SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
x | | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Fiscal Year ended December 31, 2007
OR
o | | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number 001-04129
A. Full title of the plan and the address of the plan, if different from that of issuer named below:
ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive offices:
Zale Corporation
901 W. Walnut Hill Lane
Irving, Texas 75038-1003
ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
Financial Statements and Supplemental Schedules
December 31, 2007 and December 31, 2006
(With Reports of Independent Registered Public Accounting Firms Thereon)
ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
Table of Contents
* All other schedules required by 29 CFR Section 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosures under the Employee Retirement Income Security Act of 1974, as amended, have been omitted because they are not applicable.
Report of Independent Registered Public Accounting Firm
Zale Corporation Savings and Investment Administrative Committee
Zale Corporation Savings and Investment Plan:
We have audited the accompanying statement of net assets available for plan benefits of the Zale Corporation Savings and Investment Plan (the Plan) as of December 31, 2007, and the related statement of changes in net assets available for plan benefits for the year 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 audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides 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 at December 31, 2007, and the changes in its net assets available for plan benefits for year then ended, in conformity with U.S. generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules of assets (held at end of year) as of December 31, 2007, and delinquent participant contributions for the year ended December 31, 2007, are presented for purposes of additional analysis and are not a required part of the 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. These supplemental schedules are the responsibility of the Plan’s management. The supplemental schedules have been subjected to the auditing procedures applied in our audit of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/Ernst & Young LLP
June 26, 2008
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Report of Independent Registered Public Accounting Firm
The Plan Committee
Zale Corporation Savings and Investment Plan:
We have audited the accompanying statement of net assets available for plan benefits of the Zale Corporation Savings and Investment Plan (the Plan) as of December 31, 2006, and the related statement of changes in net assets available for plan benefits for the transition period from August 1, 2006 to December 31, 2006. 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides 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 Zale Corporation Savings and Investment Plan as of December 31, 2006, and the changes in net assets available for plan benefits for the transition period from August 1, 2006 to December 31, 2006 in conformity with U.S. generally accepted accounting principles.
/s/KPMG LLP
Dallas, Texas
June 26, 2007
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ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2007 and 2006
| | 2007 | | 2006 | |
Assets: | | | | | |
Investments, at fair value: | | | | | |
Mutual funds | | $ | 104,192,816 | | $ | 100,689,302 | |
Zale Corporation common stock | | 7,402,377 | | 14,810,990 | |
Common/collective trust | | 2,614,769 | | 1,825,823 | |
Participants’ loans | | 4,153,837 | | 4,339,253 | |
Total investments | | 118,363,799 | | 121,665,368 | |
| | | | | |
Receivables: | | | | | |
Employer’s contributions | | 2,087,579 | | 889,041 | |
Employees’ contributions | | 382,660 | | 503,214 | |
Total receivables | | 2,470,239 | | 1,392,255 | |
Total assets | | 120,834,038 | | 123,057,623 | |
| | | | | |
Liabilities: | | | | | |
Excess contributions payable | | 160,787 | | 130,929 | |
Net assets available for plan benefits at fair value | | 120,673,251 | | 122,926,694 | |
| | | | | |
Adjustment from fair value to contract value for fully | | | | | |
benefit-responsive investment contracts held in a | | | | | |
collective trust | | 28,416 | | 18,352 | |
Net assets available for plan benefits | | $ | 120,701,667 | | $ | 122,945,046 | |
See accompanying notes to financial statements.
