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
For the Fiscal Year ended December 30, 2001
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
OWENS CORNING
One Owens Corning Parkway
Toledo, Ohio 43659
Commission File No. 1-3660
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REQUIRED INFORMATION
(a) Financial Statements.
1. 2001 Report of Independent Accountants
2. Copy of 2000 Report of Independent Public Accountants
3. Statements of Net Assets Available for Benefits - as of December 30,
2001 and December 30, 2000
4. Statements of Changes in Net Assets Available for Benefits - for the
years ended December 30, 2001 and December 30, 2000
5. Notes to Financial Statements
(b) Exhibit.
Consent of PricewaterhouseCoopers LLP
In accordance with the instructions to this Form 11-K, "plans subject to the
Employee Retirement Income Security Act of 1974 ("ERISA") may file plan
financial statements and schedules prepared in accordance with the financial
reporting requirements of ERISA." As the Plan is subject to the filing
requirements of ERISA, the aforementioned financial statements and schedules of
the Plan have been prepared in accordance with such requirements. Schedules
required by Section 2520.103-10 of the Department of Labor's Rules and
Regulations for Reporting and Disclosure Under ERISA have been omitted because
they are not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the Plan) have duly caused this annual
report to be signed by the undersigned hereunto duly authorized.
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
By: /s/ Richard C. Tober
--------------------------------
Richard C. Tober
Plan Administrator
Dated:
June 26, 2002
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Report of Independent Accountants
To the Participants and Administrator of the
Owens Corning Savings and Profit Sharing 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 Owens Corning Savings and Profit Sharing Plan (the "Plan") at December 30,
2001, and the changes in net assets available for benefits for the year ended
December 30, 2001 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 audit. We conducted our audit 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 that our
audit provides a reasonable basis for our opinion. The financial statements of
the Plan as of December 30, 2000 and for the year then ended were audited by
other independent auditors whose report dated May 25, 2001 expressed an
unqualified opinion on those statements.
/s/ PricewaterhouseCoopers LLP
Toledo, OH
June 26, 2002
THIS REPORT IS A COPY OF A PREVIOUSLY ISSUED ARTHUR ANDERSEN LLP REPORT AND HAS
NOT BEEN REISSUED BY ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator
of the Owens Corning
Savings and Profit Sharing Plan:
We have audited the accompanying statements of assets available for benefits of
the OWENS CORNING SAVINGS AND PROFIT SHARING PLAN as of December 30, 2000 and
1999, and the related statements of changes in 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. 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 the Plan's management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets available for benefits of the Owens Corning
Savings and Profit Sharing Plan as of December 30, 2000 and 1999, and the
changes in its assets available for benefits for the year then ended in
conformity with accounting principles generally accepted in the United States.
/s/ Arthur Andersen LLP
Toledo, Ohio,
May 25, 2001
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OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 30, 2001 AND DECEMBER 30, 2000
December 30, 2001 December 30, 2000
----------------- -----------------
ASSETS:
Investment in master trust $ 270,356,697 $ 287,311,650
Due from Owens Corning 12,561,745 -
Contribution Receivable 6,504 -
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Total Assets 282,924,946 287,311,650
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LIABILITIES:
Due to Participants (1,032,242) (631,035)
Due to Owens Corning (445,236) (461,777)
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Total Liabilities (1,477,478) (1,092,812)
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NET ASSETS AVAILABLE FOR BENEFITS $ 281,447,468 $ 286,218,838
============= =============
The accompanying notes are an integral part of these statements.
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OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 30, 2001 AND DECEMBER 30, 2000
December 30, 2001 December 30, 2000
----------------- -----------------
ADDITIONS:
Net interest in master trust investment
loss $ (22,450,654) $(104,733,604)
CONTRIBUTIONS:
Participants 24,017,062 47,490,902
Owens Corning 23,010,448 19,033,773
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47,027,510 66,524,675
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DEDUCTIONS:
Distributions to participants (29,146,658) (75,801,258)
Administrative expenses and other (201,568) (210,906)
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(29,348,226) (76,012,164)
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Net decrease (4,771,370) (114,221,093)
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NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 286,218,838 400,439,931
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End of year $ 281,447,468 $ 286,218,838
============= =============
The accompanying notes are an integral part of these statements.
