UNITED STATES
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 [FEE REQUIRED]
For the period ended December 31, 2002 and the fiscal year ended December 30,
2002
Or
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______________________ to ______________________
COMMISSION FILE NUMBER 000-49604
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
B. Name of the issuer of the securities held pursuant to the plan and the
address of its principal executive office:
MANTECH INTERNATIONAL CORPORATION
12015 Lee Jackson Highway
Fairfax, VA 22033-3300
INDEX
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Independent Auditors' Report
Financial Statements for the period ended December 31, 2002
and the years ended December 30, 2002 and 2001:
Statements of Net Assets Available for Plan Benefits
Statements of Changes in Net Assets Available for Plan Benefits
Notes to Financial Statements
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes as of December 31, 2002
and December 30, 2002
Schedule of Reportable Transactions for the period ended December 31,
2002 and the year ended December 30, 2002
Signatures
Exhibit Index
INDEPENDENT AUDITORS' REPORT
To the Administrative Committee
ManTech International Corporation Employee Stock Ownership Plan
Fairfax, Virginia
We have audited the accompanying statements of net assets available for plan
benefits of the ManTech International Corporation Employee Stock Ownership Plan
(the "Plan") as of December 31, 2002 and December 30, 2002 and 2001, and the
related statements of changes in net assets available for plan benefits for the
period ended December 31, 2002 and the years ended December 30, 2002 and 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 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, such financial statements present fairly, in all material
respects, the net assets available for plan benefits of the Plan as of December
31, 2002 and December 30, 2002 and 2001, and the changes in net assets available
for plan benefits for the period ended December 31, 2002 and the years ended
December 30, 2002 and 2001, in conformity with accounting principles generally
accepted in the United States of America.
As discussed in Note 2 to the financial statements, the 2001 financial
statements include securities valued at $4,045,997 (74% of net assets) whose
value at December 30, 2001 has been estimated by the Board of Trustees in the
absence of readily ascertainable market values. We have examined the procedures
used by the Board of Trustees in arriving at its estimate of the value of such
securities and have inspected underlying documentation, and in the
circumstances, we believe that such procedures are reasonable and the
documentation appropriate. However, because of the inherent uncertainty of
valuation, those estimated values may differ significantly from the values that
would have been used had a ready market for the securities existed, and the
differences could be material.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Assets Held
for Investment Purposes and of Reportable Transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements, but are 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. These schedules are the
responsibility of the Plan's management. Such schedules have been subjected to
the auditing procedures applied in our audit of the basic 2002 financial
statements and, in our opinion, are fairly stated in all material respects when
considered in relation to the basic 2002 financial statements taken as a whole.
As discussed in Note 4 to the financial statements, effective for plan years
after December 30, 2002, the plan year end was changed from December 30 to
December 31.
McLean, Virginia
June 20, 2003
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 2002 AND DECEMBER 30, 2002 and 2001
December 31, December 30, December 30,
2002 2002 2001
------------ ------------ ------------
ASSETS:
Investment in the Company's Class A Common Stock, at fair value:
Value of Common Stock
on deposit with CIGNA $7,858,554 $7,714,322 $4,045,997
Cash -- -- 22,252
Contributions receivable:
Cash -- -- 413,057
Employer's contribution of the
Company's Class A Common Stock 401,252 393,888 989,576
---------- ---------- ----------
Net assets available for plan benefits $8,259,806 $8,108,210 $5,470,882
---------- ---------- ----------
---------- ---------- ----------
The accompanying notes are an integral part of these financial statements.
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
PERIOD ENDED DECEMBER 31, 2002 AND
YEARS ENDED DECEMBER 30, 2002 and 2001
Period ended Year ended Year ended
December 31, December 30, December 30,
2002 2002 2001
------------- ------------ ------------
Additions to net assets:
Employer contributions $ -- $1,351,434 $1,424,885
Net appreciation
in fair value of investments 151,596 1,914,314 1,075,770
---------- ---------- ----------
Total additions 151,596 3,265,748 2,500,655
Deductions from net assets:
Distributions -- 628,420 225,192
---------- ---------- ----------
Net increase 151,596 2,637,328 2,275,463
Net assets available for plan benefits:
Beginning of period 8,108,210 5,470,882 3,195,419
---------- ---------- ----------
End of period $8,259,806 $8,108,210 $5,470,882
---------- ---------- ----------
---------- ---------- ----------
The accompanying notes are an integral part of these financial statements.
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF PLAN
The following description of the ManTech International Corporation Employee
Stock Ownership Plan (commonly referred to herein as the "ESOP" or the "Plan")
provides only general information. Participants should refer to the Plan
agreement for more detailed information.
General
The ESOP is a qualified retirement plan, established effective January 1, 1999,
and subject to the provisions of the Employee Retirement Income Security Act of
1974 (ERISA), as amended. All employees of ManTech International Corporation
("the Company"), and its subsidiaries, who are on the Company's U.S. payroll are
eligible to participate in the Plan, including regular full-time employees, and
part-time employees scheduled to work 20 or more hours per week. Employees who
are not eligible to participate in the Plan include: (i) leased employees; (ii)
employees who are employed under the terms of contracts between the Company and
the United States government, unless the contracts are designated by the Company
as participating in the Plan; and (iii) employees who are employed by a
subsidiary or related company that has not adopted the Plan.
