11-K 1 a04-7168_111k.htm 11-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 11-K

 

FOR THE YEAR ENDED DECEMBER 31, 2003

 


 

(Mark One)

 

ý

ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

 

 

o

TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

 

Commission File Number:

001-01011

 

A.                       Full title of the plan and the address of the plan, if different from that of the issuer named below:

 

THE 401(K) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN OF CVS
CORPORATION AND AFFILIATED COMPANIES

 

B.                         Name of the issuer of the securities held pursuant to the plan and the address of its principal executive office:

 

CVS CORPORATION

ONE CVS DRIVE

WOONSOCKET, RI 02895


 

REQUIRED INFORMATION

 

THE 401(K) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN OF CVS CORPORATION AND AFFILIATED COMPANIES (THE PLAN) IS SUBJECT TO THE REQUIREMENTS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 (ERISA). ATTACHED HERETO IS A COPY OF THE MOST RECENT FINANCIAL STATEMENTS AND SCHEDULES OF THE PLAN PREPARED IN ACCORDANCE WITH THE FINANCIAL REPORTING REQUIREMENTS OF ERISA.

 

 



 

THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CORPORATION AND AFFILIATED COMPANIES
FINANCIAL STATEMENTS AND SCHEDULES
DECEMBER 31, 2003 AND 2002

 

CONTENTS

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

 

 

FINANCIAL STATEMENTS:

 

 

 

 

 

Statements of Net Assets Available for Plan Benefits

 

 

 

 

 

Statements of Changes in Net Assets Available for Plan Benefits

 

 

 

 

 

Notes to Financial Statements

 

 

 

 

SUPPLEMENTARY SCHEDULE:

 

 

 

 

 

Schedule of Assets (Held at End of Year)

 

 

 

 

SIGNATURE

 

 

 

 

EXHIBIT INDEX

 

 

 

 

 

Exhibit 23

Consent of Independent Registered Public Accounting Firm

 

 

1



 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

The Administrative Committee of

The 401(k) Plan and the Employee Stock Ownership

Plan of CVS Corporation and Affiliated Companies:

 

We have audited the accompanying statements of net assets available for plan benefits of The 401(k) Plan and the Employee Stock Ownership Plan of CVS Corporation and Affiliated Companies (the Plan) as of December 31, 2003 and 2002, and the related statements of changes in net assets available for plan 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 the standards of the Public Company Accounting Oversight Board (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, 2003 and 2002, and the changes in net assets available for plan benefits for the years then ended in conformity with the standards of the Public Company Accounting Oversight Board (United States).

 

As discussed in note 1 to the financial statements, effective April 9, 2002 the 401(k) Profit Sharing Plan of CVS Corporation was merged into the CVS Corporation and Subsidiaries Employee Stock Ownership Plan, and the name of the CVS Corporation and Subsidiaries Employee Stock Ownership Plan was changed to The 401(k) Plan and the Employee Stock Ownership Plan of CVS Corporation and Affiliated Companies.

 

Our audits were 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 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. 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.

 

 

/s/ KPMG LLP

 

KPMG LLP

 

 

 

Boston, Massachusetts

 

May 26, 2004

 

 

2



 

THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP
PLAN OF CVS CORPORATION AND AFFILIATED COMPANIES

 

Statements of Net Assets Available for Plan Benefits

 

December 31, 2003 and 2002

 

 

 

2003

 

2002

 

Assets:

 

 

 

 

 

Investments (note 7):

 

 

 

 

 

Guaranteed insurance contracts (note 2(b))

 

$

241,321,011

 

$

230,459,757

 

Equities

 

809,501,726

 

506,499,003

 

Investments in pooled funds

 

539,632,551

 

435,517,598

 

Short-term investments

 

595,616

 

2,685,037

 

Loans to participants (note 3)

 

39,865,574

 

37,727,331

 

 

 

1,630,916,478

 

1,212,888,726

 

Receivables:

 

 

 

 

 

Interest (note 2(g))

 

573,465

 

1,508,186

 

Dividends (note 2(g))

 

2,616,372

 

1,582,046

 

Employer contributions (note 1(d))

 

7,908,968

 

7,075,868

 

Employee contributions (note 1(d))

 

8,531,981

 

7,814,349

 

 

 

19,630,786

 

17,980,449

 

 

 

 

 

 

 

Total assets

 

1,650,547,264

 

1,230,869,175

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

Notes payable (note 1(c))

 

163,200,000

 

194,400,000

 

Accrued expenses and other liabilities

 

3,156,134

 

3,725,359

 

 

 

 

 

 

 

Total liabilities

 

166,356,134

 

198,125,359

 

 

 

 

 

 

 

Net assets available for plan benefits

 

$

1,484,191,130

 

$

1,032,743,816

 

 

See accompanying notes to financial statements.

 

3



 

THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP
PLAN OF CVS CORPORATION AND AFFILIATED COMPANIES

 

Statements of Changes in Net Assets Available for Plan Benefits

 

Years ended December 31, 2003 and 2002

 

 

 

2003

 

2002

 

Investment activity:

 

 

 

 

 

Interest income (note 2(g))

 

$

11,285,652

 

$

10,508,821

 

Dividend income (note 2(g))

 

34,667,312

 

30,198,617

 

Realized losses (note 4)

 

(25,749,891

)

(23,443,535

)

Unrealized gains/(losses) (note 4)

 

338,682,151

 

(186,248,269

)

Total investment activity

 

358,885,224

 

(168,984,366

)

 

 

 

 

 

 

Contributions:

 

 

 

 

 

Employer contributions (note 1(d))

 

73,522,709

 

46,092,160

 