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ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
Statements of Changes in Net Assets Available for Plan Benefits
Year Ended December 31, 2007 and Transition Period from August 1, 2006 to December 31, 2006
| | 2007 | | 2006 | |
Increases in net assets: | | | | | |
Investment income: | | | | | |
Net appreciation mutual funds | | $ | 2,227,390 | | $ | 4,962,821 | |
Net (depreciation) appreciation in Zale Corporation common stock | | (5,860,620 | ) | 1,403,974 | |
Total net (depreciation) appreciation | | (3,633,230 | ) | 6,366,795 | |
| | | | | |
Interest and dividends | | 7,002,710 | | 4,005,079 | |
Total investment income | | 3,369,480 | | 10,371,874 | |
| | | | | |
Contributions: | | | | | |
Employer | | 2,087,579 | | 953,179 | |
Participants | | 8,966,268 | | 3,626,761 | |
Rollovers | | 343,204 | | 129,870 | |
Total contributions | | 11,397,051 | | 4,709,810 | |
| | | | | |
Total increase in net assets | | 14,766,531 | | 15,081,684 | |
| | | | | |
Decreases in net assets: | | | | | |
Payments to participants and beneficiaries | | 16,849,123 | | 5,305,252 | |
Refund of excess contributions | | 160,787 | | 130,929 | |
Total decrease in net assets | | 17,009,910 | | 5,436,181 | |
| | | | | |
Net (decrease) increase in net assets available for plan benefits | | (2,243,379 | ) | 9,645,503 | |
| | | | | |
Net assets available for plan benefits, beginning of period | | 122,945,046 | | 113,299,543 | |
Net assets available for plan benefits, end of period | | $ | 120,701,667 | | $ | 122,945,046 | |
See accompanying notes to financial statements.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(1) Change in Plan Year
Effective August 1, 2006, Zale Corporation changed the Zale Corporation Savings and Investment Plan (the Plan) year end from July 31 to December 31. Accordingly, the accompanying financial statements consist of the statements of net assets available for plan benefits as of December 31, 2007 and 2006 and the related statements of changes in net assets available for plan benefits for the year ended December 31, 2007 and the transition period from August 1, 2006 to December 31, 2006.
(2) Description of Plan
The Plan is a defined contribution retirement plan. The following description of the Plan provides only general information. Participants should refer to the Plan document for a more complete description of the Plan’s provisions.
(a) General
Employees are eligible to participate in the Plan on the first day of the month that coincides with or next follows the date on which the employee has both (i) completed one year of service and (ii) attained age 21. One year of service is defined by the Plan as a 12-month period commencing on the date of employment or any subsequent Plan year during which the employee has completed 1,000 or more hours of service with Zale Corporation or any of its related affiliates (the Company or Employer). Employees covered under a collective bargaining agreement, which does not provide for participation in the Plan, and certain nonresident aliens are excluded from participation. Effective December 31, 2007, eligible employees will not include any employee on the Company’s payroll in Puerto Rico. Effective January 1, 2008, these employees will be eligible for the Zale Corporation Puerto Rico Employee Savings and Investment Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA).
(b) Employee Contributions
Participants are permitted to make pre-tax contributions, from 1% to 60%, (or 30% if the participant is a highly-compensated employee as defined by the Internal Revenue Code (Code)), of their annual compensation to their respective Employee 401(k) Contribution Account. The Plan has implemented an automatic enrollment feature under which employees newly eligible are automatically enrolled in the Plan at a pre-tax contribution level of 2% of the employee’s compensation unless the employee elects otherwise. All participants are subject to Internal Revenue Service (IRS) limitations on these contributions. The maximum amount a participant could contribute under this limitation is $15,500 for the year ended December 31, 2007. Employees who are or will be at least 50 years of age by the end of a calendar year are eligible to make additional pre-tax contributions called catch-up contributions to the Plan at any time during such calendar year. The maximum amount of catch-up contributions a participant can contribute is $5,000 for the year ended December 31, 2007. Catch-up contributions are credited to the Catch-Up Contribution Account. In addition, participants may also elect to make rollover contributions to the Plan which are credited to the Rollover Account.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(c) Employer Contributions
The Plan provides that the Company will make matching contributions (Employer 401(k) Matching Contributions) to each eligible participant who makes pre-tax contributions to the Plan. No Employer 401(k) Matching Contributions are made with respect to catch-up contributions.
