The Goodyear Tire & Rubber Company 11-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2007
Commission File Number: 1-1927
THE GOODYEAR TIRE & RUBBER COMPANY
SAVINGS PLAN FOR RETAIL EMPLOYEES
(Full title of the Plan)
THE GOODYEAR TIRE & RUBBER COMPANY
(Name of Issuer of the Securities)
1144 East Market Street
Akron, Ohio 44316-0001
(Address of Issuers Principal Executive Office)
TABLE OF CONTENTS
THE GOODYEAR TIRE & RUBBER COMPANY
SAVINGS PLAN FOR RETAIL EMPLOYEES
ITEM 1. Not applicable.
ITEM 2. Not applicable.
ITEM 3. Not applicable.
ITEM 4. FINANCIAL STATEMENTS OF THE PLAN
The Financial Statements of The Goodyear Tire & Rubber Company Savings Plan for
Retail Employees (the Plan) as of December 31,
2007 and April 1, 2007 and for the fiscal year ended December 31, 2007, together
with the report of Bober, Markey, Fedorovich & Company, independent registered public accounting
firm, are attached to this Annual Report on Form 11-K as Annex A, and are by specific reference
incorporated herein and filed as a part hereof. The Financial Statements and the Notes thereto are
presented in lieu of the financial statements required by Items 1, 2 and 3 of Form 11-K. The Plan
is subject to the requirements of the Employee Retirement Income Security Act of 1974 (ERISA).
EXHIBITS.
EXHIBIT 23.1 Consent of Bober, Markey, Fedorovich & Company, independent registered public
accounting firm.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Plan Administrator has duly
caused this Annual Report to be signed by the undersigned thereunto duly authorized.
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THE GOODYEAR TIRE & RUBBER COMPANY |
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Plan Administrator of THE GOODYEAR TIRE & RUBBER
COMPANY SAVINGS PLAN FOR RETAIL EMPLOYEES |
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June 27, 2008
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By: |
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/s/ Damon Audia |
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Damon Audia, Vice President and Treasurer |
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ANNEX A
TO
Form 11-K
THE GOODYEAR TIRE & RUBBER COMPANY
SAVINGS PLAN FOR RETAIL EMPLOYEES
* * * * *
FINANCIAL STATEMENTS
DECEMBER 31, 2007
The Goodyear Tire & Rubber Company
Savings Plan
For Retail Employees
Financial Statements
December 31, 2007 and April 1, 2007
The Goodyear Tire & Rubber Company
Savings Plan For Retail Employees
Index To Financial Statements
December 31, 2007 and April 1, 2007
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Page |
Report of Independent Registered Public Accounting Firm |
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2 |
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Financial Statements: |
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Statements of Net Assets Available for Benefits at December
31, 2007 and April 1, 2007 |
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3 |
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Statement of Changes in Net Assets Available for Benefits
for the Period of Inception (April 1, 2007) to December 31,
2007 |
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3 |
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Notes to Financial Statements |
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4-14 |
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Supplemental Information |
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Schedule
of Assets (Held at End of Year) |
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Schedule I |
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Note:
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Certain schedules required by the Department of Labors Rules and
Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974 have been omitted because of
the absence of the conditions under which they are required. |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Participants and Administrator of
The Goodyear Tire & Rubber Company Savings Plan for
Retail Employees
Akron, Ohio
We have audited the accompanying statements of net assets available for benefits of The Goodyear
Tire & Rubber Company Savings Plan for Retail Employees (the Plan) as of December 31, 2007 and
April 1, 2007, and the related statement of changes in net assets available for benefits for the
period of inception (April 1, 2007) to December 31, 2007. These financial statements are the
responsibility of the Plans management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (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 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 benefits of The Goodyear Tire & Rubber Company Savings Plan
for Retail Employees as of December 31, 2007 and April 1, 2007 and the changes in its net assets
available for benefits for the period of inception (April 1, 2007) to December 31, 2007 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 financial statements
taken as a whole. The supplemental schedule of assets (held at end of year) as of December 31,
2007, 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 Labors Rules
and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental information is the responsibility of the Plans management. The
supplemental information has been subjected to the auditing procedures applied in the audit 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.
