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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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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[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 [NO FEE REQUIRED].
For the fiscal year ended December 31, 2000
OR
[ ] 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: 1-10767
A. Full title of plan and the address of the plan, if different from
that of the issuer named below:
THE PROFIT SHARING AND 401(k) PLAN NO. SS7
(Formerly "The Schottenstein Stores Corporation and Affiliates
Associated Profit Sharing and 401(k) Plan No. SS7")
B. Name of issuer of the securities held pursuant to the Plan and the
address of its principal executive office:
VALUE CITY DEPARTMENT STORES, INC.
3241 Westerville Road
Columbus, Ohio 43224
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2000 AND 1999
AND FOR THE YEAR ENDED DECEMBER 31, 2000
TOGETHER WITH AUDITORS' REPORT
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
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INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Plan Benefits
as of December 31, 2000 and 1999 2
Statement of Changes in Net Assets Available for Plan
Benefits for the Year Ended December 31, 2000 3
Notes to Financial Statements and Schedules 4-7
SUPPLEMENTAL SCHEDULE:
Form 5500 Schedule H, Part IV, Line 4I, Schedule of
Assets Held as of December 31, 2000 8
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INDEPENDENT AUDITORS' REPORT
To the Plan Committee
of The Profit Sharing and 401(k) Plan No. SS7:
We have audited the accompanying financial statements of The Profit Sharing and
401(k) Plan No. SS7 (formerly "the Schottenstein Stores Corporation and
Affiliates Associated Profit Sharing and 401(k) Plan No. SS7") (the "Plan") as
of December 31, 2000, and for the year then ended, listed in the Table of
Contents. These financial statements and the schedule referred to below are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements and schedule based on our audit. The
statement of net assets available for plan benefits of The Profit Sharing and
401(k) Plan No. SS7 as of December 31, 1999 was audited by other auditors whose
report, dated December 15, 2000, expressed an unqualified opinion on that
statement.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. 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 audit provides 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 plan benefits of the Plan as
of December 31, 2000, and the changes in net assets available for plan benefits
for the year ended December 31, 2000, in conformity with accounting principles
generally accepted in the United States of America.
Our audit was conducted for the purpose of forming an opinion on the basic 2000
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents is presented for the purpose of additional analysis and is not
a required part of the basic 2000 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 schedule is the responsibility of the Plan's management. Such
schedule has been subjected to the auditing procedures applied in our audit of
the basic 2000 financial statements and, in our opinion, is fairly stated in all
material respects when considered in relation to the basic 2000 financial
statements taken as a whole.
July 20, 2001
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Statements of Net Assets Available for Plan Benefits
December 31, 2000 and 1999
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2000 1999
INVESTMENTS, AT FAIR VALUE $160,516,309 $137,130,596
PARTICIPANT LOANS 2,867,081 2,201,222
RECEIVABLES:
Employee contributions 688,018 458,732
Employer matching contributions 304,332 153,308
Employer profit sharing contributions 1,794,676 2,172,319
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Total receivables 2,787,026 2,784,359
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NET ASSETS AVAILABLE FOR PLAN BENEFITS $166,170,416 $142,116,177
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See notes to financial statements
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Statement of Changes in Net Assets Available for Plan Benefits
For the Year Ended December 31, 2000
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ADDITIONS TO NET ASSETS:
Investment income, net:
Dividends and interest $9,331,380
Net realized and unrealized depreciation in fair
value of investments (16,195,955)
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Total investment loss, net (6,864,575)
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Contributions:
Employee 16,083,048
Employer matching 6,763,150
Employer profit sharing contributions 1,794,676
Rollovers 2,076,590
Net assets transferred 16,948,402
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Total contributions 43,665,866
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Total additions 36,801,291
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DEDUCTIONS FROM NET ASSETS:
Distributions to participants 12,726,426
Fees 20,626
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Total deductions 12,747,052
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NET INCREASE 24,054,239
NET ASSETS AVAILABLE FOR
PLAN BENEFITS - Beginning of year 142,116,177
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NET ASSETS AVAILABLE FOR PLAN BENEFITS - End of year $166,170,416
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See notes to financial statements.
