11-K: Annual report of employee stock purchase, savings and similar plans
Published on June 28, 2007
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, 2006
OR
TRANSITION
REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For
the
transition period from _______ to _______
Commission
File No. 001-02217
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
(Full
title of the plan)
(Name
of
issuer of the securities held pursuant to the plan)
One
Coca-Cola Plaza
Atlanta,
Georgia 30313
(Address
of the plan and address of issuer's principal executive offices)
THRIFT
PLAN
Financial
Statements and Supplemental Schedule
As
of December 31, 2006 and 2005
and
for the Year Ended December 31, 2006
with
Report of Independent Registered Public Accounting Firm
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Financial
Statements and Supplemental Schedule
As
of December 31, 2006 and 2005
and
for the Year Ended December 31, 2006
Table
of
Contents
|
Page
|
|
|
Report
of Independent Registered Public Accounting Firm
|
1
|
|
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)
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10
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[LETTERHEAD
OF BANKS, FINLEY, WHITE &
CO.]
To
the
Thrift Plan Committee of
Caribbean
Refrescos, Inc.
Caribbean
Refrescos, Inc.
Cidra,
Puerto Rico
Report
of Independent Registered Public Accounting Firm
We
have
audited the accompanying statements of net assets available for benefits of
the
Caribbean Refrescos, Inc. Thrift Plan (the “Plan”) as of December 31, 2006
and 2005 and the related statement of changes in net assets available for
benefits for the year then ended December 31, 2006. 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 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 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 as of
December 31, 2006 and 2005 and the changes in net assets available for
benefits for the year ended December 31, 2006, in conformity with U.S.
generally accepted accounting principles.
Our
audits were performed 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 purposes of additional analysis
and
is not a required part of the basic financial statements but is supplemental
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 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.
/s/
BANKS, FINLEY, WHITE & CO.
College
Park, Georgia
June
28,
2007
1
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Statements
of Net Assets Available for Benefits
December
31, 2006 and 2005
|
2006
|
2005
|
|||||||
|
ASSETS
|
||||||||
|
Investments
(Notes 3 and 4)
|
$ |
24,670,169
|
$ |
23,011,055
|
||||
|
NET
ASSETS AVAILABLE FOR BENEFITS
|
$ |
24,670,169
|
$ |
23,011,055
|
||||
The
accompanying notes are an integral part of the financial
statements.
2
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Statement
of Changes in Net Assets Available for Benefits
Year
Ended December 31, 2006
|
Additions
to net assets attributed to:
|
||||
|
Investment
income:
|
||||
|
Net
appreciation in fair value
of investment (Note 3)
|
$ |
3,607,632
|
||
|
Dividend
income
|
527,222
|
|||
|
Interest
income
|
195,465
|
|||
|
Total
investment income
|
4,330,319
|
|||
|
Contributions:
|
||||
|
Employer
|
539,098
|
|||
|
Participants
|
1,240,942
|
|||
|
Total
contributions
|
1,780,040
|
|||
|
Total
additions
|
6,110,359
|
|||
|
Deductions
from net assets attributed to:
|
||||
|
Distributions
to Participants
|
4,435,659
|
|||
|
Administrative
expenses
|
15,586
|
|||
|
Total
deductions
|
4,451,245
|
|||
|
Net
increase in net assets available for benefits
|
1,659,114
|
|||
|
Net
assets available for benefits, beginning of year
|
23,011,055
|
|||
|
NET
ASSETS AVAILABLE FOR BENEFITS, END OF YEAR
|
$ |
24,670,169
|
||
The
accompanying notes are an integral part of the financial
statements.
3
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements
December
31, 2006 and 2005
Note
1 – Description of Plan
The
following description of the Caribbean Refrescos, Inc. Thrift Plan (the “Plan”)
provides only general information. Participants should refer to the
Summary Plan Description for a more complete description of the Plan’s
provisions.
General
The
Plan
is a defined contribution pension plan covering a majority of the employees
of
Caribbean Refrescos, Inc. (the “Company”), a wholly owned subsidiary of The
Coca-Cola Company. Eligible employees may begin participating in the
Plan after reaching age 18 and completing three months of
service. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”).
Contributions
The
election to contribute to the Plan by employees (“Participants”) is
voluntary. Participant contributions are in the form of payroll
deductions with the Company currently making a matching contribution equal
to
100% of the first 3% of compensation contributed by a Participant subject to
certain limitations imposed by the Puerto Rico Internal Revenue Code of 1994
(the “Code”).