To be eligible for an Employer 401(k) Matching Contribution, the Plan requires each participant who makes pre-tax contributions to the Plan during the Plan year to be employed on the last day of the Plan year in order to receive an allocation of matching contributions, unless the participant has died, retired on or after the normal retirement date (i.e., the later of age 65 or the 5th anniversary of the date the participant commenced participation in the Plan), or become disabled (as defined in the Plan) during the Plan year. Further, the amount of Employer 401(k) Matching Contribution made with respect to each such participant is 50% of the first 4% of annual compensation contributed to the Plan by the participant as a pre-tax contribution. The Plan authorizes the Company to make Employer 401(k) Matching Contributions in cash or in shares of Zale Corporation Common Stock, par value $0.01 per share (Company Common Stock). For the year ended December 31, 2007 and for the transition period ended December 31, 2006, Employer 401(k) Matching Contributions were made in cash. Employer 401(k) Matching Contributions are allocated after the end of the Plan year.
(d) Investment Options
Upon enrollment in the Plan, participants may direct contributions in whole percentage increments to any one or more of 23 mutual funds, a collective trust, and Company Common Stock, however, no more than 25% of the participant’s contributions and investment elections may be directed to Company Common Stock.
In general, participants may change their contribution investment directions daily, except for when the Company has closed the trading window for Company Common Stock, participants who are subject to section 16b of the Securities Exchange Act of 1934 may not direct contributions into or out of Company Common Stock. Once the trading window has been opened, such participants are free to make such directions. Likewise, participants may reallocate the investment of their Plan accounts on a daily basis among any of the Plan investment options, subject to the foregoing preclusion during trading window closures and the 25% limit on investment elections in Company Common Stock. Earnings or losses of the Plan are allocated to the participants based on their relative account balances in the respective Plan investment options.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(e) Loan Provisions
The Plan allows eligible participants to borrow from their accounts (but not any of their account balances invested in Company Common Stock) a minimum of $1,000 and a maximum equal to the lesser of $50,000 or 50% of their account balance. The $50,000 limit is reduced by the participant’s highest loan balance in the last 12 months. Loan terms range from one to five years or up to 20 years for the purchase of a primary residence. The loans are secured by up to 50% of the participant’s vested accounts and bear interest at the prime lending rate as published by the Wall Street Journal at the time of the loan, plus 1%, unless the rate is deemed not to be “reasonable” within the meaning of Section 408 of ERISA, in which case a reasonable rate of interest will apply. The interest rate will be fixed for the term of the loan. Principal and interest are paid ratably through biweekly payroll deductions or through electronic funds transfer. In addition, participants may continue to remit loan payments manually following their termination of employment.
(f) Vesting
Participants are automatically fully vested in their pre-tax contributions, catch-up contributions, rollover contributions, and Employer 401(k) Matching Contributions plus actual earnings thereon.
(g) Distributions and Withdrawals
A participant will be entitled to a complete distribution of his Plan accounts upon the participant’s retirement, disability (as defined in the Plan) or termination of employment for any reason in the form of a single, lump-sum distribution or a direct rollover to an Individual Retirement Account (IRA) or another employer’s qualified retirement plan (collectively an Eligible Retirement Plan). Amounts invested in Company Common Stock, may, at the election of the participant, be distributed in whole shares of Company Common Stock, with fractional shares in cash. In the event of the participant’s death, the participant’s accounts will be distributed to the participant’s beneficiary. In any case, if the participant’s vested account balance is less than $1,000, it will be automatically distributed in the form of a single lump sum payment as soon as practicable following the distribution event, unless the participant elects to roll it over to an Eligible Retirement Plan. If the participant’s vested account is at least $1,000, the participant may leave the balance in the Plan until the participant’s normal retirement date. Participants may also make withdrawals during employment upon the attainment of age 59 1/2 or the occurrence of a hardship, subject to terms of the Plan. In-service withdrawals may also be made from the participant’s Rollover Account or prior After-Tax Contribution Account at any time.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(h) Tax Status
The Plan has received a determination letter from the IRS dated August 4, 2003, stating that the Plan is qualified under Section 401(a) of the Code and, therefore, the related trust is exempt from taxation. Subsequent to this determination by the IRS, the Plan was amended and restated. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan sponsor has indicated that it will take the necessary steps, if any, to bring the Plan’s operations into compliance with the Code.
