-----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, OA2tJ7O/EtkwBRAlYpzFUr+YstNgouAwKsXGoiw2rptTmkQNrWuxvstNkwXP5MZT X+xAqZS+Cc7twKVyj8SCEA== 0000912057-02-025853.txt : 20020628 0000912057-02-025853.hdr.sgml : 20020628 20020628162825 ACCESSION NUMBER: 0000912057-02-025853 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20011231 FILED AS OF DATE: 20020628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AES CORPORATION CENTRAL INDEX KEY: 0000874761 STANDARD INDUSTRIAL CLASSIFICATION: COGENERATION SERVICES & SMALL POWER PRODUCERS [4991] IRS NUMBER: 541163725 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12291 FILM NUMBER: 02691764 BUSINESS ADDRESS: STREET 1: 1001 N 19TH ST STREET 2: STE 2000 CITY: ARLINGTON STATE: VA ZIP: 22209 BUSINESS PHONE: 7035221315 11-K 1 a2083395z11-k.txt 11-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 11-K ANNUAL REPORT Pursuant to Section 15(d) of the Securities Exchange Act of 1934 [Fee Waived] For the Fiscal Year Ended December 31, 2001 Commission File Number 0-1928 Full Title of the Plan: THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN Name of Issuer of the Securities Held Pursuant to the Plan and the Address of its Principal Executive Office: THE AES CORPORATION 1001 North 19th Street Arlington, VA 22209 Page 1 of [13] sequentially numbered pages. The Exhibit Index is on Page [12]. THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000, SUPPLEMENTAL SCHEDULE FOR THE YEAR ENDED DECEMBER 31, 2001, AND INDEPENDENT AUDITORS' REPORT THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN TABLE OF CONTENTS - --------------------------------------------------------------------------------
PAGE INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000: Statements of Net Assets Available for Participants' Benefits 2 Statements of Changes in Net Assets Available for Participants' Benefits 3 Notes to Financial Statements 4-9 SUPPLEMENTAL SCHEDULE FOR THE YEAR ENDED DECEMBER 31, 2001: Schedule of Assets Held for Investment Purposes 10
INDEPENDENT AUDITORS' REPORT The AES Corporation Profit Sharing and Stock Ownership Plan: We have audited the accompanying statements of net assets available for participants' benefits of The AES Corporation Profit Sharing and Stock Ownership Plan (the Plan) as of December 31, 2001 and 2000, and the related statements of changes in net assets available for participants' 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 audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the net assets available for participants' benefits of the Plan as of December 31, 2001 and 2000, and the changes in net assets available for participants' benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. As discussed in Note 10, on June 7, 2002, the net assets available for participants' benefits had decreased by approximately $100 million, compared to December 31, 2001, primarily as a result of a decline in the share price of The AES Corporation common stock. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule listed in the Table of Contents 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 schedule is the responsibility of the Plan's management. Such supplemental schedule has been subjected to the auditing procedures applied in our audit of the basic 2001 financial statements and, in our opinion, is fairly stated in all material respects when considered in relation to the basic 2001 financial statements taken as a whole. /s/ Deloitte & Touche LLP McLean, Virginia June 7, 2002 THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS DECEMBER 31, 2001 AND 2000 - --------------------------------------------------------------------------------
ASSETS 2001 2000 Cash $ 609,213 $ 5,530,158 ------------- ------------ Investments, at fair value (Notes 2 and 3): Common stock - The AES Corporation 132,378,872 416,334,066 Self-direct option - common stock 5,139,215 4,480,245 Money market funds 20,613,325 30,000,191 Mutual funds 24,233,513 27,376,843 ------------- ------------ Total investments, at fair value 182,364,925 478,191,345 ------------- ------------ Participant loans (Note 6) 4,254,658 4,225,453 ------------- ------------ Total cash and investments 187,228,796 487,946,956 ------------- ------------ RECEIVABLES: Employer contributions 2,188,832 4,307,782 Participant contributions 751,232 651,491 ------------- ------------ Total receivables 2,940,064 4,959,273 ------------- ------------ NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS $190,168,860 $492,906,229 ============= ============
