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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 Commission File
December 31, 2000 Number 1-1550
CHIQUITA SAVINGS AND INVESTMENT PLAN
Chiquita Brands International, Inc.
Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
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CHIQUITA SAVINGS AND INVESTMENT PLAN
CONTENTS
Page(s)
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REPORT OF INDEPENDENT AUDITORS 1
AUDITED FINANCIAL STATEMENTS
Statement of Net Assets Available for Benefits
as of December 31, 2000 and 1999 2
Statement of Changes in Net Assets
Available for Benefits for the Years Ended
December 31, 2000 and 1999 3
Notes to Financial Statements 4 - 9
SUPPLEMENTAL SCHEDULE
Schedule of Assets (Held At End of Year) 10
SIGNATURE 11
EXHIBIT
Consent of Independent Auditors Exhibit 1
REPORT OF INDEPENDENT AUDITORS
Employee Benefits Committee
Plan Administrator of the
Chiquita Savings and Investment Plan
We have audited the accompanying statement of net assets available for benefits
of the Chiquita Savings and Investment Plan as of December 31, 2000 and 1999,
and the related statement of changes in net assets available for benefits for
the years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2000 and 1999, and the changes in net assets available for benefits
for the years then ended, in conformity with accounting principles generally
accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedule of
assets (held at end of year) as of December 31, 2000 is presented for purposes
of additional analysis and is not a required part of the 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. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in our audit 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/ ERNST & YOUNG LLP
Cincinnati, Ohio
June 11, 2001
CHIQUITA SAVINGS AND INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR BENEFITS
December 31,
------------------------------------
2000 1999
--------------- ---------------
Investments, at fair value $ 39,426,517 $ 58,204,953
Contributions receivable:
Participant 4,184 12,280
Company 1,599,609 1,824,463
--------------- ---------------
Net assets available for benefits $ 41,030,310 $ 60,041,696
=============== ===============
See accompanying notes to financial statements.
2
CHIQUITA SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
Year Ended December 31,
-------------------------------------
2000 1999
---------------- ----------------
Investment income:
Dividends $ 2,767,568 $ 2,589,562
Interest 62,837 79,645
Net appreciation (depreciation) in fair value of investments (17,401,256) 1,934,753
Contributions:
Participant 2,530,479 3,047,817
Company 2,669,825 3,109,902
Rollovers 189,621 474,575
---------------- ----------------
(9,180,926) 11,236,254
Less: Distributions to participants (9,830,460) (5,704,464)
---------------- ----------------
Increase (decrease) in net assets available
for benefits (19,011,386) 5,531,790
Net assets available for benefits:
Beginning of the year 60,041,696 54,509,906
---------------- ----------------
End of the year $ 41,030,310 $ 60,041,696
================ ================
See accompanying notes to financial statements.
3
CHIQUITA SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DESCRIPTION OF THE PLAN
The following description of the Chiquita Savings and Investment Plan (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 covering substantially all
full-time and part-time domestic salaried employees of Chiquita Brands
International, Inc. (the "Company" or "Plan Sponsor") and its participating
subsidiaries who have completed two months of service and have attained the age
of 21. Although it is anticipated that the Plan will continue indefinitely, the
Board of Directors of the Company can amend, suspend or terminate the Plan
subject to the provisions of ERISA. In the event of Plan termination, active
participants would become 100% vested in their accounts.
The assets of the Plan at December 31, 2000 are held by Putnam Investments
(the "Trustee"). Pending investment in each fund's primary investment vehicle,
the Trustee may invest monies temporarily in short-term investments.
FINANCIAL CONDITION OF PLAN SPONSOR
On January 16, 2001, the Plan Sponsor, Chiquita Brands International, Inc.,
announced its intention to restructure its publicly-held debt. As part of this
restructuring initiative, all principal and interest payments on this debt have
been discontinued and as a result, all such debt is subject to acceleration. The
Company has begun discussions regarding the proposed restructuring with holders
of its publicly-held debt. If successful, the restructuring would result in
conversion of a significant portion of such debt into common equity, and the
equity interests of existing common shareholders, including shares held by the
Plan, would be diluted. If an agreement with the debt holders is reached, the
resulting restructuring plan would likely be presented for judicial approval
under Chapter 11 of the U.S. Bankruptcy Code. Discussions with debt holders are
in the preliminary stages, and there can be no assurances that an agreement
regarding a financial restructuring will be reached. The assets of the Plan are
legally protected from creditors in any bankruptcy proceeding.
