SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_____________
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One):
ý ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED, EFFECTIVE OCTOBER 7, 1996].
For the fiscal year ended December 31, 2001
OR
o TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED].
For the transition period from __________ to __________
Commission file number 1-724
A. Full title of the plan and the address of the plan, if different from that of the issuer named below: PVH Associates Investment Plan For Residents Of The Commonwealth Of Puerto Rico
B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Phillips-Van Heusen Corporation, 200 Madison Avenue, New York, New York 10016
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the Administrative Committee has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
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PHILLIPS-VAN HEUSEN CORPORATION |
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ASSOCIATES INVESTMENT PLAN FOR |
|
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RESIDENTS OF THE COMMONWEALTH |
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OF PUERTO RICO |
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Date: June 27, 2002 |
By /s/ Pamela N. Hootkin |
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Pamela N. Hootkin, Member of |
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Administrative Committee |
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Financial Statements
Years ended December 31, 2001 and 2000
Contents
|
Report of Independent Auditors |
F-2 |
|
Statements of Net Assets Available for Benefits |
F-3 |
|
Statements of Changes in Net Assets Available for Benefits |
F-4 |
|
Notes to Financial Statements |
F-5 |
F-1
[Letterhead of Ernst & Young LLP]
Report of Independent Auditors
Administrative Committee of the Plan
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
We have audited the accompanying statements of net assets available for benefits of the Phillips-Van Heusen Corporation Associates Investment Plan for Residents of the Commonwealth of Puerto Rico as of December 31, 2001 and 2000, and the related statements 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 as of December 31, 2001 and 2000, and the changes in its net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
June 14, 2002
F-2
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Statements of Net Assets Available for Benefits
|
December 31 |
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|
2001 |
2000 |
|
|
Assets |
||
Investments, at fair value (Notes A and E): |
||
Shares of Master Trust: |
||
Equity Fund |
$15,002 |
$ 40,456 |
Bond Fund |
8,049 |
8,629 |
Balanced Fund |
10,905 |
44,146 |
International Fund |
3,662 |
3,977 |
Spartan Equity Index Fund |
2,604 |
1,634 |
Small Cap Fund |
1,449 |
739 |
Common Stock-Employer Company Fund |
17,629 |
34,463 |
Common Trust Fund * |
6,894 |
8,562 |
Participant loans receivable |
1,503 |
2,384 |
|
Net assets available for benefits |
$67,697 |
$144,990 |
* Consists of the Money Market Fund (Chase Manhattan Bank Domestic Liquidity Fund).
See notes to financial statements.
F-3
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Statements of Changes in Net Assets Available for Benefits
|
Year ended December 31 |
||
|
2001 |
2000 |
|
Additions |
||
Contributions: |
||
Employer Company, net of forfeitures |
$ 455 |
|
Employees |
1,055 |
|
|
1,510 |
||
Interest and investment income |
$ 2,527 |
7,460 |
|
Total additions |
2,527 |
8,970 |
Deductions |
||
Payments to participants |
69,591 |
83,638 |
Administrative expenses |
36 |
144 |
Total deductions |
69,627 |
83,782 |
Net realized and unrealized (depreciation) appreciation of investments |
(10,193) |
5,287 |
Net decrease |
(77,293) |
(69,525) |
Net assets available for benefits at beginning of year |
144,990 |
214,515 |
Net assets available for benefits at end of year |
$ 67,697 |
$ 144,990 |
See notes to financial statements.
F-4
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements
December 31, 2001
A. Description of the Plan
The following description of the Phillips-Van Heusen Corporation ("the Company") Associates Investment Plan for Residents of the Commonwealth of Puerto Rico (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 covering salaried clerical and hourly production associates of Phillips-Van Heusen Corporation (the "Company") who are residents of the Commonwealth of Puerto Rico, have at least one year of service (1,000 hours in a year) and are age 21 or older. The Plan is subject to the reporting and disclosure requirements of the Employee Retirement Income Security Act of 1974 ("ERISA").
Contributions
Each year, participants may contribute up to 10% of pretax annual compensation, as defined by the Plan. Through March 31, 1999, the Company contributed 50% of the first 6% of base compensation that a participant contributed to the Plan. Effective April 1, 1999, the Company matched 100% of the first 2% of base compensation that a participant contributed to the Plan plus 25% of the next 4% of base compensation contributed by the participant.
The Company closed its Puerto Rico plant during 2000; therefore, there were no active participants or contributions to the Plan during 2001.
Participant Accounts
Each participant's account is credited with the participant's contributions and allocations of (a) the Company's contributions and (b) Plan earnings. Forfeited balances of terminated participants' nonvested accounts are used to reduce future Company contributions. Through March 31, 1999, 100% of the Company contributions were automatically invested in the common stock of the Company. Effective April 1, 1999, the Company contributions were invested in any fund offered by the Plan as elected by the participant. However, existing balances as of March 31, 1999 must remain in the Employer Company Fund until participants are age 55 or older, at which time they may choose to transfer their investment.