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Notes to Financial Statements for the
Years Ended December 31, 2000 and 1999
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1. DESCRIPTION OF THE PLAN
GENERAL - The following description of The Profit Sharing and 401(k)
Plan No. SS7 (the Plan) (formerly "the Schottenstein Stores
Corporation and Affiliates Associated Profit Sharing and 401(k) Plan
No. SS7") is provided for general information only. Interested parties
should refer to the Plan document for more complete information.
The Plan was adopted by Schottenstein Stores Corporation and
affiliated companies (the "Company") effective August 1, 1989 for the
profit sharing provisions of the Plan and effective October 1, 1989
for the 401(k) provisions of the Plan. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974.
The Plan is administered by the Company, and all Plan expenses, with
the exception of loan fees, are paid by the Company. Reliance Trust
Company is the trustee and asset custodian of the Plan.
CONTRIBUTIONS TO THE PLAN - The Plan is a defined contribution plan.
Pursuant to the 401(k) feature of the Plan, an eligible employee may
contribute up to 20% of his or her cash compensation on a pretax basis
within certain dollar limitations imposed by the Internal Revenue
Service. The Company matches employee contributions on the first
$50,000 of gross wages as follows:
EMPLOYEE CONTRIBUTION EMPLOYER MATCH
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1.0% 1.5%
2.0% 2.5%
3.0% 3.0%
Effective January 1, 2001 the match formula will be as follows:
EMPLOYEE CONTRIBUTION EMPLOYER MATCH
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1.0% 1.0%
2.0% 2.0%
3.0% 3.0%
4.0% 3.5%
5.0% 4.0%
6.0% 4.5%
Effective January 1, 2001 there will no longer be a $50,000 gross
wages limitation. The Company may also elect to make a discretionary
profit sharing contribution. Such contributions are allocated to
eligible participants, as defined by the Plan, based on the ratio of
each participant's compensation to the total of all eligible
participants' compensation. Total discretionary contributions for 2000
were approximately $1,800,000.
INVESTMENTS - Participants have the option to direct the investment of
their accounts among alternative investment funds selected by the Plan
committee.
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Notes to Financial Statements for the
Years Ended December 31, 2000 and 1999
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ELIGIBILITY AND VESTING - Employees are eligible for participation in
the Plan after completing 60 days of service, and having attained the
age of twenty and one-half years.
Amounts contributed by the participants and earnings thereon are fully
vested and nonforfeitable at all times. Amounts contributed by the
Company (matching and profit sharing contributions) to a participant's
account and earnings thereon vest at the rate of 25% per year,
beginning with the second full year of plan matching participation.
Participants are fully vested at the end of the fifth year of matching
participation.
ALLOCATION OF INVESTMENT INCOME AND FORFEITURES - Investment income
for each fund is allocated to the applicable participants' accounts
based on the ratio of each participant's account balance to the total
of all participants' account balances in that fund, as defined.
Forfeitures have historically been used to offset employer
contributions after five consecutive one year service breaks, as
defined by the Plan, based on the ratio of each eligible participant's
compensation to the total of all eligible participants' compensation.
The Plan's forfeitures are immediately available to offset employer
contributions.
BENEFIT PAYMENTS - Benefits are generally payable upon the
participating employee's retirement, death, disability or termination
of employment and are paid as a lump-sum amount.
NET ASSETS TRANSFERRED - In 2000, the net assets of two affiliated
Companies' 401(k) plan were transferred to the Plan, and the
affiliated Companies' 401(k) plan were merged into the Plan. The total
amount of transferred assets was $16,948,402.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The financial statements are prepared using the
accrual basis 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 and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
VALUATION OF INVESTMENTS - Investments are stated at fair value.
Unrealized appreciation (depreciation) of assets is based on fair
values at year end and fair values at the beginning of the Plan year
or cost at the time of purchase during the year. Realized appreciation
(depreciation) on sale or redemption of assets is based on the
proceeds and the fair value of the assets at the beginning of the Plan
year or cost at the time of purchase during the year.
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Notes to Financial Statements for the
Years Ended December 31, 2000 and 1999
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Purchases and sales of securities are recorded on a trade date basis.
Dividends are recorded on the ex-dividend date.
