UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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(Mark One):
[X] 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, 2002
[ ] 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: 1-4188
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
NEWELL RUBBERMAID 401(K) SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
NEWELL RUBBERMAID INC.
29 EAST STEPHENSON STREET
NEWELL CENTER
FREEPORT, ILLINOIS 61032
REQUIRED INFORMATION
Financial Statements. The following financial statements and schedules are filed
as part of this annual report and appear immediately after the signature page
hereof:
1. Report of Independent Auditors
2. Statements of Assets Available for Benefits
3. Statement of Changes in Assets Available for Benefits
4. Notes to Financial Statements
5. Supplemental Schedule
Exhibits. The following exhibits are filed as a part of this annual report:
Exhibit 23.1 Consent of Ernst & Young LLP
Exhibit 99.1 Certification Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the Plan has duly caused this annual report to be signed on
its behalf by the undersigned hereunto duly authorized.
NEWELL RUBBERMAID 401(k) SAVINGS
PLAN
Date: June 27, 2003 /s/ Tom Nohl
------------------------------------
Tom Nohl, Member,
Plan Administrative Committee
2
Financial Statements and Supplemental Schedule
Newell Rubbermaid 401(k) Savings Plan
December 31, 2002 and 2001 and
year ended December 31, 2002
with Report of Independent Auditors
Newell Rubbermaid 401(k) Savings Plan
Financial Statements and Supplemental Schedule
December 31, 2002 and 2001 and year ended December 31, 2002
CONTENTS
Report of Independent Auditors....................................... 1
Financial Statements
Statements of Assets Available for Benefits.......................... 2
Statement of Changes in Assets Available for Benefits................ 3
Notes to Financial Statements........................................ 4
Supplemental Schedule
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)....... 11
Report of Independent Auditors
To the Plan Administrator of the Newell Rubbermaid 401(k) Savings Plan:
We have audited the accompanying statements of assets available for benefits of
the Newell Rubbermaid 401(k) Savings Plan as of December 31, 2002 and 2001, and
the related statement of changes in assets available for benefits for the year
ended December 31, 2002. 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 assets available for benefits of the Plan as of
December 31, 2002 and 2001, and the changes in its assets available for benefits
for the year ended December 31, 2002, in conformity with accounting principles
generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
(held at end of year) as of December 31, 2002, is presented for the purpose 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 audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.
/s/ Ernst & Young LLP
Chicago, Illinois
June 18, 2003
1
Newell Rubbermaid 401(k) Savings Plan
Statements of Assets Available for Benefits
DECEMBER 31
2002 2001
------------ ------------
ASSETS
Investments $450,240,147 $435,940,421
Interest in Newell Rubbermaid Master Trust 177,396,232 166,563,764
Employer contribution receivable 9,026,937 7,775,822
------------ ------------
Assets available for benefits $636,663,316 $610,280,007
============ ============
See accompanying notes.
2
Newell Rubbermaid 401(k) Savings Plan
Statement of Changes in Assets Available for Benefits
Year ended December 31, 2002
ADDITIONS
Investment income:
Interest and dividends $ 8,471,492
Net investment income from Newell Rubbermaid Master Trust 8,758,801
------------
17,230,293
Contributions:
Participant 42,908,718
Employer 28,605,233
Rollover 3,341,245
------------
74,855,196
Transfer of assets from American Tool Companies, Inc. Salary Deferral
and Profit Sharing Plan 59,889,523
Transfer of assets from other plans 81,838
------------
Total additions 152,056,850
DEDUCTIONS
Net realized and unrealized depreciation in fair value of investments 58,687,316
Benefits paid to participants 66,822,555
Administrative expenses 163,670
------------
Total deductions 125,673,541
------------
Net increase 26,383,309
Assets available for benefits - Beginning of year 610,280,007
------------
Assets available for benefits - End of year $636,663,316
============
See accompanying notes.
