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, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ................................ to ............. Commission file number 1-4982 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: PARKER RETIREMENT SAVINGS PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: PARKER-HANNIFIN CORPORATION 6035 PARKLAND BOULEVARD CLEVELAND, OHIO 44124-4141 PARKER RETIREMENT SAVINGS PLAN INDEX OF FINANCIAL STATEMENTS
PAGE ---- Independent Auditors' Report 1 Financial Statements: Statements of Net Assets Available for Benefits at December 31, 2000 and 1999 2 Statements of Changes in Net Assets Available for Benefits for the years ended December 31, 2000 and 1999 2 Notes to Financial Statements 3 Supplemental Schedules: Schedule of Assets (Held at End of Year) for the year ended December 31, 2000 9
Independent Auditors' Report ---------------------------- To the Participants and Board of Directors Parker-Hannifin Corporation Parker Retirement Savings Plan We have audited the accompanying statements of net assets available for benefits of the Parker Retirement Savings 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 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 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 the Parker Retirement Savings 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 of America. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule listed in the accompanying index 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. Hausser & Taylor LLP Beachwood, Ohio May 9, 2001 1 PARKER RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS AT DECEMBER 31, 2000 AND 1999 (Dollars in Thousands)
2000 1999 ------------ ------------ ASSETS - ------ Investments (Notes 1, 5 & 7) $ 1,367,188 $ 1,415,746 Accrued interest and dividends 1,389 1,318 Other 1,987 1,905 ------------ ------------ Total assets 1,370,564 1,418,969 ------------ ------------ LIABILITIES - ----------- Notes payable (Note 4) 94,188 105,295 Other 4,343 5,639 ------------ ------------ Total liabilities 98,531 110,934 ------------ ------------ Net Assets Available for Benefits $ 1,272,033 $ 1,308,035 ============ ============
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999 (Dollars in Thousands)
2000 1999 ------------ ------------ ADDITIONS - --------- Participant payroll deductions (Notes 1 & 2) $ 74,466 $ 71,264 Employer contributions (Notes 1 & 2) 29,942 25,414 Interest income 26,821 23,798 Dividend income 9,727 13,386 Net (depreciation) appreciation in the fair value of investments (Notes 1 & 5) (103,760) 310,661 ------------ ------------ Total additions 37,196 444,523 ------------ ------------ DEDUCTIONS - ---------- Benefits paid to participants 65,385 95,194 Interest expense 6,136 5,489 Trustee fees and expenses 1,677 1,842 ------------ ------------ Total deductions 73,198 102,525 ------------ ------------ Net (decrease) increase in Assets Available for Benefits (36,002) 341,998 Net Assets Available - Beginning of year 1,308,035 966,037 ------------ ------------ Net Assets Available - End of year $ 1,272,033 $ 1,308,035 ============ ============
2 NOTES TO FINANCIAL STATEMENTS (Dollars in Thousands) 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ------------------------------------------ Investment Valuation -------------------- The investments in Parker-Hannifin Corporation (the Company) common shares, non-convertible corporate bonds, U.S. Government bonds, Key Trust Employee Benefits Value Equity Fund, Key Trust Employee Benefits Fixed Income Fund, Aetna Small Company Fund, Capital Guardian International Equity Fund, the SSgA S&P 500 Index Fund, the Federated Equity Income Fund, the Janus Fund, and the John Hancock Technology Fund are valued at quoted market prices as of the last reported trade price on the last business day of the period. The Parker Retirement Savings Plan (the Plan) presents in the Statement of Changes in Net Assets Available for Benefits the net appreciation (depreciation) in the fair value of its investments which consists of the realized gains or losses from the sale of investments and the unrealized appreciation (depreciation) on investments held by the Plan. Investments in the Key Trust Employee Benefits Money Market Fund are valued at market, which approximates cost. Refer to Note 7 for information relating to the Contract Income Fund. Management believes that the Plan's investments are well diversified and do not create a significant concentration of credit risk. Participants assume all risk in connection with any decrease in the market price of any securities in all the Funds. Although the annual