PARTICIPANT ACCOUNTS
Participants may have up to six accounts under the Plan:
Account Description of Account
- ------------------------------------------------ --------------------------------------------------
EMPLOYEE ACCOUNTS:
Employee Before-Tax Contributions Reflect all before-tax, after-tax and
Employee After-Tax Contributions rollover contributions, and the income,
Rollover Contributions losses, withdrawals and distributions
attributable to such contributions.
4
COMPANY ACCOUNTS:
Matching Contributions Reflect participant's share of Company
Profit Sharing Contributions contributions, profit-sharing contributions of
Non-elective Contributions certain merged plans, and an amount equal to
participant's unspent employee credits
contributed from the Company's separate
welfare benefits plans, and the income, losses,
withdrawals and distributions attributable
to such contributions.
Prior to November 23, 2000, the Employee Before-Tax Contributions Account had
two sub-accounts - the "Participant Restricted Contributions Account" and the
"Participant Non-restricted Contributions Account." The Company Matching
Contributions Account also had two sub-accounts - the "Company Restricted
Contributions Account" and the "Company Non-restricted Contributions Account."
Contributions to the restricted accounts were allocated to the Chiquita Common
Stock Fund and could not be directed to other investment funds for a certain
period of time (see "Participant Contributions" and "Company Contributions"). On
November 23, 2000, all existing balances in the restricted accounts were
transferred to the non-restricted accounts, which allowed participants to direct
those balances to any investment fund.
PARTICIPANT CONTRIBUTIONS
Participants may elect to defer as a Before-Tax Contribution any whole
percentage of their compensation from 1% to 12%. The first 6% of compensation
contributed to the Plan ("Eligible Participant Contributions") is eligible for
employer matching contributions. Prior to 1989, participants could also elect to
make After-Tax Contributions.
The Plan limits the maximum amount of Before-Tax Contributions which may be
made by a participant in any plan year to 12% of compensation, subject to the
non-discrimination standards of the Internal Revenue Code (the "Code").
Participants' taxable compensation is reduced by the amount of Before-Tax
Contributions, and such amount is contributed to the Plan on their behalf by the
Company. A participant's Before-Tax Contributions in any one year are also
limited to a fixed dollar maximum ($10,500 for 2000 and $10,000 for 1999) as
specified by the Code in Internal Revenue Service ("IRS") notices.
Prior to November 23, 2000, Eligible Participant Contributions to the
Chiquita Common Stock Fund were placed in the Participant Restricted
Contributions Account. These restricted contributions were transferred to the
Participant's Non-restricted Contributions Account on the second anniversary of
the first day of the Plan year in which the contributions were made. Effective
November 23, 2000, the Plan was amended such that all participant contributions
are now allocated directly to the Participant Non-restricted Contributions
Account.
Effective January 16, 2001, no participant contributions can be directed to
the Chiquita Common Stock Fund. A participant is permitted to keep existing
balances at January 16, 2001 in the Chiquita Common Stock Fund. However, if a
participant chooses to transfer any funds from the Chiquita Common Stock Fund to
another investment fund after January 16, 2001, the participant will not be
permitted to transfer those amounts back to the Chiquita Common Stock Fund.
5
The Plan also accepts rollover contributions ("Rollovers") from other
qualified plans or from certain individual retirement accounts. Rollovers are
credited to a participant's Rollover Contributions Account, are treated in a
manner similar to Before-Tax Contributions for Plan accounting and federal
income tax purposes, and are not eligible for matching contributions by the
Company.
COMPANY CONTRIBUTIONS
The Company makes a Basic Matching Contribution and may make a
Discretionary Matching Contribution and a Stock Incentive Matching Contribution,
as described below. These contributions are based on Eligible Participant
Contributions. The Company's matching contributions are subject to the
non-discrimination standards of the Code.
BASIC MATCHING CONTRIBUTIONS The Company makes a Basic Matching
Contribution equal to 50% (or such higher percentage as the Plan
Administrative Committee may in its discretion announce) of Eligible
Participant Contributions. The Basic Matching Contribution amounted to 50%
of Eligible Participant Contributions in 2000 and 1999.