Contributions and Eligibility
The ESOP is non-leveraged and will be funded entirely through Company
contributions based on a percentage of eligible employee compensation, as
defined in the Plan. Contributions can consist of the Company's Class A Common
Stock or cash. Prior to the Company's initial public offering, the common shares
were valued at their estimated fair value determined by an annual independent
appraisal. Eligible employees share in any Company contribution made for a plan
year if they meet the following minimum requirements:
a) The employee is credited with at least 1,000 hours of service
during the plan year; and
b) The employee is employed by the Company on the last day of the
plan year.
Plan Administration
The Plan is administered by the Company, which plans, administers, and
negotiates rights and benefits for participants in the Plan. Mellon Financial
Corporation is the Plan's Trustee. The custodian of the Plan, CIGNA Retirement
and Investment Services (CIGNA), is responsible for administration.
Through the Plan year ended December 30, 2001, the Plan's Trustee was George J.
Pedersen, the Company's majority owner, Chairman of the Board, CEO and
President. Mr. Pedersen neither participates in the Plan nor will he derive any
stock ownership from Plan operation.
All administrative expenses, including the cost of independent stock valuations,
are paid directly by the Company.
Distributions
No distributions from the Plan will be made until a participant retires, becomes
disabled, dies (in which case, payment shall be made to his or her beneficiary
or, if none, his or her legal representatives), or otherwise terminates
employment with the Company. For the period ended December 31, 2002 and the year
ended December 30, 2002, participants could elect to receive distributions in
cash or shares of Company stock. For the years ended through December 30, 2001,
all distributions were paid in cash no later than the end of the Plan year
following the Plan year in which the termination event took place.
Vesting
Participants vest in their ESOP account on a graduated scale based on years of
continuous service. A participant is fully vested after five years of credited
service.
Forfeitures
Plan participants who are not 100% vested at the time of employment termination
will forfeit a pro-rata share of their ESOP account balance. Forfeitures will be
used to offset future Company contributions. Forfeitures are fully recognized
beginning at the end of the plan year in which the participant either receives a
distribution of the vested portion of his or her account, or incurs a one-year
break in service as an employee of the Company; whichever occurs first.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements of the Plan are presented on the accrual basis of
accounting. In January 2002, prior to the Company's initial public offering, the
Company reincorporated from New Jersey to Delaware, recapitalized and effected a
16.3062-for-one stock split. As of December 30, 2001, the common shares of the
Company were valued at their estimated fair value determined by an annual
independent appraisal. After the Company's initial public offering in February
2002, the common shares are valued at fair market value. Unrealized appreciation
or depreciation in the fair value of investments held at period-end is recorded
in the statement of changes in net assets available for Plan benefits for the
respective period. The per share fair market value at December 31, 2002 and
December 30, 2002 was $19.07 and $18.72, respectively. The independent market
value appraisal was $13.42 per share ($218.88 per share pre-split) at December
30, 2001.
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 assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
Tax Status
The Internal Revenue Service (IRS) has determined and informed the Company by a
letter dated January 8, 2003, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC). The Plan
has subsequently been amended since receiving this determination letter and the
Company anticipates obtaining a determination letter from the IRS that the Plan,
as amended, continues to comply with all applicable requirements of the IRC. The
Company believes that the Plan is designed and is currently being operated in
compliance with the applicable requirements of the IRC. Accordingly, no
provision for income taxes has been recorded in the Plan's financial
statements.
Plan Termination
The Company expects to continue to sponsor the Plan indefinitely and to continue
to make contributions. However, the Company has the right to terminate the Plan
at any time upon written notice to CIGNA. In the event of plan termination,
participants are 100% vested in their accounts.
NOTE 3 - SHARE ALLOCATION
In April 2002, 81,128 shares (4,275 shares pre-split) of the Company's
common stock, representing $1,424,885 in total contributions, less cash
contributed to accommodate ESOP distributions, were allocated to all eligible
participants. These shares were valued at their estimated fair value determined
by an independent appraisal as of December 30, 2001. The independent market
value appraisal was $13.42 per share ($218.88 per share pre-split) at December
30, 2001.
A total of $435,309 in distributions pertaining to fully and partially vested
account balances as of December 30, 2001 was completed in 2002.
NOTE 4 - SUBSEQUENT EVENTS
Plan Year Change
The Plan was amended, effective for plan years after December 30, 2002. The plan
year will start on January 1st and end on December 31st. As a result, the
Statement of Net Assets and the Statement of Changes in Net Assets include the
one day period, December 31, 2002.
Form 5500 Filing
Due to the plan year change, to comply with the IRS requirement for filing Form
5500, the Company will be filing two separate forms. One form will be for the
plan year ending December 30, 2002, and the other will be for the one day,
December 31, 2002. The financial statements contain information corresponding
to both periods.