rates of return with respect to the contracts held in the Contract Income Fund are guaranteed by major insurance and bank companies, the Company does not make any representations as to the financial capability of such companies or their ability to make payments under the contracts. Contributions ------------- Participants may make contributions on a before tax and/or after tax basis. Contributions from employees and the Company are recorded in the period that payroll deductions are made from Plan participants. Company contributions are invested solely in a non-participant directed ESOP Fund, which holds primarily Company stock. Other ----- Purchases and sales of securities are reflected on a trade-date basis. Dividend income is recorded on the ex-dividend date. Interest and other income are recorded as earned on the accrual basis. Costs incident to the purchase and sale of securities, such as brokerage commissions and stock transfer taxes, as well as investment advisory fees, are charged to the funds to which they relate and are netted against interest income. Certain costs and expenses incurred in administering the Plan are paid out of the Plan's assets and the Company pays the remainder. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Benefits are recorded when paid. 3 NOTES TO FINANCIAL STATEMENTS, continued (Dollars in Thousands) 2. DESCRIPTION OF PLAN ------------------- General ------- The following description of the Plan provides only general information. Participants should refer to the Plan document or summary plan description for a more complete description of the Plan's provisions. The Plan is a defined contribution plan which is available to all U. S. domestic regular and part-time non-union employees. Employees are able to enroll in the Plan the first day of the month following the date of hire. The Plan is subject to Sections 401(a) and 401(k) of the Internal Revenue Code and the provisions of the Employee Retirement Income Security Act (ERISA) of 1974, as amended. The Plan was amended and restated effective January 1, 1998 to reflect certain operational and administrative changes and to comply with tax legislative changes. Cash ---- The Plan maintains at a financial institution cash which exceeds federally insured amounts at times and which may, at times, significantly differ from balance sheet amounts due to outstanding checks. Contributions and Transfers --------------------------- Participants may elect to contribute, through payroll deductions, not less than 1% nor more than 20% of their total compensation for a Plan year and may change such percentage upon request. The amount which a highly compensated employee may contribute may be limited in order to comply with Internal Revenue Code Sections 401(k) and 401(m). Participants may suspend their contributions at any time and may designate one or more of several available funds in which their contributions are to be invested. Investment elections may be changed at any time. Available funds are: (a) Company Stock Fund - Invested primarily in common shares of the ------------------ Company purchased on the open market. A participant's contribution is limited to 50% of the total amount invested. (b) Fixed Income Fund - Invested primarily in securities which have a ----------------- fixed rate of return such as government and high-quality corporate bills, notes, bonds, and other similar investments of issuers other than the Company. (c) Equity Fund - Invested primarily in common stock of high-quality ----------- medium and large capitalization companies other than the Company. (d) Contract Income Fund - Invested primarily in high-quality fixed income -------------------- investments such as contracts issued by insurance companies and banks which provide a return guaranteed by the issuer, and debt securities such as notes and bonds issued by Federal agencies or mortgage backed securities, with each of these investments typically providing a stable rate of return for a specific period of time. Refer to Note 7 for a further description of this fund. (e) Balanced Fund - Invested primarily in securities which have a fixed ------------- rate of return such as government and high-quality corporate bills, notes, bonds, and/or invested in bonds, convertible securities, money market investments, and common stocks of high-quality medium and large capitalization companies other than the Company. (f) Aetna Small Company Fund - Invested primarily in common stocks and ------------------------ securities convertible into common stocks of companies with smaller market capitalization who outperform the market over time (g) International Fund - Invested primarily in common stocks, preferred ------------------ stocks, warrants and rights to subscribe to common stocks of non-U.S. issuers. (h) S&P 500 Index Fund - Invested in stocks which comprise the S&P 500 ------------------ Index, most of which are listed on the New York Stock Exchange. 