PARTICIPANT LOANS - Subject to certain provisions, a participant may
borrow from their account balances. The participant executes a
promissory note with an interest rate based upon prevailing commercial
lending rates. Loan principal and interest are paid over a period in
excess of one year as determined by the Plan Committee. Participant
loans are valued at cost which approximates fair value.
3. TAX STATUS
The Internal Revenue Service has determined and informed the Company
by a letter dated September 26, 1996, that the Plan and related trust
are designed in accordance with applicable sections of the Internal
Revenue Code (IRC). The Company adopted the proposed amendments in
April 1997. The Plan has been amended since the latest determination
letter. However, the Plan Administrator believes the Plan, as
currently designed, is in compliance and is being operated within the
applicable requirements of the IRC.
4. INVESTMENTS
The fair value of investments, which represent 5% or more of net
assets available for Plan benefits, as of December 31, 2000 and 1999,
are as follows:
2000 1999
MFS Institutional Fixed Fund $ 58,231,049 $ 56,785,787
Massachusetts Investors Trust Fund 12,451,922 13,147,263
Massachusetts Investors Growth Stock Fund 28,479,538 21,217,040
MFS Capital Opportunities Fund 14,061,726 14,899,374
American Eagle Stock Fund 7,687,293
During 2000, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
depreciated in value by $16,195,955 as follows:
Mutual funds $ 12,864,817
Common stock 3,331,138
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Total depreciation $ 16,195,955
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5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to terminate the Plan at any time subject to the
provisions of ERISA. In the event of Plan termination, participants
will become 100% vested in their accounts.
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Notes to Financial Statements for the
Years Ended December 31, 2000 and 1999
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6. RELATED PARTY TRANSACTION
Certain Plan investments are funds managed by MFS. MFS is the asset
custodian of the Plan, and therefore, these transactions qualify as
party in interest. Additionally, as Value City Department Stores
(VCDS) and American Eagle Corporation are affiliated companies, the
transactions in the VCDS common stock fund and American Eagle Stock
Fund qualify as party in interest. Participant loans also qualify as
party in interest.
7. REQUIRED SCHEDULE INFORMATION
There is no information to be reported for the following schedules as
of December 31, 2000 or for the year then ended:
- Assets held for investment purposes which were both acquired and
disposed of within the Plan year.
- Loans or fixed income obligations in default.
- Leases in default or classified as uncollectible.
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THE PROFIT SHARING AND 401(k) PLAN NO. SS7
Form 5500 Schedule H, Part IV, Line 4I, Schedule of Assets Held
As of December 31, 2000
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IDENTITY OF ISSUE, BORROWER,
LESSOR, OR SIMILAR PARTY DESCRIPTION OF ASSET CURRENT VALUE
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Reliance Trust Company Conservative Option Fund $ 4,451,816
Reliance Trust Company Moderate Option Fund 6,805,674
Reliance Trust Company Aggressive Option Fund 6,612,329
*Reliance Trust Company MFS Institutional Fixed Fund 58,231,049
Reliance Trust Company PIMCO Total Return Fund 1,153,220
*Reliance Trust Company MFS Total Return Fund 4,960,403
Reliance Trust Company Vanguard 500 Index Fund 4,553,737
Reliance Trust Company Massachusetts Investors Trust Fund 12,451,922
Reliance Trust Company Massachusetts Investors Growth Stock Fund 28,479,538
*Reliance Trust Company MFS Capital Opportunities Fund 14,061,726
*Reliance Trust Company MFS Emerging Growth Fund 3,997,970
Reliance Trust Company Lord Abbott Develop Growth Fund 564,403
Reliance Trust Company American New Perspectives Fund 2,893,837
Reliance Trust Company Amer Europacific Growth Fund 731,484
*Reliance Trust Company Value City Company Stock Fund 2,604,252
*Reliance Trust Company American Eagle Stock Fund 7,962,949
*Various Participants Outstanding Participant Loans (with interest
rates ranging from 7% to 10% with maturities
though 2021) 2,867,081
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TOTALS $ 163,383,390
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* Denotes party-in-interest
See notes to financial statements.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed by the undersigned hereunto duly
authorized.
The Profit Sharing and 401(k) Plan No. SS7
Dated: October 3, 2001 /s/ George Dailey
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By: George Dailey
Title: Plan Administrator