SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO ________
COMMISSION FILE NUMBER 0-20570
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A. FULL TITLE OF THE PLAN AND THE ADDRESS OF THE PLAN, IF DIFFERENT
FROM THAT OF THE ISSUER NAMED BELOW:
USA NETWORKS, INC. RETIREMENT SAVINGS PLAN--NETWORKS
B. NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND THE
ADDRESS OF ITS PRINCIPAL EXECUTIVE OFFICE:
USA INTERACTIVE
152 WEST 57TH STREET
NEW YORK, NEW YORK
10019
REQUIRED INFORMATION
1. Not Applicable
2. Not Applicable
3. Not Applicable
4. The USA Networks, Inc. Retirement Savings Plan--Networks (the "Plan") is
subject to the requirements of the Employee Retirement Income Security Act of
1974 ("ERISA"). Attached hereto as Appendix I is a copy of the most recent
financial statements and schedules of the Plan prepared in accordance with the
financial reporting requirements of ERISA.
Exhibit
(23) Consent of Ernst & Young LLP
2
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 on its behalf by the undersigned hereunto duly authorized.
USA NETWORKS, INC. RETIREMENT
SAVINGS PLAN--NETWORKS
Date: June 27, 2002 By: /s/ Lisa Letizio
-----------------------------------
Lisa Letizio
Member, Plan Administrative
Committee
3
Appendix I
Financial Statements and Supplemental Schedule
USA Networks, Inc. Retirement Savings Plan
December 31, 2001 and 2000 and year ended December 31, 2001
with Report of Independent Certified Public Accountants
4
USA Networks, Inc. Retirement Savings Plan - Networks
Audited Financial Statements
and Supplemental Schedule
As of December 31, 2001 and 2000 and Year ended December 31, 2001
CONTENTS
Report of Independent Certified Public Accountants...........................1
Audited Financial Statements
Statements of Net Assets Available for Benefits..............................2
Statement of Changes in Net Assets Available for Benefits....................3
Notes to Financial Statements................................................4
Supplemental Schedule
Schedule H, Line 4i--Schedule of Assets (Held at End of Year).................9
5
Report of Independent Certified Public Accountants
The Administrative Committee
USA Networks, Inc. Retirement Savings Plan - Networks
We have audited the accompanying statements of net assets available for benefits
of the USA Networks, Inc. Retirement Savings Plan - Networks as of December 31,
2001 and 2000, and the related statement of changes in net assets available for
benefits for the year ended December 31, 2001. 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, 2001 and 2000, and the changes in its net assets available for
benefits for the year ended December 31, 2001, 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, 2001 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 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
June 28, 2002
Tampa, Florida
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USA Networks, Inc. Retirement Savings Plan - Networks
Statements of Net Assets Available for Benefits
DECEMBER 31
2001 2000
-------------------------
ASSETS
Investments, at fair value $62,732,968 $71,724,245
Receivables:
Participant 36,752 157,216
Employer 11,771 48,694
-------------------------
Total receivables 48,523 205,910
-------------------------
Net assets available for benefits $62,781,491 $71,930,155
=========================
SEE ACCOMPANYING NOTES.
7
USA Networks Inc. Retirement Savings Plan - Networks
Statement of Changes in Net Assets Available for Benefits
Year ended December 31, 2001
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income:
Dividend and interest income $ 1,156,894
Contributions:
Participant contributions 4,867,497
Employer contributions 1,176,593
Participant rollover contributions 640,810
-------------
Total additions 7,841,794
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Net realized and unrealized depreciation in fair value of plan
investments 8,415,046
Benefits paid to participants 8,570,841
Administrative expenses 4,571
-------------
Total deductions 16,990,458
-------------
Net decrease in net assets available for benefits (9,148,664)
Net assets available for benefits--beginning of year 71,930,155
-------------
Net assets available for benefits--end of year $ 62,781,491
=============
SEE ACCOMPANYING NOTES.
8
USA NETWORKS, INC. RETIREMENT SAVINGS PLAN - NETWORKS
Notes to Financial Statements
December 31, 2001
1. DESCRIPTION OF THE PLAN
The following description of the USA Networks, Inc. Retirement Savings Plan -
Networks (the Plan) provides only general information. Participants should refer
to the Plan agreement for a more complete description of the Plan's provisions.
GENERAL
The Plan is a defined contribution Plan covering substantially all employees of
certain affiliated companies of USA Networks, Inc. (the Company). The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA).
During 2001, USA Networks, Inc. sold its USA Broadcasting division. The
assets for the employees of USA Broadcasting had not transferred out of the
Plan as of December 31, 2001.
CONTRIBUTIONS
Participants can make contributions through payroll deductions ranging from 1%
to 16% of their compensation as defined in the Plan, subject to Internal
Revenue Service limitations. Participants can direct their contributions to
any of the Plan's fund options and may change their investment options on a
daily basis.
The Company contributes an amount equal to 50% of the first 6% of compensation
that a participant contributes in each payroll period to the Plan. The Company
may also make a discretionary contribution of funds which is set annually by the
Company's Board of Directors. For the year ended December 31, 2001, the
Company's matching contribution was $1,176,593. No discretionary contributions
were made to the Plan.
9
USA Networks, Inc. Retirement Savings Plan - Networks
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
VESTING
Participant contributions are fully vested in the Plan at the time of
contribution. A participant is 100% vested in the Company contribution
portion of their accounts plus actual earnings thereon after four years of
credited service
ELIGIBILITY
Participants must have completed at least three months of service, as defined in
the Plan document.
PARTICIPANTS' ACCOUNTS
Each participant's account is credited with the participant's contribution and
allocations of the Company's contributions and Plan earnings. Allocations are
based on participant account balances, as defined. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's account.
