-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CqioYXy7H61Q3Z1QJya4W5G1W97hlxr49tKvLO+YOSE6o/QgUAG2ElqIVss/c18v q+3Sqs+mApAMkrnLaVAnZQ== 0000950152-03-006419.txt : 20030723 0000950152-03-006419.hdr.sgml : 20030723 20030626171908 ACCESSION NUMBER: 0000950152-03-006419 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20021231 FILED AS OF DATE: 20030626 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COLE NATIONAL CORP /DE/ CENTRAL INDEX KEY: 0000769644 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-RETAIL STORES, NEC [5990] IRS NUMBER: 341453189 STATE OF INCORPORATION: DE FISCAL YEAR END: 0130 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12814 FILM NUMBER: 03759198 BUSINESS ADDRESS: STREET 1: 5915 LANDERBROOK DR CITY: MAYFIELD HEIGHTS STATE: OH ZIP: 44124 BUSINESS PHONE: 4404494100 MAIL ADDRESS: STREET 1: 5915 LANDERBROOK DRIVE STREET 2: SUITE 300 CITY: CLEVELAND STATE: OH ZIP: 44124 FORMER COMPANY: FORMER CONFORMED NAME: CNC HOLDING CORP/DE DATE OF NAME CHANGE: 19920703 11-K 1 l01622ae11vk.txt COLE NATIONAL CORP 11-K/401K FOR PEARLE VISION United States Securities and Exchange Commission Washington, DC 20549 ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FORM 11-K [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2002, see Explanatory Note below OR [ ] TRANSACTION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to Commission file number 1-12814 A. Full title of the plan and address of the plan, if different from that of the issuer named below: COLE NATIONAL CORPORATION 401(k) PLAN FOR EMPLOYEES OF PEARLE VISION CENTERS B. Name of issuer of the securities held pursuant to the plan and the address of the principal executive office: Cole National Corporation 5915 Landerbrook Drive Mayfield Heights, Ohio 44124 Explanatory Note On March 1, 2002, Cole National merged the Cole National Corporation 401(k) Plan for Employees of Pearle Vision Centers (the "Plan") and the Cole National Corporation 401(k) Plan for Employees at Former AVC/NuVision Locations into the Cole National Corporation 401(k) Plan. REQUIRED INFORMATION Financial Statements The Plan is subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). In accordance with Item 4 of Form 11-K and in lieu of the requirements of Items 1-3 thereof, the following Plan financial statements prepared in accordance with the financial reporting requirements of ERISA are included herein: Independent Auditors' Report, Deloitte & Touche LLP Report of Independent Public Accountants, Grant Thornton LLP Statements of Net Assets Available for Benefits Statement of Changes in Net Assets Available for Benefits Notes to Financial Statements Exhibits 23 Consent of Deloitte & Touche LLP 23.1 Consent of Grant Thornton LLP 99 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 1 SIGNATURE 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. COLE NATIONAL CORPORATION 401(k) PLAN FOR EMPLOYEES OF PEARLE VISION CENTERS June 26, 2003 By: /s/ Lawrence E. Hyatt ------------------------------------------ Lawrence E. Hyatt Member of the Plan's Investment Committee 2 EXHIBIT INDEX 23 Consent of Deloitte & Touche LLP 23.1 Consent of Grant Thornton LLP 99 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 3 COLE NATIONAL CORPORATION 401(k) PLAN FOR EMPLOYEES AT PEARLE VISION CENTERS Financial Statements as of March 1, 2002 (Date of Plan Merger) and December 31, 2001 and for the Period January 1, 2002 Through March 1, 2002, and Independent Auditors' Report COLE NATIONAL CORPORATION 401(K) PLAN FOR EMPLOYEES AT PEARLE VISION CENTERS TABLE OF CONTENTS - -------------------------------------------------------------------------------- PAGE INDEPENDENT AUDITORS' REPORT 1 REPORT OF INDEPENDENT PUBLIC ACCOUNTANT 2 FINANCIAL STATEMENTS: Statements of Net Assets Available for Benefits as of March 1, 2002 (Date of Plan Merger) and December 31, 2001 3 Statement of Changes in Net Assets Available for Benefits for the Period January 1, 2002 Through March 1, 2002 (Date of Plan Merger) 4 Notes to Financial Statements 5-9 INDEPENDENT AUDITORS' REPORT Cole National Corporation 401(k) Plan for Employees at Pearle Vision Centers We have audited the accompanying statement of net assets available for benefits of the Cole National Corporation 401(k) Plan For Employees at Pearle Vision Centers (the "Plan") as of March 1, 2002 (Date of Plan Merger), and the related statement of changes in net assets available for benefits for the period January 1, 2002 through March 1, 2002. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, such 2002 financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of March 1, 2002, and the changes in net assets available for benefits for the period January 1, 2002 through March 1, 2002, in conformity with accounting principles generally accepted in the United States of America. On March 1, 2002, the Plan was merged into the Cole National Corporation 401(k) Plan. /s/ Deloitte & Touche LLP Cleveland, Ohio June 13, 2003 1 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Administrative Committee of Cole National Group, Inc.: We have audited the accompanying statement of net assets available for benefits of the Cole National Corporation 401(k) Plan for Employees at Pearle Vision Centers (the "Plan") as of December 31, 2001. This financial statement is the responsibility of the plan administrator. Our responsibility is to express an opinion on this financial statement based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statement referred to above presents fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2001, in conformity with accounting principles generally accepted in the United States of America. /s/ GRANT THORNTON LLP Cleveland, Ohio June 24, 2002 2 COLE NATIONAL CORPORATION 401(k) PLAN FOR EMPLOYEES AT PEARLE VISION CENTERS STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS MARCH 1, 2002 (DATE OF PLAN MERGER) AND DECEMBER 31, 2001 - -------------------------------------------------------------------------------- ASSETS 2002 2001 Investments $ - $ 30,708,414 Receivables: Employee contributions 72,316 Employer contributions 175,786 Interest 7,096 ----------- ------------ Total receivables 255,198 ----------- ------------ NET ASSETS AVAILABLE FOR BENEFITS $ - $ 30,963,612 =========== ============ See notes to financial statements. 3 COLE NATIONAL CORPORATION 401(k) PLAN FOR EMPLOYEES AT PEARLE VISION CENTERS STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE PERIOD JANUARY 1, 2002 THROUGH MARCH 1, 2002 (DATE OF PLAN MERGER) - -------------------------------------------------------------------------------- ADDITIONS: Investment income: Interest $ 15,780 Dividends 93,597 Contributions: Employee 259,008 Employer 21,739 ------------ Total additions 390,124 ------------ DEDUCTIONS: Investment losses--net depreciation in fair value of investments 799,581 Benefits paid to participants 482,560 Deemed distributions on defaulted loans 165,805 Transfers to Cole National Corporation 401(k) Plan 29,905,790 ------------ Total deductions 31,353,736 ------------ NET DECREASE (30,963,612) NET ASSETS AVAILABLE FOR BENEFITS--Beginning of period 30,963,612 ------------ NET ASSETS AVAILABLE FOR BENEFITS--End of period $ -- ============
See notes to financial statements. 4 COLE NATIONAL CORPORATION 401(K) PLAN FOR EMPLOYEES AT PEARLE VISION CENTERS NOTES TO FINANCIAL STATEMENTS AS OF MARCH 1, 2002 (DATE OF PLAN MERGER) AND DECEMBER 31, 2001, AND FOR THE PERIOD JANUARY 1, 2002 THROUGH MARCH 1, 2002 - -------------------------------------------------------------------------------- 1. SUMMARY OF PLAN The following description of the Cole National Corporation 401(k) Plan for Employees at Pearle Vision Centers (the "Plan") is provided for general information purposes only. Participants should refer to the Plan document for more complete information. GENERAL--The Plan is a defined contribution plan covering eligible employees of Pearle, Inc. and Pearle Vision, Inc. (herein collectively referred to as the "Company") and is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The Company is a wholly owned subsidiary of Cole National Group, Inc. On March 1, 2002, Cole National merged the Cole National Corporation 401(k) Plan for Employees at Pearle Vision Centers and the Cole National Corporation 401(k) Plan for Employees at Former AVC/NuVision Locations into the Cole National Corporation 401(k) Plan. ELIGIBILITY--All employees of the Company are eligible to participate in the Plan upon attaining the age of 21 and completing one year of service in which at least 1,000 hours of service are performed. Participation may begin as soon as administratively feasible following satisfaction of the eligibility requirements. CONTRIBUTIONS--Participants may contribute up to 17% of pretax annual compensation ("Elective Deferral"), as defined in the Plan. Participants may also contribute amounts representing distributions from other qualified defined benefit or defined contribution plans ("Rollover Contributions"). The Company makes a