SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------------- FORM 11-K FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 --------------------------------- [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2000. [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to ______. Commission file number 1-2299 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Applied Industrial Technologies, Inc. Supplemental Defined Contribution Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Applied Industrial Technologies, Inc. One Applied Plaza Cleveland, Ohio 44115-5056 Financial Statements and Exhibit(s) Page No. (a) Financial Statements (in this Report) -------------------- ---------------- Independent Auditors' Report 5 Statements of Net Assets Available 6 for Benefits -- December 31, 2000 and 1999 Statement of Changes in Net Assets 7 Available for Benefits -- Years Ended December 31, 2000, 1999 and 1998 Notes to Financial Statements -- 8 - 11 Years Ended December 31, 2000, 1999 and 1998 (b) Exhibit(s) ---------- Independent Auditors' Consent 12 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan has duly caused this annual report to be signed on its behalf by the undersigned, hereunto duly authorized. APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN By: Applied Industrial Technologies, Inc., as Plan Administrator By: /s/ John R. Whitten ---------------------------------- Signature John R. Whitten ---------------------------------- Printed Name Vice President ---------------------------------- Title Date: March 28, 2001 APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN Financial Statements As of December 31, 2000 and 1999 and For the Years Ended December 31, 2000, 1999 and 1998, And Independent Auditors' Report APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN TABLE OF CONTENTS -------------------------------------------------------------------------------- Page INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS: Statements of Net Assets Available for Benefits As of December 31, 2000 and 1999 2 Statements of Changes in Net Assets Available for Benefits For the Years Ended December 31, 2000, 1999 and 1998 3 Notes to Financial Statements 4 - 7 INDEPENDENT AUDITORS' REPORT Applied Industrial Technologies, Inc. Supplemental Defined Contribution Plan We have audited the accompanying statements of net assets available for benefits of the Applied Industrial Technologies, Inc. Supplemental Defined Contribution Plan (the "Plan") as of December 31, 2000 and 1999, and the related statements of changes in net assets available for benefits for the years ended December 31, 2000, 1999 and 1998. 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 benefits of the Plan as of December 31, 2000 and 1999, and the changes in net assets available for benefits for the years ended December 31, 2000, 1999 and 1998 in conformity with accounting principles generally accepted in the United States of America. /s/ Deloitte & Touche LLP March 26, 2001 APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 2000 and 1999 -------------------------------------------------------------------------------- 2000 1999 ASSETS: Investments at fair value: Applied Industrial Technologies, Inc. common stock $2,929,054 $ 452,981 Mutual funds 2,274,991 2,120,075 Common/collective fixed income funds 198,933 19,152 ---------- ---------- Total investments 5,402,978 2,592,208 ---------- ---------- NET ASSETS AVAILABLE FOR BENEFITS $5,402,978 $2,592,208 ========== ========== See notes to financial statements. APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS YEARS ENDED DECEMBER 31, 2000, 1999 and 1998 -------------------------------------------------------------------------------- 2000 1999 1998 ----------- ----------- ----------- ADDITIONS: Participant Contributions $ 2,613,549 $ 399,348 $ 478,687 Investment income: Dividends Common stock 26,970 12,295 5,532 Mutual funds 130,955 108,439 95,622 Common/collective fixed income funds 12 2 2 ----------- ----------- ----------- Total dividends 157,937 120,736 101,156 Net appreciation/(depreciation) in market value of investments: Common stock 515,504 72,632 (98,496) Mutual funds (380,589) 359,709 102,222 Common/collective fixed income funds 7,947 528 1,515 ----------- ----------- ----------- Total net appreciation in market value 142,862 432,869 5,241 ----------- ----------- ----------- Total investment income 300,799 553,605 106,397 ----------- ----------- ----------- Total additions 2,914,348 952,953 585,084 DEDUCTIONS: Distributions to participants 91,800 98,701 133,824 Administrative expenses 11,778 7,999 8,866 ----------- ----------- ----------- Total deductions 103,578 106,700 142,690 ----------- ----------- ----------- INCREASE IN NET ASSETS FOR THE YEAR 2,810,770 846,253 442,394 NET ASSETS AVAILABLE FOR BENEFITS, BEGINNING OF YEAR 2,592,208 1,745,955 1,303,561 NET ASSETS AVAILABLE FOR BENEFITS, ----------- ----------- ----------- END OF YEAR $ 5,402,978 $ 2,592,208 $ 1,745,955 =========== =========== =========== See notes to financial statements. APPLIED INDUSTRIAL TECHNOLOGIES, INC. SUPPLEMENTAL DEFINED CONTRIBUTION PLAN NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998 -------------------------------------------------------------------------------- 1. DESCRIPTION OF THE PLAN The following description of the Applied Industrial Technologies, Inc. Supplemental Defined Contribution Plan (the "Plan") is provided for general information purposes only. Participants and users of the financial statements should refer to the Plan document for more complete information. General - The Plan was established by Applied Industrial Technologies, Inc. and its subsidiaries (the "Company") effective January 1, 1996, for the benefit of a select group of management or highly compensated employees. This is a non-qualified Plan and is subject to the claims of creditors in the case of bankruptcy of Applied Industrial Technologies, Inc. Administration - The Plan is administered by the Company. The Company's powers and duties relate to making participant and employer contributions to the Trust, establishing investment objectives, authorizing disbursements from the Trust, and resolving any questions of Plan interpretation. The assets of the Plan are maintained and administered by Key Trust Co. of Ohio, N.A. acting as Trustee. The Trustee is responsible for the custody of assets. Participant Accounts - Each participant's account is credited with that participant's contribution and allocations of (a) the Company's contribution and, (b) Plan earnings, and charged with an allocation of administrative expenses. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. Participation and Contributions - Participation in the Plan is limited to select management or highly compensated employees of the Company and whose contributions under the Applied Industrial Technologies, Inc. Retirement Savings Plan (the "Retirement Savings Plan") are limited. Eligible participants elect to make contributions to the Plan. There are no limits to the amount they can contribute. Participants may elect to transfer excess contributions from the Retirement Savings Plan. The company makes Supplemental Matching Contributions equal to the amount that matching contributions under the Retirement Savings Plan are limited each year due to the requirements of the provisions of Sections 401(k) and 401(m) of the Internal Revenue Code. Effective October 2000, the Plan was amended to allow transfers from the Applied Industrial Technologies, Inc. Deferred Compensation Plan upon retirement. Subsequently in 2001, this provision to allow transfers from the Applied Industrial Technologies, Inc. Deferred Compensation Plan was revoked. Supplemental Matching Contributions are segregated in the Matching Contributions Account and are invested in the Company Stock Fund. Non-participant directed investments included in the Company Stock Fund were $36,722 and $30,430 at December 31, 2000 and 1999, respectively. During the years ended December 31, 2000, 1999 and 1998, there were no Supplemental Matching Contributions made to the plan. Contributions are excluded from participant's taxable income until such amounts are received by them as a distribution from the Plan. Investment of Contributions - Participants elect investment of their contributions in 5% increments in the Plan's Company Stock Fund, American Fundamental Investors Fund, American EuroPacific Growth Fund, Bond Fund of America, Financial Reserves Fund, Small Company Stock Fund, Growth Stock Fund, Growth and Income Stock Fund, T Rowe Price Fund or the VanGuard Asset Allocation Fund. Participants may change their investment elections as to future contributions and may also elect to reallocate a portion or all of their account balances among the investment funds in increments of 5% of the total amount to be reallocated. All such elections are filed with the Trustee and become effective daily. The value of the funds and the interest of individual participants under each fund are calculated daily (daily valuation). Vesting and Distributions - Each participant is immediately and fully vested in all participant contributions and earnings thereon. Participants vest in Supplemental Matching Contributions at a rate of 25% for each year of eligible service, becoming completely vested after four years, or at death, termination of employment due to permanent and total disability, or normal or early retirement as defined in the Plan. Upon termination of service, participants may receive lump sum distributions of their vested account balances no later than 60 days after the end of the Plan year in which they terminate employment with the Company. Distributions upon retirement may be received as a lump sum or as installments in accordance with the participant's election. Participants may also apply for hardship withdrawals from their Supplemental Salary Savings Contributions, subject to adherence to Internal Revenue Service regulations and approval by the Company. Forfeitures of nonvested amounts are applied to reduce future Supplemental Matching Contributions. There were no forfeitures in 2000, 1999 or 1998. Plan Termination - The Plan was adopted with the expectation that it will continue indefinitely. The Company may, however, terminate the Plan at any time and may amend the Plan from time to time. In the event of termination of the Plan, all participants will immediately become fully vested in the value of all Supplemental Matching Employer Contributions made on their behalf. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates - The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Valuation of Investments - Investments are accounted for at cost on the trade-date and are reported in the statement of net assets available for benefits at fair value. The investment in Applied Industrial Technologies, Inc. common stock is valued using the year-end closing price listed by the New York Stock Exchange. Investment funds are stated at values using year-end closing price for each of the funds or quoted market prices. Benefits Payable - Distributions to participants are recorded by the Plan when payments are made. Administrative Expenses - Administrative expenses of the Plan are paid by the Plan or the Company, as determined by the Company. 3. INVESTMENTS The Plan provides that, in accordance with the investment objectives established by the Company, the Trustee of the Plan shall hold, invest, reinvest, manage and administer all assets of the Plan as a trust fund for the exclusive benefit of participants and their beneficiaries. Plan investments exceeding 5% of net assets available for benefits as of December 31, 2000 and 1999, respectively, were as follows: Description of Investment 2000 1999 Applied Industrial Technologies, Inc. Common Stock $2,965,427 $452,981 Fundamental Investors, Inc. 312,762 305,850 Franklin Small Cap Growth Fund 481,827 360,382 Growth Fund Portfolio 648,039 705,219 Income Fund of America 0 171,888 EuroPacific Growth Fund 159,825 230,039 Victory Stock Index Fund 150,184 207,824 ****** INDEPENDENT AUDITORS' CONSENT Applied Industrial Technologies, Inc. We consent to the incorporation by reference in Registration Statement No. 033-65509 of Applied Industrial Technologies, Inc. on Form S-8 of our report dated March 26, 2001, appearing in this Annual Report on Form 11-K of the Applied Industrial Technologies, Inc. Supplemental Defined Contribution Plan for the year ended December 31, 2000. /s/ Deloitte & Touche LLP Cleveland, Ohio March 26, 2001