-----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, G3b+OILMW0CNUmCo/wZnFmDpQ9/cqd3Wx44iOrtOPxyDbfaEyBfkDZ/htfngOG2m 3b7BgtUtnDwtfyYJgJkA/g== 0000891618-97-002964.txt : 19970723 0000891618-97-002964.hdr.sgml : 19970723 ACCESSION NUMBER: 0000891618-97-002964 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970722 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GYMBOREE CORP CENTRAL INDEX KEY: 0000786110 STANDARD INDUSTRIAL CLASSIFICATION: APPAREL & OTHER FINISHED PRODS OF FABRICS & SIMILAR MATERIAL [2300] IRS NUMBER: 942615258 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21250 FILM NUMBER: 97643353 BUSINESS ADDRESS: STREET 1: 700 AIRPORT BLVD STE 200 CITY: BURLINGAME STATE: CA ZIP: 94010 BUSINESS PHONE: 4155790600 MAIL ADDRESS: STREET 2: 700 AIRPORT BLVD #200 CITY: BURLINGAME STATE: CA ZIP: 94010 11-K 1 FORM 11-K FOR PERIOD ENDED DECEMBER 31, 1996 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]. FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996. OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM __________ TO __________ Commission file number 000-21250 A. Full title of the Plan and the address of the Plan, if different from that of the issuer named below: THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN B. Name of issuer of the securities held pursuant to the Plan and the address of its principal executive office: THE GYMBOREE CORPORATION 700 AIRPORT BLVD., SUITE 200 BURLINGAME, CA 94010-1912 2 ITEM 1. CHANGES IN THE PLAN Effective April 7, 1995, the Company appointed Merrill Lynch Trust Company of California successor trustee of the Plan. ITEM 2. CHANGES IN INVESTMENT POLICY No material changes occurred during the 1996 fiscal year with respect to the nature of securities or other investments in which funds held under the Plan were invested. ITEM 3. CONTRIBUTIONS UNDER THE PLAN The Gymboree Corporation makes matching cash contributions to the Plan. The Company matches 50% of participant contributions, up to a maximum annual contribution of $500 in 1996 and 1995. ITEM 4. PARTICIPATING EMPLOYEES The Plan had approximately 400 participating employees at December 31, 1996. ITEM 5. ADMINISTRATION OF THE PLAN The Plan is administered by a committee comprising employees of The Gymboree Corporation. No person receives compensation from the Plan in the role of administrative committee member.
Name of Position held committee member with issuer Address - ---------------- ----------- ------- NANCY J. PEDOT President, Chief 700 Airport Blvd., Suite 200 Executive Officer Burlingame, CA 94010-1912 JAMES P. CURLEY Senior Vice President, 700 Airport Blvd., Suite 200 Chief Financial Officer/ Burlingame, CA 94010-1912 Chief Administrative Officer JOSEPH T. PRUSKO Vice President, 700 Airport Blvd., Suite 200 Controller Burlingame, CA 94010-1912 JANELLE DAUSCH Benefits Manager 700 Airport Blvd., Suite 200 Burlingame, CA 94010-1912
2 3 ITEM 6. CUSTODIAN OF INVESTMENTS The custodian of Plan assets is Merrill Lynch Trust Company of California (Merrill Lynch) located at 101 California Street, San Francisco, California 94111. The Plan did not pay Merrill Lynch any compensation as trustee of investments as all administrative fees are paid by the Company. ITEM 7. REPORTS TO PARTICIPATING EMPLOYEES Participants receive quarterly reports from the Plan administrator summarizing the transactions and market value changes. ITEM 8. FINANCIAL STATEMENTS AND EXHIBITS (a) Financial statements - Audited financial statements of The Gymboree Corporation Retirement Savings Plan as of and for the years ended December 31, 1996 and 1995. (b) Exhibit 23.1 - Consent of Mohler, Nixon & Williams, Independent Accountants 3 4 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the administrator has duly caused this annual report to be signed by the undersigned thereunto duly authorized. THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN DATE July 17, 1997 BY /s/ JAMES P. CURLEY ------------------- JAMES P. CURLEY SENIOR VICE PRESIDENT, CHIEF FINANCIAL OFFICER/ CHIEF ADMINISTRATIVE OFFICER 4 5 THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 5 6 THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN Financial Statements and Supplemental Schedules Years ended December 31, 1996 and 1995 TABLE OF CONTENTS Independent Accountants' Report..............................................7 Consent of Independent Accountants...........................................8 Financial Statements: Statements of Net Assets Available for Plan Benefits ........................9 Statements of Changes in Net Assets Available for Plan Benefits, With Fund Information..................................................10 Notes to Financial Statements...............................................11 Supplemental Schedules as of and for the year ended December 31, 1996 .......................................................15 Assets Held for Investment Purposes .....................................16 Schedule of Reportable Transactions .....................................17
