-----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, BjM32GKS+VeyO7MTe8zk+9xje9JalHGWolipGX33hZ9rsGziyrwqZgpEegou7UfF HExCUhHY2PuHRr2fjx91SA== 0000794367-01-500014.txt : 20010629 0000794367-01-500014.hdr.sgml : 20010629 ACCESSION NUMBER: 0000794367-01-500014 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FEDERATED DEPARTMENT STORES INC /DE/ CENTRAL INDEX KEY: 0000794367 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-DEPARTMENT STORES [5311] IRS NUMBER: 133324058 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-13536 FILM NUMBER: 1669762 BUSINESS ADDRESS: STREET 1: 151 WEST 34TH STREET CITY: NEW YORK STATE: NY ZIP: 10001 BUSINESS PHONE: 2124941602 MAIL ADDRESS: STREET 1: 7 W SEVENTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 FORMER COMPANY: FORMER CONFORMED NAME: R H MACY & CO INC DATE OF NAME CHANGE: 19950307 11-K 1 fds401k-11k.txt 11-K FOR 401(K) SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 11-K [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For fiscal year ended December 31, 2000 [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from___ to ___ Commission file number: 1-13536 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Federated Department Stores, Inc. Profit Sharing 401 (k) Investment Plan. B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Federated Department Stores, Inc. 7 West Seventh Street Cincinnati, Ohio 45202 and 151 West 34th Street New York, New York 10001 FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Financial Statements December 31, 2000 and 1999 With Independent Auditors' Report Thereon Independent Auditors' Report Pension and Profit Sharing Committee Federated Department Stores, Inc. Profit Sharing 401(k) Investment Plan: We have audited the accompanying statements of net assets available for benefits of the Federated Department Stores, Inc. Profit Sharing 401(k) Investment Plan (the "Plan") as of December 31, 2000 and 1999, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the 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 management, as well as evaluating the overall report 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 benefits of the Plan as of December 31, 2000 and 1999, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. KPMG LLP Cincinnati, Ohio June 15, 2001 FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Index Independent Auditors' Report Statements of Net Assets Available for Benefits - December 31, 2000 and 1999 Statements of Changes in Net Assets Available for Benefits - Years Ended December 31, 2000 and 1999 Notes to Financial Statements FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Statements of Net Assets Available for Benefits December 31, 2000 and 1999 (in thousands) Assets: 2000 1999 Master Trust investments, at fair value (Note 3) $1,282,129 $1,326,258 Receivables: Employer contributions 28,328 28,432 Participant contributions 1,332 - Interest 248 106 Total receivables 29,908 28,538 Total assets 1,312,037 1,354,796 Liabilities: Trustee and management fees payable 846 803 Total liabilities 846 803 Net assets available for benefits $1,311,191 $1,353,993 The accompanying notes are an integral part of these financial statements. FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Statements of Changes in Net Assets Available for Benefits Years Ended December 31, 2000 and December 31, 1999 (in thousands) 2000 1999 Additions: Net investment income (loss): Net appreciation (depreciation) in the fair value of Master Trust investments (Note 3) $ (82,078) $ 110,188 Interest and dividends 49,082 43,603 Total investment income (loss) (32,996) 153,791 Less administrative expenses (5,420) (5,375) Net investment income (loss) (38,416) 148,416 Contributions: Employer 28,376 28,456 Participant 100,729 93,456 Other (Note 1) 28,263 - Total contributions 157,368 121,912 Total additions 118,952 270,328 Deductions: Distributions 161,754 155,663 Net increase (decrease) (42,802) 114,665 Net assets available for benefits: Beginning of year 1,353,993 1,239,328 End of year. $1,311,191 $1,353,993 The accompanying notes are an integral part of these financial statements. FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements December 31, 2000 and 1999 1.Description of the Plan The following brief description of the Federated Department Stores, Inc. Profit Sharing 401 (k) Investment Plan (the "Plan") is provided for general information purposes only. Participants should refer to the Plan document for more complete information. General The Plan is sponsored by Federated Department Stores, Inc. (the "Company"). The Plan is a defined contribution plan and is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") and U.S. tax law. Eligibility Employees are generally eligible for participation in the Plan after one year of service of at least 1,000 hours and after reaching a minimum age of 21. Contributions Participants may elect to contribute an amount equal to 1% to 15% (subject to certain limitations) of the participant's eligible compensation. A participant may elect to make these contributions (subject to certain limitations) on a pre-tax basis pursuant to Section 401(k) of the Internal Revenue Code or on an after-tax basis. Pre-tax contributions up to 5% of eligible compensation are considered basic savings which are eligible for matching Company contributions. Company contributions are made as soon as administratively feasible after year end only to persons who are active participants on the last day of the year and who did not make a withdrawal of basic savings during the year. The Company's contribution formula is based on the Company's annual earnings and the minimum Company contribution is the amount necessary to produce a company match of 33 1/3% of an employee's basic savings. The Plan also provides that the matching percentage for eligible participants with 15 or more years of vesting service at the start of the