See notes to financial statements. 2 THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS YEARS ENDED DECEMBER 31, 2001 AND 2000 - --------------------------------------------------------------------------------
2001 2000 ADDITIONS TO NET ASSETS: Investment income: Net (depreciation) appreciation in fair value of investments (Note 5) $ (306,210,493) $128,851,046 Interest and dividends 705,830 5,100,465 Contributions: Employer 7,824,549 8,080,784 Participant 11,839,634 10,312,435 ------------- ------------ Total additions (285,840,480) 152,344,730 DEDUCTIONS FROM NET ASSETS: Withdrawals and distributions (16,896,889) (27,247,165) ------------- ------------ NET (DECREASE) INCREASE (302,737,369) 125,097,565 NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS: Beginning of year 492,906,229 367,808,664 ------------- ------------ End of year $ 190,168,860 $492,906,229 ============= ============
See notes to financial statements. 3 THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 2001 AND 2000 - -------------------------------------------------------------------------------- 1. PLAN DESCRIPTION The AES Corporation Profit Sharing and Stock Ownership Plan (the Plan) was established on April 1, 1989, as the successor plan to the Applied Energy Services, Inc. Employee Profit Sharing Plan, the Applied Energy Services, Inc. Employee Stock Ownership Plan, the AES Deepwater Division Employee Profit Sharing Plan, the AES Beaver Valley Division Employee Profit Sharing Plan, and the BV Partners Employee Profit Sharing Plan. The following description of the Plan provides only general information. Participants should refer to the Summary Plan Description for a more complete description of the Plan's provisions. GENERAL - The Plan is a defined contribution plan that covers eligible regularly scheduled full-time and part-time employees of The AES Corporation (the Company) and its participating subsidiaries. Eligible employees may enroll in the Plan upon commencement of employment. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). As of December 31, 2001, the majority of the Plan's assets, approximately 70%, was common stock of The AES Corporation. CONTRIBUTIONS - Participants may make pre-tax contributions to the Plan up to an annual maximum determined by the Internal Revenue Service. Participants may also make after-tax contributions to the Plan. During 2001 and 2000, the Company matched participant pre-tax and after-tax contributions up to 5.0% of compensation, as defined by the Plan, on a dollar for dollar basis. Matching contributions made by the Company are paid in common stock of The AES Corporation. In addition, unless otherwise provided under the Plan, the Company may make profit sharing contributions to the Plan that are allocated to a participant's account on the basis of the participant's compensation, as defined by the Plan. Profit-sharing contributions are made in the Company's common stock. During 2001 and 2000, the Company contributed 1.5% and 5.5%, respectively, of compensation as profit sharing allocations. PARTICIPANT ACCOUNTS - Each participant's account is credited with the participant's and the employer's contributions and an allocation of the Plan's earnings or losses. Allocations are based on the balance of each investment type in the participant's account. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. Participants can choose to invest their contributions in common stock of The AES Corporation and various money market and mutual funds including Franklin Small-Mid Cap Growth Fund, Van Kampen Growth & Income Fund, Massachusetts Investment Growth Stock Fund, ING Pilgrim International Value, AIM Global Financial Services, PIMCO Innovation Fund, ING Pilgrim Small Cap Opportunities, Eaton Vance Worldwide Health Sciences, Mercury International Value Fund, PIMCO Total Return Fund, State Street Aurora Fund, Van Kampen Emerging Growth Fund, Alliance Quasar Fund, Calvert Income Fund, Eaton Vance Income Fund of Boston, Calvert Social Investment Fund Equity, PIMCO Renaissance Fund, MFS Utilities Fund and in the following Merrill Lynch funds: Equity Index Trust I, Retirement Preservation Trust, Balanced Capital Fund, Basic Value Fund, US 4 Government Mortgage Fund, Fundamental Growth Fund, Global Smallcap Fund, Global Allocation Fund, or in any combination thereof in increments of 10% at their discretion. Participants can allocate their investment among the common stock of The AES Corporation or any of the funds at their discretion. Such investment options are selected by the administrative committee of the Plan. Effective