BOBER, MARKEY, FEDOROVICH & COMPANY
Akron, Ohio
June 27, 2008
2
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
Statements of Net Assets Available for Benefits
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December 31, |
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April 1, |
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(Dollars in Thousands) |
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2007 |
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2007 |
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Plans Interest in Commingled Trust at fair value |
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$ |
105,318 |
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$ |
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Participant Loans |
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4,981 |
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Contribution Receivable Employee |
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145 |
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Contribution Receivable Employer |
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6 |
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Net Assets Available for Benefits at fair value |
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110,450 |
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Adjustment from Fair Value to Contract Value for
Fully Benefit-Responsive Investment Contracts |
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(547 |
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Net Assets Available for Benefits |
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$ |
109,903 |
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$ |
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Statement of Changes in Net Assets Available for Benefits
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Period of Inception |
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(April 1, 2007) to |
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(Dollars in Thousands) |
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December 31, 2007 |
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Contributions: |
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Employer |
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200 |
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Employee |
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4,402 |
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Total Contributions |
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4,602 |
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Deductions: |
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Benefits Paid to Participants or Their Beneficiaries |
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(3,510 |
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Interest From Participant Loans |
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267 |
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Net Investment Gain from Plans Interest in Commingled Trust |
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2,104 |
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Transfer from The Goodyear Tire & Rubber Company Employee Savings
Plan for Salaried Employees |
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106,440 |
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Net Increase in Net Assets Available for Benefits During the Period |
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109,903 |
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Net Assets Available for Benefits at Beginning of Period |
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Net Assets Available for Benefits at End of Period |
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$ |
109,903 |
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The accompanying notes are an integral part of these statements.
- 3 -
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
1. |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: |
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Basis of Accounting |
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The accounts of The Goodyear Tire & Rubber Company Savings Plan for Retail Employees (the
Plan) are maintained on the accrual basis of accounting and in accordance with The Northern
Trust Company (the Trustee) Trust Agreement. |
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Plan Year |
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The Plan Year is a Calendar year. |
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Trust Assets |
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Certain savings plans sponsored by The Goodyear Tire & Rubber Company and certain subsidiaries
(the Company) maintain their assets in a master trust entitled The Goodyear Tire & Rubber
Company Commingled Trust (the Commingled Trust) administered by the Trustee. The Company
sponsored three savings plans at December 31, 2007 that participate in the Commingled Trust.
The Plans undivided interest in the Commingled Trust is presented in the accompanying financial
statements in accordance with the allocation made by the Trustee. |
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Recordkeeper |
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JP Morgan Retirement Plan Services, LLC is the recordkeeper of the Plan. |
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Asset Valuation and Income Recognition |
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The majority of the assets of the Plan are valued at fair market value. The fair value of the
Plans interest in the Commingled Trust is based on the beginning of the period value in the
trust plus actual contributions and allocated investment income less actual distributions and
allocated administrative expenses. Investments in the Goodyear Stock Fund are valued at the
last reported sales price on the last business day of the Plan year. If no sales were reported
on that date, the shares are valued at the last bid price. Investments in mutual funds are
valued at the net asset value of shares held by the Commingled Trust at year end. Investments
in commingled funds are valued at fair value, as determined by the fund manager. Investments in
the self directed account are valued at fair value, based on the underlying investments in the
account. Participant loans are valued at their outstanding balances, which approximate fair
value. Investment income and administrative expenses relating to the Commingled Trust are
allocated on a daily basis to the Plan based on the Plans value in each applicable fund within
the Commingled Trust. |
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As described in Financial Accounting Standards Board Staff Position, FSP AAG INV-1 and SOP
94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment
Companies Subject to the AICPA Investment Company Guide and Defined- |
4
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
Contribution Health and Welfare and Pension Plans (the FSP), investment contracts held by a
defined-contribution plan are required to be reported at fair value. However, contract value is
the relevant measurement attribute for that portion of the net assets available for benefits of
a defined-contribution plan attributable to fully benefit-responsive investment contracts
because contract value is the amount participants would receive if they were to initiate
permitted transactions under the terms of the plan. As required by the FSP, the Statement of Net
Assets Available for Benefits presents the fair value of the investment contracts held in the
Stable Value fund of the Commingled Trust as well as the adjustment of the fully
benefit-responsive investment contracts from fair value to contract value. The Statement of
Changes in Net Assets Available for Benefits is prepared on a contract value basis.
