UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
(Mark one)
o ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002
[ ] Transition report pursuant to Section 15(d) of the Securities
Exchange Act of 1934.
For the transition period from _______ to _______
Commission File Number 001-12209
A. Full title of the plan and address of the plan, if different from
the issuer named below
RANGE RESOURCES CORPORATION
401(k) PLAN
B. Name of issuer of the securities held pursuant to the plan and
address of its principle executive office
RANGE RESOURCES CORPORATION
777 MAIN STREET,
FORT WORTH, TEXAS, 76012
Table of Contents
Report of Independent Auditors ....................................... F-1
Audited Financial Statements
Statements of Net Assets
Available for Benefits .................................... F-2
Statements of Changes in Net
Assests Available for Benefits ............................ F-3
Notes to Financial Statements ................................ F-4
Supplemental Schedule - Form
5500 Schedule H line
4i - Schedule of Assests
Held for Investment
Purposes at End of Year ................................... F-11
Signatures ........................................................... F-12
Exhibit Index ........................................................ F-13
Exhibit 23 - Consent of Independent Auditors ......................... F-14
Exhibit 99.1 - Certification of Periodic Reports ..................... F-15
REPORT OF INDEPENDENT AUDITORS
To the Administrative Committee of
Range Resources Corporation 401(k) Plan
We have audited the accompanying statements of net assets available for benefits
of Range Resources Corporation 401(k) Plan (the "Plan") as of December 31, 2002
and 2001 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, based on our audits, the financial statements referred to above
present fairly, in all material respects, the net assets available for benefits
of the Plan as of December 31, 2002 and 2001, and the changes in its net assets
available for benefits for the years then ended in conformity with accounting
principles generally accepted in the United States of America.
Our audit was conducted for the purposes of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes at end of year as of December 31, 2002 is presented for
the 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 ("ERISA"). This 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 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/ Whitley Penn
-----------------
Fort Worth, Texas
May 16, 2003
F-1
RANGE RESOURCES CORPORATION 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31,
-------------------------
2002 2001
---------- ----------
ASSETS
Investments, at fair value:
Shares of registered investment companies:
Mutual Funds $2,988,099 $2,538,154
Range Resources Common Stock 2,514,532 1,338,107
Participant loans 209,088 117,648
---------- ----------
5,711,719 3,993,909
Receivables
Employer's -- 554,243
Participants' -- 1,357
Investment income -- 253
---------- ----------
-- 555,853
Total assets 5,711,719 4,549,762
---------- ----------
Liabilities -- --
---------- ----------
Net assets available for benefits $5,711,719 $4,549,762
========== ==========
See accompanying notes to the financial statements.
F-2
RANGE RESOURCES CORPORATION 401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
YEARS ENDED DECEMBER 31,
----------- -----------
2002 2001
----------- -----------
Additions to net assets attributed to:
Investment Income:
Net realized and unrealized loss
on investments $ (169,906) $(1,043,873)
Interest and dividends 53,313 60,003
----------- -----------
(116,593) (983,870)
Contributions:
Non cash:
Employer stock 601,500 554,243
Cash:
Participant 643,570 660,573
Rollover -- 39,948
Transfer from qualified plan 425,408 --
----------- -----------
1,670,478 1,254,764
----------- -----------
Total additions 1,553,885 270,894
Deductions from assets attributed to:
Benefits paid to participants 391,928 562,110
----------- -----------
Total deductions 391,928 562,110
----------- -----------
Net increase (decrease) 1,161,957 (291,216)
Net assets available for benefits at beginning of year 4,549,762 4,840,978
----------- -----------
Net assets available for benefits at end of year $ 5,711,719 $ 4,549,762
=========== ===========
See accompanying notes to the financial statements.
F-3
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
A. DESCRIPTION OF PLAN
PLAN DESCRIPTION
The following description of the Range Resources Corporation 401(k) Plan (the
"Plan") provides only general information. The Plan is sponsored by Range
Resources Corporation (the "Company"). Participants should refer to the Plan
agreement for a more complete description of the Plan's provisions.
GENERAL
The Plan is a defined contribution plan covering employees of the Company who
are eighteen years of age or older. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan was restated
January 1, 2001, when the Plan adopted the prototype plan provided by CPI
Qualified Plan Consultants as a substitution and amendment of an existing
retirement plan originally established January 1, 1989. The Plan was restated
again effective January 1, 2002, refer to Footnote H.
The purpose of the Plan is to encourage employees to save and invest,
systematically, a portion of their current compensation in order that they may
have a source of additional income upon their retirement, or for their family in
the event of death.