Participants
may contribute to the Plan with “Before-Tax” dollars or “After-Tax”
dollars. “Before-Tax” contributions are not subject to current
federal income taxes. Participants may contribute up to 13% (10% on a
“Before-Tax” basis) of their annual compensation to the Plan, subject to certain
limitation imposed by the Code. For 2006, the maximum “Before-Tax”
annual contribution amount was $8,000. Participants are allowed to
roll over account balances from other qualified retirement plans or Individual
Retirement Accounts into the Plan. Effective May 16, 2006, the Plan
was amended to allow participants who are age 50 or older by the end of the
year to make additional “Catch-Up” contributions within limits imposed by the
Code.
All
contributions are paid to a trustee and are invested as directed by Participants
and the Company. Participants may direct their contributions into The Coca-Cola
Company Stock Fund and 10 mutual and collective trust funds with various
investment objectives and strategies.
All
Company matching contributions are invested in The Coca-Cola Company Stock
Fund
and are immediately vested to the Participants. Effective March 30,
2007, participants are permitted to elect to direct the Plan to invest Employer
Contributions to any investment option under the Plan. Refer to Note
8.
4
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements (Continued)
Note
1 – Description of Plan (Continued)
Valuation
of Participant Accounts
Participant
account balances are valued based upon the number of units of each investment
fund credited to Participant accounts. Units are revalued on a daily
basis to reflect earnings and other transactions. Participant account
balances are updated on a daily basis to reflect transactions affecting account
balances.
Participant
Loans
Participants
may borrow from their account balances subject to certain
limitations. Participant loans may be taken from a combination of
“Before-Tax”, “After-Tax” and rollover account balances.
The
following applies to Participant loans:
|
(a)
|
The
maximum amount that a Participant may borrow is the lesser of 50%
of their
account balance or $50,000. The $50,000 maximum is reduced by
the Participant’s highest outstanding loan balance on any loans during the
preceding 12 months.
|
|
(b)
|
The
minimum amount that a Participant may borrow is the lesser of 50%
of their
account balance or $1,000.
|
|
(c)
|
The
loan interest rate is the prime rate (as published in The Wall Street
Journal at the inception of the loan) plus
1%.
|
|
(d)
|
The
loan repayment period is one to five years for a general purpose
loan and
one to 15 years for a loan used to purchase or build a principal
residence.
|
Payment
of Benefits
Generally,
payments from the Plan are made in a single lump sum upon a Participant’s
retirement, termination or disability. However, if a Participant
dies, the surviving spouse or other designated beneficiary may choose to receive
payment from the Plan in up to 10 annual installments. Participants
may elect to receive in-service withdrawals from their After-Tax account
balances.
Administration
The
Company is the named plan administrator as defined in ERISA Section
3(16)(A). However, the Thrift Plan Committee of Caribbean Refrescos,
Inc. (the “Committee”), on behalf of the Company and as designated in the Plan
document, has substantial control of and discretion over the administration
of
the Plan.
5
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements (Continued)
Note
1 – Description of Plan (Continued)
Plan
Termination
The
Company expects the Plan to be continued indefinitely but reserves the right
to
terminate the Plan or to discontinue its contributions to the Plan at any time,
by written document approved by the Committee. In the event of
termination, the Committee may either:
|
|
(a)
|
continue
the trust for as long as it considers advisable,
or
|
|
|
(b)
|
terminate
the trust, pay all expenses from the trust fund, and direct the payment
of
Participant account balances, either in the form of lump-sum
distributions, installment payments, or any other form selected by
the Committee.
|
Note
2 – Summary of Significant Accounting Policies
Basis
of Accounting
The
financial statements of the Plan are presented on the accrual basis of
accounting.
Use
of Estimates
The
preparation of financial statements in conformity with U.S. generally accepted
accounting principles requires Plan management to make estimates that affect
certain reported amounts and disclosures. Accordingly, actual results
may differ from those estimates.
Valuation
of Investments
All
investments are stated at fair value. The investments in common stock
of The Coca-Cola Company and the mutual funds are determined at the quoted
prices in active markets at the last reported sales price on the last business
day of the Plan year. Investments in collective trust funds are
stated at fair value, based on quoted redemption values as determined by the
investment manager. Participant loans are valued based upon remaining unpaid
principal plus any accrued but unpaid interest.