mandatory company-matching contribution equal to 10% of the participants' Elective Deferrals. The Company may also make a discretionary matching contribution for each plan year equal to such dollar amount or percentage of participant Elective Deferrals as determined by the Company's board of directors. The Company did not make discretionary matching contributions for the period January 1, 2002 through March 1, 2002. Participant and Company contributions are subject to certain limitations imposed by law. PARTICIPANTS' ACCOUNTS--Each participant's account is credited with the participant's Elective Deferrals and allocations of (a) the Company's contribution, and (b) Plan earnings. Allocations of a Company contribution are based on the ratio of each participant's Elective Deferral for the Plan year to total Elective Deferrals of all participants for the Plan year. Allocations of the Plan earnings are based on participant account balances. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. 5 VESTING--Participants are immediately vested in their Elective Deferrals and Rollover Contributions plus actual earnings thereon. Participants vest in the Company's contribution portion of their accounts, plus actual earnings thereon, at the following rates: 1 year of service 25% 2 years of service 50% 3 years of service 75% 4 years of service 100% ADMINISTRATION--The administrator of the Plan is the Investment Committee of Cole National Group, Inc. INVESTMENT OPTIONS--Upon enrollment in the Plan, a participant may direct the investment of their Elective Deferral contributions in whole percentage increments. The ten investment options as of December 31, 2001 through March 1, 2002 were as follows: Merrill Lynch Retirement Preservation Trust--Funds are invested in shares of a trust that invests in guaranteed investment contracts, obligations of U.S. Government, U.S. Government agency securities and money market instruments. Cole National Corporation Common Stock--Funds are invested in the common stock of Cole National Corporation. MFS Emerging Growth Fund--Funds are invested primarily in common stocks of emerging growth companies, which are companies that Fund management believes are early in their life cycle but have the potential to become major enterprises or are major enterprises whose rates of earnings growth are expected to accelerate because of special factors, such as rejuvenated management, new products, changes in consumer demand, or basic changes in the economic environment. State Street Research International Equity Fund--Funds are invested primarily in common stocks and other equity securities issued by foreign companies. Also, the Fund invests in domestic and foreign investment-grade debt securities. PIMCO Total Return Fund--Funds are invested in a diversified portfolio of fixed-income securities of varying maturities, securities denominated in foreign currencies and U.S. dollar-denominated securities of foreign issuers. The Fund also buys and sells certain "derivative" instruments, contracts or options for the purpose of hedging or increasing its return. Merrill Lynch S&P 500 Index Fund--Funds are generally invested in common stocks included in the S&P 500 Index ("Index"), approximately the same weightings as the Index. The Fund may use options and futures contracts and other types of financial instruments relating to all or a portion of the Index. PIMCO Capital Appreciation Fund--Funds are invested primarily in the common stocks of 60 to 100 large-market capitalization companies (those with at least $1 billion at the time of investment). 6 AIM Balanced Fund--Funds are invested primarily in equities and investment-grade fixed-income securities. The fixed-income portion may include U.S. government obligations, mortgage-backed or asset-based securities, and corporate debt. Also, the Fund may invest up to 10% of its funds in bonds rated below investment-grade and up to 20% of assets in foreign securities. Alliance Technology Fund--Funds are invested primarily in securities of companies expected to benefit from technological advances and improvements. Typically, funds are invested in equity securities; however, debt securities, derivatives, and preferred stocks with price-appreciation potential may be purchased. Also, the Fund may invest up to 10% of its funds in foreign securities and it may seek income by writing call options. Davis New York Venture Fund--Funds are invested primarily in common stocks. While the Fund invests predominantly in equity securities of companies with market capitalization of at least $5 billion, it can invest in issues of small-market capitalization companies. Participants may change their investment elections daily. Company contributions, which are credited to a participant's account, are allocated to the aforementioned investment options based on the participant's election on the date of the Company contribution. In conjunction with the Plan merger, the Company switched from Merrill Lynch as trustee of the Plan to CIGNA Bank & Trust Company, FSB. The fair market value of the total investments was transferred to CIGNA Bank & Trust Company, FSB on the effective date as follows:
MERRILL LYNCH CIGNA TRANSFERRED FROM: TRANSFERRED TO: -------------------------------------------------------- ------------------------------------------------------- Merrill Lynch Retirement Preservation Trust Guaranteed Income Fund Cole National Corporation Common Stock Cole National Corporation Common Stock MFS Emerging Growth Fund Large Cap Growth/Dresdner RCM State Street Research International Templeton Foreign PIMCO Total Return Fund State Street Global Advisors Intermediate Bond Merrill Lynch S&P 500 Index Fund S&P 500 Index Fund PIMCO Capital Appreciation Fund S&P 500 Index Fund AIM Balanced Fund CIGNA Lifetime 50 Alliance Technology Fund Alliance Technology Fund Davis New York Venture Fund Large Cap Value Fund/Wellington Management
PARTICIPANT NOTES RECEIVABLE--Participants may borrow from their accounts a minimum of $1,000 and a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Loan transactions are treated as a transfer to (from) the investment fund from (to) the Participant Notes Receivable fund. The maximum term of any loan is for five years, including loans used to acquire principal residences. The loans are secured by the balance in the participant's account and bear interest at a rate equal to the Prime Interest Rate quoted in 7 the Wall Street Journal on the first business day of the third month of the calendar quarter before the loan was made plus 1%. Administrative fees associated with such loans are deducted from the participants' accounts that incurred the expense. In conjunction with the plan merger, all current notes receivable were transferred from Merrill Lynch to CIGNA. PAYMENT OF BENEFITS--On termination of service due to death, disability, retirement or separation from service of the Company, a participant may elect to have the value of the vested interest in his or her account paid as a lump-sum distribution, in installments or rolled over into another qualified plan. Furthermore, a participant may elect to withdraw all or any part of the vested interest in his or her account if, prior to termination of employment, a participant attains the age of 59 1/2 or if a participant incurs a hardship (as defined in the Plan document). EXPENSES--All expenses and fees associated with transactions from the Plan are charged against and withdrawn from the participants' accounts. Transactional costs include, but are not limited to, charges incurred for distribution upon termination of employment, withdrawals during employment, loans, and hardship distributions. The Company discretionarily paid approximately $11,900 in administrative expenses for the period January 1, 2002 through March 1, 2002. FORFEITURES--Forfeitures are used to reduce Company contributions for the respective year. Should participants to which such forfeitures relate return to the Plan prior to incurring five consecutive one year breaks in service, the Employer will increase the contributions to the Plan in an amount necessary to reinstate such forfeited amounts if the employee repays to the Plan the amount of any prior distribution. There were no forfeitures for the period January 1, 2002 through March 1, 2002. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING--The financial statements of the Plan are prepared under the accrual method of accounting. VALUATION OF INVESTMENTS--Assets of the Plan are held in trust by Merrill Lynch Trust Company (the "Trustee") whereby the Trustee acts as custodian of the Plan's investment portfolio. Except for the Merrill Lynch Retirement Preservation Trust, the investments and changes therein have been reported by the Trustee as having been determined through the use of quoted market prices, which represent the fair value of investments held by the Plan as of December 31, 2001. The Merrill Lynch Retirement Preservation Trust is an investment contract account that is fully benefit responsive. All activity in this account is recorded at contract value based on the guaranteed annual return. According to the Trustee of the Plan, as of December 31, 2001 contract value closely approximates the fair market value of this fund. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. CONTRIBUTIONS AND PAYMENT OF BENEFITS--Participant contributions are recognized at the payroll withholding date. Benefit payments to participants are recorded upon distribution. 8 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 additions and deductions during the reporting period. Actual results could differ from those estimates. 3. INFORMATION FURNISHED BY TRUSTEE Under the Plan agreement, the Trustee holds all investment assets, executes all investment transactions and distributes funds to the Plan participants in accordance with the Plan document. The financial statements have been prepared from investment information and related activity certified as complete and accurate and furnished by the Trustee. 4. RELATED PARTY TRANSACTIONS Certain Plan investments are shares of mutual funds or a common trust managed by Merrill Lynch, Pierce, Fenner & Smith, Inc. ("Merrill Lynch"). Merrill Lynch Trust Company is the Trustee as defined by the Plan and, therefore, these transactions qualify as party-in-interest transactions. 5. INVESTMENTS The following table presents the fair values of investments, as determined by the Plan Trustee, representing 5% or more of the Plan's assets as of December 31, 2001: Merrill Lynch Retirement Preservation Trust $9,774,501 PIMCO Total Return Fund 1,949,247 PIMCO Capital Appreciation Fund 6,692,296 Davis New York Venture Fund 7,327,215
6. TAX STATUS The Plan obtained a determination letter on April 3, 1997, in which the Internal Revenue Service stated that the Plan, as then designed, is in compliance with the applicable requirements of the Internal Revenue Code ("IRC"). The Plan has been subsequently amended since receiving the determination letter. However, the plan administrator believes that the Plan was designed and operated in compliance with the applicable requirements of the IRC through the date of the Plan merger. ****** EX-23 3 l01622aexv23.txt EXHIBIT 23 EXHIBIT 23 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statement Nos. 333-53900, 333-82263, 333-82265, 333-82271, 333-40605, 333-40607, 333-40609, 333-19419, 333-18765, 333-83630, 333-82480, 333-105519, and 333-105904 of Cole National Corporation on Form S-8 of our report dated June 13, 2003, appearing in this Annual Report on Form 11-K of Cole National Corporation 401(k) Plan for Employees at Pearle Vision Centers for the year ended December 31, 2002. /s/ DELOITTE & TOUCHE LLP Cleveland, Ohio June 26, 2003 EX-23.1 4 l01622aexv23w1.txt EXHIBIT 23.1 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS We have issued our report dated June 24, 2002 included in this Form 11-K for the year ended December 31, 2002. We hereby consent to the incorporation by reference of said report in the Company's previously filed Registration Statements File No. 333-53900, No. 333-82263, No. 333-82265, No. 333-82271, No. 333-40605, No. 333-40607 No. 333-40609 No. 333-19419, No. 333-18765, No. 333-83630 and No. 333-82480, No. 333-105519 and No. 333-105904. /s/ GRANT THORNTON LLP Cleveland, Ohio June 24, 2003 EX-99 5 l01622aexv99.txt EXHIBIT 99 EXHIBIT 99 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 of the Cole National Corporation 401(k) Plan for Employees of Pearle Vision Centers (the "Plan") on Form 11-K for the year ended December 31, 2002, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned officers of Cole National Corporation, the sponsor of the Plan, certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to such officer's knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition of the Plan as of the dates and for the periods expressed in the Report. A signed original of this written statement required by Section 906 has been provided to Cole National Corporation and will be retained by Cole National Corporation and furnished to the Securities and Exchange Commission or its staff upon request. Date: June 26, 2003 COLE NATIONAL CORPORATION 401(k) PLAN INVESTMENT COMMITTEE /s/ Lawrence E. Hyatt --------------------------------------------- Name: Lawrence E. Hyatt Title: Member of Cole National Corporation 401(k) Plan Investment Committee and Chief Financial Officer of Cole National Group, Inc., the Plan Sponsor -----END PRIVACY-ENHANCED MESSAGE-----