SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 2001
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________ to _______
Commission File Number 0-3683
Full title of the Plan and the address of the Plan, if different from that of
the issuer named below:
Trustmark National Bank 401(k) Plan
(Full Title of the Plan)
Name of issuer of the securities held pursuant to the Plan and the address of
its principal executive office:
Trustmark Corporation
248 E. Capitol Street
Jackson, Mississippi 39201
(Name of Issuer of Securities and address of Principal Executive Office)
TRUSTMARK NATIONAL BANK 401(K) PLAN
Financial Statements and Schedule
December 31, 2001 and 2000
(With Independent Auditors' Report Thereon)
TRUSTMARK NATIONAL BANK 401(K) PLAN
Index to Financial Statements and Schedule
Independent Auditors' Report
Statements of Net Assets Available for Benefits as of December 31, 2001 and 2000
Statement of Changes in Net Assets Available for Benefits for the year ended
December 31, 2001
Notes to Financial Statements
Supplemental Schedule:
Schedule H, Line 4i - Schedule of Assets (Held at End of Year) as of December
31, 2001
All other schedules are omitted because there is no information to report.
Independent Auditors' Report
The Plan Administrator
Trustmark National Bank 401(k) Plan:
We have audited the accompanying statement of net assets available for benefits
of Trustmark National Bank 401(k) Plan (the Plan) as of December 31, 2001, 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 audit. The statement of net assets available
for benefits as of December 31, 2000, was audited by other auditors whose report
thereon dated June 14, 2001, expressed an unqualified opinion on the statement.
We conducted our audit 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 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 Trustmark
National Bank 401(k) Plan as of December 31, 2001, and the changes in its 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 audit was 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 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 is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the 2001 basic financial statements and, in
our opinion, is fairly stated in all material respects in relation to the 2001
basic financial statements taken as a whole.
/s/ KPMG LLP
------------
KPMG LLP
Jackson, Mississippi
June 7, 2002
TRUSTMARK NATIONAL BANK 401(K) PLAN
Statements of Net Assets Available for Benefits
December 31, 2001 and 2000
2001 2000
------------ -----------
Receivables:
Sponsor contributions $ 2,650,000 $ 2,650,000
Participant contributions 124,809 125,464
------------ -----------
Total receivables 2,774,809 2,775,464
Investments, at fair value:
Money market accounts 9,956,151 7,345,153
Fixed income mutual funds 4,747,472 2,658,053
Common stock of Trustmark Corporation 62,084,423 56,878,276
Equity mutual funds 22,760,031 22,222,659
------------ -----------
Total investments 99,548,077 89,104,141
------------ -----------
Net assets available for benefits $102,322,886 $91,879,605
============ ===========
See accompanying notes to financial statements.
TRUSTMARK NATIONAL BANK 401(K) PLAN
Statement of Changes in Net Assets Available for Benefits
Year ended December 31, 2001
Contributions:
Sponsor $ 2,671,871
Participant 3,676,148
------------
Total contributions 6,348,019
------------
Net investment income:
Net appreciation in fair value of investments 7,692,104
Interest income 471,790
Dividend income 319,594
------------
Net investment income 8,483,488
------------
Benefits paid to participants (4,388,226)
------------
Net increase in net assets available for benefits 10,443,281
Net assets available for benefits:
Beginning of year 91,879,605
------------
End of year $102,322,886
============
See accompanying notes to financial statements.
Trustmark National Bank 401(K) Plan
Notes to Financial Statements
December 31, 2001 and 2000
(1) Plan Description
The following description of Trustmark National Bank 401(k) Plan (the
Plan) provides only general information. Participants should refer to the
Plan agreement for a more complete description of the Plan's provisions.
(a) General
The Plan is a defined contribution plan established for the
employees of Trustmark National Bank (the Company) and certain
other associated companies. Employees who are active participants
in the Canton Exchange Bank Employee's Retirement Plan are
ineligible to participate in the Plan. The Plan provides
eligibility for participation on the next semiannual entry date
(January 1st or July 1st) following the completion of at least
1,000 hours of service during the twelve-month period ending on
the anniversary of a person's employment commencement date.
(b) Plan Administration
The Plan's record keeping and trust functions are handled by Bisys
Plan Services and Frontier and Reliance Trusts, respectively. The
plan administrator is Trustmark National Bank.
(c) Employee Contributions
The Plan allows participants to make voluntary before-tax salary
deferral contributions, through payroll deductions, to separately
invested funds in accordance with Section 401(k) of the Internal
Revenue Code. If certain requirements of Internal Revenue Code
Section 401(k) are not met in Plan operation, the salary deferral
agreements of participants may, on a nondiscriminatory and uniform
basis, be amended or revoked to preserve the qualified status of
the Plan. Voluntary after-tax contributions by participants are
not allowed. Participants may direct investment of their voluntary
contributions among several investment options.