4 NOTES TO FINANCIAL STATEMENTS, continued (Dollars in Thousands) (i) Janus Fund - Invested primarily in common stocks of larger, more ---------- established companies that are expected to have greater than average earnings growth. (j) Federated Equity Income Fund - Invested in equities and convertible ---------------------------- securities. (k) John Hancock Technology Fund - Invested primarily in U.S. and foreign ---------------------------- technology companies whose stocks appear to be trading below their true value. Parker-Hannifin Corporation Contributions ----------------------------------------- The Company contributes an amount equal to 100% of the first 3% of the monthly before-tax contributions and an amount equal to 25% of the 4th percent and 5th percent of the contribution. The Company may also match after-tax contributions, but matches only 25% of the 4th percent and 5th percent of after tax contributions. Company contributions match the before- tax contributions prior to the after-tax contributions. Company contributions are invested solely in the ESOP Fund. A participant age 55 or older, with 10 or more years of participation in the Plan, may transfer a portion of the shares of stock in the ESOP Fund to any of the investment funds within the Plan. Participant Loans ----------------- The Plan has a loan provision which allows an active participant to borrow a minimum of $500 (actual dollars) and up to the lesser of a) 50% of their account balance or b) $50,000 (actual dollars) less the largest outstanding loan balance he/she had in the last 12 months. The loan must be repaid, with interest equal to the prime rate at the time the loan is entered into plus 1%, over a period from 1 year to 4 1/2 years for a general purpose loan and up to ten years for a residential loan. Participant loans are valued at cost, which approximates fair value. Participant Accounts -------------------- The Plan utilizes the unit value method for allocating Plan earnings for all funds. Unit values are determined on a daily basis and exclude contributions receivable and benefits payable. 3. VESTING, WITHDRAWALS AND DISTRIBUTIONS -------------------------------------- Participants are fully vested at all times. In general, a participant's account is only paid out after termination of employment, but under certain circumstances, a participant may withdraw in cash a portion of his/her before and/or after tax contributions, subject to certain limitations and restrictions. After a participant terminates employment for any reason, all amounts are distributable to the participant or if the participant is deceased, to the participant's designated beneficiary. The distribution may be deferred until the age of 70 1/2 if the participant's interest exceeds $5,000 (actual dollars). Distribution is in cash either in a single payment, quarterly installments or, by purchase of an annuity, except that amounts held in the Company Stock Fund and ESOP Fund may be distributed in the form of common shares or cash, as the participant elects. Dividends received by the ESOP Fund with respect to allocated Company shares are paid to participants at the end of each Plan year. 5 NOTES TO FINANCIAL STATEMENTS, continued (Dollars in Thousands) 4. ESOP FUND NOTES PAYABLE ----------------------- In March 1999, the Trust issued and sold $112,000 aggregate principal amount of its 6.34% Amortizing Notes due 2008, the proceeds of which were used to purchase 3,055,413 million shares of the Company's stock from the Company's treasury. The Notes were guaranteed by the Company and call for payment of principal and interest semiannually from July 15, 1999 through July 15, 2008. The ESOP Fund uses company contributions and cash dividends received on unallocated shares to repay the loan plus interest. Commencing July 1, 1999 and continuing over the period of the loan, the shares purchased by the ESOP Fund will be allocated to participants making contributions to the plan. The shares will be held in suspense in the ESOP fund (referred to as unallocated shares), to be released and allocated to participant's accounts periodically in full or partial satisfaction of the Company's matching contribution obligations. Principal amounts of the notes payable for the five years ending December 31, 2001 through 2005 are $11,187, $11,294, $11,430, $11,596 and $11,793, respectively. 5. INVESTMENTS ----------- The Plan investments at fair value (determined by quoted market price) at December 31,:
2000 1999 ---- ---- Cash and cash equivalents Employee Benefits Money Market Fund $ 27,060 $ 19,996 Common Shares Company Stock Fund 146,835 131,257 ESOP Fund - Allocated * 358,294 403,188 ESOP Fund - Unallocated * 110,270 147,033 Investment Contracts - estimated 149,287 157,633 Other Investments AIM Constellation Fund 50,071 Aetna Small Company Fund 57,043 Capital Guardian International Equity Fund 32,990 37,600 SSgA S&P 500 Index Fund 96,105 107,298 Employee Benefits Fixed Income Fund 33,324 34,099 Employee Benefits Value Equity Fund 247,837 261,124 Federated Equity Income Fund 4,031 Janus Fund 13,643 John Hancock Technology Fund 9,411 U.S. Government Securities 25,290 19,972 Corporate Debt Instruments 12,657 14,115 ----------- ------------ 532,331 524,279 Participant Loans - estimated 43,111 32,360 ----------- ------------ Total Assets Held for Investment $ 1,367,188 $ 1,415,746 =========== ============
* Non-participant directed investments The plan's investments appreciated (depreciated) in value as follows:
2000 1999 ---- ---- Company Stock Fund $ (9,555) $ 58,000 ESOP Fund - Allocated (54,488) 147,587 ESOP Fund - Unallocated (23,349) 41,998 Bank Common/ Collective Trusts 8,882 39,057 Mutual Funds (25,250) 24,019 --------- ------ $(103,760) $310,661 ========== =======
6 NOTES TO FINANCIAL STATEMENTS, continued (Dollars in Thousands) 6. NONPARTICIPANT-DIRECTED INVESTMENTS ----------------------------------- Information about the net assets and the significant components of the changes in net assets relating to the nonparticipant directed investments at December 31 is as follows:
2000 1999 ---- ---- Net Assets: ESOP Fund - Allocated $362,112 $405,770 ESOP Fund - Unallocated 14,260 39,684 -------- -------- $376,372 $445,454 ======== ========
Year ended December 31, Year ended December 31, 2000 1999 ---------------------------------- ------------------------------------- ESOP Fund ESOP Fund ESOP Fund ESOP Fund Allocated Unallocated Allocated Unallocated ------------- ---------------- ---------------- ---------------- Changes in Net Assets: Contributions $ 14,287 $ 15,653 $ 16,804 $ 8,610 Transfers from (to) other plan funds 10,424 (13,429) (1,454) (6,949) Interest income 106 76 164 21 Dividend income 5,481 1,761 9,981 1,494 Net (depreciation) appreciation (54,488) (23,349) 147,589 41,997 Benefits paid to participants (19,468) (26,626) Interest expense (6,136) (5,489) ------------- ---------------- ---------------- ---------------- $ (43,658) $ (25,424) $ 146,458 $ 39,684 ============= ================ ================ ================
7. CONTRACT INCOME FUND -------------------- Reported in aggregate for the Contract Income Fund (including cash and cash equivalents) at December 31:
2000 1999 ---- ---- Contract Value of Assets $ 172,029 $ 173,382 Fair Value of Assets $ 173,055 $ 170,329 Average Yield of Assets 6.56% 6.39% Return on assets for the 12 months ended December 31 6.48% 6.26% Duration 2.38 Years 2.88 years
The above information is provided in compliance with the AICPA Statement of Position 94-4 (SOP 94-4). SOP 94-4 requires that fair value be based upon the standard discounted cash flow methodology as referred to in the Statement of Financial Accounting Standards No. 107. To arrive at the above aggregate fair value, comparable duration Wall Street Journal Guaranteed Investment Contract (GIC) Index rates were used as the discount factor within the discounted cash flow formula. A standard present value calculation has been employed to arrive at a current value for each cash flow within a contract. The sum of the present values for each contract's cash flows is the estimated total fair value for that contract. All of the contract fair values are then added together to arrive at the above aggregate fair value for the portfolio. The Contract Income Fund contains a managed synthetic GIC. This is a portfolio of securities owned by the Fund with a benefit-responsive, book- value "wrap" contract associated with the portfolio. The wrap contract assures that book-value, benefit-responsive payments can be made for participant withdrawals. The managed synthetic GIC (which exceeded 5% of the Plan's net assets) included in the above amounts at December 31, 2000 and 1999 had a book value of $ 53,874 and $54,483, while the fair value was $54,346 and $53,119, respectively. 