Employee contributions (note 1(d))

 

111,382,539

 

80,201,208

 

Total contributions

 

184,905,248

 

126,293,368

 

 

 

 

 

 

 

Transfer in from 401(k) Plan

 

 

1,050,013,103

 

 

 

 

 

 

 

Deductions:

 

 

 

 

 

Benefits paid to participants (notes 1(g) and 2(c))

 

69,938,007

 

68,066,541

 

Net loans (repaid)/issued (note 3)

 

(338,431

)

903,328

 

Interest expense

 

16,562,881

 

18,735,480

 

Administrative expenses

 

4,096,893

 

3,986,706

 

Other deductions

 

2,083,808

 

228,560

 

 

 

 

 

 

 

Total deductions

 

92,343,158

 

91,920,615

 

 

 

 

 

 

 

Net increase for the year

 

451,447,314

 

915,401,490

 

 

 

 

 

 

 

Net assets beginning of the year

 

1,032,743,816

 

117,342,326

 

 

 

 

 

 

 

Net assets end of the year

 

$

1,484,191,130

 

$

1,032,743,816

 

 

See accompanying notes to financial statements.

 

4



 

THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP
PLAN OF CVS CORPORATION AND AFFILIATED COMPANIES

 

Notes to Financial Statements

 

December 31, 2003 and 2002

 

(1)                     Plan Description

 

The following description of The 401(k) Plan and the Employee Stock Ownership Plan of CVS Corporation and Affiliated Companies (the “Plan”) provides only general information. Participants should refer to the Plan document for a more complete description of the Plan’s provisions.

 

(a)                     Background

 

The Plan is a defined contribution plan subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. The general administration of the Plan and the responsibility for carrying out the provisions of the Plan are maintained by a committee (the “Plan Committee”) of not less than three persons appointed by the Board of Directors of CVS Corporation (“CVS” or the “Company”), the sponsor of the Plan. In accordance with the provisions of the Plan, the Plan Committee has appointed an administrator (the “Administrator”) and a trustee (the “Trustee”). The Administrator maintains participant account records and instructs the Trustee to execute transactions such as benefit payments to participants. The Trustee holds the assets of the Plan and executes transactions at the direction of the Plan Committee and the Administrator.

 

Effective April 9, 2002, the 401(k) Profit Sharing Plan of CVS Corporation (the “401(k) Plan”) was merged into this Plan, and the name of this plan was changed from CVS Corporation and Subsidiaries Employee Stock Ownership Plan (the “ESOP”) to The 401(k) Plan and the Employee Stock Ownership Plan of CVS Corporation and Affiliated Companies. All assets and liabilities under the 401(k) Plan as of April 9, 2002 were transferred to the Plan and, as of that date, benefits for the participants and beneficiaries of the 401(k) Plan have been paid from the Plan. Changes in net assets available for plan benefits shown in the 2002 Financial Statements include the changes related to the ESOP for the entire year, and changes related to the 401(k) Plan from April 10, 2002 through December 31, 2002. See note 2(a) for further breakdown between ESOP and 401(k) assets.

 

The ESOP and the 401(k) Plan were established as of January 1, 1989.

 

(b)                     Eligibility

 

Employees are eligible to participate in the Plan upon attainment of age 21 and on the earliest of:

 

                The first payroll period of the first month after completion of 90 continuous days of service as a full-time employee; or

 

                Completion of 12 months of service beginning on the employee’s enrollment date with at least 1,000 hours worked; or

 

                Completion of at least 1,000 hours of service in the course of one calendar year.

 

“Employees” referred to above are defined as regular employees of the Company other than:

 

                A nonresident alien receiving no United States (“U.S.”) earned income from the Company;

 

                An individual covered under a collective bargaining agreement (unless the agreement provides for membership);

 

                A leased employee (as defined in the Internal Revenue Code);

 

5



 

                      A temporary employee (as determined by the Company); or

 

                      An independent contractor or consultant (as defined by the Company).

 

(c)                      Leveraged ESOP Transaction

 

On June 23, 1989, the ESOP borrowed $357,500,000 from qualified lenders at an interest rate of 8.60% for a 20-year term. The loan to the ESOP is guaranteed by CVS. The ESOP used the proceeds of the loan to purchase 6,688,494 shares of CVS Corporation Series One ESOP Convertible Preference Stock (“ESOP Preference Stock”). Each share of ESOP Preference Stock is convertible into shares of CVS Common Stock at the election of the Plan’s Trustee. The conversion rate is 2.314 shares of CVS Common Stock for each share of ESOP Preference Stock. Shares of ESOP Preference Stock converted into common stock and retired amounted to 84,899 and 144,785 shares in 2003 and 2002, respectively. The annual dividend on the ESOP Preference Stock is $3.90 per share.

 

In accordance with the terms of the loan agreement, the interest rate on the loan was adjusted as of January 1, 1995 in connection with the increase in the Federal income tax rate to 35%. The adjusted interest rate is 8.52%.

 

As of December 31, 2003, annual maturities of notes payable are as follows:

 

 

 

Amount

 

Year ending December 31:

 

 

 

2004

 

$

22,300,000

 

2005

 

26,900,000

 

2006

 

31,900,000

 

2007

 

37,600,000

 

2008

 

44,500,000

 

 

 

$

163,200,000

 

 

As the Plan makes principal payments, a specified percentage of ESOP Preference Stock is allocated to participants’ accounts. The borrowing is collateralized by the unallocated shares of ESOP Preference Stock. The lenders have no rights against the shares once they are allocated to participants’ accounts.