Employees can elect to contribute up to 15% of their compensation
each period, subject to regulatory limitations. Any excess
contributions must be returned to the applicable participant by
April 15 of the calendar year following the year of excess
contributions. The Plan does not allow rollover contributions from
individual retirement accounts or other qualified plans.
(d) Employer Contributions
In general, employee contributions are not matched by the
employer; however, former participants of Rankin County Bank
401(k) Plan are eligible for a 100% match of their contributions
up to 3% of their annual compensation. The Company contributed
$2,671,871 to the Plan in 2001. Of this amount, $2,650,000 was a
discretionary contribution.
(e) Allocations
Employee and employer contributions are allocated directly to each
participant's account in accordance with the individual
participant's elections.
Investment earnings or losses of the Plan's investment options are
allocated based on the investment earnings base multiplied by the
calculated rate of return for the separate investment accounts.
The investment earnings base is calculated as beginning of the
year account balance plus one half of the current year salary
deferral contributions less withdrawals and transfers out.
Forfeitures of nonvested employer match accounts are used to
reduce the employer match contribution.
(f) Vesting
On the first day of the month coincident with or following a
participant's sixty-fifth birthday, such participant is entitled
to retire from active service with the employer, and 100% of the
value of the participant's share of the Plan becomes fully vested.
A participant also vests 100% upon death or termination of
employment due to permanent disability.
Participants are immediately vested in their voluntary
contributions and discretionary safe-harbor employer contributions
and vest in their employer match contributions as shown in the
following schedule:
Years vesting service Vested percentage
--------------------- -----------------
Less than 5 0%
5 or more 100%
In case of termination of the Plan, the value of each
participant's share of the Plan becomes fully vested as of the
date of such termination.
(g) Payment of Benefits
On retirement, death, disability, or termination of service, a
participant may elect to receive a lump-sum distribution equal to
his or her vested account balance or a life annuity. In addition,
hardship distributions are permitted if certain criteria are met.
(h) Plan Termination
Although it has not expressed any intent to do so, the Company has
the right under the Plan to discontinue its contributions at any
time and to terminate the Plan subject to the provisions of ERISA.
However, no such action may derive any participant or beneficiary
under the Plan of any vested right.
(2) Significant Accounting Policies
(a) Basis of Presentation
The Plan's financial statements are prepared using the accrual
basis of accounting, with the exception of the payment of
benefits, which are recognized as a reduction in the net assets of
the Plan as they are disbursed to participants. Purchases and
sales of securities are recorded on a trade-date basis.
(b) Use of Estimates
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 reported amounts of net assets and changes therein, and
disclosure of contingent assets and liabilities. Actual results
could differ from those estimates.
(c) Valuation of Investments
Cash equivalents are stated at cost which approximates fair value.
Marketable securities are stated at fair value. Securities traded
on a national securities exchange are valued at the last reported
sales price on the last business day of the year.
(d) Net Appreciation in Fair Value of Investments
Net appreciation in fair value of investments, as recorded in the
accompanying statement of changes in net assets available for
benefits, includes changes in fair value of investments acquired,
sold, or held during the year.
(e) Administrative Fees
Professional fees incurred by the Plan are paid by the Company.
(3) Investments
The fair value of individual investments that represent 5% or more of the
Plan's net assets as of December 31, 2001 and 2000 are as follows:
December 31,
--------------------------
2001 2000
----------- ------------
Investment at fair value as determined by quoted market price:
Common stock of Trustmark Corporation $62,084,423 $56,878,276
Performance Funds Trust Mutual Funds:
Large-Cap Equity Fund 10,571,905 10,154,309
Mid-Cap Equity Fund 7,555,686 7,750,427
Investments at cost which approximates fair value:
Federated Capital Preservation Fund 9,729,922 7,159,421
During 2001, the Plan's investments (including investments bought and
sold, as well as held during the year) appreciated (depreciated) in value
as follows:
Investments at fair value as determined by quoted market price:
Common stock of Trustmark Corporation $9,655,981
Performance Funds Trust Mutual Funds:
Short Term Govt. Inst. Fund 46,990
Intermediate Term Govt. Inst. Fund 27,260
Leader's Equity Fund (103,798)
Large-Cap Equity Fund (1,171,126)
Small-Cap Equity Fund (105,586)
Mid-Cap Equity Fund (517,611)
Templeton Foreign Fund (140,006)
----------
Net appreciation in fair value of investments $7,692,104
==========
(4) Income Tax Status
The Internal Revenue Service has determined and informed the Company by a
letter dated June 1, 1998, that the Plan and related trust are designed
in accordance with applicable sections of the Internal Revenue Code
(IRC). The Plan has been amended since receiving the determination
letter. However, the plan administrator and the Plan's tax counsel
believe that the Plan is designed and is currently being operated in
compliance with the applicable requirements of the IRC.