F-5
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
Vesting
Through March 31, 1999, amounts attributable to Company contributions become vested on the participant's 65th birthday or if the participant's employment by the Company terminates by reason of the participant's death or permanent disability or the participant has completed five years of service with the Company. Effective April 1, 1999, the Company's contribution becomes 25% vested after two years from the participant's date of hire and vests 25% more each year, reaching 100% after five years of service.
Investment Options
Upon enrollment in the Plan, a participant may direct employee contributions into any of six investment options. A participant may contribute a maximum of 25% of employee contributions into the Phillips-Van Heusen Corporation Common Stock Fund.
Participant Loans Receivable
Participants may borrow from the Plan, with certain restrictions, using their vested account balance as collateral. The minimum loan amount is $1,000 and the maximum loan amount is the lesser of (i) $50,000 reduced by the participant's highest outstanding loan balance during the previous 12 months, or (ii) 50% of the vested value of the participant's account. Interest is fixed for the term of the loan at the prime rate as of first business day of the month of application as published in The Wall Street Journal, plus 1%. Loan repayments are made through payroll deductions which may be specified for a term of 1 to 5 years or up to 15 years for the purchase of a primary residence.
Forfeitures
Contributions made on behalf of non-vested employees who have terminated are retained by the Plan and are used to reduce the Company's future matching contributions.
Payment of Benefits
Participants entitled to final distributions generally will receive payment in the form of a lump-sum amount equal to the value of their vested account.
F-6
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
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% vested in their accounts.
B. Significant Accounting Policies
The accounting records of the Plan are maintained on the accrual basis.
Substantially all administrative expenses are paid by the Company.
In accordance with the Rules and Regulations of the Department of Labor, investments are included in the accompanying financial statements at market value as determined by quoted market prices or at fair value as determined by the trustee. Purchases and sales of securities are reflected on a trade date basis.
All assets of the Plan are held by the trustee in the Company's Associates Investment Plan Master Trust (the "AIP Master Trust") and are segregated from the assets of the Company. The Plan shares in AIP Master Trust interest and investment income based upon its participants' shares of AIP Master Trust net assets available for benefits.
The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
C. Transactions with Parties-in-Interest
During the years ended December 31, 2001 and 2000, the AIP Master Trust purchased 103,200 and 218,613 shares, respectively, of the Company's common stock and received $187,304 and $201,414, respectively, from the Company as payment of dividends on its common stock. The AIP Master Trust also sold 168,533 and 308,224 shares of the Company's common stock during the years ended December 31, 2001 and 2000, respectively.
F-7
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements (continued)
D. Changes in the AIP Master Trust Net Assets Held by Fund
The Plan is one of three plans in the AIP Master Trust and represents an approximate .09% and .2% interest in the trust at December 31, 2001 and 2000 respectively. Changes in the AIP Master Trust net assets held by fund during the year ended December 31, 2001 were as follows:
|
Phillips-Van Heusen Corporation Common |
Money Market Fund |
Bond Fund |
Balanced Fund |
Equity Fund |
Current International Fund |
Small Cap Fund |
Spartan Equity Fund |
Loan Fund |
Total |
|
Net assets at beginning of year |
$17,408,929 |
$ 6,931,550 |
$2,266,319 |
$10,055,036 |
$21,671,208 |
$4,317,250 |
$2,364,232 |
$4,128,418 |
$1,155,798 |
$70,298,740 |
Interest and investment income |
211,805 |
326,000 |
172,897 |
521,328 |
398,155 |
- |
- |
54,834 |
- |
1,685,019 |
Contributions received: |
||||||||||
Employer Company, net of forfeitures |
904,344 |
130,593 |
76,131 |
158,708 |
414,788 |
93,210 |
180,316 |
430,467 |
- |
2,388,557 |
Employees |
347,457 |
576,294 |
417,928 |
1,103,647 |
1,881,342 |
454,350 |
509,091 |
986,114 |
- |
6,276,223 |
Net realized and unrealized appreciation (depreciation) |
(2,480,462) |
- |
67,698 |
(628,631) |
(2,438,359) |
(815,305) |
89,859 |
(590,066) |
- |
(6,795,266) |
Loans to participants, net of repayments |
876,751 |
(73,168) |
(18,458) |
(91,618) |
(103,105) |
(18,936) |
(11,975) |
(7,568) |
428,822 |
980,745 |
Payments to participants |
(1,952,865) |
(986,112) |
(263,837) |
(934,613) |
(1,388,626) |
(239,222) |
(145,340) |
(295,294) |
(63,404) |
(6,269,313) |
Administrative expenses |
- |
(17,517) |
- |
- |
- |
(32,813) |
(17,774) |
- |
- |
(68,104) |
Transfers (to) from other accounts |
(1,401,694) |
1,496,789 |
1,146,720 |
(119,159) |
(740,827) |
(533,189) |
104,654 |
46,706 |
- |
- |
Net assets at end of year |
$13,914,265 |
$8,384,429 |
$3,865,398 |
$10,064,698 |
$19,694,576 |
$3,225,345 |
$3,073,063 |
$4,753,611 |
$1,521,216 |
$68,496,601 |
Plan's beneficial interest at end of year |
$ 17,629 |
$ 6,894 |
$ 8,049 |
$ 10,905 |
$ 15,002 |
$ 3,662 |
$ 1,449 |
$ 2,604 |
$ 1,503 |
$ 67,697 |
Note: Certain funds above include investments in the Chase Manhattan Bank Domestic Liquidity Fund.