7 NOTES TO FINANCIAL STATEMENTS, continued (Dollars in Thousands) At December 31, 2000 and 1999 the Contract Income Fund contained a non- benefit responsive contract. SOP 94-4 recommends that this contract be carried at a fair value. However, the Fund's non-benefit responsive contract was not material to the Contract Income Fund. Therefore, this contract has been reported at contract value in the financial statements. Certain employer initiated events (e.g., layoffs, bankruptcy, plant closings, plan termination, mergers, early retirement incentives) are not eligible for book value disbursements even from fully benefit responsive contracts. These events may cause liquidation of all or a portion of a contract at a market value adjustment. 8. TAX STATUS ---------- The Internal Revenue Service has determined and informed the Company by letter dated July 24, 1995, that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). Since receiving the determination letter the Plan has been amended to provide for various administrative changes including adding additional investment funds and furnishing daily valuations. The Plan administrator and the Plan's tax counsel believe that the Plan continues to be designed and operated in compliance with the applicable provisions of the IRC. Contributions matched by the Company and all earnings generally are not taxable until distributed to the participants. 9. PLAN TERMINATION ---------------- Although it has not expressed any intent to do so, the Company, by action of its Board of Directors, without further approval by the shareholders, has the right to amend, modify, suspend, or terminate the Plan in its entirety, or as to any subsidiary or operating location. No amendment, modification, suspension, or termination may permit assets held in trust by the Trustee to be used for or diverted to purposes other than for the exclusive benefit of participants or their beneficiaries. If the Plan is terminated, the Company contributions credited to each affected participant will continue to be fully vested. 10. PARTY-IN-INTEREST ----------------- Certain plan investments are units of common/collective trusts managed by Key Bank. Key Bank is the trustee as defined by the Plan and, therefore, these transactions qualify as party-in-interest. 11. PLAN AMENDMENTS --------------- Effective January 1, 2000, the plan was amended to allow employees to contribute, through payroll deductions, up to 20% of their total compensation for a Plan year and may change such percentage upon request. Effective July 1, 2000, the plan was amended to allow union employees at Wickliffe, Eastlake North and Eastlake South to participate in the Parker Hannifin 401(k) plan. Participants may elect to contribute, through payroll deductions, not less than 1% nor more than 20% of their total compensation for a Plan year and may change such percentage upon request. Such contributions can be made on a before tax basis only. The company does not match the above contributions, and does not provide for loan provisions, after tax withdrawals or automatic enrollment. 8 PARKER RETIREMENT SAVINGS PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR) FOR THE YEAR ENDED DECEMBER 31, 2000 EIN 34-0451060
(a) (b) (c) (d) (e) Identity of issue, borrower, lessor, Description of investment including maturity date, Current or similar party rate of interest, collateral, par, or maturity value Cost value -------------------------------------------------------------------------------------------------------------------------------- * Employee Benefits Money Market Fund Cash and cash equivalents $ 27,060,225 $ 27,060,225 * Parker Hannifin Corporation 3,327,712 Common Shares 112,219,650 146,835,292 * ESOP - Allocated 8,119,970 Common Shares 151,796,949 358,293,676 * ESOP - Unallocated 2,499,037 Common Shares 91,605,325 110,270,008 AIM 8.417 units of AIM Constellation Fund 239 244 Aetna 4,017,134 units of Aetna Small Company Fund 61,360,854 57,043,301 Federated 212,610 units of Federated Equity Income Fund 4,359,329 4,031,089 Janus 409,829 units of the Janus Fund 16,517,595 13,643,215 John Hancock 1,089,175 units of the John Hancock Technology Fund 11,915,997 9,410,471 Capital Guardian 1,077,390 units of Capital Guardian Intl Equity Fund 36,128,668 32,989,682 SSgA 4,404,428 units of SSgA S&P 500 Index Fund 94,934,833 96,104,626 * Key Bank 308,790 units of Employee Benefits Fixed Income Fund 27,688,211 33,324,439 * Key Bank 3,946,860 units of Employee Benefits Value Equity Fund 130,495,748 247,837,184 * Participant Loans Participant loans - 8.75% - 9.25% - 43,110,632 U.S. Government Securities: Cost Value --------------------------- ----- ----- Freddie Mac Gold 6.0% due 04-01-2026 113,513 118,545 Freddie Mac Gold 7.0% due 07-01-2030 247,887 253,410 Freddie Mac