fair value
for each significant class of investment is shown in the accompanying financial
statements as investment income.
8
Investment Options
------------------
Under the Prism Plan, participants are able to direct their
contributions among several investment options. The investment funds available
to participants are as follows:
1. VICTORY INVESTMENT QUALITY BOND FUND - invests primarily in
investment-grade bonds issued by corporations and the U.S. Government
and its agencies or instrumentalities.
2. VICTORY BALANCED FUND - invests in a diversified portfolio of common
stocks and fixed income securities or other collective funds holding
these securities.
3. CARDINAL HEALTH, INC. COMMON STOCK FUND - invests in the common stock
of the parent Company. (See Note 8, "Significant Event")
4. VICTORY U.S. GOVERNMENT OBLIGATIONS FUND - invests only in short-term
securities issued or guaranteed by the U.S. Treasury and repurchase
agreements collateralized by U.S. Treasury securities with maturities
of thirteen months or less.
5. AMERICAN EUROPACIFIC GROWTH FUND - invests in small and large companies
based in industrial nations as well as smaller, developing nations.
6. AMERICAN WASHINGTON MUTUAL INVESTORS FUND - invests primarily in
companies that consistently pay dividends and earn more than their
dividend payout.
7. PRIORITY HEALTHCARE CORPORATION COMMON STOCK FUND - one time investment
in the common stock of Priority Healthcare Corporation, resulting from
the Bindley Western Industries, Inc. January 1, 1999 spin-off.
8. FRANKLIN SMALL-CAP GROWTH FUND - invests primarily in the equity
securities of small capitalization companies in the United States.
9. VICTORY STOCK INDEX FUND - invests primarily in the common stocks that
comprise the S&P 500 Index.
10. FIDELITY ADVISOR EQUITY GROWTH FUND - invests primarily in the common
and preferred stocks of companies with above-average growth
characteristics.
11. VICTORY INTERMEDIATE INCOME FUND - invests at least 65% of assets in
investment-grade debt securities.
12. VICTORY GOVERNMENT RESERVES FUND - invests only in securities issued by
the U.S. Government, its agencies and/or instrumentalities.
Fund Transfers
--------------
Transfers between funds result from participants redirecting their
contributions between the funds listed above.
9
NOTE 4 - PARTY-IN-INTEREST
--------------------------
Participants in the Plan may invest their contributions/account
balances in a Cardinal Health, Inc. Common Stock Fund, which primarily holds
shares of Cardinal common stock. At December 31, 2001, this fund held
244,572 Cardinal shares with a historical cost of $10,837,081 and a market
value of $15,814,026. At December 31, 2000, this fund held 356,386 Bindley
shares with a historical cost of $5,804,048 and a market value of $15,113,504.
(See Note 8, "Significant Event")
NOTE 5 - INCOME TAX STATUS
--------------------------
The Internal Revenue Service issued a determination letter on October
2, 1996 stating that the Plan qualifies for tax-exempt status under the
applicable provisions of the Internal Revenue Code. The Plan has been amended
since receiving the determination letter. However, management believes the Plan
is designed and is currently being administered in accordance with the Internal
Revenue Code and ERISA.
NOTE 6 - PLAN TERMINATION
-------------------------
Although it has not expressed any intent to do so, Cardinal 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 percent vested in their accounts.
NOTE 7 - DIFFERENCE FROM FORM 5500
----------------------------------
At December 31, 2001, there are no differences between the Annual
Return/Report of Employee Benefit Plan (Form 5500) filed with the Internal
Revenue Service and the accompanying financial statements.
NOTE 8 - SIGNIFICANT EVENT
--------------------------
On February 14, 2001, Bindley Western Industries, Inc. shareholders
voted to approve a merger with Cardinal Health, Inc. This was a stock-for-stock
transaction, where Bindley Western Industries, Inc. shareholders received 0.6413
Cardinal Health, Inc. common shares for each outstanding share of Bindley
Western Industries, Inc. As a result, all Bindley Western Industries, Inc.
common stock held in participant accounts was converted into Cardinal Health,
Inc. common stock at the applicable exchange ratio and the Bindley Western
Industries, Inc. common stock fund was converted to the Cardinal Health, Inc.
common stock fund.
Also in connection with the merger the Cardinal Health, Inc. Employee
Benefits Policy Committee has assumed responsibility for administration of the
plan.
10
PROFIT SHARING PLAN OF
BINDLEY WESTERN INDUSTRIES, INC.
AND SUBSIDIARIES
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
DECEMBER 31, 2001
-----------------
Current
Identity of Issue Description of Investment Cost Value
--- -------------------------------------------------------- --------------------------------------- ----------- ------------
American EuroPacific Growth Fund Registered Investment Company $ 1,240,292 $ 966,511
Fidelity Adv Equity Growth Fund Registered Investment Company 1,127,730 869,877
Franklin Small Cap Growth Fund Registered Investment Company 2,241,748 1,864,972
Victory Stock Index Fund Registered Investment Company 780,241 750,294
Victory Balanced Fund Registered Investment Company 3,291,172 3,010,905
American Washington Mutual Investors Fund Registered Investment Company 4,804,418 4,667,038
Victory Intermediate Income Fund Registered Investment Company 1,440,031 1,422,545
* Cardinal Health, Inc. Common Stock Fund Equity Securities of Cardinal Health Inc. 11,241,199 16,056,341
Priority Healthcare Corp Common Stock Fund Equity Securities of Priority Healthcare 969,791 6,726,244
Corporation
Victory Government Reserves Fund Registered Investment Company 7,667,122 7,692,201
* Loans to participants (Interest rates of 8.25% to 9.25%) 161,585 161,585
----------- -----------
$34,965,329 $44,188,513
=========== ===========
*Denotes party-in-interest.
See auditors' report and accompanying notes to the financial statements
11