- 3 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(1) SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN AND ACCOUNTING
POLICIES
Operations of the Plan
- ----------------------
The Owens Corning Savings and Profit Sharing Plan (the Plan) principally
benefits salaried employees of Owens Corning and certain designated subsidiaries
(the Company). An eligible employee may elect to enroll in the Plan at any time.
Administrative expenses of the Plan are charged to the Plan and include
professional fees, accounting and other administrative expenses.
Plan investment elections, included in a master trust (Note 3), are shares of
mutual funds managed by Fidelity Investments and Company stock. Fidelity
Investments is the trustee (the Trustee) as defined by the Plan and the Company
is the plan sponsor. Therefore, these transactions qualify as party-in-interest
transactions.
The following descriptions of the Plan provide only general information.
Participants should refer to the plan agreement for a more complete description
of the Plan's provisions.
Plan Contributions
- ------------------
During 2000 and 2001, participants could elect to contribute from 1% to 15% of
their base pay to the Plan. Beginning January 1, 2002, participants may elect to
contribute from 1% to 30% of their base pay to the Plan. All or a portion of
participants' contributions may be designated at participants' options as
deferred income up to the maximum amount allowed by federal law pursuant to
Section 401(k) of the Internal Revenue Code. Deferred income contributions are
not subject to Federal income tax until such amounts are distributed to the
participants. The Plan requires remittance of participant contributions to the
Trustee as soon as deducted from participants' paychecks.
The Plan provides a retirement contribution equal to a specified percentage of
eligible pay (which percentage varies by employee group) for participants who
work at a plant or business unit where a defined benefit pension plan is not
available. Company contributions relating to the retirement contribution are
invested according to the participant's elections at the time of contribution.
- 4 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(1) SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN AND ACCOUNTING
POLICIES (continued)
Plan Contributions (continued)
- ------------------
In addition, the Company matches 50% of all participants' contributions up to
10% of eligible compensation. The Company may, at its discretion, make an annual
profit sharing contribution to the Plan up to 4% of compensation depending on
the Company's financial performance. The Company made discretionary profit
sharing contributions of approximately $12.6 million and $7.0 million in 2001
and 2000, respectively. The 2001 discretionary profit sharing contribution was
fully paid subsequent to the Plan's year-end and is included as Due from Owens
Corning in the related Statement of Net Assets Available for Benefits. The 2000
discretionary profit sharing contribution was fully paid during the 2000 Plan
year. All Company contributions are invested according to the participant's
elections at the time of the contribution.
Included in 2001 and 2000 participant contributions in the accompanying
financial statements are approximately $1.2 million and $21.3 million,
respectively, of rollovers from other plans, including an hourly savings plan
maintained by the Company that is also invested in the Owens Corning Saving
Plans Master Trust (Note 3).
As part of the 2001 and 2000 non-discrimination testing performed by the
Trustee, it was determined that certain highly compensated participants exceeded
the allowed contributions in relation to the remaining participants. The Plan
took corrective action by returning the excess contributions to the applicable
participants and the Company after the respective year-end. The resulting
amounts to be refunded are recorded as Due to Participants and Due to Owens
Corning in the related Statements of Net Assets Available for Benefits.
Plan Investment Options
- -----------------------
Participants elect to have their contributions invested in 1% increments among
the investment funds made available under the Plan, which are collectively held
in a master trust (Note 3). Participants may change their investment options and
contribution rate on a daily basis and redistribute their account balances
daily. Participants may discontinue their contributions to the Plan at any time.
The Trustee, at its sole discretion subject to the provisions in the trust
agreement, may hold any portion of any contribution in cash, which it considers
necessary to meet anticipated disbursements.
- 5 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(1) SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN AND ACCOUNTING
POLICIES (continued)
Basis of Accounting
- -------------------
The accompanying financial statements have been prepared on the accrual basis.
Investments are reported at quoted market values and trades are recorded at
market value on the date of trade.
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 and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
Reclassifications
- -----------------
Certain amounts in the 2000 financial statements have been reclassified to
conform with the 2001 presentation.