 

(d)                     Contributions

 

If the amount of a scheduled debt payment due by the Plan on its notes payable outstanding is in excess of the cash available to the Plan from dividends, CVS contributes to the Plan the amount of the difference. Prior to April 9, 2002, no participant was required, or permitted, to make any contributions under the Plan.

 

6



 

Effective April 9, 2002 (upon merger with the 401(k) Plan), participants may elect to have CVS contribute to their accounts from 1% to 15% of the compensation that would otherwise be due them, in multiples of 1%, pursuant to a salary reduction agreement. Each participant’s total elective deferrals for any calendar year may not exceed 15% of annual compensation or the maximum allowed by the Internal Revenue Code (the “Code”), whichever is less, as specified in the Plan document. The maximum elective deferrals allowed by the Code were $12,000 for 2003 and $11,000 for 2002.

 

CVS matches 100% up to 5% of pre-tax compensation contributed, 50% to the employees’ 401(k) Plan account monthly and 50% to the employees’ ESOP account at year-end if the employee is actively employed at that time.  The ESOP portion of the match may be diversified into other 401(k) investment elections any time after it has been made.  Upon the merger of the two plans, this matching contribution agreement was not changed.

 

(e)                      Participant’s Account

 

Each participant’s account is credited with an allocable share of the Plan’s investments, ESOP Preference Stock, and any unrealized appreciation or depreciation of those investments. The total amount of new shares to be allocated each year is calculated by multiplying the ratio of each year’s debt service payments to total current and future debt service payments by the total number of unallocated shares of ESOP Preference Stock in the Plan. Allocations to individual participant’s accounts are based on the number of shares due to each participant as described in 1(d) above.

 

Cash dividend payments on ESOP Preference Stock are used to make debt service payments and are not allocated to participant’s accounts. Shares of ESOP Preference Stock are allocated to a participant based upon the cash dividend amount for shares allocated to the participant’s account, divided by the greater of $53.45 (the cash liquidation value as specified in the Plan document) or the market price of CVS Common Stock at the time of allocation. Shortfalls in the number of shares allocated to participants and new shares to be allocated based on debt retirements are alleviated by the use of forfeited shares as described in (i) below. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s account (see (g) below).

 

(f)                        Vesting

 

Participants become fully vested in Company contributions made to their accounts prior to January 1, 2002, upon the completion of five years of credited service. For Company contributions made after January 1, 2002, participants will vest after three years.

 

Participants whose account balances have been transferred into the Plan from other defined contribution plans maintain at least the degree of vesting in the account they had at the time of the transfer. Notwithstanding the foregoing, participants are fully vested in, and have a nonforfeitable right to (1) their accounts upon death or disability, and (2) any elective deferrals described in note 1(d).

 

7



 

(g)                     Payment of Benefits

 

Upon termination of service by the participant, the Administrator will direct the Trustee to pay to the participant their benefit under one or more options, such as a single lump-sum, or in equal annual installments over a period not exceeding fifteen years, with interest payable at a reasonable rate as determined by the Plan Committee. The beneficiary may elect to receive their ESOP payment in shares of CVS Common Stock or in cash at $53.45 per ESOP Preference Stock or the fair market value of a share of CVS Common Stock at the time of the distribution times a factor of 2.314, whichever is greater.

 

(h)                     Administrative Expenses

 

Administrative expenses specifically attributable to the Plan and not covered by forfeitures, were funded by the Plan for 2003 and 2002. Trustees fees were paid by the Plan for 2003 and 2002.

 

(i)                        Forfeitures

 

On a participant’s termination date, any unvested portion of their account is forfeited. If a former participant resumes employment and eligibility in the Plan within five years of termination, any amounts previously forfeited are restored to the participant’s account, but remain subject to the vesting provisions of the Plan. Forfeitures during any plan year are applied as follows: (i) to restore amounts previously forfeited by participants but required to be reinstated upon resumption of employment; (ii) to pay administrative expenses of the Plan; or (iii) to reduce future CVS contributions. If forfeitures for any plan year are insufficient to restore the required forfeitures, CVS shall contribute the balance required for that purpose.

 

Approximately 21,456 and 35,338 shares of ESOP Preference Stock previously allocated to participant accounts were forfeited during 2003 and 2002, respectively, and have been applied as of December 31, 2003 and 2002. Forfeitures restored to participants in ESOP Preference Stock upon resumption of employment for 2003 and 2002 were approximately 6,407 and 6,241 shares of ESOP Preference Stock, respectively.

 

Cash forfeitures for 2003 and 2002 were $976,221 and $1,019,525, respectively. Cash forfeitures restored to participants upon resumption of employment for 2003 and 2002 were approximately $194,940 and $107,558, respectively.

 

(j)                        Investment Options

 

Upon enrollment in the Plan or at select intervals thereafter, a participant may elect to direct contributions or investment balances within the investments listed below. The following is a brief explanation of each fund’s investment objectives:

 

Core Equity Fund (Vanguard Index Trust 500 Portfolio Fund)

 

This fund’s objective is to replicate the total return of the Standard and Poor’s (“S&P”) 500 Index by investing in the stocks that make up the Index. The S&P 500 Index consists mainly of large companies and represents about 75% of the U.S. stock market value.

 

8



 

Diversified Bond Fund (PIMCO Total Return Admin Fund)

 

This fund is a core bond fund that seeks to outperform the Lehman Brothers Aggregate Bond Index on a consistent basis while maintaining an overall risk similar to the Index. Investments may include government and corporate debt securities, mortgage and other asset backed securities, money market instruments and derivatives.

 

International Equity Fund (Templeton International Fund)

 

This fund’s investment objective is long-term capital growth through participation in stock markets outside the U.S. The fund invests primarily in the common stock of companies based in more developed countries, but may also include investments in developing countries.