DISCRETIONARY MATCHING CONTRIBUTIONS The Company may, at its discretion,
make an additional contribution to the account of each participant who is
actively employed by the Company on the last day of the Plan year. The
Discretionary Matching Contribution amounted to 100% of Eligible
Participant Contributions in 2000 and 1999.
STOCK INCENTIVE MATCHING CONTRIBUTIONS The Company may, at its discretion,
contribute an additional matching contribution for Eligible Participant
Contributions invested in the Chiquita Common Stock Fund. The Stock
Incentive Matching Contribution was 40% in 2000 and 1999. However,
beginning January 16, 2001, participants can no longer invest in the
Chiquita Common Stock Fund, eliminating the Stock Incentive Matching
Contribution.
Beginning November 23, 2000, all Company matching contributions are made in
cash, allocated to the Company Non-restricted Contributions Account and invested
proportionally in the same fund options that participants have selected for
their Before-Tax Contributions. Prior to November 23, 2000, all Company
contributions were made with shares of Chiquita Brands International, Inc.
common stock ("Chiquita Common Stock") and were allocated to the Company
Restricted Contributions Account within the Chiquita Common Stock Fund. Amounts
allocated to the Company Restricted Contributions Account were transferred to
the Company Non-restricted Contributions Account on the second anniversary of
the first day of the Plan year in which the contributions were made. An
exception was made for 1999 Company Discretionary Matching Contributions, which
were transferred to the Company Non-restricted Contributions Account on April 1,
2000.
Under the Code, a participant's annual Before-Tax Contributions, After-Tax
Contributions, employer matching contributions and Non-elective Contributions
for any calendar year cannot exceed the lesser of a fixed dollar amount ($30,000
for 2000 and 1999) or 25% of the participant's compensation for that calendar
year.
6
INVESTMENT OPTIONS
Prior to January 16, 2001, participants could direct their contributions to
any of the Plan's investment options. Beginning January 16, 2001, participants
are no longer permitted to invest in the Chiquita Common Stock Fund.
Participants may change the investment allocation of accumulated account
balances daily. A participant's future contribution deferral amount and
investment allocation may be changed with each pay period. The Plan
Administrative Committee (the "Plan Administrator") may change any of the
investment funds offered to participants at its discretion.
VESTING
Participants are fully vested in their Employee Accounts. Company
contributions and the related earnings with respect to each Plan year become
vested at a rate of 20% for each year of service to the Company. A participant
also becomes fully vested immediately at age 65 or as a result of retirement on
or after attaining age 65, death or disability.
The non-vested portions of a terminating participant's Company Accounts are
forfeited and used to reduce future Company contributions.
WITHDRAWALS, DISTRIBUTIONS AND LOANS
A participant's contributions, including all income and loss thereon, may
be withdrawn only in limited circumstances, as permitted by the Code.
Upon termination of service, participants may apply to receive a
distribution of the vested portion of their account balance in a lump-sum amount
or leave their account balance in the Plan until age 65. Distributions consist
of cash or Chiquita Common Stock from the Chiquita Common Stock Fund and cash
from all other investment funds. In addition, other forms of distribution are
permitted for participants' account balances from merged plans, including
qualified joint and survivor annuities and monthly installment payments.
Participants may, with the approval of the Plan Administrator, borrow
amounts from certain of their accounts subject to conditions and terms as set
forth by the Plan Administrator.
SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accompanying financial statements of the Plan have been prepared on the
accrual basis.
USE OF ESTIMATES
The financial statements have been prepared in conformity with generally
accepted accounting principles, which require management to make estimates and
assumptions that affect the amounts and disclosures reported in the financial
statements and accompanying notes.
7
VALUATION OF INVESTMENTS
Chiquita Common Stock is valued at the last sales price reported on the New
York Stock Exchange on the day of valuation. Units of participation in
common/collective trusts (Putnam Stable Value Fund and Putnam S&P 500 Index
Fund) are valued at redemption value. The shares of registered investment
companies (the remainder of the funds) are valued at quoted market prices which
represent the net asset values of shares held by the Plan. Loans to participants
are valued at cost, which approximates fair value.
SECURITIES TRANSACTIONS
Purchases and sales of investments are recorded on a trade date basis.
DIVIDEND AND INTEREST INCOME
Dividend income is recorded on the ex-dividend date and interest income is
recorded on an accrual basis.