- 6 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(1) SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN AND ACCOUNTING
POLICIES (continued)
Income Taxes
- ------------
The Internal Revenue Service (IRS) has issued a determination letter dated March
27, 1996, stating that the Plan meets the requirements of Section 401(a) of the
Internal Revenue Code (the Code) and that the master trust is exempt from
taxation under Section 501(a) of the Code. Participants generally are not
subject to Federal income tax on Company contributions or related earnings until
those amounts are distributed to them. Participants may elect to designate all
or a portion of their contributions to the Plan as deferred income pursuant to
Section 401(k) of the Code. This election permits the participants to exclude
from gross taxable income for Federal tax purposes that portion of their
contributions so designated, subject to certain limitations, until such time as
they are withdrawn from the Plan. The plan agreement has had several amendments
since the determination letter was issued. Management believes that the
amendments do not change the Plan's status for meeting the requirements of
Section 401(a) of the Internal Revenue Code and that the trust is still exempt
from taxation.
Proceedings in the Event of Plan Termination
- --------------------------------------------
Although it has not expressed any intent to do so, the Company has the right to
terminate the Plan. In the event of termination or upon a permanent
discontinuance of Company contributions, the Plan accounts of each participant
not previously vested would become fully vested. Participants would, in
accordance with the terms of the Plan, receive their contributions to the Plan
as well as Company contributions to the Plan on their behalf and the earnings on
those contributions.
(2) PLAN SPONSOR VOLUNTARY PETITION FOR RELIEF UNDER CHAPTER 11
As discussed in Note 1 of the Company's 2001 financial statements included in
its annual report filed on Form 10-K, the Company filed a voluntary petition for
relief under Chapter 11 of the United States Bankruptcy Code on October 5, 2000.
The United States Bankruptcy Court for the District of Delaware approved the
Company's motion to continue to operate the Plan. The Plan will continue to be
funded in accordance with the plan agreement provisions subject to the outcome
of the Chapter 11 bankruptcy proceedings noted above.
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OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(3) MASTER TRUST
The Owens Corning Savings Plans Master Trust (the Master Trust) was established
for the investment of the assets of the Plan and another savings plan sponsored
by the Company. Each participating plan has an undivided interest in the Master
Trust, which is based on beginning of year plan interest adjusted for
transactions attributable to each plan and a proportionate share of income and
expenses attributable to the Master Trust as a whole. A summary of the assets of
the Master Trust as of December 30, 2001 and 2000 is as follows:
2001 2000
---- ----
ASSETS:
Investments:
Company Common Stock* $ 4,595,315 $ 2,752,464
Mutual Funds:
Fidelity Puritan Fund 29,591,464 29,724,980
Fidelity Investment Grade Bond Fund 10,691,768 7,510,697
Fidelity Growth & Income Portfolio 27,342,975 28,747,984
Fidelity Blue Chip Growth Fund 40,878,284 47,273,241
Fidelity Low-Priced Stock Fund 60,273,581 45,602,671
Fidelity Aggressive Growth Fund 31,358,516 54,377,964
Fidelity Diversified International Fund 18,994,262 23,019,997
Fidelity Retirement Money Market Portfolio 67,790,354 58,970,400
Fidelity Freedom Income 352,394 -
Fidelity Freedom 2000 578,681 -
Fidelity Freedom 2010 1,474,829 -
Fidelity Freedom 2020 969,406 -
Fidelity Freedom 2030 384,615 -
Fidelity Freedom 2040 626,189 -
Spartan U.S. Equity Index Fund 39,492,080 44,342,691
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Total Mutual Funds 330,799,398 339,570,625
Loans to Participants (Note 5) 11,895,012 13,218,535
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Total Assets $347,289,725 $355,541,624
PLAN INTEREST PERCENTAGE 77.85% 80.81%
============ ============
PLAN INTEREST IN MASTER TRUST $270,356,697 $287,311,650
============ ============
* Nonparticipant-directed (Note 4)
- 8 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(3) MASTER TRUST (continued)
A summary of investment loss for the Master Trust for the years ended December
30, 2001 and 2000, is as follows:
2001 2000
---- ----
Investment Loss:
Net appreciation (depreciation) in
fair value of investments:
Company Stock Fund $ - $(123,121,756)
Company Common Stock 3,563,654 (2,463,182)
Mutual Funds (36,868,348) (46,246,890)
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(33,304,694) (171,831,828)
Interest 1,000,386 3,217,811
Dividends 9,489,589 29,174,694
------------- -------------
Total investment loss $ (22,814,719) $(139,439,323)
============= =============
Net appreciation (depreciation) in fair value of investments includes changes in
unrealized appreciation (depreciation) of investments and realized gains and
losses on the sale of investments computed using average cost. Purchases and
sales are recorded on the trade date basis.