 

Small Cap Growth Fund (Invesco Small Company Growth Fund)

 

This fund seeks long-term growth of capital and dividend income through participation in the stock market. The fund invests primarily in stocks of relatively small companies.

 

Global Equity Fund  (Janus Worldwide Fund)

 

This fund seeks long-term growth of capital by investing in a diversified portfolio of foreign and domestic companies.  The fund tries to outperform the Morgan Stanley Capital International (MSCI) World Index, which measures the performance of U.S. and international stock markets.  In 2003, all investments in this fund were transferred into the American Funds New Perspective.

 

Small Cap Value Fund (Galaxy Small Cap Value Fund)

 

This fund seeks long-term growth by investing primarily in stocks of small to medium-sized companies that are believed to either offer superior earnings growth or appear to be undervalued.  This fund is benchmarked by the Russell 2000 Index.  In 2003, all investments in this fund were transferred into the Columbia Small Cap Value Fund.

 

Large Cap Blend Fund (American Funds New Perspective)

 

This fund seeks long-term growth of capital.  The fund invests primarily in stocks of U.S. companies, as well as developed European and Asian companies.

 

Small Cap Value Fund (Columbia Small Cap Value Fund)

 

This fund’s investment objective is long-term capital appreciation.  This fund invests primarily in the stocks of companies that have market capitalization similar in size to those companies in the Russell 2000 index.

 

Growth and Income Fund (J & W Seligman Large Cap Value Fund)

 

This fund seeks long-term capital growth and dividend income through participation in the stock market. The fund invests primarily in the common stock of U.S. based, well-established medium to large size companies.

 

9



 

Large Cap Growth Fund (Columbus Circle Core Equity Fund)

 

This investment objective is long-term capital growth, through participation in the stock market. The fund invests primarily in the common stock of established large companies that are based in the U.S. and that represent industries expected to outperform the stock market as a whole.

 

Conservative Lifestyle Fund (various managers)

 

This fund is for people who will need access to their money in less than five years. Approximately 70% of the fund is invested in fixed-income or low-risk investments. The remaining 30% is invested in stock-oriented mutual funds or moderate-risk investments.

 

Moderate Lifestyle Fund (various managers)

 

This fund is for less conservative investors who can keep their money invested for at least five years. Because stocks make up approximately 60% of the fund’s mix, the fund has more exposure to the fluctuations in the stock market than the Conservative Lifestyle Fund. The remaining 40% is invested in bonds.

 

Aggressive Lifestyle Fund (various managers)

 

This fund is for those individuals who can keep their money invested for at least ten years or those who are willing to accept a greater level of risk in return for greater possible reward. Therefore, 80% of the fund is invested in stocks and the remaining 20% is invested in fixed-income securities.

 

CVS Corporation Common Stock Fund

 

This fund was established as a result of the transfer of assets from the Revco D.S., Inc. 401(k) Plan during 1997. The Plan may, at the discretion of the Plan Committee, offer a company stock fund as one of the available investment funds for employee and employer contributions. The fund holds CVS Common Stock. This fund seeks long-term growth and dividend income by purchasing shares of CVS Common Stock. Because the fund invests in only one company, it is considered a high-risk investment with potential for large rewards.

 

Investment Contract Fund (managed by State Street Bank & Trust Co.)

 

This fund seeks to preserve capital, while generating a steady rate of return higher than money market funds. The fund’s investments consist of highly-rated (AA or higher) insurance company and bank investment contracts.

 

10



 

(2)                     Summary of Significant Accounting Policies

 

(a)                     Basis of Presentation

 

The following table presents the breakdown of net assets available for plan benefits between the 401(k) Plan and the ESOP as of December 31, 2003 and 2002.

 

 

 

December 31, 2003

 

December 31, 2002

 

 

 

401(k) Plan

 

ESOP

 

Total

 

401(k) Plan

 

ESOP

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Guaranteed insurance contracts

 

$

241,321,011

 

$

 

$

241,321,011

 

$

230,459,757

 

$

 

$

230,459,757

 

Equities

 

406,004,091

 

403,497,635

 

809,501,726

 

232,463,899

 

274,035,104

 

506,499,003

 

Investments in pooled funds

 

539,632,551

 

 

539,632,551

 

435,517,598

 

 

435,517,598

 

Short-term investments

 

 

595,616

 

595,616

 

 

2,685,037

 

2,685,037

 

Loans to participants

 

39,865,574

 

 

39,865,574

 

37,727,331

 

 

37,727,331

 

 

 

1,226,823,227

 

404,093,251

 

1,630,916,478

 

936,168,585

 

276,720,141

 

1,212,888,726

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivables:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

572,705

 

760

 

573,465

 

1,503,885

 

4,301

 

1,508,186

 

Dividends

 

2,616,372

 

 

2,616,372

 

1,582,046

 

 

1,582,046

 

Employer contributions

 

7,901,968

 

7,000

 

7,908,968

 

7,075,868

 

 

7,075,868

 

Employee contributions

 

8,531,981

 

 

8,531,981

 

7,814,349

 

 

7,814,349

 

 

 

19,623,026

 

7,760

 

19,630,786

 

17,976,148

 

4,301

 

17,980,449

 

Total assets

 

1,246,446,253

 

404,101,011

 

1,650,547,264

 

954,144,733

 

276,724,442

 

1,230,869,175

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes payable

 

 

163,200,000

 

163,200,000

 

 

194,400,000

 

194,400,000

 

Accrued expenses and other liabilities

 

3,136,442

 

19,692

 

3,156,134

 

3,722,182

 

3,177

 

3,725,359

 

Total liabilities

 

3,136,442

 

163,219,692

 

166,356,134

 

3,722,182

 

194,403,177

 

198,125,359

 

Net assets available for plan benefits

 

$

1,243,309,811

 

$

240,881,319

 

$

1,484,191,130

 

$

950,422,551

 

$

82,321,265

 

$

1,032,743,816

 

 

11



 

The following table presents the net assets available for ESOP benefits separately, on an accrual basis, according to:

 

                  The accounts of employees with rights to allocated stock (Allocated); and

 

                  Stock not yet allocated to employees (Unallocated).