Purchases of securities are recorded on the trade date basis. Dividend income is recorded on
the ex-dividend date. Interest income is recorded on the accrual basis.
Concentration of Credit Risk
The Stable Value Fund of the Commingled Trust invests part of the fund in investment contracts
of financial institutions with strong credit ratings and has established guidelines relative to
diversification and maturities that maintain safety and liquidity (See Note 8).
The Goodyear Stock Fund invests primarily in the Common Stock of the Company. Significant
changes in the price of Goodyear Stock can result in significant changes in the Net Assets
Available for Benefits.
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 amounts reported in the basic financial statements and related notes to
financial statements. Changes in such estimates may affect amounts reported in future years.
Risk and Uncertainties
The Plan invests in various investment securities. Investment securities are exposed to various
risks such as interest rate, market, and credit risk. Due to the level of risk associated with
certain investment securities, it is at least reasonably possible that changes in the values of
investment securities will occur in the near term and that such changes could materially affect
participants account balances and the amounts reported in the
Statements of Net Assets Available
for Benefits.
New Accounting Standard
In September 2006, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards (SFAS) No. 157, Fair Value Measurements. This standard establishes
5
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
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a single authoritative definition of fair value, sets out a framework for measuring fair value and
requires additional disclosures about fair value measurements. SFAS No. 157 applies to fair
value measurements already required or permitted by existing standards. SFAS No. 157 is
effective for financial statements issued for fiscal years beginning after November 15, 2007. |
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Plan management is currently evaluating the impact the adoption of SFAS No. 157 will have on the
Plans financial statements. |
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2. |
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GENERAL DESCRIPTION AND OPERATION OF THE PLAN: |
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Inception |
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The Plan is a defined contribution plan, which became effective April 1, 2007. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Participants of the Plan were previously covered by The Goodyear Tire & Rubber Company Employee
Savings Plan for Salaried Employees (the Salaried Plan). The Plan was created pursuant to a
spin-off from the Salaried Plan, which was originally effective July 1, 1984. In connection
with the spin-off of the Plan, $106,440,363 was transferred to the Plan from the Salaried Plan. |
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Eligibility |
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Salaried employees of retail store locations of the Company who were participants under the
Salaried Plan immediately prior to April 1, 2007 are participants under this plan on and after
that date. All other eligible employees will become eligible to participate in the Plan as of
the first enrollment date after completing one year of continuous service with the Company. |
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Vesting |
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Employee contributions are fully vested. Employer contributions are vested after the
participant has completed two years of continuous service with the Company, provided the
employee terminates employment with the Company under certain conditions specified in the Plan
document. |
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Contributions |
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Eligible employees may elect to contribute any whole percent from 1% to 50% of earnings,
including wages, bonuses, commissions, overtime and vacation pay into the Plan. In addition,
the Plan permits catch-up contributions by participants who have attained age 50 by December 31
of each year subject to certain limitations under the Internal Revenue Code. Participating
employees may elect to have their contributions invested in any of the funds available for
employees at the time of their contributions. The Company calculates and deducts employee
contributions from gross earnings each pay period based on the percent elected by the employee.
