As filed with the Securities and Exchange Commission on October 24, 2003
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE,
SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended April 30, 2003
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: I-10899
A. Full title of the plan and the address of
the plan, if different from that of the
issuer named below:
KIMCO REALTY CORP. 401(k) PLAN
B. Name of issuer of the securities held
pursuant to the plan and the address of its
principal executive office:
KIMCO REALTY CORPORATION
3333 NEW HYDE PARK RD, SUITE 100
NEW HYDE PARK, NY 11042
401(k) PLAN
FINANCIAL STATEMENTS
APRIL 30, 2003
KIMCO REALTY CORP. 401(k) PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
Page
Report of Independent Auditors .................................................. 1
Statements of Assets Available for Benefits as of April 30, 2003 and 2002 ....... 2
Statements of Changes in Assets Available for Benefits for the fiscal years
ended April 30, 2003 and 2002.................................................... 3
Notes to Financial Statements ................................................... 4 - 6
Schedule H, line 4i-Schedule of Assets (Held at End of Year) as of April 30, 2003 7
Report of Independent Auditors
To the Participants and Administrator of
Kimco Realty Corp. 401(k) Plan:
In our opinion, the accompanying statements of assets available for benefits and
the related statements of changes in assets available for benefits present
fairly, in all material respects, the assets available for benefits of Kimco
Realty Corp. 401(k) Plan (the "Plan") at April 30, 2003 and 2002, and the
changes in assets available for benefits for the years then ended, in conformity
with accounting principles generally accepted in the United States of America.
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 of these statements in accordance with
auditing standards generally accepted in the United States of America, which
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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Assets (Held
at End of Year) is presented for the purpose of additional analysis and is not a
required part of the basic 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
the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
/s/ PricewaterhouseCoopers, LLP
October 21, 2003
1
KIMCO REALTY CORP. 401(k) PLAN
Statements of Assets Available for Benefits
April 30, 2003 and 2002
2003 2002
----------- -----------
Assets:
Cash $ -- $ 7,852,257
Investments (see Note 3) 12,400,913 1,621,528
Loans to participants 188,928 162,389
Receivables:
Participant -- 96,340
Employer -- 61,160
Income receivable -- 5,101
----------- -----------
Assets Available For Benefits $12,589,841 $ 9,798,775
=========== ===========
The accompanying notes are an integral part of these
financial statements.
2
Kimco Realty Corp. 401(k) Plan
Statement of Changes in Assets Available for Benefits
For the Fiscal Years ended April 30, 2003 and 2002
2003 2002
------------ ------------
Additions:
Investment activities:
Net (depreciation) in fair value
of investments $ (472,043) $ (919,242)
Interest and dividends 201,785 307,802
------------ ------------
Investment (loss) (270,258) (611,440)
------------ ------------
Contributions:
Participant 1,868,748 1,091,193
Rollovers 407,939 96,096
Employer 951,121 712,660
------------ ------------
Total contributions 3,227,808 1,899,949
------------ ------------
Total additions 2,957,550 1,288,509
------------ ------------
Deductions:
Benefits paid to participants 166,484 940,462
Other disbursements -- 17,075
------------ ------------
Total deductions 166,484 957,537
------------ ------------
Net increase 2,791,066 330,972
Assets Available For Benefits:
Beginning of Year 9,798,775 9,467,803
------------ ------------
End of Year $ 12,589,841 $ 9,798,775
============ ============
The accompanying notes are an integral part of these
financial statements.
3
KIMCO REALTY CORP. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
DESCRIPTION OF PLAN:
The following description of the Kimco Realty Corp. 401(k) Plan (the
"Plan") provides only general information. Participants should refer to the
Plan agreement for a more comprehensive description of the Plan's
provisions.
General - The Plan was established on March 1, 1984 as a defined
contribution plan covering all eligible employees of Kimco Realty
Corporation (the "Company") who have completed three months of service and
are age eighteen or older. The Plan was last amended on July 1, 1994 to
comply with the Tax Reform Act of 1986 and subsequent legislation.