INVESTMENTS
The following presents investments, at fair value, that represent five
percent or more of the Plan's net assets:
December 31,
------------------------------------
2000 1999
--------------- ---------------
Putnam New Opportunities Fund $ 12,079,641 $ 17,892,383
Putnam S&P 500 Index Fund 10,604,301 15,144,961
Putnam Stable Value Fund 4,201,660 6,148,426
Franklin Templeton Small Cap Growth Fund 2,273,504 1,296,032
Chiquita Brands International, Inc. common stock 2,096,151 9,343,447
(valued at $1 per share at December 31, 2000
and $4.75 per share at December 31, 1999)
During 2000 and 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
(depreciated) in value as follows:
Year Ended December 31,
------------------------------------
2000 1999
--------------- ---------------
Mutual funds $ (8,961,162) $ 10,532,050
Chiquita Brands International, Inc. common stock (8,440,094) (8,597,297)
--------------- ---------------
$ (17,401,256) $ 1,934,753
=============== ===============
8
RELATED PARTY TRANSACTIONS
During the years ended December 31, 2000 and 1999, the Plan purchased
2,006,037 and 1,619,389 shares and sold 1,876,929 and 1,173,315 shares,
respectively, of Chiquita Brands International, Inc. common stock. All purchases
and sales were conducted at market prices.
While it has no obligation to do so, the Company has provided certain
administrative services and has paid professional fees for the benefit of the
Plan.
NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the changes in net assets of
nonparticipant-directed investments follows:
December 31,
-------------------------------------
2000 1999
---------------- ---------------
Investment in Chiquita Brands International, Inc.
common stock $ -- $ 2,968,493
=============== ===============
Year Ended December 31,
------------------------------------
2000 1999
--------------- ---------------
Changes in net assets:
Contributions $ 3,367,013 $ 3,905,789
Dividends -- 96,716
Net depreciation in fair value (1,800,090) (2,445,531)
Benefits paid to participants (163,717) (157,828)
Transfers to participant-directed investments (4,371,699) (2,367,839)
--------------- ---------------
$ (2,968,493) $ (968,693)
=============== ===============
TAXES
The Plan has received determination letters from the Internal Revenue
Service dated November 11, 1996 and March 3, 1998 ruling that the Plan, as
amended, has maintained its qualified status under section 401(a) of the Code
and, therefore, the related trust is not subject to tax under present income tax
law. Once qualified, the Plan is required to operate in conformity with the Code
to maintain its qualification. The Company is not aware of any course of action
or series of events that has occurred that might adversely affect the Plan's
qualified status or the related trust's tax-exempt status.
9
CHIQUITA SAVINGS AND INVESTMENT PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS
(HELD AT END OF YEAR)
DECEMBER 31, 2000
EIN No. 04-1923360, Plan No. 003
Number of Shares or
Rate of Interest and Current
Identity of Issue/Description of Asset Maturity Date Value
- -------------------------------------- ----------------------- ---------------
* Putnam New Opportunities Fund 206,067 shares $ 12,079,641
* Putnam S&P 500 Index Fund 334,732 units 10,604,301
* Putnam Stable Value Fund 4,201,660 units 4,201,660
Franklin Templeton Small Cap Growth Fund 57,806 shares 2,273,504
* Chiquita Brands International, Inc.
common stock, $.01 par value 2,096,151 shares 2,096,151
* Putnam Voyager Fund 74,072 shares 1,725,889
* Putnam Asset Allocation: Balanced Portfolio 156,002 shares 1,687,946
* Putnam International Growth Fund 58,364 shares 1,442,185
Pimco Total Return Fund 88,161 shares 915,995
* The Putnam Fund for Growth and Income 42,981 shares 839,427
* Putnam Asset Allocation: Conservative Portfolio 55,947 shares 517,511
* Putnam Asset Allocation: Growth Portfolio 33,589 shares 368,470
Participant loans receivable Interest rates range
from 7.0% to 10.5%;
maturities range from
1 to 10 years 673,837
---------------
$ 39,426,517
===============
* Denotes party-in-interest.
10
SIGNATURE
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 thereunto duly authorized.
CHIQUITA SAVINGS AND INVESTMENT PLAN
Date: June 22, 2001 By: /s/ Barry H. Morris
------------------------------------
Barry H. Morris, Chairman of the
Employee Benefits Committee
11