SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
ANNUAL REPORT
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 [NO FEE REQUIRED].
For the fiscal year ended December 31, 2001
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 1-14443
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below: Gartner, Inc. Savings and
Investment Plan
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office: Gartner, Inc., 56 Top
Gallant Road, Stamford, CT 06902-7747
GARTNER, INC.
SAVINGS AND INVESTMENT PLAN
TABLE OF CONTENTS
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PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statement of net assets available for benefits as of December 31, 2001 and 2000 2
Statement of changes in net assets available for benefits
for the year ended December 31, 2001 3
Notes to the financial statements for the years ended December 31, 2001 and 2000 4
SUPPLEMENTAL SCHEDULES:
Schedule of assets held for investment purposes as of December 31, 2001 10
Independent Auditors' Report
To the Participants and Administrative Committee of the
Gartner, Inc. Savings and Investment Plan:
We have audited the accompanying statements of net assets available for benefits
of the Gartner, Inc. Savings and Investment Plan (the Plan) as of December 31,
2001 and 2000, and the related statements of changes in net assets available for
benefits for the years then ended. 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 of America. 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
the 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, 2001 and 2000 and the changes in the net assets available for
benefits for the years then ended in conformity with accounting principles
generally accepted in the United States of America.
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
for investment purposes 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 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/ KPMG LLP
St. Petersburg, FL
May 10, 2002
GARTNER, INC.
SAVINGS AND INVESTMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 2001 and 2000
2001 2000
------------------ ------------------
Assets:
Investments:
Cash $ 59,928 163,775
Investments in registered investment company shares 144,736,522 145,322,090
Gartner, Inc. common stock 4,441,651 2,192,648
Participant loans 2,799,179 2,542,932
------------------ ------------------
Total investments 152,037,280 150,221,445
------------------ ------------------
Receivables:
Employer contribution 2,073,272 2,180,205
Participant contribution -- 488,789
Other 35,854 1,348
------------------ ------------------
Total receivables 2,109,126 2,670,342
------------------ ------------------
Total assets 154,146,406 152,891,787
------------------ ------------------
Liabilities:
Accrued expenses 50,107 73,218
Refunds of excess contributions 5,068 46,959
------------------ ------------------
Total liabilities 55,175 120,177
------------------ ------------------
Net assets available for benefits $ 154,091,231 152,771,610
================== ==================
See accompanying notes to the financial statements.
2
GARTNER, INC.
SAVINGS AND INVESTMENT PLAN
Statements of Changes in Net Assets
Available for Benefits
For the years ended December 31, 2001 and 2000
2001 2000
------------------ -------------------
Additions:
Investment income (loss):
Net depreciation in fair value of investments $ (21,462,273) (24,276,362)
Interest 235,249 186,803
Dividends 2,936,457 12,197,680
------------------ -------------------
Investment loss (18,290,567) (11,891,879)
Contributions:
Participant 21,299,283 22,034,840
Employer 10,273,476 9,822,186
------------------ -------------------
Total additions, net 13,282,192 19,965,147
------------------ -------------------
Deductions:
Benefits paid to participants 11,867,526 16,941,003
Administrative expenses 95,045 98,144
------------------ -------------------
Total deductions 11,962,571 17,039,147
------------------ -------------------
Increase in net assets available for benefits 1,319,621 2,926,000
Net assets available for benefits:
Beginning of year 152,771,610 149,845,610
------------------ -------------------
End of year $ 154,091,231 152,771,610
================== ===================
See accompanying notes to the financial statements.
3
GARTNER, INC.
SAVINGS AND INVESTMENT PLAN
Notes to Financial Statements
December 31, 2001 and 2000
(1) Description of the Plan
The following description of the Gartner, Inc. Savings and Investment
Plan (the Plan) provides only general information. Participants should
refer to the plan agreement for a more complete description of the Plan
provisions.
(a) General
The Plan is a defined contribution retirement plan subject to the
provisions of the Employee Retirement Income Security Act of 1974
(ERISA). The Plan has been amended and restated at various times
in order to comply with regulatory guidance, most recently as of
February 22, 2002 (see note 5).