Administrative
Expenses
Certain
administrative expenses were paid by the Plan, as permitted by the Plan
document. All other administrative expenses were paid by the
Company.
6
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements (Continued)
Note
3 – Investments
The
fair
value of investments at December 31 is as follows:
|
2006
|
2005
|
|||||||
|
Participant-directed
investments
|
$ |
12,281,645
|
$ |
10,878,156
|
||||
|
Nonparticipant-directed
investments
|
12,388,524
|
12,132,899
|
||||||
| $ |
24,670,169
|
$ |
23,011,055
|
|||||
The
fair
value of individual investments that represent 5% or more of the Plan’s net
assets at December 31 is
as
follows:
|
2006
|
2005
|
|||||||
|
Common
stock of The Coca-Cola Company
|
$ |
18,794,437
|
$ |
17,739,262
|
||||
|
AIM
Money Market Fund
|
2,011,631
|
1,772,050
|
||||||
Investments
in common stock of The Coca-Cola Company include both participant-directed
and
nonparticipant-directed investments.
During
2006, the Plan’s investments (including investments purchased, sold, as well as
held during the year) appreciated in fair value as follows:
|
Year
Ended December 31, 2006
|
||||
|
Net
appreciation in fair value of investments (as determined by quoted
market
prices):
|
||||
|
Common
stock of The Coca-Cola Company
|
$ |
3,395,318
|
||
|
Mutual
funds
|
137,411
|
|||
| 3,532,729 | ||||
|
Net
appreciation in fair value of investments (as determined by
the investment manager):
|
||||
|
Collective
trust funds
|
74,903
|
|||
|
Net
appreciation in fair value of investments
|
$ |
3,607,632
|
||
7
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements (Continued)
Note
4 – Nonparticipant-Directed Investments
Information
about the net assets and the significant components of the changes in net assets
relating to the nonparticipant-directed investments is as follows:
|
December
31,
2006
|
December
31,
2005
|
|||||||
|
Net
assets, at fair value:
|
||||||||
|
The
Coca-Cola Company Stock
Fund
|
$ |
12,388,524
|
$ |
12,132,899
|
||||
|
Year
Ended December 31, 2006
|
||||||||
|
Changes
in net assets:
|
||||||||
|
Contributions
|
$ |
535,666
|
||||||
|
Dividends
|
345,963
|
|||||||
|
Net
appreciation
|
2,266,651
|
|||||||
|
Distributions
to
Participants
|
(2,363,153 | ) | ||||||
|
Transfers
from other
investment funds, net
|
(524,035 | ) | ||||||
|
Administrative
expenses
|
(5,467 | ) | ||||||
|
Net
increase
|
$ |
255,625
|
||||||
Note
5 – Transactions with Party-in-Interest
The
Plan
received dividends on common stock of The Coca-Cola Company in 2006 of
$527,222. The Plan purchased 8,944 shares of common stock of The
Coca-Cola Company with a fair value of $377,083 in 2006. During 2006,
the Plan sold 59,493 shares of common stock of The Coca-Cola Company for
proceeds of $2,717,227, resulting in a gain of $1,268,897 based on historical
cost. The Plan held 389,522 and 440,071 shares of common stock of The
Coca-Cola Company as of December 31, 2006 and 2005, respectively, with a fair
value of $18,794,437 and $17,739,262, respectively.
8
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
Notes
to
Financial Statements (Continued)
Note
6 – Risk and Uncertainties
The
Plan
invests in various investment securities. Investment securities are
exposed to various risks such as interest rate, market, and credit
risks. 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
statement of net assets available benefits.
Note
7 – Income Tax Status
The
Plan
qualifies under Sections 165(a) and 165(e) of the Puerto Rico Income Tax Act
of
1954 (the “Act”), as amended, (for applicable tax years) and Sections 1165(a)
and 1165(e) of the Puerto Rico Internal Revenue Code of 1994, as amended, (for
applicable tax years) and is, therefore, not subject to tax under present income
tax laws. Once qualified, the Plan is required to operate in
conformity with the applicable tax requirements to maintain its
qualification. The Plan obtained a determination letter on October
19, 1990, in which the Puerto Rico Department of the Treasury ruled that the
Plan, as then designed, was in compliance with the applicable requirements
of
the Act. The Plan has been amended subsequent to receiving this determination
letter. The Plan obtained letters on October 22, 1998 and September
27, 2000, in which the Puerto Rico Department of the Treasury ruled that the
amendments do not affect the qualified status of the Plan. The
Committee has indicated that it will take whatever actions are necessary to
maintain the Plan’s tax-qualified status.