(i) Plan Administration
The Plan is administered by the Zale Corporation Savings and Investment Plan Committee (the Committee), which is appointed by the Company’s Board of Directors (the Board) or Chief Executive Officer. The Company retains the services of Fidelity Management Trust Company (Fidelity) as the trustee and Fidelity Investments Institutional Operations Company, Inc. as the recordkeeper of the Plan. The Committee engaged the third-party advisory investment firm of RBC Dain Rauscher.
(3) Amendment or Termination of the Plan
The Company’s Board has the right to amend or terminate the Plan or to reduce or stop contributions either temporarily or permanently at its sole discretion subject to the provisions of ERISA. In addition, the Chief Executive Officer has the authority to amend the Plan to comply with changes in the law or to implement changes recommended by the Committee that do not have a significant impact on Plan costs. If the Board exercised its right to stop contributions permanently or to terminate the Plan, the entire amount in each participant’s account would continue to be 100% vested and distributed under the direction of the Committee. The Board has no intention at this time to terminate the Plan.
(4) Summary of Significant Accounting Policies
(a) Basis of Accounting
The Plan uses the accrual method of accounting.
(b) Investment Valuation and Income Recognition
Investments in Company Common Stock are valued at fair market value based on quoted market prices. Investments in mutual funds are valued at fair value using published market prices, which represent the net asset value of shares held by the plan at year-end. Participant loans are valued at their outstanding balances, which approximate fair value.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
As described in Financial Accounting Standards Board Staff Position AAG INV-1 and SOP 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Pension Plans (the FSP), investment contracts held by a defined contribution plan are required to be reported at fair value. However, contract value is the relevant measure attribute for that portion of the net assets available for benefits of a defined contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. The Plan invests in investment contracts through a collective trust, the Fidelity Managed Income Portfolio (the MIP Fund). As required by the FSP, the statements of net assets available for benefits present the fair value of the investment in the MIP Fund as well as the adjustment from fair value to contract value. The fair value of the Plan’s interest in the MIP Fund is based on information reported by Fidelity, the issuer of the collective trust at year-end, based upon the underlying fair values of securities held. The contract value of the MIP Fund represents contributions plus earnings, less participant withdrawals and administrative expenses.
Purchases and sales of securities are recorded on a trade date basis. Dividends are recorded on the ex-dividend date.
(c) Administration Expenses
Although not required, on occasion the Company paid administrative expenses directly from its general assets.
(d) Use of Estimates
The preparation of the financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
(e) Risks and Uncertainties
The Plan invests in certain investments that are exposed to various risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in values of investment securities will occur in the near term, and such changes could materially affect participants’ accounts and the amounts reported in the statements of net assets available for plan benefits.
(f) Payment of Benefits
Payments to participants and beneficiaries are recorded when paid.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(g) New Account Pronouncement
In September 2006, the Financial Accounting Standards Board issued Statement on Financial Accounting Standards No. 157 (FAS 157), Fair Value Measurement. This standard clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements. FAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. Plan management is currently evaluating the effect that the provisions of FAS 157 will have on the Plan’s financial statements.