Employees may change their contribution percent any time. The |
6
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
change will become effective as
soon as administratively possible after participant makes it. Employees may transfer amounts
attributable to employee contributions from one fund to the other on a daily basis. Employees
may suspend their contributions at any time effective immediately.
The Plan has been established under section 401 of the Internal Revenue Code. Therefore,
employee (except for Roth 401(k) contributions) and employer contributions to the Plan are not
subject to federal withholding tax, but are taxable when they are withdrawn from the Plan.
Participants who were hired by the Company on or after January 1, 2005 and are not
eligible to participate in a Company pension plan will receive matching employer
contributions equal to 50% of the first 4% of compensation contributed by the participant
through elective deferrals to the Plan. Effective January 1, 2009, all participants will be
eligible to receive the matching employer contribution.
Effective for pay periods occurring after December 31, 2008, the Company shall make retirement
contributions to the Plan for employees older than forty years of age, at percentages ranging
from 1% to 2%, dependant on age. Participants must be hired before January 1, 2005,
participating in a Company pension plan, not yet receiving pension benefits and participating
in the Plan during the contribution period in order to be eligible to receive the Company
retirement contribution. The employee can elect to invest this contribution in any of the
investment options available for employee contributions.
Participant Accounts
A variety of funds have been established for each participant in the Plan. All accounts are
valued daily by the Trustee.
Interest and dividends (in non Goodyear Stocks) are automatically reinvested in each
participants respective accounts and reflected in the unit value of the fund which affects the
value of the participants accounts.
Under the Employee Stock Ownership Plan (the ESOP), participants may elect to receive in cash
dividends on the Goodyear stock held in their employer match account. Such election results in
a distribution to the participant. For the year ended December 31, 2007 there were no dividends
paid on the Goodyear stock held.
Plan Withdrawals and Distributions
Participants
may take in-service distributions of vested amounts from their accounts if they:
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Attain the age of 591/2, or |
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Qualify for a financial hardship. |
7
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
The Internal Revenue Service (IRS) issued guidelines governing financial hardship. Under the
IRS guidelines, withdrawals are permitted for severe financial hardship. Contributions to the
Plan are suspended for 6 months subsequent to a financial hardship withdrawal.
Participant vested amounts are payable upon retirement, death or other termination of
employment.
All withdrawals and distributions are valued as of the end of the month they are processed, and
may be subject to federal income tax upon receipt. Any non-vested Company contributions are
forfeited and applied to reduce plan expenses and future contributions by the Company. As of
December 31, 2007, the Plan had forfeiture credits in the amounts of $11,460.
Participant Loans
Eligible employees may borrow money from their participant accounts. The minimum amount to be
borrowed is $1,000. The maximum amount to be borrowed is the lesser of $50,000 reduced by the
highest outstanding balance of any loan during the preceding twelve month period, or 50% of the
participants vested account balance. Participants may have up to two loans outstanding at any
time. The interest rate charged will be a fixed rate that will be established at the time of
the loan application based on prime plus one (8.25% at December 31, 2007).
Loan repayments, with interest, are made through payroll deductions. If a loan is not repaid
when due, the loan balance is treated as a taxable distribution from the Plan.
Rollovers
Employees, Plan participants, or former Plan participants may transfer eligible cash
distributions from any other employer sponsored plan qualified under Section 401 of the Internal
Revenue Code into the Plan by a direct transfer from such other plan.
Expenses
Expenses of administering the Plan were paid partly by the Company and partly by the Commingled
Trust. The payment of Trustees fees and brokerage commissions associated with the Company
Stock Fund are paid by the Company. Expenses related to the asset management of the investment
funds, and recordkeeping services are paid from such Funds
which reduce the investment return reported and credited to participant accounts.