June 1, 2000, the Plan was amended to allow participants the opportunity to direct all or a portion of their account balance through a self-directed brokerage account which allows participants the option to purchase certain investments outside those selected by the administrative committee of the Plan. VESTING - Participants are immediately vested in their pre-tax, after-tax and matching contributions, including earnings thereon. Vesting in employer profit sharing contributions is based on years of continuous service. A participant vests 20% per year and is fully vested after five years of credited service. WITHDRAWALS AND DISTRIBUTIONS - The value of participants' contributions plus the value of all vested Company contributions are payable to participants upon retirement, death, or upon termination of employment with the Company. At each participant's election, the entire distribution may be made as a single lump sum payable in common stock of The AES Corporation, cash, or a combination of both. The participants also have the option of receiving the value of their Plan account in substantially equal cash installments over a twenty-year period. FORFEITURES - Participants who leave the Company who have not completed five years of credited service forfeit the value of the Company's profit sharing contributions in which they are not then vested. Forfeitures are applied to reduce the Company's contributions in subsequent years. ADMINISTRATION - The Plan is administered by an Administrative Committee appointed by the Board of Directors of the Company. Merrill Lynch Trust Company is the Plan Trustee. Administrative, legal, and all other expenses of the Plan are paid by the Company. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES GENERAL - The Plan's financial statements are prepared on the accrual basis of accounting. Participant benefits are recorded when paid. VALUATION OF INVESTMENTS - All money market and other mutual funds are stated at their quoted market prices at December 31, 2001 and 2000. All participant loans are valued at cost, which approximates fair value. The Company's stock is traded on the New York Stock Exchange (NYSE). The Plan's investment in the Company's stock is stated at quoted market value. On April 17, 2000, the Board of Directors authorized a two-for-one stock split, effected in the form of a stock dividend, payable to stockholders of record on May 1, 2000. At December 31, 2001 and 2000, the quoted market value of the Company's common stock was $16.35 and $55.38 per share, respectively. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Investment securities, in general, are exposed to various risks, such as interest rate, credit, and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for plan benefits. 5 USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan 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 additions and deductions during the reporting period. Actual results could differ from those estimates. 3. INVESTMENTS The participants' and the Company's contributions to the Plan and Plan earnings are invested in various money market, mutual funds or Company stock at the direction of the participants. The following tables present the fair values of investments as of December 31, 2001 and 2000.
DECEMBER 31, DECEMBER 31, 2001 2000 -------------------- -------------------- Cash $ 609,213 $ 5,530,158 Investments at quoted market value: The AES Corporation common stock 132,378,872* 416,334,066* Self Direct Option common stock 5,139,215 4,480,245 Money market funds: Merrill Lynch Retirement Preservation Fund 15,631,216* 24,367,278 Merrill Lynch Equity Index Trust I Fund 4,982,109 5,632,913 Mutual funds: Merrill Lynch Fundamental Growth Fund 5,587,641 8,319,863 Merrill Lynch Basic Value Fund 5,620,431 6,719,297 Merrill Lynch Global Allocation Fund 3,079,444 3,299,953 Merrill Lynch US Government Mortgage Fund 2,296,785 2,480,554 Other 7,649,212 6,557,176 Participant loans 4,254,658 4,225,453 -------------- ------------ Total cash and investments $187,228,796 $487,946,956 ============== ============
The above investments indicated with an "*" represent 5% or more of the Plan's net assets as of December 31, 2001 and 2000, respectively. 4. THE AES CORPORATION COMMON STOCK Contributions made by the Company are paid in common stock of The AES Corporation and are therefore considered nonparticipant-directed investments in accordance with Statement of Position 99-3 "Accounting for and Reporting of Certain Defined Contribution Plan Investments and Other Disclosure Matters." After a participant's account is credited with the Company's contribution, each participant can choose to direct his or her allocation in any investment option offered under the Plan. Information about the net assets and the significant components of the changes in net assets relating to The AES 6 Corporation common stock is as follows as of December 31, 2001 and 2000, and for the years then ended:
2001 2000 Net assets: Common Stock - The AES Corporation, 8,096,569 and 7,518,448 shares in 2001 and 2000, respectively $ 132,378,872 $ 416,334,066 Employer Contribution Receivable 2,188,832 4,307,782 --------------- --------------- Net assets available for participants' benefits $ 134,567,704 $ 420,641,848 =============== =============== Changes in net assets: Net (depreciation) appreciation $ (301,662,422) $ 133,756,927 Interest 147,245 107,556 Employer contributions 7,824,549 8,080,423 Participant contributions 5,051,518 4,922,966 Benefits paid to participants (4,557,382) (4,645,026) Transfers from (to) participant-directed investments 7,122,348 (20,441,301) --------------- --------------- Net change (286,074,144) 121,781,545 Common Stock - The AES Corporation, beginning of year(1) 420,641,848 298,860,303 --------------- --------------- Common Stock - The AES Corporation, end of year(1) $ 134,567,704 $ 420,641,848 =============== ===============
(1) Includes the value of the AES Common Stock distributed to the Plan subsequent to year- end to satisfy the employer contribution. 5. NET (DEPRECIATION) APPRECIATION IN FAIR VALUE OF INVESTMENTS During the years ended December 31, 2001 and 2000, the Plan's investments (including investments bought, sold, as well as held during the period) (depreciated) appreciated in value by $(306,210,493) and $128,851,046, respectively, as follows:
YEAR ENDED YEAR ENDED DECEMBER 31, 2001 DECEMBER 31, 2000 ----------------- ----------------- The AES Corporation common stock $(301,662,422) $133,756,927 Self Direct Option common stock (9,306) (293,764) Money market funds (707,038) (564,385) Mutual funds (3,831,727) (4,047,732) --------------- ------------ Net (depreciation) appreciation in fair value $(306,210,493) $128,851,046 =============== ============
7 6. PARTICIPANT LOANS Participants may obtain up to three loans from the Plan in aggregate amounts up to the lesser of (a) $50,000 or (b) 50% of the participant's vested account balance. Loans are repayable over periods up to five years (ten years for loans to purchase a principal residence). The loans are collateralized by the balance in the participant's account and bear a fixed interest rate, based on the federal prime lending rate plus 1/2%, determined at the commencement of the loan. Interest on all loans is allocated to the participant's account from which the loan was funded. Principal and interest are paid ratably through monthly payroll deductions. Interest rates on outstanding loans as of December 31, 2001 ranged from 6.5% to 12% with maturities from 2002 to 2012. Former employees are prohibited from obtaining loans except to the extent required by law. 7. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right to terminate the Plan subject to the provisions of ERISA. In the event of a termination, the assets of the Plan will first be used to pay the liabilities (if any) of the Plan. The remaining assets will then be distributed to the participants in proportion to their respective interest in the Funds. 8. INCOME TAXES The Plan obtained its most recent determination letter on January 31, 1996, pursuant to which the Internal Revenue Service (the IRS) determined that the terms of the Plan, as submitted, were in compliance with the applicable requirements of the Internal Revenue Code of 1986, as amended (the Code). The Plan has subsequently been amended since receiving this determination letter. In connection with these amendments, the Plan filed a request for determination letter from the IRS on February 27, 2002, to ensure that the Plan, as amended, continues to comply with all the applicable requirements of the Code. The Company also believes that the Plan is being operated in compliance with all applicable requirements of the Code. Therefore, no provision for income taxes has been included in the Plan's financial statements. 