FORFEITURES
Company matching contributions that become forfeitures are first made available
to reinstate previously forfeited account balances of qualifying participants
who have left the Company and have subsequently returned. The remaining amount,
if any, is used to reduce the Company's matching contributions. Forfeited
non-vested accounts totaled $845,919 and $218,015 at December 31, 2001 and 2000,
respectively.
PARTICIPANT LOANS
Participants may borrow from their fund accounts a minimum of $500 up to a
maximum equal to the lesser of $50,000 reduced by the highest outstanding loan
balance within the last 12 months or 50% of their vested account balances. With
the exception of loans used to purchase a primary residence which can have terms
up to 15 years, loan terms are limited to a maximum of five years. Loans are
secured by the balance in the participant's account and bear interest at a rate
commensurate with commercial prevailing rates as determined by the Plan
administrator. Principal and interest are paid ratably through biweekly payroll
deductions.
10
USA Networks, Inc. Retirement Savings Plan - Networks
Notes to Financial Statements (continued)
1. DESCRIPTION OF PLAN (CONTINUED)
PAYMENT OF BENEFITS
Upon a participant's retirement, death, disability or other interruption of
continuous service, his/her entire vested account balance will be distributed in
the form of a lump sum unless the participant's vested balance is at least
$5,000 and the participant elects to leave such amounts in the Plan.
PLAN TERMINATION
Although the Company has expressed no intent to terminate the Plan, in the event
that the Plan is terminated by the Company, all amounts credited to the
participants' accounts would become 100% vested and the assets would be
distributed to participants.
ADMINISTRATIVE EXPENSES
Substantially all of the administrative expenses are paid by the Company.
Participants are responsible for certain transaction fees related to their
respective account, such as new loan set-up fees and hardship withdrawal fees.
The participant expenses were $4,571 for the year ended December 31, 2001.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accompanying financial statements have been prepared on the accrual basis of
accounting.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
that affect amounts reported in the financial statements and the accompanying
notes. Actual results could differ from those estimates.
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USA Networks, Inc. Retirement Savings Plan - Networks
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INVESTMENTS
The Plan's investments are stated at fair value. The shares of registered
investment companies are valued at quoted market prices which represent the net
asset values of shares held by the Plan at year end. Securities traded on a
national securities exchange are valued at the last reported sales price on the
last business day of the Plan year. The participant loans are valued at their
outstanding balances, which approximate fair value.
Purchases and sales of securities are recorded as of their trade date. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
3. INVESTMENTS
During 2001, the Plan's investments (including investments purchased, sold and
held during the year) depreciated in fair value as determined by quoted market
prices as follows:
Investments in mutual funds $(8,856,139)
Investments in USA Networks Inc. stock 441,093
---------------
$(8,415,046)
===============
The Plan's investments are held in a bank-administered trust fund. The following
are investments that represent 5% or more of the Plan's net assets.
DECEMBER 31
2001 2000
--------------------------
American Century Ultra Fund $22,698,701 $28,855,394
American Century Value Fund 4,950,231 3,965,478
American Century International Growth Fund - 4,311,521
Schwab Composite Fund - 6,734,721
JP Morgan Smart Index Fund 5,886,742 6,659,296
American Century Stable Asset Fund 11,807,818 11,151,330
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USA Networks, Inc. Retirement Savings Plan - Networks
Notes to Financial Statements (continued)
4. INCOME TAX STATUS
The Plan has applied for but has not received a determination letter from the
Internal Revenue Service stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The plan sponsor has
indicated that it will take the necessary steps, if any, to maintain the Plan's
qualified status.
5. SUBSEQUENT EVENT
Subsquent to year end, USA Networks, Inc. entered into an agreement with
Vivendi Universal, S.A. to contribute its entertainment divisions to a joint
venture with Vivendi. The Networks Retirement Savings Plan covers all
employees of the entertainment divisions. This transaction was consummated on
May 7, 2002 and has no effect on the Plan as of December 31, 2001.
13
Supplemental Schedule
14
USA Networks, Inc. Retirement Savings Plan - Networks
E.I.N. 06-1060657 Plan No: 001
Schedule H, Line 4i
Schedule of Assets (Held at End of Year)
December 31, 2001
(c)
DESCRIPTION OF INVESTMENT
(b) INCLUDING MATURITY DATE, RATE OF (e)
IDENTITY OF ISSUE, BORROWER, INTEREST, COLLATERAL, PAR OR CURRENT
(a) LESSOR, OR SIMILAR PARTY MATURITY VALUE VALUE
-------------------------------------------------------------------------------
* American Century Ultra Fund Mutual fund $22,698,701
* American Century Value Fund Mutual fund 4,950,231
* American Century
International Growth Fund Mutual fund 2,815,481
* American Century Strategic
Allocation - Conservative Mutual fund 218,610
* American Century Strategic
Allocation - Moderate Mutual fund 699,699
* American Century Strategic
Allocation - Aggressive Mutual fund 1,155,669
Schwab Composite Fund Mutual fund 3,056,188
JP Morgan Diversified Fund Mutual fund 2,211,807
JP Morgan Bond Fund Mutual fund 777,606
JP Morgan Smart Index Fund Mutual fund 5,886,742
Lord, Abbett & Co
Developing Growth Fund Mutual fund 2,229,269
Class A
LM Value Institutional Port Mutual fund 1,267,812
F1 Fund
* American Century Stable Collective trust fund 11,807,818
Asset Fund
* USA Networks, Inc. Stock Common stock 1,696,197
-------------
61,471,830
Participant Loans 6.0% to 10.5% 1,261,138
-------------
$62,732,968
=============
*Party-in-interest.
Note: Cost information has not been included in column (d), because all
investments are participant directed.
15