The JPMorgan Personal Asset Manager Program provides personalized portfolio management for
participants who wish to delegate investment decisions about fund choices within the Plan to a
professional manager. Participation in the program is paid solely by those participants
electing to enroll. The expense reduces the investment return reported and credited to
participant accounts.
8
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
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Termination Provisions |
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The Company anticipates and believes that the Plan will continue without interruption, but
reserves the right to discontinue the Plan. In the event of termination, the obligation of the
Company to make further contributions ceases. All participants accounts would then be fully
vested with respect to Company contributions. |
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3. |
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RELATED PARTY TRANSACTIONS: |
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The Trustee serves as the fund manager of the Daily S&P 500 Index Stock Equity Fund. |
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JP Morgan Investment Management Inc. serves as the fund manager for the Large Capitalization
Value Fund and the International Equity Fund. |
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The Goodyear Stock Fund is designed primarily for investment in common stock of the Company,
except for short-term investments needed for Plan operations. During 2007, the price per share
of Goodyear common stock on The New York Stock Exchange composite transactions ranged from
$21.40 to $36.90. The closing price per share of Goodyear common stock on The New York Stock
Exchange was $28.22 at December 31, 2007. The common stock of The Goodyear Tire & Rubber
Company and a Short-Term Investments Fund are the current investments of this fund. The portion
of this fund related to employer contributions is within an employee stock ownership plan
(ESOP). |
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4. |
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TAX STATUS OF PLAN: |
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The Plan is currently in the process of completing an application for a determination letter.
However, the Company and the Plans tax counsel believe the Plan is currently designed and being
operated in compliance with the applicable requirements of the Internal Revenue Code.
Therefore, no provision for income taxes has been included in the Plans financial statements. |
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5. |
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LITIGATION: |
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Following the announcement of a restatement of the Companys financial statements in October
2003, several lawsuits were filed in the U.S. District Court for the Northern District of Ohio
against the Company and current and/or former officers, directors and associates of the Company
asserting breach of fiduciary duty claims under ERISA on behalf of a putative class of
participants in The Goodyear Tire & Rubber Company Employee Savings Plan for Bargaining Unit
Employees and the Salaried Plan. All of these actions were consolidated into a separate action
in the U. S. District Court for the Northern District of Ohio. In July 2006, the Court denied
the defendants motion to dismiss the breach of fiduciary duty claims |
9
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
under
ERISA. Although the Company continues to believe the ERISA claims are without merit, the Company has entered into a
settlement agreement with the plaintiffs, which is subject to court approval, in order to
eliminate the ongoing cost and distraction of the litigation. If the settlement agreement is
not approved by the court, the Company will continue to vigorously defend these claims.
6. |
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RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 |
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The following is a reconciliation of net assets available for benefits per the financial
statements at December 31, 2007 to the Form 5500: |
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December 31, |
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(Dollars in Thousands) |
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2007 |
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Net Assets Available for Benefits per the Financial Statements |
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$ |
109,903 |
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Amount for adjustment from fair value to contract value for
fully benefit-responsive investment contracts |
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547 |
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Amounts Allocated to Withdrawing Participants |
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(2 |
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Net Assets Available for Benefits per the Form 5500 |