NOTE 5 - RECONCILIATION TO IRS FORM 5500
Pursuant to ERISA provisions, the following is a reconciliation of net assets
available for plan benefits at December 31, 2002, December 30, 2002 and
December 30, 2001, as reported in the Statement of Net Assets Available for Plan
Benefits, to net assets as reported on Form 5500 to be filed with the IRS:
December 31, December 30, December 30,
2002 2002 2001
------------ ------------ ------------
Amount per Statement of Net Assets
Available for Plan Benefits $8,259,806 $8,108,210 $5,470,882
Items reflected in IRS Form 5500 not
reflected in the Statement of Net
Assets Available for Plan Benefits:
Distributions Payable (392,542) (392,542) (435,309)
----------- ---------- -----------
Amount per IRS Form 5500 $7,867,264 $7,715,668 $5,035,573
---------- ---------- -----------
---------- ---------- -----------
Pursuant to ERISA provisions, the following is a reconciliation of total
withdrawals in the periods ended December 31, 2002, December 30, 2002 and
December 30, 2001, as reported in the Statement of Changes in Net Assets
Available for Plan Benefits, to withdrawals as reported on Form 5500 to be filed
with the IRS:
Period ended Year ended Year ended
December 31, December 30, December 30,
2002 2002 2001
------------ ------------- ------------
Withdrawals per Statement of
Changes in Net Assets
Available for Plan Benefits $ -- $628,420 $225,192
Add: Distributions Payable to
withdrawing participants
at period end 392,542 392,542 435,309
Less: Distributions Payable to
withdrawing participants
at beginning of period -- (435,309) (225,778)
-------- -------- --------
Amount per IRS Form 5500 $392,542 $585,653 $434,723
-------- -------- --------
-------- -------- --------
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2002 AND DECEMBER 30, 2002
Identity of Issuer,
Borrower, Lessor or
Similar Party Description of Investment Shares Fair Value Date
------------------- ------------------------- ------ ---------- ----------
ManTech International Class A Common Stock 412,089 $7,858,554 12/31/2002
Corporation (1)
ManTech International Class A Common Stock 412,089 $7,714,322 12/30/2002
Corporation (1)
(1) Noted as party-in-interest.
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE PERIOD ENDED DECEMBER 31, 2002 AND THE YEAR ENDED DECEMBER 30, 2002
Transaction Type Description Shares Cost Value of Assets Fair Gain/Loss
---------------- ----------- ------ --------- --------------- --------------
I. Single transaction in excess of 5%:
None
II. Series of transactions with respect to
securities of the same issue in
excess of 5%:
Contributions ManTech International
Corporation (1)
Class A Common Stock 72,192 $1,351,434 $1,351,434 --
Distributions ManTech International
Corporation (1)
Class A Common Stock 33,569 $ 628,420 $ 628,420 --
III. Any transactions with respect to securities with a person if any prior or
subsequent transactions with such person exceeded 5%:
None
(1) Noted as party-in-interest.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
administrator has duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
MANTECH INTERNATIONAL CORPORATION
EMPLOYEE STOCK OWNERSHIP PLAN
By:/s/ George J. Pedersen
---------------------------
ManTech International Corporation, Plan Administrator
George J. Pedersen
Chairman of the Board, Chief Executive Officer
and President
EXHIBIT INDEX
Exhibit
Number Description of Exhibits
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
99.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
EXHIBIT 99.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 11-K of the ManTech International
Corporation Employee Stock Ownership Plan (the "Plan") for the period ended
December 31, 2002 and the fiscal year ended December 30, 2002 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, George
J. Pedersen, Chief Executive Officer of the Company, certify pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, to the best of my knowledge, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Plan.
This certificate is being made for the exclusive purpose of compliance by the
Chief Executive Officer of the Company with the requirements of Section 906 of
the Sarbanes-Oxley Act of 2002, and may not be distributed or used by
any person or for any reason other than as specifically required by law.
Date: July 14, 2003
By: /s/ George J. Pedersen
-------------------------
Name: George J. Pedersen
Title: Chairman of the Board of Directors,
Chief Executive Officer and President
EXHIBIT 99.2
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 11-K of the ManTech International
Corporation Employee Stock Ownership Plan (the "Plan") for the period ended
December 31, 2002 and the fiscal year ended December 30, 2002 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Ronald
R. Spoehel, Chief Financial Officer of the Company, certify pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, to the best of my knowledge, that:
(1) The Report fully complies with the requirements of Section 13 (a) or 15(d)
of the Securities Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Plan.
This certificate is being made for the exclusive purpose of compliance by the
Chief Financial Officer of the Company with the requirements of Section 906 of
the Sarbanes-Oxley Act of 2002, and may not be distributed or used by
any person or for any reason other than as specifically required by law.
Date: July 14, 2003
By: /s/ Ronald R. Spoehel
------------------------
Name: Ronald R. Spoehel
Title: Executive Vice President and
Chief Financial Officer