SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 2001
Commission File Number 1-2227
E. Full title of the plan:
Crown Cork & Seal Company, Inc.
401(k)Retirement Savings Plan
F. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
CROWN CORK & SEAL COMPANY, INC.
ONE CROWN WAY
PHILADELPHIA, PA 19154-4599
INDEX
Pages
Signatures........................................................... 3
Report of Independent Accountants.................................... 6
Audited Plan Financial Statements and Schedules in
accordance with the Financial Reporting Requirements of ERISA........ 7 to 14
Exhibit 23 - Consent of Independent Accountants...................... 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee has duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Crown Cork & Seal Company, Inc.
401(k)Retirement Savings Plan
By: /s/ James T. Malec
------------------
James T. Malec
Member, Benefit Plan Committee
Date: June 28, 2002
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Financial Statements as of and for the
years ended December 31, 2001 and 2000
Additional information required for Form 5500
as of and for the year ended December 31, 2001
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Table of Contents
- --------------------------------------------------------------------------------
Page Number
Report of Independent Accountants 1
Basic Financial Statements
Statements of Net Assets Available for Benefits 2
as of December 31, 2001 and 2000
Statements of Changes in Net Assets Available for Benefits 3
for the years ended December 31, 2001 and 2000
Notes to Financial Statements 4 - 7
Additional Information *
Schedule I - Schedule of Assets (Held at End of Year) 8
* Other supplemental schedules required by Section 2520.103-10 of the Department
of Labor Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974 have been omitted because they
are not applicable.
Report of Independent Accountants
To the Benefit Plans Committee and Participants of the
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan (the
"Plan") at December 31, 2001 and 2000, 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. 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 of these statements in accordance with auditing standards
generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe our audits provide a reasonable basis for our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets (held
at end of year) 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
supplemental schedule is the responsibility of the Plan's management. The
supplemental schedule has been subjected to the auditing procedures applied in
the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
/s/ PricewaterhouseCoopers LLP
Philadelphia, PA
June 21, 2002
1
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Statements of Net Assets Available for Benefits
- ------------------------------------------------------------------------------------------------------------------------------------
As of December 31,
2001 2000
---------------------------------------
Investments, at fair value
Registered investment companies:
Vanguard 500 Index Fund $ 41,149,175 * $ 51,080,209 *
Vanguard Balanced Index Fund 9,974,444 * 10,719,072 *
Vanguard Explorer Fund 14,102,443 * 14,123,171 *
Vanguard International Growth Fund 4,190,209 5,624,707
Vanguard Total Bond Market Index Fund 7,623,012 * 5,527,941
------------- -------------
77,039,283 87,075,100
Vanguard Retirement Savings Trust 53,178,965 * -
Crown Cork & Seal Company, Inc. Stock Fund 7,579,695 ** 12,325,249 **
Participant Loans 3,026,187 3,726,717
------------- -------------
140,824,130 103,127,066
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Investments, at contract value
Crown Cork & Seal Fixed Income Fund - 52,612,540 *
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Total investments 140,824,130 155,739,606
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Receivables
Employer's contributions 144,093 158,989
Participants' contributions 518,250 574,495
------------- -------------
Total receivables 662,343 733,484
------------- -------------
Net assets available for benefits $ 141,486,473 $ 156,473,090
============= =============
<FN>
* Represents 5% or more of net assets available for benefits.
** Represents nonparticipant-directed investments that are 5% or more of net
assets available for benefits.
The accompanying notes are an integral part of these financial statements.
</FN>
2
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Statements of Changes in Net Assets Available for Benefits
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Year Ended December 31,
2001 2000
---------------------------------------
Additions
Investment income:
Interest and dividend income, investments $ 4,490,166 $ 8,802,553
Interest income, participant loans 279,598 303,600
Net depreciation in fair value of investments (17,119,159) (24,532,379)
------------- -------------
(12,349,395) (15,426,226)
------------- -------------
Contributions:
Employer 1,893,373 2,131,547
Participant 7,480,721 7,912,206
------------- -------------
9,374,094 10,043,753
------------- -------------
Total additions (2,975,301) (5,382,473)
------------- -------------
Deductions
Payment of benefits 12,003,196 22,709,635
Asset transfers out - 1,069,385
Administrative expenses 8,120 6,970
------------- -------------
Total deductions 12,011,316 23,785,990
------------- -------------
Net decrease (14,986,617) (29,168,463)
Net assets available for plan benefits:
Beginning of year 156,473,090 185,641,553
------------- -------------
End of year $ 141,486,473 $ 156,473,090
============= =============
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
3
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 - DESCRIPTION OF PLAN
The following description of the Crown Cork & Seal Company, Inc. 401 (k)
Retirement Savings Plan (the "Plan") provides only general information.