 

 

 

December 31, 2003

 

December 31, 2002

 

 

 

Allocated

 

Unallocated

 

Total

 

Allocated

 

Unallocated

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CVS Corporation Series One ESOP Convertible Preference Stock, at fair value (3,018,953 allocated and 1,808,632 unallocated shares in 2003 and 2,521,926 allocated and 2,220,760 unallocated shares in 2002)

 

$

252,329,142

 

$

151,168,493

 

$

403,497,635

 

$

145,718,319

 

$

128,316,785

 

$

274,035,104

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-term investments, at fair value, and cash

 

594,526

 

1,090

 

595,616

 

2,683,959

 

1,078

 

2,685,037

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest receivable

 

759

 

1

 

760

 

4,300

 

1

 

4,301

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employer contribution receivable

 

7,000

 

 

7,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

252,931,427

 

151,169,584

 

404,101,011

 

148,406,578

 

128,317,864

 

276,724,442

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes payable

 

 

163,200,000

 

163,200,000

 

 

194,400,000

 

194,400,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other payables

 

19,692

 

 

19,692

 

3,177

 

 

3,177

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

19,692

 

163,200,000

 

163,219,692

 

3,177

 

194,400,000

 

194,403,177

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets/(liabilities) available for plan benefits

 

$

252,911,735

 

$

(12,030,416

)

$

240,881,319

 

$

148,403,401

 

$

(66,082,136

)

$

82,321,265

 

 

12



 

The following table presents the breakdown of the changes in net assets available for plan benefits between the 401(k) Plan and the ESOP for the years-ended December 31, 2003 and 2002.

 

 

 

Year ended December 31, 2003

 

Year ended December 31, 2002

 

 

 

401(k) Plan

 

ESOP

 

Total

 

401(k) Plan

 

ESOP

 

Total

 

Investment activity:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

11,250,229

 

$

35,423

 

$

11,285,652

 

$

10,439,710

 

$

69,111

 

$

10,508,821

 

Dividend income

 

15,839,730

 

18,827,582

 

34,667,312

 

11,702,142

 

18,496,475

 

30,198,617

 

Realized (losses)/gains

 

(27,253,676

)

1,503,785

 

(25,749,891

)

(27,030,773

)

3,587,238

 

(23,443,535

)

Unrealized gains/(losses)

 

213,797,717

 

124,884,434

 

338,682,151

 

(134,660,830

)

(51,587,439

)

(186,248,269

)

Total investment activity

 

213,634,000

 

145,251,224

 

358,885,224

 

(139,549,751

)

(29,434,615

)

(168,984,366

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contributions:

 

 

 

 

 

 

 

 

 

 

 

 

 

Employer contributions

 

32,351,062

 

41,171,647

 

73,522,709

 

21,186,705

 

24,905,455

 

46,092,160

 

Employee contributions

 

111,382,539

 

 

111,382,539

 

80,201,208

 

 

80,201,208

 

Total contributions

 

143,733,601

 

41,171,647

 

184,905,248

 

101,387,913

 

24,905,455

 

126,293,368

 

Transfer of assets from 401(k)

 

 

 

 

1,050,013,103

 

 

1,050,013,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deductions:

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits paid to participants

 

60,959,416

 

8,978,591

 

69,938,007

 

56,847,745

 

11,218,796

 

68,066,541

 

Net loans (repaid)/issued

 

(338,431

)

 

(338,431

)

903,328

 

 

903,328

 

Interest expense

 

 

16,562,881

 

16,562,881

 

 

18,735,480

 

18,735,480

 

Administrative expenses

 

4,096,893

 

 

4,096,893

 

3,866,623

 

120,083

 

3,986,706

 

Other (credits)/deductions

 

(237,537

)

2,321,345

 

2,083,808

 

(188,982

)

417,542

 

228,560

 

Total deductions

 

64,480,341

 

27,862,817

 

92,343,158

 

61,428,714

 

30,491,901

 

91,920,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase/(decrease) for the year

 

292,887,260

 

158,560,054

 

451,447,314

 

950,422,551

 

(35,021,061

)

915,401,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets beginning of the year

 

950,422,551

 

82,321,265

 

1,032,743,816

 

 

117,342,326

 

117,342,326

 

Net assets end of the year

 

$

1,243,309,811

 

$

240,881,319

 

$

1,484,191,130

 

$

950,422,551

 

$

82,321,265

 

$

1,032,743,816

 

 

13



 

The following table presents the changes in net assets available for ESOP benefits separately, on an accrual basis, according to:

 

                                          The accounts of employees with rights to allocated stock (Allocated); and

 

                                          Stock not yet allocated to employees (Unallocated).

