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--COMMERCE
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--Commerce (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--COMMERCE
Date: June 27, 2002 By: /s/ Lisa Letizio
-----------------------------------
Lisa Letizio
Member, Plan Administrative
Committee
3
Appendix I
Financial Statements and Supplemental Schedules
USA Networks, Inc. Retirement Savings Plan--Commerce
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 - Commerce
Audited Financial Statements
and Supplemental Schedules
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 Schedules
Schedule H, Line 4i--Schedule of Assets (Held at End of Year).................9
Schedule G, Part III--Schedule of Nonexempt Transactions.....................10
5
Report of Independent Certified Public Accountants
The Administrative Committee
USA Networks, Inc. Retirement Savings Plan - Commerce
We have audited the accompanying statements of net assets available for benefits
of the USA Networks, Inc. Retirement Savings Plan - Commerce 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 schedules of assets
(held at end of year) as of December 31, 2001 and nonexempt transactions for the
year then ended, are presented for purposes of additional analysis and are not a
required part of the financial statements but are 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. These
supplemental schedules are the responsibility of the Plan's management. The
supplemental schedules have been subjected to the auditing procedures applied in
our audits of the financial statements and, in our opinion, are 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
6
USA Networks, Inc. Retirement Savings Plan - Commerce
Statements of Net Assets Available for Benefits
DECEMBER 31
2001 2000
-------------------------
ASSETS
Investments, at fair value $82,636,985 $72,939,448
Receivables:
Participant 317,465 699,704
Employer 98,245 239,871
-------------------------
Total receivables 415,710 939,575
-------------------------
Net assets available for benefits $83,052,695 $73,879,023
=========================
SEE ACCOMPANYING NOTES.
7
USA Networks Inc. Retirement Savings Plan - Commerce
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 $ 1,563,981
Net realized and unrealized appreciation in fair value of
plan investments 805,778
-------------
2,369,759
Contributions:
Participant contributions 10,141,546
Employer contributions 1,912,652
Participant rollover contributions 1,584,602
-------------
Total additions 16,008,559
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Benefits paid to participants 6,801,374
Administrative expenses 33,513
-------------
Total deductions 6,834,887
-------------
Net increase in net assets available for benefits 9,173,672
Net assets available for benefits--beginning of year 73,879,023
-------------
Net assets available for benefits--end of year $83,052,695
=============
SEE ACCOMPANYING NOTES.
8
USA Networks, Inc. Retirement Savings Plan - Commerce
Notes to Financial Statements
December 31, 2001
1. DESCRIPTION OF THE PLAN
The following description of the USA Networks, Inc. Retirement Savings Plan -
Commerce (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).
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 $1,912,652. No discretionary contributions
were made to the Plan.
9
USA Networks, Inc. Retirement Savings Plan - Commerce
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 be 21 years of age or older and have completed at least one
year 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 $2,036,636 and $1,411,530 at December 31, 2001 and
2000, respectively.
10
USA Networks, Inc. Retirement Savings Plan - Commerce
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
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.
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 loan set-up fees and hardship withdrawal fees. These
participant fees were $33,513 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.
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USA Networks, Inc. Retirement Savings Plan - Commerce
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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.
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) appreciated (depreciated) in fair value as determined by
quoted market prices as follows:
Investments in mutual funds $(5,021,439)
Investments in USA Networks Stock, Inc. Stock 5,827,217
--------------
$ 805,778
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USA Networks, Inc. Retirement Savings Plan - Commerce
Notes to Financial Statements (continued)
3. INVESTMENTS (CONTINUED)
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 $ 6,771,388 $ 6,142,863
American Century Strategic Aggressive Fund 5,535,517 4,727,690
JP Morgan Diversified Fund 4,799,138 4,598,716
JP Morgan Smart Index Fund 13,546,230 15,126,772
American Century Stable Asset Fund 11,678,641 10,744,300
USA Networks, Inc. stock 19,286,784 14,959,379
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. However, the plan administrator believes that the
Plan is qualified and, therefore, the related trust is exempt from taxation.
13
Supplemental Schedules
14
USA Networks, Inc. Retirement Savings Plan - Commerce
E.I.N. 59-2649518 Plan No: 001
Schedule H, Line 4i
Schedule of Assets (Held at End of Year)
December 31, 2001
(c)
DESCRIPTION OF INVESTMENT
INCLUDING MATURITY DATE,
(b) RATE OF INTEREST, (e)
IDENTITY OF ISSUE, BORROWER, COLLATERAL, PAR OR MATURITY CURRENT
(a) LESSOR, OR SIMILAR PARTY VALUE VALUE
-------------------------------------------------------------------------------
* American Century Ultra Fund Mutual fund $ 6,771,388
* American Century Value Fund Mutual fund 2,587,669
* American Century International
Growth Fund Mutual fund 2,185,373
* American Century Strategic
Conservative Fund Mutual fund 867,291
* American Century Strategic
Moderate Fund Mutual fund 3,203,319
* American Century Strategic
Aggressive Fund Mutual fund 5,535,517
Schwab Composite Fund Mutual fund 678,863
JP Morgan Diversified Fund Mutual fund 4,799,138
JP Morgan Bond Fund Mutual fund 1,597,605
JP Morgan Smart Index Fund Mutual fund 13,546,230
Lord Abbett Developing Growth Mutual fund 3,517,046
Fund - A
Legg Mason Value Institutional Mutual fund 2,642,485
Port FI
* American Century Stable Asset Collective trust fund 11,678,641
Fund
* USA Networks, Inc. Stock Common stock 19,286,784
-------------
78,897,349
Participant Loans 6.0% to 10.5% 3,739,636
-------------
$82,636,985
=============
*Party-in-interest.
Note: Cost information has not been included in column (d), because all
investments are participant-directed.
15
USA Networks Inc. Retirement Savings Plan - Commerce
E.I.N. 59-2649518 Plan No: 001
Schedule G, Part III
Schedule of Nonexempt Transactions
Year ended December 31, 2001
(b) (c)
RELATIONSHIP TO DESCRIPTION OF TRANSACTIONS
(a) PLAN, EMPLOYER, OR INCLUDING MATURITY DATE, RATE (d)
IDENTITY OF OTHER OF INTEREST, COLLATERAL, PAR PURCHASE
PARTY INVOLVED PARTY-IN-INTEREST OR MATURITY VALUE PRICE
--------------------------------------------------------------------------------
Precision Employer Late remittance of participant
Response contributions for May 2001
Corporation made June 27, 2001 $127,389
Precision Employer Late remittance of participant
Response contributions for June 2001
Corporation made July 26, 2001 119,795
Note: Columns (e) through (j) are not applicable.
16