Participants should refer to the Plan document for a more complete description
of the Plan's provisions.
General
The plan is a defined contribution plan. The purpose of the Plan is to provide a
convenient method by which eligible employees of Crown Cork & Seal Company, Inc.
(the "Company") may save regularly through salary deferrals and through Company
matching contributions. Generally, employees are eligible to participate in the
Plan upon date of hire. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA").
The Plan is administered by the Crown Cork & Seal Company, Inc. Benefit Plans
Committee (the "Committee"). The Committee has appointed Vanguard Fiduciary
Trust Company ("VFTC") to assume both trustee and recordkeeping
responsibilities.
During 1999, the Company sold a segment of the Composite Can division. As a
result of this transaction, participant accounts of former Composite Can
employees were transferred out of the Plan in 2000 in the amount of $1,069,385.
Effective October 8, 2001, the Crown Cork & Seal Fixed Income Fund (the "Fund")
was closed and the Vanguard Retirement Savings Trust (the "Trust") was added as
a new investment option in the Plan. The balance of the Fund was transferred
into the Trust.
Contributions
Generally, the Plan has two components: a participant salary deferral 401(k)
component and a Company matching contribution component. The salary deferral
401(k) component of the Plan allows before-tax employee contributions of 2% to
12% of annual compensation. Contribution amounts are subject to certain
limitations, $10,500 in 2001 and 2000, as prescribed by law. The Company makes
matching contributions equal to 50 percent of the employee's contribution, from
3% up to 6% of compensation, depending on the employer company. Participants
direct the investment of their contributions into various investment options
offered by the Plan. Company contributions are invested in Company common stock.
Effective January 1, 2002, Company contributions are invested in accordance with
participant investment directions.
Participant Accounts
Each participant's account is credited with participant's contribution and the
participant's allocation of the Company's contribution, as described above. Plan
earnings are allocated to the participant's account based on participant's
account balances. The benefit to which a participant is entitled is the benefit
that can be provided from the participant's vested account.
Vesting
Participants are immediately vested in their contributions plus actual earnings
thereon. Vesting in the Company's contribution plus actual earnings thereon is
based on years of continuous service. Generally, a participant is 100 percent
vested after four years of credited service.
4
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
- --------------------------------------------------------------------------------
Participant Loans
Participants may borrow from their account a minimum of $1,000 up to a maximum
equal to the lesser of $50,000 or 50 percent of the participant's vested
balance. Loan transactions are treated as a transfer to (from) the investment
fund from (to) Participant loans. Loan terms range from 1 to 5 years or up to 10
years for the purchase of a primary residence. The loans are secured by the
balance in the participant's account and bear interest at a rate commensurate
with a prevailing commercial rate for a secured personal loan. Principal and
interest is paid ratably through monthly payroll deductions. A participant may
not have more than two outstanding loans at any one time.
Payment of Benefits
On termination of service due to death, disability or retirement, a participant
may elect to receive either a lump sum amount equal to the value of the
participant's vested interest in his or her account, or substantially equal
periodic installments over a period equal to the life expectancy of the
recipient or beneficiary. For termination of service due to other reasons, a
participant may receive the value of the vested interest in his or her account
as a lump-sum distribution. All distributions are paid in either cash or company
stock at the participant's election.
Forfeited Accounts
Total unallocated forfeitures, which will be used to reduce future employer
contributions, were $40,140 and $23,580 at December 31, 2001 and 2000,
respectively. In 2001 and 2000, $7,393 and $668, respectively, of unallocated
forfeitures were used to offset employer contributions.
Plan Termination
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100 percent vested in their accounts.