 

 

 

Year ended December 31, 2003

 

Year ended December 31, 2002

 

 

 

Allocated

 

Unallocated

 

Total

 

Allocated

 

Unallocated

 

Total

 

Additions/(deductions):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allocation of CVS Corporation Series One ESOP Convertible Preference Stock, at liquidation value (412,128 shares and 381,691 shares in 2003 and 2002, respectively)

 

$

22,028,232

 

$

(22,028,232

)

$

 

$

20,401,393

 

$

(20,401,393

)

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

35,410

 

13

 

35,423

 

68,923

 

188

 

69,111

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividend income

 

 

18,827,582

 

18,827,582

 

 

18,496,475

 

18,496,475

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Realized gain

 

1,503,785

 

 

1,503,785

 

3,587,238

 

 

3,587,238

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains/(losses)

 

80,004,494

 

44,879,940

 

124,884,434

 

(22,053,345

)

(29,534,094

)

(51,587,439

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employer contributions

 

12,236,349

 

28,935,298

 

41,171,647

 

(62

)

24,905,517

 

24,905,455

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total additions/(deductions)

 

115,808,270

 

70,614,601

 

186,422,871

 

2,004,147

 

(6,533,307

)

(4,529,160

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deductions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefits paid to participants

 

8,978,591

 

 

8,978,591

 

11,218,796

 

 

11,218,796

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

16,562,881

 

16,562,881

 

 

18,735,480

 

18,735,480

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Administrative expenses

 

 

 

 

120,083

 

 

120,083

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Miscellaneous

 

2,321,345

 

 

2,321,345

 

417,542

 

 

417,542

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deductions

 

11,299,936

 

16,562,881

 

27,862,817

 

11,756,421

 

18,735,480

 

30,491,901

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase/(decrease) for the year

 

104,508,334

 

54,051,720

 

158,560,054

 

(9,752,274

)

(25,268,787

)

(35,021,061

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets/(liabilities) available for plan benefits:

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning of the year

 

148,403,401

 

(66,082,136

)

82,321,265

 

158,155,675

 

(40,813,349

)

117,342,326

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

End of the year

 

$

252,911,735

 

$

(12,030,416

)

$

240,881,319

 

$

148,403,401

 

$

(66,082,136

)

$

82,321,265

 

 

14



 

(b)                     Investment Valuation

 

The value of the investments in the 401(k) portion of the Plan held at December 31, 2003 and 2002 is based on the fair value of the underlying funds except for guaranteed insurance contracts which are valued at contract value.  The contract value represents contributions made under the contract, plus earnings, less participant withdrawals and administrative expenses. The value fluctuates in response to various factors including, but not limited to, the price of the shares in the underlying funds, dividends paid, earnings and losses and the mix of assets in the respective fund. The fair value for the guaranteed insurance contracts at December 31, 2003 and 2002 was $253,642,162 and $246,117,439, respectively. The average yield for 2003 and 2002 was 5.18% and 5.87%, respectively.

 

Short-term investments, which consist primarily of cash and cash equivalents, and loans to participants, are at fair value.

 

The ESOP portion of the Plan invests its funds primarily in ESOP Preference Stock. The investment in ESOP Preference Stock is carried at the higher of the cash liquidation value of $53.45 or 2.314 times the market value of an equivalent share of CVS Common Stock. The market value of CVS Common Stock was $36.12 and $24.97 per share at December 31, 2003 and 2002, respectively.

 

(c)                      Benefits Paid

 

Benefits are recorded when paid.

 

(d)                     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 changes in net assets available for plan benefits during the reporting period. Actual results could differ from those estimates.

 

(e)                      Accrual Basis of Accounting

 

The Plan utilizes the accrual basis of accounting.

 

(f)                        Purchase and Sale of Securities

 

Purchase and sales of securities are made on a trade-date basis.

 

(g)                     Investment Income

 

Dividend and interest income is recorded when earned.

 

(3)                     Loans to Participants

 

Prior to merger with the 401(k) Plan, loans were not allowed from the Plan. Effective April 9, 2002, under the amended terms of the Plan, participants may obtain bona fide loans from the Plan, utilizing funds accumulated in their accounts. The minimum amount which may be borrowed is $1,000. Participants can borrow up to 50% of their vested account balance but not more than $50,000 less their highest outstanding loan balance during the previous twelve months.

 

15



 

The loans are repaid to the Plan through after-tax payroll deductions. The term of the loan is selected at the discretion of the participant, but may not exceed five years for a general loan and twenty-five years for a home purchase loan. Interest on loans is equal to the Prime rate plus 1%.

 

(4)                     Investment Policy

 

At December 31, 2003 and 2002, most of the Plan’s 401(k) related assets were allocated among the investment options discussed in note 1(j) based on Employee’s elections.  The investment options are administered by independent investment managers. Employee asset allocations that are awaiting processing are temporarily invested in commingled funds held by a bank-administered trust fund. These commingled funds are also used to account for and administer participants’ loans. The loan repayments and interest earned are allocated to each of the investment funds based upon the participants’ contribution election percentages.

 

Net unrealized appreciation (depreciation) represents the net difference between the fair value of the investment and its historical cost basis if purchased during the plan year or the change in its fair value during the Plan year. During 2003 and 2002, the Plan’s investments (including investments bought, sold and held during the year) experienced net appreciation (depreciation) as follows:

 

 

 

2003

 

2002

 

 

 

Realized

 

Unrealized

 

Realized

 

Unrealized

 

 

 

 

 

 

 

 

 

 

 

401(k) Plan

 

$

(27,253,676

)

$

213,797,717

 

$

(27,030,773

)

$

(134,660,830

)

ESOP

 

1,503,785

 

124,884,434

 

3,587,238

 

(51,587,439

)

 

 

$

(25,749,891

)

$

338,682,151

 

$

(23,443,535

)

$

(186,248,269

)

 

(5)                     Plan Termination and Related Commitments

 

Although it has not expressed any intention to do so, CVS has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. If CVS terminates the Plan, all participants in the Plan become fully vested.