Gold 7.5% due 04-01-2028 69,382 72,252 Freddie Mac Gold 6.0% due 04-01-2028 24,784 26,141 Freddie Mac Gold 6.0% due 07-01-2028 315,288 328,685 Freddie Mac Gold 6.0% due 02-01-2013 381,537 404,733 Freddie Mac Gold 6.0% due 06-01-2013 63,907 65,290 Freddie Mac Gold 6.5% due 07-01-2028 51,820 53,750 Freddie Mac Gold 7.0% due 11-01-2028 507,380 497,675 Freddie Mac Gold 6.5% due 01-01-2029 613,596 601,703 Freddie Mac Gold 6.0% due 01-01-2029 414,549 426,394 Freddie Mac Gold 6.0% due 08-01-2028 139,331 143,790 Freddie Mac Gold 6.0% due 01-01-2029 113,264 123,122 Freddie Mac Gold 7.5% due 03-01-2029 36,651 35,905 Freddie Mac Gold 7.5% due 11-01-2029 107,934 108,834 Freddie Mac Gold 6.5% due 07-01-2029 250,132 262,415 Freddie Mac Gold 6.0% due 03-01-2013 51,843 53,652 Freddie Mac Gold 7.5% due 08-01-2030 14,846 15,183 Freddie Mac 6.25% due 09-15-2023 168,488 172,815 Freddie Mac 6.00% due 06-15-2027 259,425 271,357 Freddie Mac Gold 6.50% due 05-01-2026 231,570 237,801 Freddie Mac 5.0% due 01-15-2004 459,664 480,134 Freddie Mac 6.43% due 01-28-2014 210,558 220,154 Freddie Mac 6.625% due 09-15-2009 232,120 245,846 Freddie Mac 6.875% due 09-15-2010 147,241 149,078 Freddie Mac 6.375% due 11-15-2003 41,945 42,787 Fannie Mae 5.75% due 02-15-2008 122,764 128,679 Fannie Mae 7.125% due 06-15-2010 221,601 232,402 Fannie Mae 7.0% due 07-15-2005 878,793 882,655 Fannie Mae 6.625% due 10-15-2007 228,717 240,026 Fannie Mae 6.625% due 11-15-2030 212,179 227,464 Fannie Mae 6.0% due 10-01-2023 2,966 3,144 Fannie Mae 6.5% due 03-01-2018 122,964 127,120 Fannie Mae 6.5% due 07-01-2028 165,454 171,101
9 PARKER RETIREMENT SAVINGS PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR) FOR THE YEAR ENDED DECEMBER 31, 2000 EIN 34-0451060
(a) (b) (c) (d) (e) Identity of issue, borrower, lessor, Description of investment including maturity date, Current or similar party rate of interest, collateral, par, or maturity value Cost value -------------------------------------------------------------------------------------------------------------------------------- Fannie Mae 6.5% due 09-01-2028 132,093 139,460 Fannie Mae 6.5% due 11-01-2028 179,659 185,724 Fannie Mae 7.5% due 01-01-2030 31,811 33,731 Fannie Mae 8.0% due 02-01-2030 91,092 93,042 Fannie Mae 7.5% due 12-01-2028 248,328 250,971 Fannie Mae 6.5% due 12-01-2028 13,215 13,930 Fannie Mae 6.0% due 02-01-2029 28,973 30,081 Fannie Mae 7.0% due 10-01-2026 215,282 217,097 Fannie Mae 8.0% due 06-01-2012 295,517 298,703 Fannie Mae 6.0% due 04-01-2028 170,352 177,842 Fannie Mae 8.5% due 11-01-2017 87,355 85,120 Fannie Mae 6.0% due 12-01-2028 96,310 100,775 Fannie Mae 6.5% due 03-01-2029 111,708 109,818 Fannie Mae 7.5% due 05-01-2029 76,933 76,137 Fannie Mae 7.5% due 05-01-2029 60,027 58,854 Fannie Mae 6.0% due 07-01-2029 97,126 101,266 Fannie Mae 7.5% due 11-01-2029 57,417 57,948 Fannie Mae 7.50% due 02-01-2029 27,687 28,682 Fannie Mae 8.5% due 08-01-2019 268,395 266,963 Fannie Mae 7.5% due 03-01-2027 301,228 310,037 Fannie Mae 8.0% due 11-01-2019 303,825 302,619 Fannie Mae 8.5% due 11-01-2019 115,075 113,606 Fannie Mae 10.0% due 11-01-2013 452,170 457,236 Fannie Mae 10.5% due 11-01-2013 157,907 158,735 Fannie Mae 11.0% due 11-01-2013 202,030 203,278 Fannie Mae 8.5% due 01-01-2030 100,315 101,393 Fannie Mae 7.0% due 06-01-2015 103,595 107,277 Fannie Mae 8.0% due 03-01-2030 193,070 196,437 Fannie Mae 7.0% due 06-01-2015 296,986 307,507 Fannie Mae 9.5% due 10-01-2021 18,424 18,528 GNMA 8.0% due 08-20-2025 33,095 33,786 GNMA 8.0% due 01-20-2027 76,907 78,487 GNMA 8.0% due 02-20-2027 77,162 78,750 GNMA 7.0% due 07-15-2023 58,091 57,202 GNMA 7.0% due 11-15-2023 12,378 12,658 GNMA 7.0% due 09-15-2028 41,026 42,669 GNMA 7.0% due 02-15-2028 19,940 20,973 GNMA 7.0% due 04-15-2028 59,638 59,275 GNMA 7.0% due 04-15-2028 59,343 58,964 GNMA 6.5% due 07-15-2028 164,532 170,189 GNMA 7.5% due 11-15-2028 17,401 17,595 GNMA 7.5% due 04-15-2029 116,065 114,123 GNMA 9.0% due 11-15-2017 254,447 255,213 GNMA 7.0% due 12-15-2023 360,849 368,035 GNMA 7.0% due 12-15-2025 192,295 197,140 GNMA 8.5% due 12-15-2017 205,452 205,408 GNMA 7.0% due 12-15-2023 90,763 93,111 GNMA 8.5% due 12-15-2017 772,478 772,341 GNMA 9.5% due 07-15-2025 286,572 289,842 GNMA 8.5% due 04-01-2006 160,535 155,677 United States Treas Bonds 0% due 11-15-2021 237,559 251,072 United States Treas Bonds 10.625% due 08-15-2015 282,374 304,013
10 PARKER RETIREMENT SAVINGS PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR) FOR THE YEAR ENDED DECEMBER 31, 2000 EIN 34-0451060