6 7 To the Participants and Plan Administrator of The Gymboree Corporation Retirement Savings Plan INDEPENDENT ACCOUNTANTS' REPORT We have audited the accompanying statements of net assets available for plan benefits of The Gymboree Corporation Retirement Savings Plan (the Plan) as of December 31, 1996 and 1995, and the related statements of changes in net assets available for plan benefits, with fund information, for the years then ended. These financial statements are the responsibility of the Plan's management. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audits 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 the Plan's 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, 1996 and 1995, and the changes in net assets available for plan benefits, with fund information, for the years then ended, in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules as listed in the accompanying table of contents are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The fund information in the statement of changes in net assets available for plan benefits is presented for purpose of additional analysis rather than to present the changes in net assets available for plan benefits for each fund. The supplemental schedules and fund information have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 17, 1997 7 8 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the use of our name on our report, dated June 17, 1997, with respect to the financial statements and schedules of The Gymboree Corporation Retirement Savings Plan for the years ended December 31, 1996 and 1995, included in the Annual Report on Form 11-K which is filed electronically with the Securities and Exchange Commission. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 17, 1997 8 9 THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, -------------------------- 1996 1995 ----------- ----------- Investments, at contract value $ 166,070 $ 146,990 Investments, at fair value 2,453,877 1,495,901 ----------- ----------- Assets held for investment purposes 2,619,947 1,642,891 Receivables 38,114 47,177 ----------- ----------- Total assets 2,658,061 1,690,068 Payables (49,119) ----------- ----------- Net assets available for plan benefits $ 2,608,942 $ 1,690,068 =========== ===========
See independent accountants' report and accompanying notes to financial statements. 9 10 THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
Merrill Lynch ---------------------------------------------------------------------------------------- CMA Global Retirement Gymboree Money Capital Growth Allocation Preservation Stock Market Fund Fund Fund Trust Fund Fund ----------- ----------- ----------- ----------- ----------- ----------- Net assets available for plan benefits at December 31, 1994 $ 112,231 $ 316,054 $ 254,687 $ 102,505 $ 78,918 $ 22,998 ----------- ----------- ----------- ----------- ----------- ----------- Employer's contribution 14,126 36,908 25,767 11,441 9,940 Participants' contributions/rollovers 80,172 322,762 153,625 78,979 66,642 Withdrawals/distributions (28,512) (73,270) (109,100) (29,508) (20,553) Dividends and interest 19,960 60,319 28,185 Net appreciation (depreciation) in fair value of investments 21,331 70,806 30,251 7,293 (37,084) Net loan activities (955) (16,220) (106) 564 227 Transfers in (out) 509 7,967 17,715 (24,284) 7,748 (22,998) ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets 106,631 409,272 146,337 44,485 26,920 (22,998) ----------- ----------- ----------- ----------- ----------- ----------- Net assets available for plan benefits at December 31, 1995 218,862 725,326 401,024 146,990 105,838 -- ----------- ----------- ----------- ----------- ----------- ----------- Employer's contribution 20,124 53,726 28,054 12,296 11,014 Participants' contributions/rollovers 157,923 412,355 194,689 71,215 73,653 Withdrawals/distributions (56,468) (170,985) (114,078) (49,196) (30,625) Dividends and interest 26,653 72,719 52,770 3,136 Net appreciation (depreciation) in fair value of investments 4,381 159,091 16,825 6,750 8,817 Net loan activities (16,576) (27,377) (15,461) (5,849) (1,309) Transfers in (out) (17,041) (29,459) 34,717 (19,272) (17,640) 59,700 ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets 118,996 470,070 197,516 19,080 43,910 59,700 ----------- ----------- ----------- ----------- ----------- ----------- Net assets available for plan benefits at December 31, 1996 $ 337,858 $ 1,195,396 $ 598,540 $ 166,070 $ 149,748 $ 59,700 =========== =========== =========== =========== =========== ===========
Participant Loans Receivables Payables Total ----------- ----------- ------------ ----------- Net assets available for plan benefits at December 31, 1994 $ 27,659 $ 22,630 ($ 35,973) $ 901,709 ----------- ----------- ------------ ----------- Employer's contribution 98,182 Participants' contributions/rollovers 47,177 749,357 Withdrawals/distributions (260,943) Dividends and interest 702 109,166 Net appreciation (depreciation) in fair value of investments 92,597 Net loan activities 16,490 -- Transfers in (out) (22,630) 35,973 -- ----------- ----------- ------------ ----------- Increase (decrease) in net assets 17,192 24,547 35,973 788,359 ----------- ----------- ------------ ----------- Net assets available for plan benefits at December 31, 1995 44,851 47,177 -- 1,690,068 ----------- ----------- ------------ ----------- Employer's contribution 125,214 Participants' contributions/rollovers (47,177) 862,658 Withdrawals/distributions (2,936) (424,288) Dividends and interest 4,148 159,426 Net appreciation (depreciation) in fair value of investments 195,864 Net loan activities 66,572 -- Transfers in (out) 38,114 (49,119) -- ----------- ----------- ------------ ----------- Increase (decrease) in net assets 67,784 (9,063) (49,119) 918,874 ----------- ----------- ------------ ----------- Net assets available for plan benefits at December 31, 1996 $ 112,635 $ 38,114 $ (49,119) $ 2,608,942 =========== =========== ============ ===========