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$ |
110,448 |
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The following is a reconciliation of benefits paid to participants per the financial statements
for the period ended December 31, 2007 to the Form 5500:
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Period Ended |
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December 31, |
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(Dollars in Thousands) |
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2007 |
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Benefits Paid to Participants per the Financial Statements |
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$ |
3,510 |
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Add: Amounts Allocated to Withdrawing Participants at
December 31, 2007 |
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2 |
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Benefits Paid to Participants per the Form 5500 |
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$ |
3,512 |
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Amounts allocated to withdrawing participants are recorded on the Form 5500 for benefit claims
that have been processed and approved for payment prior to the plan year end, but not
yet paid as of that date. |
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The following is a reconciliation of net investment gain from the Plans interest in commingled
trust per the financial statements for the period ended December 31, 2007 to the Form 5500: |
10
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
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Period Ended |
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December 31, |
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(Dollars in Thousands) |
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2007 |
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Net Investment Gain from Plans Interest in Commingled Trust
per the Financial Statements |
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$ |
2,104 |
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Impact of reflecting fully benefit-responsive investment
contracts at fair value at December 31, 2007 |
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547 |
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Net Investment Gain from Plans Interest in Commingled Trust
per the Form 5500 |
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$ |
2,651 |
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Fully benefit-responsive investment contracts are recorded at fair value on the Form 5500. |
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7. |
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FINANCIAL DATA OF THE COMMINGLED TRUST: |
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All the Plans investments except for the participant loans are in the Commingled Trust, which
was established for the investment of assets of the Plan. Each Participating plan has an
undivided interest in the Commingled Trust. At December 31, 2007, the Plans interest in the
net assets of the Commingled Trust was approximately 5.3%. The Commingled Trust assets are held
by the Trustee. |
11
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
The financial data of the Commingled Trust is as follows:
Statement of Net Assets Available for Benefits of the Commingled Trust
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December 31, |
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(Dollars in Thousands) |
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2007 |
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Investments: |
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Common Collective Trusts |
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JP Morgan Value Opportunities Fund |
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$ |
71,850 |
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NTGI-QM
Daily S & P 500 Equity Index Fund |
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414,998 |
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JPMCB EAFE Plus Fund |
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157,902 |
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Short-Term Investments |
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|
28,269 |
|
|
|
|
|
|
Mutual Funds |
|
|
|
|
Western Asset Core Plus Bond Fund Inst. Class Fund |
|
|
18,750 |
|
Vanguard Target Retirement Income Fund |
|
|
2,099 |
|
Vanguard Target Retirement 2005 Fund |
|
|
19,449 |
|
Vanguard Target Retirement 2015 Fund |
|
|
17,587 |
|
Vanguard Target Retirement 2025 Fund |
|
|
60,100 |
|
Vanguard Target Retirement 2035 Fund |
|
|
10,961 |
|
Vanguard Target Retirement 2045 Fund |
|
|
39,825 |
|
Wellington Management Growth Fund |
|
|
55,798 |
|
Artisan Small Capitalization Growth Fund |
|
|
68,157 |
|
RS Partners Small Capitalization Value Fund |
|
|
14,585 |
|
|
|
|
|
|
Charles Schwab Self Directed Account |
|
|
32,776 |
|
Common Stock of The Goodyear Tire & Rubber Company |