(a) (b) (c) (d) (e) Identity of issue, borrower, lessor, Description of investment including maturity date, Current or similar party rate of interest, collateral, par, or maturity value Cost value -------------------------------------------------------------------------------------------------------------------------------- United States Treas Bonds 7.50% due 11-15-2016 578,681 609,887 United States Treas Bonds 8.75% due 08-15-2020 914,501 961,408 United States Treas Bonds 8.0% due 11-15-2021 664,411 680,676 United States Treas Bonds 7.125% due 02-15-2023 299,881 333,637 United States Treas Bonds 6.125% due 08-15-2029 414,657 415,486 United States Treas Bonds 6.25% due 05-15-2030 346,074 362,576 United States Treas Nts 6.375% due 08-15-2002 1,382,466 1,392,906 United States Treas Nts 7.0% due 07-15-2006 189,340 198,096 United States Treas Nts 6.625% due 05-15-2007 426,375 431,124 United States Treas Nts 5.75% due 04-30-2003 914,159 923,244 United States Treas Nts 6.0% due 08-15-2009 388,540 396,740 United States Treas Nts 5.875% due 10-31-2001 435,525 437,817 United States Treas Nts 5.875% due 11-15-2004 1,182,709 1,195,395 United States Treas Nts 5.75% due 08-15-2010 550,254 558,568 United States Treas Nts 5.75% due 11-15-2005 719,933 728,945 ---------- ---------- Total U.S. Government Securities 24,744,406 25,289,867 Corporate Debt Instruments: --------------------------- Abbey National Cap Trust I Bond FL RT% due 12-29-2049 109,548 113,480 Albertsons Inc Senior Note 6.55% due 08-01-2004 233,252 234,876 Amerada Hess Corp Bond 7.875% due 10-01-2029 108,385 115,327 American Express ABS 2000-5 A FL RT% due 04-15-2008 106,000 105,966 American General Finance Med Term Note 7.45% due 01-15-2005 85,036 87,968 American General Corp Note 7.5% due 08-11-2010 248,737 262,312 Anheuser Busch Cos Inc Bond 6.8% due 01-15-2031 134,217 134,776 Avon Products Inc. Senior Note7.15% due 11-15-2009 67,815 69,485 Baker Hughes Inc. Senior Note 6.875% due 01-15-2029 148,737 144,645 British Telecommunications PLC Yankee Note 7.625% due 12-15-2005 230,366 232,698 CIT Equipment Collateral ABS 2000-2 A4 6.930% due 07-20-2011 299,942 302,490 Cabot Industrial Note 7.125% due 05-01-2004 74,767 74,776 Citigroup Inc. Sub Note 7.25% due 10-01-2010 234,323 243,058 Citigroup Inc. Senior Note 6.75% due 12-01-2005 129,671 132,506 Citigroup Inc.Cap II Bond 7.75% due 12-01-2036 63,890 65,139 Conoco Inc Senior Note 6.95% due 04-15-2029 239,867 253,318 Copelco Capital FDG Corp ABS 7.12 due 08-18-2003 80,025 80,825 Dr Invts Yankee Note 7.1% due 05-15-2002 274,843 275,910 Deere & Co Senior Deb 6.55% due 10-01-2028 99,262 102,159 Dow Chemical Co. Note 7.0% due 08-15-2005 144,353 150,007 Duke Energy Corp Senior Unsub 7.375% due 03-01-2010 124,387 130,935 El Paso Energy Corp Med Term Note 8.05% due 10-15-2030 143,269 142,066 Enron Corp Bond 7.375% due 05-15-2019 113,800 116,156 Ford Credit Auto Owner Trust ABS 7.24% due 02-15-2004 244,979 249,976 Ford Credit Auto Owner Trust ABS 6.56% due 05-17-2004 284,997 287,494 GE Cap Commercial Mtg Corp CMO 6.32% due 05-15-2010 300,746 300,602 GMAC Commercial Mtg Secs Inc CMO 6.175% due 05-15-2033 186,853 187,373 GTE Corp Deb 6.84% due 04-15-2018 241,426 250,104 General Elect Cap Corp Note 7.50% due 06-05-2003 160,253 165,922 Heller Financial Inc Note 7.875% due 05-15-2003 99,840 102,565 Honeywell International Inc Note 6.875% due 10-03-2005 218,882 227,031 Household Finance Corp Note 8.0% due 05-09-2005 234,240 246,433 Kinder Morgan Energy Partners Senior Note 8.0% due 03-15-2005 245,988 258,036
11 PARKER RETIREMENT SAVINGS PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR) FOR THE YEAR ENDED DECEMBER 31, 2000 EIN 34-0451060
(a) (b) (c) (d) (e) Identity of issue, borrower, lessor, Description of investment including maturity date, Current or similar party rate of interest, collateral, par, or maturity value Cost value -------------------------------------------------------------------------------------------------------------------------------- LB Commercial Conduit Mtg TR CMO 6.410% due 08-15-2007 151,106 155,953 Liberty Mutual Ins Co Note 8.20% due 05-04-2007 103,754 97,982 Lockheed Martin Corp Note 8.2% due 12-01-2009 109,146 115,108 Lowes Companies Inc. Note 8.25% due 06-01-2010 150,085 153,111 MBNA Master Credit Card Trust ABS2000-AC 7.9% due 07-16-2007 114,986 119,655 MBNA Master Credit Card Trust ABS98-D 5.8% due 12-15-2005 249,448 249,530 MBNA Master Credit Card Trust ABS 00-I 6.9% due 01-15-2008 208,914 216,054 Marconi Corp PLC Yankee Bond 8.375% due 09-15-2030 119,124 109,264 Morgan Stanley Dean Witter Notes 7.125% due 01-15-2003 199,956 203,586 Morgan Stanley Dean Witter Notes 7.75% due 06-15-2005 100,908 105,225 Morgan Stanley Capital I CMO 6.52% due 01-15-2008 249,143 257,371 Morgan Stanley Capital I Inc CMO 