CONTRIBUTIONS
Participants may contribute up to 50% of pre-tax annual compensation, as defined
by the Plan. Contributions are subject to limitations on annual additions and
other limitations imposed by the Internal Revenue Code as defined in the Plan
Agreement. Integrated Contributions are equal to 5.70% of each active
participant's eligible compensation in excess of the social security taxable
wage base in 2002 and 2001.
Participants must be employed on the last day of the plan year, and complete
1,000 hours of service during the plan year to be eligible to receive profit
sharing contributions. Each year the Board of Directors determines the
percentage of employee salaries that the Company will contribute as a profit
sharing contribution. In 2002 and 2001, the Company made profit sharing
contributions, the form of Company stock, at the rate of 6% of an eligible
participant's salary.
At the discretion of the Board of Directors, the Company may elect to contribute
a matching contribution based on the amounts of salary reduction of the
participants. No matching contribution was made in 2002 or 2001.
F-4
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
A. DESCRIPTION OF PLAN - CONTINUED
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's elective
contribution, employer contribution(s), and earnings thereon. Allocations are
based on participant earnings or account balances as defined in the Plan. The
benefit to which a participant is entitled is the benefit that can be provided
from the participant's vested account.
VESTING
Participants are immediately fully vested in their elective contributions plus
actual earnings thereon. Vesting in the Company contribution portion of accounts
plus actual earnings thereon is as follows:
VESTED
YEARS OF SERVICE PERCENTAGE
-------------------------------- --------------------
Less than One (1) year 0%
One (1) year 40%
Two (2) years 80%
Three (3) or more years 100%
A year of service for vesting purposes is defined as a period in which a
participant completes at least 1,000 hours of service.
LOANS
Participants may borrow from their fund accounts up to a maximum equal to the
lesser of $50,000 or 50% of their vested account balance. Loan terms range from
one to five years or, in the case of a loan to acquire or construct the primary
residence of a participant, a period not to exceed a repayment period used by
commercial lenders for similar loans. The loans are secured by the balance in
the participant's account and bear interest at the prime rate plus 2%, as
defined by the Participant Loan Program. Principal and interest are paid ratably
through payroll deductions.
BENEFIT PAYMENTS
Participants withdrawing during the year for reasons of service or disability,
retirement, death, or termination are entitled to their vested account balance.
Benefits are distributed in the form of rollovers, lump sums, installment
payments, or through the purchase of an annuity contract. If withdrawing
participants are not entitled to their entire account balance, the amounts not
received are forfeited and reallocated to the remaining participants once it is
assured that a break in service was incurred by the withdrawing participant.
Disbursements for benefits are recorded when paid.
F-5
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
A. DESCRIPTION OF PLAN - CONTINUED
FORFEITURES
Forfeited balances of terminated participants' non-vested accounts are
reallocated to the account balances of the remaining participants.
ADMINISTRATIVE EXPENSES
The Plan Sponsor pays administrative expenses of the Plan. During 2002 and 2001,
the Plan Sponsor paid approximately $10,100 and $12,000, respectively, of Plan
expenses on behalf of the Plan.
B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan are presented on the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States of America.
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 revenue and expenses during
the reporting period. Actual results could differ from those estimates.
INVESTMENTS
Investments are valued at fair market value. The Common Stock of Range Resources
Corporation 401(k) Plan is valued at the last reported sales price on the last
business day of the plan year.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Net realized gain or loss on
investments is the difference between the proceeds received upon the sale of
investments and the market value of investments as of the end of the preceding
year or the average cost of those assets if acquired during the current year.
Unrealized appreciation or depreciation of investments represents the increase
or decrease in market value during the year.
These investments are subject to market or credit risks customarily associated
with equity investments.
F-6
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- CONTINUED
CONTRIBUTIONS
Contributions from the participants and the employer are accrued in the period
in which they are deducted in accordance with salary deferral agreements and as
they become obligations of the Company, as determined by the Plan's
administrator.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
PLAN EXPENSES
Employees of the Company perform certain administrative functions with no
compensation from the Plan. Administrative costs of the Plan are paid by the
Company and are not reflected in the accompanying financial statements.
C. INVESTMENTS
Participants may direct their 401(k) salary deferrals to be invested into any of
the nine investment funds offered by the Plan as well as the Range Resources
Corporation common stock.
Non-cash profit sharing contributions made in the form of the Company's commons
stock, by the Company, can be redirected by participants into any of the nine
investment options offered by the Plan.
The following table presents the individual investments that exceeded 5% of the
Plan's net assets available for benefits at December 31,:
DESCRIPTION 2002 2001
----------------------------------------- ---------- ----------
AIM Cash Reserves $ 403,958 $ 269,630
Bond Fund of America 307,029 211,417
Investment Co of America 590,511 566,880
AIM Balanced 465,789 507,252
AIM Blue Chip 491,063 486,698
Range Resources Common Stock (463,241 and
412,552 shares, respectively) 2,514,532 1,338,107
Range Resources common stock represents approximately 44% and 34% of total net
assets available for benefits at December 31, 2002 and 2001, respectively.