Employees may elect to participate in the Plan on the first day of the
month after completion of their first three months of service. The Company
will provide a matching contribution for participants who have completed
one year of service, defined as 1,000 hours. The Plan is subject to the
applicable provisions of the Employee Retirement Income Security Act of
1974 ("ERISA").
Contributions - Each year, participants may contribute pre-tax annual
compensation, as defined in the Plan, up to the maximum percentage
allowable amount determined by the Internal Revenue Service each calendar
year ($12,000 in 2003 and $11,000 in 2002). As a result of the Economic
Growth and Tax Relief Reconciliation Act of 2001, those who were age 50 or
older during 2003 could take advantage of a higher pre-tax contribution
limit of $14,000 (the limit increase for 2002 was $12,000). Participants
may change their percentage contribution election monthly. The Company
matches participants' contributions annually up to 5% of base compensation
subject to IRS limitations. In addition to the matching contribution, the
Company may make a discretionary contribution which is determined and
approved by the Company's board of directors annually. No discretionary
contribution payments were made for the fiscal years ended April 30, 2003
and 2002. All Company contributions are invested based upon participant
account elections.
Participant accounts - Each participant's account is credited with the
participant's contribution and allocations of the Company's contribution
and Plan earnings. Each participant may direct their contribution be
invested in any of the thirteen mutual funds or Kimco Realty Corporation
unitized common stock fund offered by the Plan.
Vesting - Participants are immediately vested in their voluntary and
Company matching contributions plus actual earnings thereon.
Loans to Participants - Participants may borrow from their fund accounts,
an amount aggregating the lesser of 50% of their total account balance or
$50,000. Loan terms range from one to five years or a reasonable period of
time greater than 5 years for the purchase of a principal residence. The
loans are collateralized by the balance in the participant's account and
bear interest at the prime rate plus 0.5%. The interest rate must be one
that a bank or other professional lender would charge for making a loan in
similar circumstance. The interest rate for loans outstanding at April 30,
2003 and 2002 ranged from 5.25% to 10.5%.
Payment of benefits - Upon termination of service due to death, disability,
or retirement, a participant may elect to receive either a lump-sum amount
equal to the value of the participant's vested interest in his or her
account or select the installment plan, provided the participant's account
balance exceeds $5,000. For termination of service due to other reasons, a
participant may receive the value of his or her account as a lump-sum
distribution.
2. SUMMARY OF ACCOUNTING POLICIES:
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting in conformity with accounting principles generally accepted
in the United States of America ("GAAP"). Certain 2002 amounts have been
reclassified to conform to the 2003 financial statement presentation.
4
KIMCO REALTY CORP. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
Use of Estimates
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported
amounts of assets available for benefits and disclosure of commitments at
the date of the financial statements and the changes in assets available
for benefits during the reporting period. The most significant estimates
relate to the valuation of investments. Actual results could differ from
those estimates. Moreover, it is reasonably possible that the value of
these investments will change in the ensuing year.
Investment Valuation and Income Recognition
Mutual funds and common stock investments are stated at fair market value
as determined by quoted market prices. Participant loans are valued at
cost, which, in the opinion of management, 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 record date.
Payment of Benefits
Benefits are recorded when paid.
Risks and Uncertainties
The Plan provides for various investment options which may invest in any
combination of stock and mutual funds. Such investments are exposed to
various risks, such as interest rate, market and credit. Due to the level
of risk associated with certain investments and the level of uncertainty
related to changes in their value, it is at least reasonably possible that
changes in risks in the near term would materially affect the amounts
reported in the statement of assets available for benefits and the
statement of changes in assets available for benefits.