9. PLAN AMENDMENTS In accordance with the terms of the Plan, the Company is authorized to amend the Plan. Since the adoption of the Plan, the Company has periodically amended the Plan to comply with the requirements of the Internal Revenue Code of 1986, as amended, as well as to implement design changes. No significant amendments were made during the year ended December 31, 2000. In the current year AES, in order to more efficiently provide retirement benefits to AES employees, elected to merge The AES Corporation Employee Stock Ownership Plan (ESOP) into the Plan. The ESOP had originally been implemented to overcome tax deduction limitations that threatened to reduce the level of retirement benefits. The Economic Growth and Tax Relief Reconciliation Act of 2001 significantly expanded the amount of tax-deductible contributions that the Corporation can contribute to its retirement plans, thereby eliminating the primary reason for maintaining the ESOP. As a result, the assets of the ESOP (approximately $10,347,169) as of December 31, 2001, are expected to be transferred into the Plan during the year ending December 31, 2002. In December 2001, a freeze was placed on the ESOP to facilitate the merger of the plans. 8 10. SUBSEQUENT EVENTS On June 7, 2002, the net assets available for participants' benefits had decreased by approximately $100 million compared to December 31, 2001, primarily as a result of a decline in the price of The AES Corporation common stock from $16.35 per share as of December 31, 2001 to $3.90 per share as of June 7, 2002. * * * * * * 9 THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 2001 - --------------------------------------------------------------------------------
(a) (b) (c) (d) (e) DESCRIPTION OF INVESTMENT IDENTITY OF ISSUER, INCLUDING MATURITY DATE, RATE BORROWER, LESSOR, OR OF INTEREST, COLLATERAL, PAR, CURRENT SIMILAR PARTY OR MATURITY VALUE COST VALUE Cash $ 609,213 $ 609,213 * THE AES CORPORATION Common stock per share, 8,096,567 shares 84,093,851 132,378,872 * MERRILL LYNCH Retirement Preservation Trust Fund, 15,631,216 shares 15,131,245 15,631,216 * MERRILL LYNCH Fundamental Growth Fund per share, 308,539 shares 8,089,896 5,587,641 * MERRILL LYNCH Global Allocation Fund per share, 239,645 shares 3,295,218 3,079,444 * MERRILL LYNCH US Govt Mortgage Fund per share, 231,530 shares 2,241,556 2,296,785 * MERRILL LYNCH Balanced Capital Fund per share, 80,443 shares 2,544,117 2,150,248 * MERRILL LYNCH Basic Value Fund per share, 191,955 shares 6,376,980 5,620,431 * MERRILL LYNCH Equity Index Trust Fund per share, 61,813 shares 5,499,903 4,982,109 * MERRILL LYNCH Global Small Cap Fund Class A, per share, 2,772 shares 45,371 47,299 Franklin Small Mid Cap Growth Fund, 2,083 shares 60,738 64,935 Van Kampen Growth and Income Fund, 13,072 shares 220,783 222,349 Massachusetts Investment Growth stock Fund, 5,180 shares 67,472 66,764 ING Pilgrim International Value Fund, 2,898 shares 40,091 37,268 AIM Global Financial Services Fund, 3,282 shares 74,121 74,737 Pimco Innovation Fund, 5,211 shares 126,905 117,830 ING Pilgrim Small Cap Opportunity Fund, 132 shares 4,053 4,017 Evergreen Worldwide Health Sciences, 28,575 shares 285,214 295,179 Mercury HW International Value Fund, 31,337 shares 755,492 610,128 Pimco Total Return Fund, 148,729 shares 1,534,960 1,555,705 State Street Aurora Fund, 16,305 shares 490,740 527,479 Van Kampen Emerging Growth Fund, 3,397 shares 154,123 143,758 Alliance Quasar Fund, 45,639 shares 1,185,886 947,700 Calvert Income Fund, 17,957 311,782 299,701 Eaton Vance Income of Boston Fund, 3,611 shares 21,976 21,957 Calvert Social Investment Equity Fund, 624 shares 19,240 19,367 Pimco Renaissance, 19,090 shares 371,699 392,866 MFS Utilities Fund, 5,725 shares 54,768 49,925 Self Direct Options 5,139,215 * Participant loans (Interest 6.5 % - 12%, maturing from 2002 to 2012) 4,254,658 4,254,658 ------------ ------------- TOTAL $137,962,051 $ 187,228,796 ============ =============
(*) Transactions in these investments are considered to be party-in-interest transactions under Department of Labor regulations. 10 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized. THE AES CORPORATION BY: /s/ -------------------- Barry J. Sharp Executive Vice President, Chief Operating Officer, and Chief Financial Officer Date: June 28, 2002 11 EXHIBIT INDEX
EXHIBIT 23.1 PAGE Independent Auditors' Consent 13
12 EX-23.1 3 a2083395zex-23_1.txt EXHIBIT 23.1 INDEPENDENT AUDITORS' CONSENT EXHIBIT 23.1 We consent to the incorporation by reference in Registration Statement No. 33-49262 of The AES Corporation on Form S-8 of our report dated June 7, 2002, appearing in this Annual Report on Form 11-K of The AES Corporation Profit Sharing and Stock Ownership Plan for the year ended December 31, 2001. McLean, Virginia June 28, 2002 13 -----END PRIVACY-ENHANCED MESSAGE-----