 

(6)                     Federal Income Taxes

 

The Plan is qualified pursuant to Section 401(a) and 4975(e)(7) of the Code and the trust established under the Plan to hold the Plan’s assets is exempt from Federal income taxes pursuant to Section 501(a) of the Code; accordingly, the trust’s net investment income is exempt from income taxes. The Plan has obtained a favorable tax determination letter from the Internal Revenue Service and the Plan’s sponsor believes that the Plan, as amended, continues to qualify and operate as designed.

 

16



 

(7)                     Investment Valuation

 

The following table presents the total investments of the Plan segregated by investment type. Investments that represent 5% or more of the fair value of the Plan’s assets are marked by an asterisk (*).

 

 

 

2003

 

2002

 

 

 

 

 

 

 

Mutual funds:

 

 

 

 

 

Vanguard Index Trust 500 Portfolio Fund

 

$

193,312,186

*

$

135,135,823

*

PIMCO Total Return Admin Fund

 

109,949,606

*

117,749,685

*

Templeton International Fund

 

71,811,410

 

46,787,266

 

Invesco Small Company Growth Fund

 

27,886,504

 

12,657,016

 

Janus Worldwide Fund

 

 

30,831,850

 

Galaxy Small Cap Value Fund

 

 

84,412,653

*

American Funds New Perspective

 

41,011,865

 

 

Columbia Small Cap Value Fund

 

128,283,547

*

 

J & W Seligman Large Cap Value Fund

 

146,744,822

*

88,125,613

*

Columbus Circle Core Equity Fund

 

170,750,479

*

115,048,070

*

CVS Corporation Common Stock Fund

 

768,679

 

621,277

 

CVS Corporation Common Stock

 

54,802,293

 

36,283,987

 

Commingled Fund

 

315,251

 

328,257

 

 

 

945,636,642

 

667,981,497

 

 

 

 

 

 

 

Loans to participants

 

39,865,574

 

37,727,331

 

Guaranteed insurance contracts

 

241,321,011

*

230,459,757

*

 

 

 

 

 

 

Allocated: CVS Corp Series One ESOP Convertible Stock

 

252,329,142

*

145,718,319

*

Short-term investments

 

594,525

 

2,683,959

 

Unallocated: CVS Corp Series One ESOP Convertible Stock

 

151,168,493

*

128,316,785

*

Short-term investments

 

1,091

 

1,078

 

 

 

 

 

 

 

 

 

$

1,630,916,478

 

$

1,212,888,726

 

 

(8)                     Transfer of Assets from 401(k) Plan

 

The transfer of assets in 2002 from the 401(k) Plan to the ESOP Plan was not a physical transfer, and the assets are still held separately in various Bank of New York accounts.

 

17



 

THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP
PLAN OF CVS CORPORATION AND AFFILIATED COMPANIES

 

Schedule of Assets (Held at End of Year)

 

December 31, 2003

 

Fund

 

Par value/
number of
shares

 

Identity
Of
Investment

 

Description

 

Cost

 

Fair
value

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans to participants

 

 

Loans to participants*

 

Prime plus 1% at loan request date

 

$

 

$

39,865,574

 

Commingled

 

311,857

 

Bank of New York*

 

Collective Short-Term Investment

 

 

 

 

 

 

 

 

 

 

 

Fund Non-Discretionary

 

311,857

 

311,857

 

 

 

64

 

Comcast Corp

 

Common Stock

 

 

2,099

 

 

 

39

 

AT&T Corp

 

Common Stock

 

 

792

 

 

 

63

 

AT&T Wireless Svsc Inc.

 

Common Stock

 

 

503

 

 

 

 

 

Commingled Subtotal

 

 

 

 

 

315,251

 

 

 

 

 

 

 

 

 

 

 

 

 

Lifestyle Conservative Fund

 

77,696

 

Vanguard Institutional Index Trust 500 Portfolio Fund

 

Mutual Fund

 

7,449,906

 

7,907,861

 

 

 

864,293

 

PIMCO Total Return Admin Fund

 

Mutual Fund

 

9,162,777

 

9,256,583

 

 

 

16,568,887

 

State Street Bank

 

Various GICs held at State Street;  due 9/15/05

 

16,568,887

 

16,568,887

 

 

 

 

 

Lifestyle Conservative Fund Subtotal

 

 

 

 

 

33,733,331

 

 

 

 

 

 

 

 

 

 

 

 

 

Lifestyle Moderate Fund

 

145,339

 

Vanguard Institutional Index Trust 500 Portfolio Fund

 

Mutual Fund

 

14,644,183

 

14,792,631

 

 

 

2,588,331

 

PIMCO Total Return Admin Fund

 

Mutual Fund

 

27,288,076

 

27,721,022

 

 

 

934,608

 

Templeton International Fund

 

Mutual Fund

 

8,775,647

 

9,944,234

 

 

 

581,458

 

Columbia Small Cap Value Fund

 

Mutual Fund

 

8,101,465

 

9,942,923

 

 

 

9,188,553

 

State Street Bank

 

Various GICs held at State Street; due 9/15/05

 

9,188,553

 

9,188,553

 

 

 

 

 

Lifestyle Moderate Fund Subtotal

 

 

 

 

 

71,589,363

 

 

See accompanying report of independent registered public accounting firm.