3. ASSETS HELD FOR INVESTMENT PURPOSES:
For the year ended April 30, 2003, MFS Retirement Services, Inc. ("MFS")
served as trustee of the plan with Merrill Lynch Trust Company ("Merrill
Lynch") serving in a similar capacity for the plan year ended, April 30,
2002. The fair market value of the following investments represent 5% or
more of the Plan's assets available for benefits at April 30, 2003 and
2002:
2003 2002
---- ----
Kimco Realty Corp unitized stock fund $ 1,842,558 $1,621,528
MFS Bond Fund 1,443,051 -
MFS Fixed Fund 1,693,565 -
-
American Europacific Growth Fund 1,506,234 -
Washington Mutual Investors Fund 934,706 -
Davis New York Venture Fund 690,513 -
The Growth Fund of America 1,833,984 -
UBS Tactical Allocation Fund 799,594 -
In 2003 and 2002, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
(depreciated)/appreciated in value as follows:
2003 2002
---- ----
Mutual Funds $(763,731) $(1,059,169)
Common Stock 291,688 139,927
---------- ------------
$(472,043) $ (919,242)
========== ============
5
KIMCO REALTY CORP. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
4. 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, account balances will be distributed in accordance with Plan
provisions.
5. TAX STATUS:
The Plan has received a favorable determination letter, dated April 23,
2002, from the Internal Revenue Service which states that the Plan
qualifies under Section 401 (a) of the Internal Revenue Code ("IRC") and,
therefore, has made no provision for federal income taxes under the
provisions of Section 501 (a). The Company believes that the Plan is
designed and is currently being operated in compliance with the applicable
provisions of the IRC.
6. PARTY-IN-INTEREST TRANSACTIONS:
All administrative expenses and accounting fees of the Plan are paid by the
Company. Certain Plan investments are shares of mutual funds offered by
MFS. MFS is the trustee as defined by the Plan and therefore, these
transactions qualify as party-in-interest. In addition, investments are
made in Kimco Realty Corporation common stock, the Plan Sponsor.
7. RECONCILIATION BETWEEN FINANCIAL STATEMENTS AND FORM 5500:
At April 30, 2003, assets available for plan benefits as reported in the
Form 5500 equaled assets reported in the financial statements. At April 30,
2002, assets available for benefits as reported in the Form 5500 were less
than assets reported in the financial statements because the financial
statements included an asset for contributions receivable in the amount
$157,500 that was not included in Form 5500.
6
KIMCO REALTY CORP. 401(k) PLAN
Schedule H, line 4i-Schedule of Assets (Held at End of Year) as of
April 30, 2003
Identity of issuer, Description of investment, including maturity date,
borrower, lessor, or similar party rate of interest, collateral and par, or maturity value Current value
---------------------------------- ------------------------------------------------------- -------------
*MFS Corporate Plans Services MFS Money Market Fund (34,689 units) $ 34,649
*MFS Corporate Plans Services MFS Bond Fund - A (110,748 units) 1,443,051
*MFS Corporate Plans Services MFS Mid Cap Growth Fund - A (49,728 units) 300,857
*MFS Corporate Plans Services MFS Fixed Fund (1,693,565 units) 1,693,565
*MFS Corporate Plans Services MFS New Discovery Fund - A (26,372 units) 312,508
American Funds Group American Europacific Growth FD - A (66,208 units) 1,506,234
American Funds Group Washington Mutual Investors FD - A (38,962 units) 934,706
Davis Funds Davis New York Venture Fund A (32,087 units) 690,513
American Funds Group The Growth Fund of America FD - A (94,099 units) 1,833,984
Franklin Templeton Investments Franklin Real Estate Secur - A (826 units) 14,012
UBS Global Asset Management Funds UBS Tactical Allocation FD - A (38,350 units) 799,594
Franklin Templeton Investments Franklin Mutual Qualified Fund (470,323 units) 434,334
AllianceBernstein Funds Allianceber Balanced Shares A (40,871 units) 560,348
*Kimco Realty Corporation Kimco Realty Corp unitized stock fund (48,211 units) 1,842,558
*Participant Loans Participant loans (at rates ranging from 5.25% to
10.50% and terms of maturity ranging from 1 to 5
years) 188,928
-------------
$ 12,589,841
=============
*Denotes a party-in-interest.
7
KIMCO REALTY CORP. 401(k) PLAN
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plans) have duly
caused this annual report to be signed on its behalf by the undersigned
thereunto duly authorized, on the 24th day of October, 2003.
Kimco Realty Corp. 401(k) Plan, as administrator
By: /s/ Michael V. Pappagallo
-----------------------------
Michael V. Pappagallo
Its: Chief Financial Officer
8