F-8
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements (continued)
D. Changes in the AIP Master Trust Net Assets Held by Fund (continued)
Changes in the AIP Master Trust net assets held by fund during the year ended December 31, 2000 were as follows:
|
Phillips-Van Heusen Corporation Common |
Money Market Fund |
Bond Fund |
Balanced Fund |
Equity Fund |
Current International Fund |
Small Cap Fund |
S&P 500 Fund |
Loan Fund |
Total |
|
Net assets at beginning of year |
$11,470,437 |
$ 7,318,089 |
$2,181,663 |
$11,050,161 |
$23,614,787 |
$4,494,773 |
$ 590,045 |
$2,404,387 |
$1,012,658 |
$64,137,000 |
Interest and investment income |
241,462 |
436,127 |
140,182 |
824,130 |
2,041,452 |
239 |
48 |
38,431 |
7,982 |
3,730,053 |
Contributions received: |
||||||||||
Employer Company, net of forfeitures |
1,001,222 |
68,837 |
42,130 |
141,679 |
368,032 |
87,919 |
134,025 |
429,225 |
- |
2,273,069 |
Employees |
235,295 |
405,572 |
247,585 |
872,219 |
1,882,725 |
475,499 |
302,956 |
852,413 |
- |
5,274,264 |
Net realized and unrealized appreciation (depreciation) |
6,171,260 |
- |
61,565 |
(111,799) |
(2,467,571) |
(618,802) |
28,415 |
(419,459) |
- |
2,643,609 |
Loans to participants, net of repayments |
105,167 |
777 |
3,385 |
20,900 |
9,863 |
7,515 |
7,051 |
(19,082) |
153,322 |
288,898 |
Payments to participants |
(1,433,444) |
(1,109,293) |
(214,644) |
(1,383,482) |
(2,695,150) |
(725,111) |
(105,076) |
(281,836) |
(17,482) |
(7,965,518) |
Administrative expenses |
(81) |
(9,857) |
(29) |
(1) |
(12) |
(58,112) |
(14,543) |
- |
- |
(82,635) |
Transfers (to) from other accounts |
(382,389) |
(178,702) |
(195,518) |
(1,358,771) |
(1,076,918) |
647,330 |
1,421,311 |
1,124,339 |
(682) |
- |
Net assets at end of year |
$17,408,929 |
$ 6,931,550 |
$2,266,319 |
$10,055,036 |
$21,677,208 |
$4,311,250 |
$2,364,232 |
$4,128,418 |
$1,155,798 |
$70,298,740 |
Plan's beneficial interest at end of year |
$ 34,463 |
$ 8,562 |
$ 8,629 |
$ 44,146 |
$ 40,456 |
$ 3,977 |
$ 739 |
$ 1,634 |
$ 2,384 |
$ 144,990 |
Note: Certain funds above include investments in the Chase Manhattan Bank Domestic Liquidity Fund.
F-9
Phillips-Van Heusen Corporation
Associates Investment Plan for Residents
of the Commonwealth of Puerto Rico
Notes to Financial Statements (continued)
E. Non Participant-Directed Investments
Information about the net assets and the significant components of the change in net assets relating to the non- participant directed investments is as follows:.
|
December 31 |
|||
|
2001 |
2000 |
||
Net assets: |
|||
Common stock |
$17,629 |
$34,463 |
|
|
Year ended December 31, 2001 |
|||
Changes in net assets: |
|||
Contributions |
$ 6,030 |
||
Earnings and net realized and unrealized |
(10,928) |
||
Distributions to participants |
(9,407) |
||
Transfers to participant directed investments |
(6,752) |
||
Loans to participants, net of repayments |
4,223 |
||
|
$(16,834) |
|||
F. Income Tax Status
The Plan has received a determination letter from the Internal Revenue Service dated April 27, 1995, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the "Code") and, therefore, the related trust is exempt from taxation. Once qualified, the plan is required to operate in conformity with the Code to maintain its qualification. The Plan has been amended since receiving the determination letter and a new determination letter has been applied for. The plan administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan is qualified and the related trust is tax-exempt.
F-10
EXHIBIT INDEX
Exhibit No.
1 Consent of Independent Auditors
Exhibit 1
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33- 46810) pertaining to the Phillips-Van Heusen Corporation Associates Investment Plan for Residents of the Commonwealth of Puerto Rico of our report dated June 14, 2002, with respect to the financial statements of the Phillips-Van Heusen Corporation Associates Investment Plan for Associates who are residents of the Commonwealth of Puerto Rico included in this Annual Report (Form 11-K) for the year ended December 31, 2001.
/s/ Ernst & Young LLP
New York, New York
June 25, 2002