3
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements
Year ended December 31, 2002
1. DESCRIPTION OF THE PLAN
The following description of the Newell Rubbermaid 401(k) Savings 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
Certain employees of Newell Operating Company and subsidiaries (the Company) are
eligible to participate in the Plan. Full-time employees, as defined, are
eligible to participate in the Plan upon date of hire. Other employees are
eligible to participate after completing one year of service, as defined. The
Plan is administered by the Administrative Committee, which is appointed by the
Board of Directors of the Company. UMB Bank, N.A. (UMB) is the trustee of the
Plan. UMB has appointed American Century Services Corporation as the
recordkeeper of the Plan and agent for UMB. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974, as amended
(ERISA).
Effective January 1, 2002, the portion of the Plan held in the Company Stock
Fund is designated as an employee stock ownership plan (ESOP).
Effective December 31, 2002, the American Tool Companies, Inc. Salary Deferral
and Profit Sharing Plan merged with the Plan.
CONTRIBUTIONS
Participants may elect to contribute up to 50% (15% prior to January 1, 2002) of
pretax earnings, as defined by the Plan. Effective January 1, 2002, a
participant who is a resident of Puerto Rico shall be limited to 10% of pretax
earnings. The Company contributes a matching contribution for participants in an
amount equal to 100% of the first 3% of compensation plus 50% of the next 2% of
compensation contributed by the participant. Certain employees at the Graco's
Children's Products Inc. Century Division receive a match equal to 50% of the
first 6% of compensation contributed by the participant. Certain participants in
the Plan are eligible for an annual retirement contribution. Generally,
participants must be employed on the last day of the Plan year to receive an
allocation of the retirement contribution. In 2002, the Company made a
retirement contribution to the Plan equal to 6% of eligible participants'
eligible compensation.
4
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
PARTICIPANT ACCOUNTS
Separate accounts are maintained for each participant. Each participant's
account is credited with the participant's contributions and Company matching
contributions, and an allocation of: (a) the Company's retirement contribution,
if applicable, and (b) Plan earnings, and is charged with an allocation of
administrative expenses. Allocations are based on participant earnings or
account balances, as defined. 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. Prior to October 1, 2000, vesting in Company matching contributions
occurred ratably over a five-year period. On October 1, 2000, all existing
participants became fully vested in Company matching contributions. Employees
enrolling in the Plan subsequent to October 1, 2000, are immediately vested in
Company matching contributions. Retirement contributions vest over a graded
seven-year period. Forfeitures are used to pay Plan expenses and reduce Company
matching or retirement contributions. Forfeitures available for future use were
$1,119,844 and $2,198,845 at December 31, 2002 and 2001, respectively.
PARTICIPANT LOANS
Participants may borrow from their accounts a minimum of $1,000 up to a maximum
equal to the lesser of $50,000 or 50% of their vested account balance. Loan
terms range from one to five years (up to ten years for the purchase of a
principal residence). The loans are secured by the balance in the participant's
account and bear interest at a rate based on prevailing market conditions.
Interest rates on loans outstanding at December 31, 2002, ranged from 4.25% to
11.6%. Principal and interest is paid ratably through monthly payroll
deductions.
PAYMENT OF BENEFITS
On termination of service, a participant may receive a lump-sum amount equal to
the vested value of his or her account, or upon death, disability, or
retirement, elect to receive periodic installment payments. Generally, unless
the participant elects otherwise, distributions related to the ESOP portion of
the participant's account will be made in equal installments over a period not
exceeding five years.
5
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
INVESTMENT OPTIONS
All investments are participant-directed. Participants may direct contributions
to the Plan to one or more of the Plan's investment funds. In addition to the
investment funds offered by the Plan, participants may invest in a self-directed
brokerage account. Participants may change their investment options or
reallocate investment balances on a daily basis.
2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying financial statements have been prepared on the accrual basis of
accounting.
INVESTMENT VALUATION AND INCOME RECOGNITION
Except for investment contracts, which are stated at contract value, the Plan's
investments are stated at fair value, which equals the quoted market price on
the last business day of the Plan year. Participant loans are valued at their
outstanding balances, which approximates fair value.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
ADMINISTRATIVE EXPENSES
All normal costs and expenses of administering the Plan and trust are paid by
Plan participants. Any cost resulting from a participant obtaining a loan or
requesting a distribution or in-service withdrawal may be borne by such
participant or charged to the participant's individual account.