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES
The following accounting policies, which conform with accounting principles
generally accepted in the United States of America, have been used consistently
in the preparation of the Plan's financial statements:
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method of
accounting.
Use of Estimates
The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States of America, requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements, as well as reported amounts of additions
and deductions during the reporting period. Actual results could differ from
those estimates.
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value except for its investment
contracts, which are valued at contract value. Shares of registered investment
companies are valued at quoted market prices, which represent the net asset
value of shares held by the Plan at year-end.
5
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
- --------------------------------------------------------------------------------
The Company stock fund is valued at its year-end unit closing price (comprised
of year-end market price plus uninvested cash position). Units of the Company's
fixed income fund and Vanguard Retirement Savings Trust are valued at net asset
value at year-end. Participant loans are valued at cost, which approximates fair
value.
Purchases and sales of investments are recorded on a trade-date basis. Interest
income is accrued when earned. Dividend income is recorded on the ex-dividend
date. Capital gain distributions are included in dividend income.
NOTE 3 - NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the significant components of changes in net assets relating
to the nonparticipant-directed investments is as follows:
Crown Cork & Seal Company, Inc. Stock Fund
------------------------------------------
2001 2000
---- ----
Changes in Net Assets:
Interest and dividend income $ - $ 1,089,087
Net depreciation (8,692,051) (15,004,797)
Contributions 2,653,175 3,263,770
Distributions (440,094) (1,483,927)
Asset transfers out - (109,497)
Interfund transfers 1,579,802 1,287,251
NOTE 4 - INVESTMENTS
During 2001 and 2000, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) depreciated in
value as follows:
Year Ended December 31,
2001 2000
---- ----
Registered investment companies $ (8,427,108) $ (9,527,582)
Common stock (8,692,051) (15,004,797)
------------------------------
Net depreciation in fair value of investments $ (17,119,159) $ (24,532,379)
==============================
NOTE 5 - RELATED PARTY TRANSACTIONS
The Plan invests in shares of registered investment companies and
common/collective trusts managed by affiliates of VFTC. VFTC acts as trustee for
investments of the Plan. The Plan also invests in shares of the Company's stock
through the Crown Cork & Seal Company, Inc. Stock Fund. Transactions in such
investments qualify as party-in-interest transactions and are exempt from the
prohibited transaction rules.
6
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 6 - PLAN EXPENSES
All recordkeeping expenses for the administration of the Plan, with the
exception of certain miscellaneous fees, are paid by the Company.
NOTE 7 - TAX STATUS
The Internal Revenue Service determined and informed the Company by letter dated
February 22, 1996 that the Plan was qualified under Internal Revenue Code
("IRC") Section 401(a). The Plan has subsequently been amended and restated
since receiving the determination letter. The Plan has filed an application for
a new determination letter, which is currently pending. However, the Company
believes the Plan is designed and is currently being operated in compliance with
the applicable requirements of the IRC.
7
Additional Information
Required for Form 5500
CROWN CORK & SEAL COMPANY, INC. Schedule I
401(k) RETIREMENT SAVINGS PLAN
Schedule of Assets (Held at End of Year)
As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan, EIN 23-1526444
Form 5500, Schedule H, Part IV, Line i:
Identity of Participant-Directed Issues Investment Type Current Value
- ------------------------------------------------------------------------------------------------------------------------------------
* Vanguard 500 Index Fund Registered Investment Company $ 41,149,175
* Vanguard Balanced Index Fund Registered Investment Company 9,974,444
* Vanguard Explorer Fund Registered Investment Company 14,102,443
* Vanguard International Growth Fund Registered Investment Company 4,190,209
* Vanguard Total Bond Market Index Fund Registered Investment Company 7,623,012
* Vanguard Retirement Savings Trust Common/Commingled Trust 53,178,965
* Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan Participant Loans (8.0% - 13.7%) 3,026,187
Identity of Nonparticipant-Directed Issues Investment Type Cost Current Value
- ------------------------------------------------------------------------------------------------------------------------------------
* Crown Cork & Seal Company, Inc. Common Stock Fund $ 35,993,532 $ 7,579,695
-------------
Total Assets (Held at End of Year) $ 140,824,130
=============
<FN>
* Party in Interest
</FN>