applicable Plan year is up to 1 1/2 times the matching percentage of eligible participants with less than 15 years of service at the start of the applicable Plan year. In addition to the $18,900,000 contribution based on the Company's annual earnings, the Company also made a $9,500,000 discretionary contribution for the Plan year ended December 31, 2000. For the Plan year ended December 31, 2000, the Company's matching percentage, including the allocation of all forfeited nonvested amounts, was 43.6% of the participants' basic savings for participants with less than 15 years of vesting service at January 1, 2000 and 65.4% of the participants' basic savings for participants with 15 or more years of vesting service at January 1, 2000. For the Plan year ended December 31, 1999, the Company's contribution based on the Company's annual earnings was $28,500,000. For the Plan year ended December 31, 1999, the Company's matching percentage was 49.3% of the participants' basic savings for participants with less than 15 years of vesting service at January 1, 1999 and 74.0% of the participants' basic savings for participants with 15 or more years of vesting service at January 1, 1999. Company contributions are invested directly in Federated Department Stores, Inc. common stock (the Federated Stock Fund). Participants may elect to redirect the value of Company contributions to other investment options permitted pursuant to Plan provisions. (Continued) FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements - Continued December 31, 2000 and 1999 Forfeited nonvested accounts of participants who terminate employment are applied to participants' accounts in accordance with Plan provisions. During the 2000 Plan year, forfeited nonvested accounts totaled $381,000. During the 1999 Plan year, forfeited nonvested accounts totaled $473,000. Net settlement proceeds of $28,263,000 were transferred into the Plan during the 2000 Plan year. The settlement increases benefits for certain employees of Broadway Stores, Inc. ("Broadway") relating to allegations that the Broadway Stores, Inc. 401(k) Savings and Incentive Plan ("Broadway Plan") violated ERISA fiduciary duty requirements. The Company bought Broadway in 1995 and the Broadway Plan was merged into the Plan on April 1, 1997. Participant Accounts Each participant's account is credited with the participant's contributions and an allocation of each fund's earnings or losses. Allocations are based on participant account balances. As soon as administratively feasible after the end of each year, the Company's applicable matching contributions are credited to the eligible individual accounts. Vesting Participants are immediately 100% vested in their own contributions and become 20% vested in the Company's contributions after 3 years of service, with additional vesting of 20% each year thereafter until fully vested. 100% vesting is also achieved through normal retirement, death or disability. Participant Withdrawals Participants may borrow from their accounts up to a maximum amount equal to the lesser of $50,000 or 50% of their 401(k) vested account balance. All loans must be repaid within five years and are also subject to certain other conditions as to security, a reasonable rate of interest and repayment schedules. Participants are permitted to make withdrawals of their after- tax contributions and earnings thereon at any time. Withdrawals of pre-tax contributions are subject to the hardship rules of Section 401 of the Internal Revenue Code. At termination, participants may elect to receive the balance of their vested account either in the form of a lump sum payment or in a variety of annuity forms. 2. Summary of Significant Accounting Policies a) Master Trust The Plan entered into the Federated Department Stores, Inc. Defined Contribution Plan Master Trust (the "Master Trust") Agreement with Chase Manhattan Bank (the "Trustee"). As of December 31, 2000 and 1999, the Master Trust holds the assets of the Plan exclusively. Under the terms of the Master Trust, the Trustee serves as Trustee custodian for the Master Trust. (Continued) FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements - Continued December 31, 2000 and 1999 The Federated Department Stores, Inc. Pension and Profit Sharing Committee selects a diversified group of investment managers who determine purchases and sales of investments for the respective portions of the assets in the Master Trust managed by them. b) Basis of Presentation The accompanying financial statements of the Plan have been prepared on the accrual basis of accounting. c) Investments Investments are reported at fair value as determined by quoted market prices on an active market. Corporate bonds are valued based on yields currently available on comparable securities of issuers with similar credit ratings. Purchases and sales of securities are recorded on a trade- date basis. Realized gains and losses on the sale of securities are reported on the average cost method. Participant loans are valued at cost which approximates fair value. Cash equivalents include highly liquid fixed-income securities with a maturity of one year or less. Dividend income is recorded on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. d) Insurance Contracts Insurance contracts are valued at contract value, which represents contributions made under the contract, plus interest earned, less benefits paid and expenses charged. e) Use of Estimates The Plan administrator has made a number of estimates and assumptions relating to the preparation of these financial statements. Actual results could differ from these estimates and assumptions. f) New Pronouncements In September 1999, the American Institute of Certified Public Accountants issued Statement of Position 99-3, "Accounting for and Reporting of Certain Defined Contribution Plan Investments and Other Disclosure Matters" ("SOP 99-3"). SOP 99-3 simplifies