6
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States require management to make estimates and
assumptions that affect amounts reported in the financial statements and
accompanying notes. Actual results could differ from these estimates.
3. INVESTMENTS
During 2002, the Plan's investment (including investments purchased, sold as
well as held during the year) (depreciated) appreciated in fair value as
determined by quoted market prices as follows:
NET REALIZED
AND UNREALIZED
APPRECIATION
(DEPRECIATION) IN FAIR
VALUE OF INVESTMENTS
--------------------
Common stock $ 10,309,996
Mutual funds (68,977,312)
------------
$(58,687,316)
============
The fair market value of individual assets that represent 5% or more of the
Plan's assets as of December 31 are as follows:
2002 2001
----------------------------------
Newell Rubbermaid Inc. common stock $108,620,133 $102,929,569
Janus Fund 55,528,966 78,490,468
American Century Equity Index Fund 39,682,261 56,136,110
Franklin Templeton Small Cap Growth Fund 36,607,115 49,983,932
J.P. Morgan Institutional Diversified Fund 34,489,549 41,749,182
American Century Income and Growth Fund * 31,038,953
PIMCO Total Return Fund 34,902,138 *
*Below 5% threshold
7
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
4. MASTER TRUST FINANCIAL INFORMATION
Certain of the Plan's investments are held in the Newell Rubbermaid Master Trust
(Master Trust) along with the investments of another Company-sponsored plan, the
Rubbermaid Retirement Plan for Collectively-Bargained Associates. Fidelity
Management Trust Company serves as the trustee for the assets of the Master
Trust.
Each participating plan has an undivided interest in the net assets of the
Master Trust. At December 31, 2002 and 2001, the Plan's interest in the net
assets of the Master Trust was 68.2% and 63.5%, respectively. Investment income
and expenses are allocated among participating plans based upon the value of the
participant accounts attributed to each plan.
The Master Trust investments at December 31 are as follows:
2002 2001
------------ ------------
Investments at fair value:
Newell Rubbermaid Inc. common stock $ 1,279,380 $ 919,239
Mutual funds 32,284,548 50,895,181
Loans to participants 1,507,868 1,065,192
Short-term investment fund 84,720 58,398
------------ ------------
35,156,516 52,938,010
Investments at contract value:
Stable Value Fund 224,911,951 209,519,597
------------ ------------
$260,068,467 $262,457,607
============ ============
Investment income for the Master Trust for the year ended December 31, 2002, is
as follows:
Interest and dividends $ 11,645,415
Net realized and unrealized appreciation (depreciation) in the fair
value of investments determined by quote market price:
Newell Rubbermaid, Inc. common stock 171,902
Mutual funds (10,704,363)
-----------
$ 1,112,303
============
8
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
5. STABLE VALUE FUND
The Master Trust holds an investment in a Stable Value Fund, which invests
primarily in guaranteed investment contracts and synthetic guaranteed investment
contracts. The fund also includes a short-term interest fund in the amount of
$10,622,209 and $6,990,464 at December 31, 2002 and 2001, respectively. The fund
is included in the financial statements at contract value as reported by the
respective insurance companies.
The blended crediting interest rate for the fund was 4.97% and 5.75% as of
December 31, 2002 and 2001, respectively. The fund's blended rate of return for
the 2002 year was 5.31%.
The crediting rates are reset periodically and are based on the market value of
the underlying portfolio of assets backing these contracts. Inputs used to
determine the crediting rate include each contract's portfolio market value,
current yield-to-maturity, duration (i.e., weighted average life), and market
value relative to contract value. All contracts have a guaranteed rate of 0% or
higher.
The contract values and fair values of investment contracts included in the
Stable Value Fund as of December 31, 2002 and 2001 are as follows:
CONTRACT VALUE FAIR VALUE
2002 2001 2002 2001
-------------------------------- --------------------------------
Guaranteed Investment Contracts $ 65,335,005 $ 57,375,436 $ 65,335,005 $ 59,135,791
Synthetic Guaranteed Investment
Contracts 148,954,737 145,153,697 139,486,885 149,107,629
------------ ------------ ------------ ------------
$214,289,742 $202,529,133 $204,821,890 $208,243,420
============ ============ ============ ============
Included in the fair value of synthetic guaranteed investment contracts as of
December 31, 2002 and 2001, are wrapper contracts with a total estimated fair
value of $13,823,109 and $17,759,647, respectively. The wrappers guarantee the
contract value of the synthetic guaranteed investment contracts for
participant-initiated withdrawal events.