(4) NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the significant components of the net assets and changes in
net assets available for benefits relating to the nonparticipant-directed
investment option within the Master Trust (the Company Common Stock and the
Company Stock Fund) is as follows:
- 9 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(4) Nonparticipant-Directed Investments (continued)
2001 2000
---- ----
Net Assets Available for Benefits:
Plan interest in Company Common Stock $ 2,492,648 $ 1,635,672
============ ============
Changes in Net Assets Available for
Benefits:
Plan interest in:
Interest $ - $ (7,370)
Dividends - 1,132,231
Net appreciation (depreciation) 2,222,424 (90,006,465)
------------ ------------
2,222,424 (88,881,604)
Contributions - 30,846,339
Transfers to participant-
directed investments (3,134) (10,036,968)
Distributions and other (1,362,314) (24,342,517)
------------ ------------
$ 856,976 $(92,414,750)
============ ============
(5) LOANS
Loans may be made from the Plan to active participants. The total amount a
participant may borrow is the lesser of $50,000 or 50% of their total vested
account balance, limited to the total of contributions designated as before-tax
and related earnings. The minimum amount available for a loan is $1,000. The
loan limit is reduced by the highest loan balance outstanding in the prior 12
months.
Loans advanced are repaid through regular payroll deductions with interest equal
to the prime rate in effect on the last business day of the month prior to the
employee's loan application.
A loan can be requested for any reason. A borrower has from one to five years to
repay the loan. Repayments of principal and interest are invested in accordance
with the borrower's investment elections.
- 10 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(6) VESTING, FORFEITURES AND DISTRIBUTIONS
If participants began employment after 1995, they become 100% vested in Company
contributions and earnings thereon after three years of completed service. If
participants began employment before 1996, the vesting of Company contributions
is 20% after one year of service, 40% after two years, and 100% after three
years. Such amounts also become fully vested upon termination of the
participant's employment due to retirement, disability or death, involuntary
termination of the participant's employment (other than for cause), termination
of the Plan, or permanent discontinuance of the prescribed Company contributions
to the Plan.
Such vested contributions and earnings thereon are automatically distributable
after termination and upon attaining 65 years of age or death, whichever is
earlier. If termination of employment occurs for any reason other than attaining
65 years of age or death, the participant's account will become distributable at
65 years of age or death unless an election for immediate distribution is filed
within 90 days of termination with the plan administrator.
Participants may at any time withdraw all or any part of the value of their
contributions, excluding contributions designated as deferrals. Participants
aged 59-1/2, or older, may withdraw all or a portion of their before-tax
contributions and earnings. Otherwise, before-tax contributions may be withdrawn
only under serious financial hardship. Earnings credited to the before-tax
contributions made before 1989, if any, are also available for withdrawal under
serions financial hardship.
Company contributions and earnings thereon subsequent to December 31, 1989,
cannot be withdrawn by Participants, even if vested, unless terminated, retired,
65 years of age or deceased. Participants who voluntarily terminate or are
terminated for cause will forfeit the non-vested portion of the Company
contributions and related earnings. Forfeitures are applied to reduce subsequent
Company contributions to the Plan. The market value of the underlying
investments forfeited by employees withdrawing from the Plan was approximately
$150,000 and $100,000 in 2001 and 2000, respectively.
Included in 2001 and 2000 distributions to participants in the accompanying
financial statements is approximately $370 thousand and $19.7 million,
respectively, of transfers to an hourly savings plan sponsored by the Company
that is also invested in the Master Trust.
- 11 -
OWENS CORNING
SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
(7) PLAN TRANSFERS
During 1998, the Company sold its business of manufacturing and selling glass
fiber yarns and specialty materials to Advanced Glassfiber Yarns, LLC ("AGY").
As a result, effective January 1, 2000, employees of AGY are no longer allowed
to participate in the Plan. AGY employee account balances totaling approximately
$19 million were transferred into a new plan, which is administered by the
management of AGY. This amount is included in distributions to participants in
the accompanying financial statements.