6.54% due 05-15-2008 305,187 314,626 Motorola Inc. Note 7.625% due 11-15-2010 149,995 154,443 Peco Energy Transition Trust ABS 2000-A2 7.3% due 09-01-2004 199,814 201,880 Pemex Finance LTD Yankee Note 9.03% due 02-15-2011 120,967 126,694 Raytheon Co. Note 6.75% due 08-15-2007 296,901 323,056 Residential Asset Secs Corp ABS 7.18% due 01-25-2025 195,000 197,613 RJ Reynolds Tobacco Hldg Note 7.375% due 05-15-2003 64,890 62,954 Salomon Inc. Note 6.75% due -02-15-2003 144,142 145,958 Sprint Capital Corp Med Term Note 7.625% due 06-10-2002 174,907 175,472 Sun Microsystems Inc. Senior Note 7.35% due 08-15-2004 132,174 132,717 Sun Microsystems Inc. Senior Note 7.65% due 08-15-2009 419,181 431,873 Target Corp Note 7.5% due 08-15-2010 362,302 379,818 Texas Instruments Inc. Senior Note 7.0% due 08-15-2004 245,170 251,321 Time Warner Inc Note 7.25% due 10-15-2017 106,891 113,872 Tyco Intl Group S A Yankee Note 6.875% due 09-05-2002 88,666 90,633 UBS PFD Funding Trust I Bond 8.622% due 12-29-2049 305,931 320,107 Unilever Capital Corp Global Note 7.125% due 11-01-2010 239,320 251,405 Union Pac Corp Bond 6.625% due 02-01-2029 109,873 116,576 Union Pac Corp Med term Note 6.79% due 11-09-2007 120,730 124,838 Union Pac Res Group Inc. Note 7.0% due 10-15-2006 88,969 92,213 United Mexican States Yankee Med Note 9.875% due 02-01-2010 81,844 80,700 United Technologies Corp DEB 7.5% due 09-15-2029 134,725 143,948 Viacom Inc. Senior Note 7.75% due 06-01-2005 104,412 98,613 Viacom Inc. Senior Note 7.7% due 07-30-2010 174,987 183,279 Vodafone Group PLC Yankee Note 7.75% due 02-15-2010 121,216 124,596 Worldcom Inc Note 7.875% due 05-15-2003 154,289 157,178 Korea Development Bank Senior Unsub 6.50% due 11-15-2002 117,415 118,754 Korea Electric Pwr DEB 6.375% due 12-01-2003 107,811 112,445 ---------- ---------- Total Corporate Debt Instruments 12,336,975 12,656,835 Investment Contracts: --------------------- Business Mens Assurance Co Amer 6.9% due 10-01-2001 3,034,750 3,034,750 Ohio National Life 7.12% due 06-15-2002 3,917,443 3,917,443 Caisse Des Depots Et Consignatio 6.51% due 01-15-2002 4,031,822 4,031,822 Protective Life Insur Co 6.89% due 09-15-2002 4,056,622 4,056,622 Safeco Life Insurance Co 7.04% due 12-15-2002 3,626,913 3,626,913 Safeco Life Insurance Co 6.49% due 11-15-2002 2,526,671 2,526,671 Jackson National Life Ins Co FL RT% due 03-31-2003 2,999,483 2,999,483 Jackson National Life Ins Co 5.96% due 08-15-2001 6,102,694 6,102,694 Transamerica 5.142% due 12-06-2001 4,109,403 4,109,403 GE Life and Annuity Assurance Co 5.63% due 08-15-2002 1,115,993 1,115,993
12 PARKER RETIREMENT SAVINGS PLAN SCHEDULE OF ASSETS (HELD AT END OF YEAR) FOR THE YEAR ENDED DECEMBER 31, 2000 EIN 34-0451060
(a) (b) (c) (d) (e) Identity of issue, borrower, lessor, Description of investment including maturity date, Current or similar party rate of interest, collateral, par, or maturity value Cost value -------------------------------------------------------------------------------------------------------------------------------- Bank of America SS GIC 5.49% due 10-15-2003 2,994,418 2,994,418 Bank of America SS GIC 5.88% due 11-15-2005 2,960,579 2,960,579 Monumental Life Insurance Co GIC 5.78% due 03-01-2005 3,547,102 3,547,102 Bank of America SS 5.81% due 03-25-2005 2,953,896 2,953,896 Bank of America SS 5.80% due 01-15-2005 4,019,786 4,019,786 Monumental Life Insurance Co 6.01% due 03-15-2006 2,474,173 2,474,173 Hartford Life Insurance Co 6.20% due 11-17-2003 4,388,182 4,388,182 Security Life of Denver Ins Co 6.36% due 11-17-2003 5,483,195 5,483,195 Caisse Des Depots Et Consignatio 6.77% due 07-15-2004 5,125,034 5,125,034 Bank of America 6.93% due 03-25-2005 2,986,326 2,986,326 UBS AG 6.82% due 07-15-2006 4,850,340 4,850,340 Canada Life Assurance Co 7.25% due 04-15-2005 4,177,963 4,177,963 Hartford Life Insurance Co 7.32% due 06-15-2005 4,276,215 4,276,215 Security Life of Denver 7.04% due 01-10-2001 5,000,000 5,000,000 Monumental Life Insurance Co 6.42% due 07-15-2005 4,946,823 4,946,823 Bankers Trust Synthetic GIC FL RT% - No maturity 53,580,914 53,580,914 ----------------------------- Total Investment Contracts 149,286,740 149,286,740 Total Assets Held for Investment $ 952,451,744 $1,367,187,526 =============================
* Denotes Party-in-Interest 13 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Administrator of the Plan has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. PARKER RETIREMENT SAVINGS PLAN BY: /s/ Michael J. Hiemstra ---------------------------------------- Michael J. Hiemstra Vice President-Finance & Administration & Chief Financial Officer Parker-Hannifin Corporation June 19, 2001 14