See independent accountants' report and accompanying notes to financial statements. 10 11 THE GYMBOREE CORPORATION RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 1996 and 1995 NOTE 1 - THE PLAN AND ITS SIGNIFICANT ACCOUNTING POLICIES: The following description of The Gymboree Corporation (the Company) Retirement Savings Plan (the Plan) provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. The Plan is a defined contribution plan that was established in 1992 by the Company to provide benefits to eligible employees. The Plan covers all full-time employees of the Company who have completed one year of service and are age 21 or older. The Plan administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code and the provisions of ERISA. ADMINISTRATION - The Company has appointed an Administrative Committee (the Committee) to control the operation and administration of the Plan. A third-party administrator, appointed by the Committee, processes and maintains the records of participant data. Under the terms of the Plan, a group of designated officers of the Company acted as the trustee of the Plan from inception through April 6, 1995. Effective April 7, 1995, the Company appointed Merrill Lynch Trust Company of California (Merrill Lynch) as trustee of the Plan. Substantially all expenses incurred for administering the Plan are paid by the Company. INVESTMENTS - Investments of the Plan are held by Merrill Lynch and invested in mutual funds, Company stock or a collective trust fund based solely upon instructions received from participants. The Plan's investment in Merrill Lynch mutual funds as well as Gymboree Corporation common stock are valued at fair value as of the last day of the Plan year, as measured by quoted market prices. The Merrill Lynch Retirement Preservation Trust (RPT) is a collective trust fund invested primarily in a diversified portfolio of GICs, money market securities, and U.S. government securities. RPT earned a gross annual effective yield of 6.40% for the year ended December 31, 1996 and is valued at contract value (purchase price plus interest) as of the last day of the Plan year. 11 12 STATEMENT OF POSITION 94-4 - The Company adopted Statement of Position 94-4, "Reporting of Investment Contracts Held by Health and Welfare Benefit Plans and Defined Contribution Pension Plans" (SOP 94-4), for the Plan year beginning January 1, 1996. Under the new reporting requirements, investment contracts with fully benefit-responsive features must be reported at contract value. The adoption of SOP 94-4 did not have a material financial impact on the Plan. CASH AND CASH EQUIVALENTS - All highly liquid investments purchased with an original maturity of three months or less (generally money market funds) are considered to be cash equivalents. VESTING - Participants are immediately vested in their entire account balance. INCOME TAXES - The Plan has applied for and received a favorable determination letter dated June 5, 1995. The Committee believes the Plan qualifies under the applicable requirements of the Internal Revenue Code and related state statutes, and is exempt from federal income and state franchise taxes. ESTIMATES - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. RECLASSIFICATIONS - Certain reclassifications were made in the 1995 financial statements to conform with the 1996 presentation. RISKS AND UNCERTAINTIES - The Plan provides for various investment options in any combination of four different Merrill Lynch mutual funds as well as Gymboree Corporation common stock. Investment securities are exposed to various risks, such as interest rate, market and credit. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in risks in the near term would materially affect participants' account balances and the amounts reported in the statement of net assets available for plan benefits and the statement of changes in net assets available for plan benefits. 