9
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
6. RELATED PARTY TRANSACTIONS
All expenses related to the trustee and recordkeeping in connection with the
operation of the Plan are paid by the Plan. All other costs are paid out of Plan
assets, except to the extent the Administrative Committee elects to have such
expenses paid directly by the Company.
7. 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.
8. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated March 18, 2003, 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 administrator believes the
Plan is being operated in compliance with the application requirements of the
Code and, therefore, believes the Plan is qualified and the related trust is tax
exempt.
9. SUBSEQUENT EVENT
The 2003 annual retirement contribution will be 3% of eligible participants'
eligible compensation. For plan years beginning after and including January 1,
2004, no retirement contributions will be made to the Plan.
10
SUPPLEMENTAL SCHEDULE
EIN 36-1953139
PLAN No. 012
Newell Rubbermaid 401(k) Savings Plan
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2002
IDENTITY OF ISSUE CURRENT VALUE
----------------- -------------
PIMCO Total Return Fund $ 34,902,138
J.P. Morgan Institutional Diversified Fund* 34,489,549
American Century Income and Growth Fund* 26,099,664
American Century Equity Index Fund* 39,682,261
Janus Fund 55,528,966
Franklin Small Cap Growth A Fund 36,607,115
American Century International Growth Fund* 21,740,014
Newell Rubbermaid, Inc. Common Stock* 108,620,133
American Century Self-Directed Brokerage Account* 1,849,395
American Century Equity Income Fund* 3,457,606
Liberty Funds Small Cap 911,449
UAM Equity Funds 4,319,941
UMB Bank - Prime Money Market Fund* 20,278
Principal Life Insurance Company Guaranteed Interest Account, interest rates 6.22%
to 6.26%, maturing December 31, 2002 600,891
Principal Life Insurance Company Guaranteed Interest Account, interest rates 5.13%
to 5.29%, maturing December 31, 2002 274,207
Principal Life Insurance Company Guaranteed Interest Account, interest rates 4.39%
to 5.07%, maturing December 31, 2003 1,198,372
Principal Life Insurance Company Guaranteed Interest Account, interest rates 4.87%
to 5.76%, maturing December 31, 2003 784,479
Principal Life Insurance Company Mature amount reinvested, matures
December 31, 2004 956,848
Principal Life Insurance Company Guaranteed Interest Account, interest rates 6.39%
to 6.40%, maturing December 31, 2004 772,794
Principal Life Insurance Company Guaranteed Interest Account, interest rates 4.73%
to 4.94%, maturing December 31, 2005 521,894
Principal Life Insurance Company Mature amount reinvested, matures December
31, 2006 691,449
Principal Life Insurance Company Money Market Account 6,872,167
Principal Life Insurance Company Bond and Mortgage Account 11,319,250
11
Newell Rubbermaid 401(k) Savings Plan
Notes to Financial Statements (continued)
Newell Rubbermaid 401(k) Savings Plan
Schedule H, Line 4i - Schedule of Assets (Held at End of Year) (continued)
IDENTITY OF ISSUE CURRENT VALUE
----------------- -------------
Principal Life Insurance Company Stock Index Account $ 2,346,745
Principal Life Insurance Company Large Company Blend 5,978,269
Principal Life Insurance Company Small Company Stock Account 3,220,086
Principal Life Insurance Company International Stock Account 1,679,060
Principal Life Insurance Company Stock Separate Account 2,871,546
Fidelity Growth and Income Fund 2,020,934
Fidelity Magellan Fund 6,260,205
Fidelity Puritan Fund 4,897,551
Fidelity OTC Fund 1,786,844
Participant Loans (interest rates of 4.25% to 11.6%) 26,958,047
------------
$450,240,147
============
*Represents a party in interest to the Plan.
12