 

18



 

Fund

 

Par value/
number of
shares

 

Identity
of
issue

 

Description

 

Cost

 

Fair
value

 

 

 

 

 

 

 

 

 

 

 

 

 

Lifestyle Aggressive Fund

 

114,803

 

Vanguard Institutional Index Trust 500 Portfolio Fund

 

Mutual Fund

 

$

11,486,637

 

$

11,684,688

 

 

 

2,045,214

 

PIMCO Total Return Admin Fund

 

Mutual Fund

 

21,576,002

 

21,904,242

 

 

 

1,066,995

 

Templeton International Fund

 

Mutual Fund

 

15,692,891

 

17,672,988

 

 

 

2,066,678

 

Columbia Small Cap Value Fund

 

Mutual Fund

 

29,016,055

 

35,340,190

 

 

 

 

 

Lifestyle Aggressive Fund Subtotal

 

 

 

 

 

86,602,108

 

 

 

 

 

 

 

 

 

 

 

 

 

International Equity Fund

 

4,153,589

 

Templeton International Fund

 

Mutual Fund

 

39,714,803

 

44,194,188

 

 

 

 

 

 

 

 

 

 

 

 

 

Core Equity Fund

 

1,561,476

 

Vanguard Institutional Index Trust 500 Portfolio Fund

 

Mutual Fund

 

162,003,451

 

158,927,007

 

 

 

 

 

 

 

 

 

 

 

 

 

Growth & Income Fund

 

4,306,486

 

J & W Seligman Large Cap Value

 

Mutual Fund

 

122,858,116

 

144,795,988

 

 

 

1,948,834

 

 

 

Collective Short-Term Invest. Fund

 

1,948,834

 

1,948,834

 

 

 

 

 

Growth & Income Fund Subtotal

 

Non-Discretionary

 

 

 

146,744,822

 

 

 

 

 

 

 

 

 

 

 

 

 

Large Cap Growth Fund

 

5,295,067

 

Columbus Circle Core Equity Fund

 

Mutual Fund

 

137,915,382

 

165,645,874

 

 

 

5,104,605

 

 

 

Collective Short-Term Invest. Fund

 

5,104,605

 

5,104,605

 

 

 

 

 

Large Cap Growth Fund Subtotal

 

Non-Discretionary

 

 

 

170,750,479

 

 

 

 

 

 

 

 

 

 

 

 

 

Small Cap Growth Fund

 

2,507,779

 

Invesco Small Company Growth Fund

 

Mutual Fund

 

26,682,663

 

27,886,504

 

 

 

 

 

 

 

 

 

 

 

 

 

Diversified Bond Fund

 

4,768,231

 

PIMCO Total Return Admin Fund

 

Mutual Fund

 

51,059,679

 

51,067,759

 

 

 

 

 

 

 

 

 

 

 

 

 

Small Cap Value Fund

 

4,853,827

 

Columbia Small Cap Value Fund

 

Mutual Fund

 

71,210,156

 

83,000,434

 

 

 

 

 

 

 

 

 

 

 

 

 

Large Cap Blend Fund

 

1,675,321

 

American Funds New Perspective

 

Mutual Fund

 

39,448,551

 

41,011,865

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment Contract Fund

 

215,563,570

 

State Street Bank

 

Various GICs held at State Street due; 09/15/05

 

215,563,570

 

215,563,570

 

 

See accompanying report of independent registered public accounting firm.

 

19



 

Fund

 

Par value/
number of
shares

 

Identity
of
issue

 

Description

 

Cost

 

Fair
value

 

 

 

 

 

 

 

 

 

 

 

 

 

CVS Stock Fund

 

21,197

 

CVS Corporation Common Stock Fund*

 

Common Stock

 

$

751,422

 

$

765,636

 

 

 

3,043

 

Bank of New York*

 

Collective Short-Term Investment Fund Non-Discretionary

 

3,043

 

3,043

 

 

 

 

 

CVS Stock Fund Subtotal

 

 

 

 

 

768,679

 

 

 

 

 

 

 

 

 

 

 

 

 

CVS Corporation Common Stock

 

1,488,962

 

CVS Corporation Common Stock*

 

CVS Corporation Common Stock

 

48,769,842

 

53,781,307

 

 

 

1,020,986

 

 

 

Collective Short-Term Investment Fund Non- Discretionary

 

1,020,986

 

1,020,986

 

 

 

 

 

CVS Corporation Common Stock Subtotal

 

 

 

 

 

54,802,293

 

 

 

 

 

 

 

 

 

 

 

 

 

Allocated CVS Corp Series One ESOP Convertible Preference Stock

 

3,018,953

 

ESOP Preference Stock*

 

ESOP Preference Stock

 

161,394,245

 

252,329,142

 

Allocated Short-Term Investments

 

594,525

 

 

 

Collective Short-Term Investment Fund

 

594,525

 

594,525

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated CVS Corp Series One ESOP Convertible Preference Stock

 

1,808,632

 

ESOP Preference Stock*

 

ESOP Preference Stock

 

96,671,375

 

151,168,493

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated Short-Term Investments

 

1,091

 

 

 

Collective Short-Term Investment Fund

 

1,091

 

1,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

1,630,916,478

 

 


*Party-in-interest

 

See accompanying report of independent registered public accounting firm.

 

20



 

SIGNATURE

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Trustee (or other persons who administer the employee benefit plan) has duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

THE 401(k) PLAN AND THE
EMPLOYEE STOCK OWNERSHIP
PLAN OF CVS CORPORATION AND
AFFILIATED COMPANIES

 

 

 

 

Date: June 25, 2004

By:

/s/ David B. Rickard

 

 

 

David B. Rickard

 

 

Senior Executive and Financial
Member of the Plan Committee

 

 

EXHIBIT INDEX

 

Exhibit

 

Description

 

 

 

23

 

Consent of Independent Registered Public Accounting Firm

 

21