12 13 NOTE 2 - PARTICIPATION AND BENEFITS: EMPLOYEE CONTRIBUTIONS - Participants may elect to have the Company contribute, from 1% to 20%, of their pre-tax compensation up to the amount allowable under current income tax regulations. Participants who elect to have the Company contribute a portion of their compensation to the Plan agree to accept an equivalent reduction in taxable compensation. Contributions withheld are invested in accordance with the participant's direction and are allocated to funds in 1% increments. Participants are also allowed to make rollover contributions of amounts received from other qualified employer-sponsored retirement plans. Such contributions are deposited in the appropriate investment funds in accordance with the participant's direction and the Plan's provisions. EMPLOYER CONTRIBUTIONS - The Company is allowed to make matching contributions as defined in the Plan and as approved by the Board of Directors. The Company matches 50% of each participant's contribution up to a maximum of $500 for 1996 and 1995. PARTICIPANT ACCOUNTS - Each participant's account is credited with the participant's contribution, Plan earnings and an allocation of the Company's contribution. Allocations of Company contributions are based on participant contributions. PAYMENT OF BENEFITS - Upon termination, the participant or beneficiary will receive the benefits in a lump-sum amount equal to the value of the participant's account. LOANS TO PARTICIPANTS - The Plan allows participants to borrow not less than $1,000 and up to the lesser of $50,000 or 50% of their account balance. The loans are secured by the participant's account balance. Such loans bear interest at rates established by the Committee and must be repaid to the Plan within a five year period, unless the loan is used for the purchase of a residence in which case the maximum repayment period may be extended. The specific terms and conditions of such loans are established by the Plan administrator. 13 14 NOTE 3 - PLAN TERMINATION AND/OR MODIFICATION: The Company intends to continue the Plan indefinitely for the benefit of its employees; however, it reserves the right to terminate and/or modify the Plan at any time by resolution of its Board of Directors and subject to the provisions of ERISA. NOTE 4 - INVESTMENTS: The following table includes the contract or fair values of net assets and investment funds that represent 5% or more of the Plan's net assets at December 31:
1996 1995 ---------- ---------- Merrill Lynch: Capital Fund $ 337,858 $ 218,862 Growth Fund 1,195,396 725,326 Global Allocation Fund 598,540 401,024 Retirement Preservation Trust 166,070 146,990 Gymboree Stock Fund 149,748 105,838 CMA Money Market Fund 59,700 Participant Loans 112,635 44,851 ---------- ---------- Total net assets at contract or fair value $2,619,947 $1,642,891 ========== ==========
NOTE 5 - PARTY IN INTEREST TRANSACTIONS: As allowed by the Plan, participants may elect to invest a portion of their accounts in the common stock of the Company. The aggregate investment in Company common stock at December 31, 1996 and 1995 was as follows:
1996 1995 ---- ---- Number of shares 6,049 5,041 Cost $179,595 $141,731 Fair value $149,748 $105,838
14 15 THE GYMBOREE CORPORATION EMPLOYEE RETIREMENT SAVINGS PLAN SUPPLEMENTAL SCHEDULES DECEMBER 31, 1996 15 16 THE GYMBOREE CORPORATION EMPLOYEE RETIREMENT SAVINGS PLAN E.I.N.: 94-261525 Plan #: 001 ITEM 27a, PART I - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES December 31, 1996
(a) (b) (c) (d) (e) Description of investment including Identity of issue, borrower, lessor, maturity date, rate of interest, Current or similar party collateral, par or maturity value Cost Value - --- --------------------------------------------- ------------------------------------- --------- ---------- Merrill Lynch Capital Fund Mutual Fund $320,374 $337,858 Merrill Lynch Growth Fund Mutual Fund 1,015,198 1,195,396 Merrill Lynch Global Allocation Fund Mutual Fund 566,227 598,540 Merrill Lynch Retirement Preservation Trust Money Market Fund 166,070 166,070 * Gymboree Stock Fund Employer Securities 182,736 149,748 Merrill Lynch CMA Money Market Fund Money Market Fund 59,700 59,700 * Participant Loans (3.81% - 9.5%) 112,635 ---------- Total assets held for investment purposes $2,619,947 ========== * Parties-in-interest
16 17 THE GYMBOREE CORPORATION EMPLOYEE RETIREMENT SAVINGS PLAN E.I.N.: 94-2615258 Plan #: 001 ITEM 27d, PART V - SCHEDULE OF REPORTABLE TRANSACTIONS For the year ended December 31, 1996
(a) (b) (c) (d) (e) Description of asset (including interest rate and maturity in case Purchase Selling Lease Identity of party involved of a loan) price price rental - ------------------------------------ ------------------------ --------- --------- --------- Merrill Lynch Growth Fund Mutual Fund $57,955 $28,844 Merrill Lynch CMA Money Market Fund Money Market Fund 1,287,224 1,266,911
(a) (f) (g) (h) (i) Expense Current value incurred of asset on with Cost of transaction Net gain Identity of party involved transaction asset date or (loss) - ------------------------------------ ----------- --------- -------------- --------- Merrill Lynch Growth Fund $83,609 $86,799 $3,190 Merrill Lynch CMA Money Market Fund 2,554,135 2,554,135 --
17 18 EXHIBIT INDEX
Exhibit No. Description - -------- ----------- 23.1 Consent of Independent Accountants
18 EX-23.1 2 CONSENT OF INDEPENDENT ACCOUNTANTS 1 Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the Registration Statement (Form S-8) pertaining to The Gymboree Corporation Retirement Savings Plan of our report dated June 17, 1997, with respect to the financial statements and schedules of The Gymboree Corporation Retirement Savings Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1996. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 17, 1997 -----END PRIVACY-ENHANCED MESSAGE-----