(5) Investments
The following investments are greater than 5% of the Plan’s ending net assets as of December 31, 2007 and 2006:
Investments | | 2007 | | 2006 | |
| | | | | |
Zale Corporation Common Stock | | $ | 7,402,377 | | $ | 14,810,990 | |
Fidelity Freedom Fund 2010 | | 10,741,023 | | 12,318,140 | |
Fidelity Freedom Fund 2015 | | 12,912,343 | | 12,628,539 | |
Fidelity Freedom Fund 2020 | | 18,181,359 | | 17,678,273 | |
Fidelity Freedom Fund 2025 | | 16,913,029 | | 16,865,663 | |
Fidelity Freedom Fund 2030 | | 11,942,738 | | 11,326,585 | |
Fidelity Freedom Fund 2035 | | 6,584,407 | | 6,156,383 | |
| | | | | | | |
(6) Related-Party Transactions
During the year ended December 31, 2007 and the transition period ended December 31, 2006, the Plan engaged in related-party transactions with Fidelity in its roles as trustee and asset custodian of the Plan since certain investments are managed by them. Additionally, a portion of the Plan’s assets are invested in the Company’s Common Stock. Because the Company is the Plan’s sponsor, transactions involving the Company’s Common Stock qualifies as related-party transactions. Such transactions are considered to be exempt party-in-interest transactions.
(7) Prohibited Transactions
A non-exempt prohibited transaction occurred between the Plan and the Company in the form of a late deposit of $11,144 in participant 401(k) contributions. The $11,144 deposit and lost interest income of approximately $619 were contributed to the Plan in January 2007.
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Zale Corporation
Savings and Investment Plan
Notes to Financial Statements
December 31, 2007 and 2006
(8) Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for plan benefits and the net decrease in net assets per the financial statements to the Form 5500:
| | December 31, | |
| | 2007 | |
| | | |
Net assets available for plan benefits per the financial statements | | $ | 120,701,667 | |
Adjustment from fair value to contract value for fully benefit- | | | |
responsive investment contracts held in a collective trust | | (28,416 | ) |
Net assets available for plan benefits per the Form 5500 | | $ | 120,673,251 | |
| | Year Ended | |
| | December 31, | |
| | 2007 | |
Net decrease in net assets per the finanical statements | | $ | 2,243,379 | |
Adjustment from fair value to contract value for fully benefit- | | | |
responsive investment contracts held in a collective trust | | 28,416 | |
Net decrease in net assets per the Form 5500 | | $ | 2,271,795 | |
The accompanying financial statements present a collective trust that invests in fully benefit-responsive contracts at contract value. The Form 5500 requires a collective trust that invests in fully benefit-responsive investment contracts to be reported at fair value. As a result, the adjustment from fair value to contract value for a collective trust that invests in fully benefit-responsive investment contracts represents a reconciling item. The Form 5500 for the transition period from August 1, 2006 to December 31, 2006 reflected these contracts at contract value and will not be amended.
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ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
EIN: 75-2080834
Plan No: 002
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2007
(a) | | (b) | | | | (c) | | (e) | |
| | Identity of Issue | | Shares | | Description of Investment | | Current Value | |
| | | | | | | | | |
| | Mutual Funds | | | | | | | |
| | American Beacon Large Cap Value Fund - Institiutional Fund | | 59,800 | | Domestic Equity Mutual Fund | | $ | 1,403,501 | |
| | ABN AMRO Mid Cap Fund - Class N | | 28,886 | | Domestic Equity Mutual Fund | | 818,342 | |
| | American Funds Growth Fund of America - Class R4 | | 53,727 | | Domestic Equity Mutual Fund | | 1,813,840 | |