Note
8 – Subsequent Event
Effective
March 30, 2007, participants are permitted to elect to direct the Plan to invest
Employer Contributions to any investment option under the Plan including The
Coca-Cola Company Common Stock Fund and participants may sell investments in
The
Coca-Cola Company Common Stock Fund attributable to Employer Contributions
to
invest in other investment options in the Plan.
9
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
EIN: 66-0276572 PN: 001
Schedule
H, line 4i - Schedule of Assets (Held at End of Year)
December
31, 2006
|
(c)
Description of investment
|
||||||||||||
|
(b)
Identity of issue,
|
including
maturity date,
|
|||||||||||
|
borrower,
lessor or
|
rate
of interest, collateral,
|
(e)
Current
|
||||||||||
|
(a)
|
similar
party
|
par,
or maturity value
|
(d)
Cost
|
value
|
||||||||
|
Short-Term
Investment:
|
||||||||||||
|
Federated
Investors, Inc.
|
Federated
Government Obligation Fund #5
|
$ |
441,330
|
$ |
441,330
|
|||||||
|
Common
Stock:
|
||||||||||||
|
*
|
The
Coca-Cola Company
|
Common
stock
|
9,495,852
|
18,794,437
|
||||||||
|
Mutual
Funds:
|
||||||||||||
|
AIM
Advisors, Inc.
|
Money
Market Fund
|
2,011,631
|
2,011,631
|
|||||||||
|
AIM
Advisors, Inc.
|
Dynamics
Fund
|
343,614
|
377,660
|
|||||||||
|
AIM
Advisors, Inc.
|
Basic
Balanced Fund
|
254,377
|
280,538
|
|||||||||
|
AIM
Advisors, Inc.
|
Income
Fund
|
366,702
|
364,849
|
|||||||||
|
AIM
Advisors, Inc.
|
Intermediate
Government Fund
|
338,890
|
323,684
|
|||||||||
|
AIM
Advisors, Inc.
|
Large
Cap Growth Fund
|
594,043
|
615,357
|
|||||||||
|
AIM
Advisors, Inc.
|
Global
Growth Fund
|
97,675
|
118,994
|
|||||||||
|
AIM
Advisors, Inc.
|
Basic
Value Fund
|
209,331
|
245,298
|
|||||||||
|
Total
Mutual Funds
|
4,216,263
|
4,338,011
|
||||||||||
|
Collective
Trust Funds:
|
||||||||||||
|
INVESCO
|
Structured
Small Cap Value Equity Trust
|
258,198
|
353,324
|
|||||||||
|
INVESCO
|
International
Equity Trust
|
148,670
|
187,931
|
|||||||||
|
Total
Collective Trust Funds
|
406,868
|
541,255
|
||||||||||
|
Participant
Loans:
|
||||||||||||
|
*
|
Participants
|
Loans
with interest rates ranging from
|
||||||||||
|
5.0%
to 10.5%. Maturities through 2020.
|
-
|
555,136
|
||||||||||
|
Total
Assets (Held at End of Year)
|
$ |
14,560,313
|
$ |
24,670,169
|
||||||||
|
*
|
Party-in-interest
|
|||||||||||
10
SIGNATURES
The
Plan. Pursuant
to the requirements of the Securities Exchange Act of 1934, the Thrift Plan
Committee of Caribbean Refrescos, Inc. has duly caused this annual report to
be
signed on its behalf by the undersigned hereunto duly authorized.
|
CARIBBEAN
REFRESCOS, INC. THRIFT PLAN
|
|
|
(Name
of Plan)
|
|
| By: /s/ Candido Collazo | |
|
Candido Collazo
Chairman, Thrift Plan Committee
of
|
|
|
Caribbean Refrescos, Inc.
|
Date: June
28, 2007
11
EXHIBIT
INDEX
|
Exhibit
No.
|
Description
|
|
23
|
Consent
of Independent Registered Public Accounting
Firm
|