F-7
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
D. TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated August 2, 2002, stating that the Plan is qualified under Section 401(a) of
the Internal Revenue Code (the Code) and, therefore, the related trust is exempt
from federal income taxation. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The Plan Sponsor
believes the Plan is being operated, in compliance with the applicable
requirements of the Code and, therefore, believes that the Plan is qualified and
the related trust is tax exempt.
E. FORFEITURES
At December 31, 2002 and 2001, the balance in the forfeiture account
approximated $3,300 and $13,300, respectively. Forfeitures reallocated to
participants in 2002 totaled approximately $13,300.
F. TRANSACTIONS WITH PARTIES IN INTEREST
Participants have the option to invest their salary deferrals into the common
stock of Range Resources Corporation, the Plan Sponsor.
G. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right to
terminate the Plan at any time, subject to the provisions of ERISA. In the event
of such termination of the Plan, participants would become fully vested and the
net assets of the Plan would be distributed among the participants in accordance
with ERISA.
H. PLAN AMENDMENT
Effective January 1, 2002, the Plan was amended and restated ("Plan Amendment")
and the definition of compensation as it relates to the Plan was changed. The
definition of compensation was modified to exclude all bonuses and amounts taxed
to employees in connection with purchases of discounted stocks. The Plan was
amended to exclude temporary employees as eligible employees to the Plan. The
Plan was amended to increase participant contributions to 50% of pre-tax annual
compensation, as defined by the Plan.
F-8
RANGE RESOURCES CORPORATION 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
I. PLAN MERGER
In 1998, Lomak Petroleum, Inc. acquired Domain Energy Corporation ("Domain") via
merger and changed the resulting company's name to Range Resources Corporation.
The Plan was amended to allow Domain employees to be eligible for the Plan, and
the Range Energy Ventures Corporation 401(k) Plan ("Domain Plan") assets were
frozen. On March 14, 2002, Domain received a favorable letter of determination
relating to tax qualification status of the Domain Plan prior to merging the
Domain Plan with the Plan. During July 2002, the Company merged Domain Plan's
net assets of $425,400 into the Plan. These net assets have been recorded as a
"Transfer From Qualified Plan" in the accompany Statements of Changes In Net
Assets Available For Benefits.
J. SUBSEQUENT EVENTS
Effective January 1, 2003, the assets of the Plan were transferred from Matrix
Capital Bank Trust Services to Scudder Trust Company ("Scudder"). As a result of
this transfer, Scudder also assumed the responsibility of trustee and record
keeper, which was formerly held by CPI Qualified Plan Consultants, Inc.
F-9
SUPPLEMENTAL SCHEDULE
F-10
RANGE RESOURCES CORPORATION 401(k) PLAN
FORM 5500, SCHEDULE H, LINE 4I- SCHEDULE OF ASSETS HELD FOR
INVESTMENT PURPOSES AT END OF YEAR
DECEMBER 31, 2002
EIN: 34-1312571
PLAN: 002
(c) (d) (e)
(b) DESCRIPTION CURRENT
(a) IDENTITY OF ISSUE OF INVESTMENTS COST VALUE
--------- ---------------------------- -------------- --------- ---------------
AIM Cash Reserves Mutual Fund - $ 403,958
Bond Fund of America Mutual Fund - 307,029
Investment Co of America Mutual Fund - 590,511
AIM Balanced Mutual Fund - 465,789
AIM Blue Chip Mutual Fund - 491,063
AIM Constellation Mutual Fund - 225,758
AIM Aggressive Growth Mutual Fund - 231,852
AIM International Equity Mutual Fund - 72,285
OPP Global Mutual Fund - 151,871
AIM Mid Cap Basic Value Mutual Fund - 47,983
* Range Resources Common Stock Common Stock - 2,514,532
* Participant Loans Prime rate - 209,088
---------------
$ 5,711,719
===============
* Party In Interest
F-11
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustee has duly caused this annual report to be signed on their behalf by
the undersigned hereunto duly authorized.
RANGE RESOURCES CORPORATION
401(k) PLAN
Date: June 26, 2003 /s/ Rodney L. Waller
-------------------------
Rodney L. Waller, Trustee
F-12
EXHIBIT INDEX
NUMBER Exhibit
------ -----------
23* Consent of independent accountants
99.1* Certification of the December 31, 2002 Annual Report on Form 11-K, pursuant to Section 906
of the Sarbanes-Oxley Act of 2002, by the Principal Executive Officer and Principal Financial
Officer of the Plan.
* included herewith
F-13