| | Brandywine Blue Fund | | 50,838 | | Growth Mutual Fund | | 1,794,088 | |
| | Columbia Acorn Fund - Class Z | | 56,947 | | Growth and Value Investing Fund | | 1,686,207 | |
| | Lazard Emerging Markets Portfolio - Institutional Class | | 176,742 | | Emerging Markets Fund | | 4,220,587 | |
| | Morgan Stanley Institutional Fund, Inc. International Equity A | | 62,450 | | International/Global Equity | | 1,181,552 | |
| | Pnx I Sm Cap Val I | | 11,578 | | Small Cap Fund | | 360,178 | |
| | Spartan US Equity Index Fund - Investor Class | | 5,431 | | Index Mutual Fund | | 281,856 | |
| | Vanguard REIT Index Fund | | 41,546 | | Growth and Income Mutual Fund | | 849,619 | |
| | | | | | | | | |
* | | Fidelity Freedom Income | | 88,098 | | Asset Allocation Mutual Fund | | 1,008,728 | |
* | | Fidelity Freedom 2000 | | 100,081 | | Asset Allocation Mutual Fund | | 1,237,999 | |
* | | Fidelity Freedom 2005 | | 326,720 | | Asset Allocation Mutual Fund | | 3,852,027 | |
* | | Fidelity Freedom 2010 | | 724,765 | | Asset Allocation Mutual Fund | | 10,741,023 | |
* | | Fidelity Freedom 2015 | | 1,035,473 | | Asset Allocation Mutual Fund | | 12,912,343 | |
* | | Fidelity Freedom 2020 | | 1,149,991 | | Asset Allocation Mutual Fund | | 18,181,359 | |
* | | Fidelity Freedom 2025 | | 1,283,234 | | Asset Allocation Mutual Fund | | 16,913,029 | |
* | | Fidelity Freedom 2030 | | 722,926 | | Asset Allocation Mutual Fund | | 11,942,738 | |
* | | Fidelity Freedom 2035 | | 481,316 | | Asset Allocation Mutual Fund | | 6,584,407 | |
* | | Fidelity Freedom 2040 | | 502,080 | | Asset Allocation Mutual Fund | | 4,885,243 | |
* | | Fidelity Freedom 2045 | | 9,584 | | Asset Allocation Mutual Fund | | 108,777 | |
* | | Fidelity Freedom 2050 | | 20,441 | | Asset Allocation Mutual Fund | | 233,645 | |
| | PIMCO Total Return Fund - Institutional Class | | 110,545 | | Bond Mutual Fund | | 1,181,728 | |
| | | | | | | | | |
| | Common Stock | | | | | | | |
* | | Zale Corporation Common Stock | | 460,920 | | Company Stock | | 7,402,377 | |
| | | | | | | | | |
| | Collective Trust | | | | | | | |
* | | Fidelity Managed Income Portfolio | | 2,643,185 | | Stable Value Fund | | 2,614,769 | |
* | | Participant Loans | | | | Participant’s Loans, interest rates ranging from 6.00% to 11.5% and maturity dates ranging from January 2008 to April 2020 | | 4,153,837 | |
| | | | | | | | | |
| | Total | | | | | | $ | 118,363,799 | |
* | | Column (a) indicates each identified person/entity known to be a party in interest. |
| | |
| | Note: Information on cost of the investments is excluded as all investments are participant directed. |
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ZALE CORPORATION
SAVINGS AND INVESTMENT PLAN
EIN: 75-2080834
Plan No: 002
Schedule H, Line 4a - Schedule of Delinquent Participant Contributions
Year ended December 31, 2007
Participant Contributions
Transferred Late to Plan | | Total that Constitutes Nonexempt
Prohibited Transaction | |
| | | |
$ | 11,144 | | $ | 11,144 | |
| | | | | |
It was noted that there were unintentional delays by the Company in submitting participant contributions in the amount of $11,144 from May 2006. The $11,144 and the lost interest of $619 were funded in January 2007.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Committee has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | | Zale Corporation Savings and Investment Plan |
| | | (Registrant) |
| | | |
| | | |
| | | |
Date | June 26, 2008 | | /s/ Cynthia T. Gordon |
| | | Cynthia T. Gordon |
| | | Senior Vice President, Controller (principal accounting officer of the registrant) |
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INDEX TO EXHIBIT
Exhibit | | |
Number | | Description |
| | |
23.1 | | Consent of Independent Registered Public Accounting Firm — Ernst & Young LLP |
| | |
23.2 | | Consent of Independent Registered Public Accounting Firm — KPMG LLP |
15