|
|
215,030 |
|
Investment Contracts (See Note 8) |
|
|
747,277 |
|
|
|
|
|
Total Investments |
|
|
1,975,413 |
|
|
|
|
|
|
Receivables: |
|
|
|
|
Pending Trades |
|
|
3,433 |
|
Accrued Interest and Dividends |
|
|
201 |
|
|
|
|
|
Total Assets Available for Benefits |
|
|
1,979,047 |
|
|
|
|
|
|
Liabilities: |
|
|
|
|
Administrative Expenses Payable |
|
|
(1,613 |
) |
|
|
|
|
Total Liabilities |
|
|
(1,613 |
) |
|
|
|
|
|
|
|
|
|
Net Assets Available for Benefits |
|
$ |
1,977,434 |
|
|
|
|
|
12
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
COMMINGLED TRUST INVESTMENT INCOME:
Net Investment income for the Commingled Trust is as follows:
|
|
|
|
|
|
|
Year Ended |
|
|
|
December 31, |
|
(Dollars in Thousands) |
|
2007 |
|
Net Appreciation in Fair Value of Investments: |
|
|
|
|
Common Collective Trust |
|
$ |
40,437 |
|
Mutual Funds |
|
|
18,851 |
|
Common Stock |
|
|
74,465 |
|
Self Directed Funds Mutual Funds |
|
|
2,519 |
|
|
|
|
|
|
|
|
136,272 |
|
Interest and dividends |
|
|
43,918 |
|
|
|
|
|
Investment Gain from Plans Interest in Master Trust |
|
$ |
180,190 |
|
Administrative Expenses |
|
|
(5,517 |
) |
|
|
|
|
Net Investment Income |
|
$ |
174,673 |
|
|
|
|
|
8. |
|
INVESTMENT CONTRACTS |
|
|
|
The Commingled Trust invests in The Goodyear Tire & Rubber Company Employee Savings Plan Stable
Value Fund (Stable Value Fund) which has entered into benefit-responsive guaranteed investment
contracts and wrapper contracts with various insurance companies. The insurance companies
maintain the contributions in general accounts. The accounts are credited with earnings on the
underlying investments and charged for participant withdrawals and administrative expenses. |
|
|
|
As described in Note 1, because the guaranteed investment contracts held by the Commingled Trust
are fully benefit-responsive, contract value is the relevant measurement attribute for that
portion of the net assets available for benefits attributable to the guaranteed investment
contracts. Contract value, as reported to the Commingled Trust by the manager of the Stable
Value Fund, represents contributions made under the contract, plus earnings, less participant
withdrawals and administrative expenses. Participants may ordinarily direct the withdrawal or
transfer of all or a portion of their investment at contract value. |
|
|
|
There are no reserves against contract value for credit risk of the contract issuers or
otherwise. The crediting interest rate is based on a formula agreed upon with the issuers. |
|
|
|
The Stable Value Fund has purchased wrapper contracts from the insurance companies. The wrapper
contracts amortize the realized and unrealized gains and losses on the underlying fixed income
investments, typically over the duration of the investments, through adjustments to the future
interest crediting rate (which is the rate earned by participants in the |
13
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
December 31, 2007 and April 1, 2007
fund for underlying
investments). The issuers of the wrapper contracts provide assurance that the adjustments to
the interest crediting rate do not result in a future interest crediting rate that is less than
zero.
Certain events limit the ability of the Plan to transact at contract value with the issuer.
These events include termination of the Plan, a material adverse change to the provisions of the
Plan, if the Commingled Trust elects to withdraw from a wrapper contract in order to switch to a
different investment provider, or if the terms of a successor plan (in the event of the spin-off
or sale of a division) do not meet the wrapper contract issuers underwriting criteria for
issuance of a clone wrapper contract. The events described above that could result in the
payment of benefits at market value rather than contract value are not probable of occurring in
the foreseeable future.
The wrapper contracts do not permit the issuers to terminate the contracts unless the Plan loses
it qualified status, has incurred material breaches of responsibilities, or material and adverse
changes occur to the provisions of the Plan.
|
|
|
|
|
|
|
Year Ended December 31, 2007 |
Average yields: |
|
|
|
|
Based on actual earnings |
|
|
5.1 |
% |
Based on interest rate credited to participants |
|
|
4.7 |
% |
14
Schedule I
The Goodyear Tire & Rubber Company
Savings Plan for Retail Employees
Schedule H,line 4i Schedule of Assets (Held at End of Year) December 31, 2007
Employer Identification Number: 34-0253240, Plan Number: 013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
|
(b) |
|
(c) |
|
(d) |
|
(e) |
|
|
|
|
|
|
Description of investment |
|
|
|
|
|
|
|
|
Identity of issue,borrower |
|
Including maturity date, rate of interest, |
|
|
|
|
|
|
|
|
|
|
|
|
lessor or similar party |
|
collateral par, or maturity value |
|
Cost |
|
Current Value |
|
|
|
|
Participant Loans |
|
|
5.0% - 9.25 |
% |
|
$ |
|
|
|
$ |
4,981,022 |
|
Note: This schedule excludes the Plans interest in the Commingled Trust, which is not required to be reported on the schedule pursuant to the
Department of Labors Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974.