(5) Related Parties
Plan assets include investments held with the Company. These investments
do not constitute prohibited transactions as defined in ERISA Section
406(a). Trustmark National Bank serves as the investment advisor for the
Performance Funds Trust Mutual Funds. Trustmark Corporation is the parent
company of Trustmark National Bank.
(6) Reconciliation of Financial Statements to Form 5500
As of December 31, 2001, the Plan had approximately $72,000 of pending
distributions to participants who elected to withdraw from the Plan. This
amount is recorded as a liability in the Plan's Form 5500; however, this
amount is not recorded as a liability in the accompanying statement of
net assets available for benefits in accordance with accounting
principles generally accepted in the United States of America.
The following table reconciles financial information per the accompanying
financial statements to the Form 5500 as filed by the Company for the
year ended December 31, 2001:
Benefits Benefits Net Assets
Payable Paid Available for
Plan Benefits
--------- ---------- -------------
Per accompanying financial statements $ -- $4,388,226 $102,322,886
2000 amounts pending distribution to
participants -- (82,000) --
2001 amounts pending distribution to
participants 72,000 72,000 (72,000)
--------- ---------- -------------
Per Form 5500 $ 72,000 $4,378,226 $102,250,886
========= ========== =============
(7) Contingencies
Trustmark Corporation (the Company's parent) and its subsidiaries are
parties to lawsuits and other claims that arise in the ordinary course of
business. Some of the lawsuits assert claims related to various business
activities; and some of the lawsuits allege substantial claims for
damages. The cases are being vigorously contested. In the regular course
of business, management evaluates estimated losses or costs related to
litigation, and provision is made for anticipated losses whenever
management believes that such losses are probable and can be reasonably
estimated. At the present time, management believes, based on the advice
of legal counsel, that the final resolution of pending legal proceedings
will not have a material impact on Trustmark Corporation's or the Plan's
consolidated financial position or results of operations.
(8) Subsequent Events
Effective January 1, 2002, Trustmark Corporation will assume sponsorship
of the Plan and the Plan will be renamed Trustmark 401(k) Plan. In
addition, the Plan will be amended and restated by adoption of the
Trustmark National Bank Prototype Defined Contribution Plan and Trust.
The provisions of the Plan will remain substantially the same except for
a change in the employer safe harbor contribution for purposes of
sections 401(k) and 401(m) of the IRC from a 3% nonelective safe harbor
contribution to a matching safe harbor contribution at the rate of 100%
of the first 3% and 50% of the next 3% of covered compensation.
TRUSTMARK NATIONAL BANK 401(K) PLAN
Plan Sponsor: Trustmark National Bank
Plan Sponsor: EIN 64-0180810
Plan Number: 002
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2001
Current
Identity of issuer Description value
---------------------------- ----------------------------------- -----------
Money market account:
Federated Capital Preservation Fund $ 9,729,922
Frontier Trust Contribution Account 226,229
Fixed income mutual funds:
* Performance Funds Trust Short Term Govt. Inst. Fund 2,359,718
* Performance Funds Trust Intermediate Term Govt. Inst. Fund 2,387,754
Common stock fund:
* Trustmark Corporation Common Stock Fund - 5,165,093 units 62,084,423
Equity mutual funds:
* Performance Funds Trust Leader's Equity Fund 490,571
* Performance Funds Trust Large-Cap Equity Fund 10,571,905
* Performance Funds Trust Small-Cap Equity Fund 2,847,935
* Performance Funds Trust Mid-Cap Equity Fund 7,555,686
Templeton Foreign Fund 1,293,934
-----------
$99,548,077
===========
* Denotes related party based on the following relationships: Trustmark
National Bank serves as investment advisor for Performance Funds Trusts;
Trustmark Corporation is the parent company of Trustmark National Bank.
See accompanying independent auditors' report.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of
Trustmark National Bank 401(k) Plan:
We have audited the accompanying statements of net assets available for plan
benefits of the Trustmark National Bank 401(k) Plan (the Plan) as of December
31, 2000 and 1999, and the related statement of changes in net assets available
for plan benefits for the year ended December 31, 2000. These financial
statements and the schedule referred to below are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements and schedule based on our audits.
We conducted our audits 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 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 plan benefits of the Plan as
of December 31, 2000 and 1999, and the changes in its net assets available for
plan benefits for the year ended December 31, 2000, in conformity with
accounting principles generally accepted in the United States.
Our audits were made 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 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 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/ Arthur Andersen LLP
------------------------
Arthur Andersen LLP
Jackson, Mississippi
June 14, 2001
Pursuant to the requirements of the Securities Act of 1934, the Plan
Administrator has duly caused this Annual Report to be signed on its behalf by
the undersigned thereunto duly authorized.
Trustmark National Bank 401(k) Plan
Trustmark National Bank, Plan Administrator
By: /s/ Louis E. Greer
-------------------
Louis E. Greer
Senior Vice President & Controller
June 27, 2002