the disclosure for certain investments and is effective for plan years ending after December 15, 1999. The Plan adopted SOP 99-3 for the Plan year ending December 31, 2000. Effective January 1, 2001, the Plan adopted Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended, which establishes the accounting and financial reporting requirements for derivative instruments. The impact upon adoption of this standard did not have a material impact on the Plan's net assets available for benefits. (Continued) FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements - Continued December 31, 2000 and 1999 3. Investments All of the Plan's investments are included in the Master Trust and are held by the trustee. The Trustee under the Master Trust, in accordance with the trust agreement, invests all contributions to the Plan among several investment funds. The funds are: Fixed Income Fund - consisting primarily of high quality fixed-income and stable value products. Balanced Fund - consisting of common/collective trusts which invest in a varying mixture of equity securities and fixed income instruments. S&P 500 Stock Index Fund - consisting principally of shares of companies included in the S&P 500 Composite Stock Price Index. Small Cap Stock Fund - consisting principally of small capitalization domestic equity securities. International Stock Fund - consisting of stocks of companies not based in the United States. Federated Stock Fund - consisting principally of the Company's registered common stock. The following table presents the fair values or contract values of investments for the Master Trust at December 31, 2000 and 1999: 2000 1999 (in thousands) Investments at fair value: Cash and cash equivalents $ 8,729 $ 19,267 U. S. government securities 3,571 - Federated Department Stores, Inc. common stock* 82,501 82,961 Common/collective trusts 750,401 782,770 Registered investment companies 27,922 26,008 Total investments at fair value 873,124 911,006 Non interest bearing cash - 88 Participant loans 21,522 19,061 Insurance contracts at contract value 387,483 396,103 Total investments $1,282,129 $1,326,258 (Continued) FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements - Continued December 31, 2000 and 1999 Net appreciation (depreciation) in the fair value of investments in the Master Trust for the years ended December 31, 2000 and 1999 is as follows: 2000 1999 (in thousands) Net appreciation (depreciation) in the fair value of investments: U.S. government securities $ 212 $ (448) Federated Department Stores, Inc. common stock* (29,419) 15,437 Common/collective trusts (44,867) 90,359 Registered investment companies (8,004) 4,840 Net appreciation (depreciation) in the fair value ofinvestments $ (82,078) $ 110,188 *nonparticipant-directed 4. Nonparticipant - Directed Investments (Federated Stock Fund) Information about the significant components of the changes in net assets relating to the nonparticipant-directed investments for the years ended December 31, 2000 and 1999 is as follows: 2000 1999 (in thousands) Changes in Net Assets: Contributions $ 32,631 $ 32,807 Net appreciation (depreciation) in the fair value of investments (29,419) 15,437 Benefits paid to participants (6,119) (6,857) Transfers from (to) participant- directed investments 1,926 (7,163) $ (981) $ 34,224 5. Plan Termination Although the Company has not expressed any intent to terminate the Plan, it may do so at any time. In the event the Plan is terminated, the Company would have no further obligation to make contributions, and all sums credited to individual accounts (after expenses) would be distributed to participants. (Continued) FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (k) INVESTMENT PLAN Notes to Financial Statements - Continued December 31, 2000 and 1999 6. Federal Income Taxes The Plan obtained its latest determination letter on June 13, 1996, in which the Internal Revenue Service stated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. While the Plan has been amended since receiving such determination letter, the Plan administrator and the Plan's tax counsel believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code. Therefore, no provision for income taxes has been included in the Plan's financial statements. The Plan's testings, subject to the provisions of the Internal Revenue Code, have not been completed for the current year. However, the Plan's sponsor believes that the Plan is currently in compliance. 7. Administrative Expenses The Plan pays reasonable and necessary expenses incurred for the ongoing administration of the Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the members of the Pension and Profit Sharing Committee (which is the administrative committee for the Federated Department Stores, Inc. Profit Sharing 401 (k) Investment Plan have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. FEDERATED DEPARTMENT STORES, INC. PROFIT SHARING 401 (K) INVESTMENT PLAN Dated: June 28, 2001 By: \s\ Karen M. Hoguet Karen M. Hoguet Chairman of the Pension and Profit Sharing Committee EX-23 2 auditorsrept-ex23.txt AUDITOR'S CONSENT Independent Auditors' Consent Pension and Profit Sharing Committee Federated Department Stores, Inc. Profit Sharing 401(k) Investment Plan: We consent to incorporation by reference in the Registration Statement (No.33-51907) on Form S-8 of Federated Department Stores, Inc. of our report dated June 15, 2001, related to the statements of net assets available for benefits of the Federated Department Stores, Inc. Profit Sharing 401(k) Investment Plan as of December 31, 2000 and 1999, and the related statements of changes in net assets available for benefits for the years then ended, which report appears in the December 31, 2000 annual report on Form 11-K of the Federated Department Stores, Inc. Profit Sharing 401(k) Investment Plan. KPMG LLP Cincinnati, Ohio June 15, 2001 -----END PRIVACY-ENHANCED MESSAGE-----