The Plan covers substantially all domestic full-time employees of
Gartner, Inc. and its wholly owned subsidiaries (collectively the
Company or Employer). Any employee who customarily works at least
20 hours per week (minimum of 1,000 hours per year) and is at
least 18 years of age is eligible to participate in the Plan.
(b) Administration
The Plan is administered by the Administrative Committee (the Plan
Committee) which is appointed by the Company's Board of Directors.
The Plan Committee is responsible for all administrative aspects
of the Plan, including selection of trustees and investment
managers, establishment of investment alternatives, determination
of benefit eligibility and benefit calculations and interpretation
of Plan provisions. The Plan Committee has appointed officers of
the Company to act as trustees (the Trustees) to administer the
Plan. Administrative expenses are to be paid by the Plan through
the use of participant forfeitures. Any administrative expenses in
excess of participant forfeitures will be paid by the Company. For
the plan years ended December 31, 2001 and 2000, all expenses were
paid by the Plan.
(c) Contributions
Participating employees may make annual contributions to the Plan
in percentages of not less than 1% or more than 25% of total
annual compensation (15% pre-tax, 10% post-tax), as defined in the
Plan agreement, subject to Internal Revenue Service (IRS)
limitations.
For 2001 and 2000, the Company is required to match pre-tax
participant contributions up to a maximum of 4% of a participant's
total compensation, or $4,200, which is 40% of the IRS pre-tax
contribution limitation for the years then ended.
The Plan also provides for a profit sharing contribution comprised
of the following elements:
-- Fixed amount - an amount equal to 1% of a participant's base
compensation, subject to an IRS limitation.
-- Discretionary amount - an amount in excess of the fixed
amount solely at the discretion of the Company's Board of
Directors based on the financial results of the Company.
4
A Company matching contribution of $0 and $227,295, a fixed profit
sharing contribution of $2,073,272 and $1,952,910 for the years
ended December 31, 2001 and 2000, respectively, have been
presented as an employer contribution receivable in the Plan
financial statements as of December 31, 2001 and 2000,
respectively.
Effective January 1, 2001, a participant may make "after tax"
contributions of up to 10% of the participants compensation,
subject to a maximum of $ 17,500 per year.
(d) Participants Accounts
Separate accounts are maintained for each participant of the Plan
through the Fidelity Management Trust Company (Fidelity). The
participants' accounts are adjusted to reflect contributions and
investment earnings such as interest, dividends, and realized and
unrealized investment gains and losses.
Cash, invested in the Fidelity Retirement Money Market Fund, in
the amount of $59,928 at December 31, 2001 and $163,755 at
December 31, 2000, although a component of the Plan's net assets,
is not specifically allocated to participants' accounts and is
non-participant directed. This unallocated cash held by the Plan
was primarily the result of participants' forfeitures.
(e) Investments
Participants may elect to invest in a variety of specialized
investment funds and may make transfers among investment funds at
their discretion in whole percentages. The Company's Board of
Directors has authorized Fidelity to execute transactions upon
direction from the participant within the framework of the trust
instrument.
(f) Vesting
Participants are immediately vested in their own contributions and
in the Employer's matching contributions. Participants vest in the
profit sharing contributions ratably over a five-year period based
on date of hire. The date of hire for the employees of acquired
companies continues to be their historical date of hire by the
acquired company for vesting purposes.
(g) Loans to Participants
Loans to participants are permitted, with the Trustees' consent,
in accordance with the limits provided by the Internal Revenue
Code. Loans bear interest at a rate equal to prime plus 1% which
ranged between 5.75% and 10.5% for loans made during the year
ended December 31, 2001, and 9.25% and 10.5% for loans made during
the year ended December 31, 2000. Participants receiving loans
from the Plan must execute an interest bearing promissory note in
the amount of the loan. The terms of the promissory note require
that all participants repay their loans based upon a fixed
repayment schedule not to exceed a five-year period, except in the
case of a primary residence loan for which the repayment period is
extended to 15 years. Participant loans are subject to a $1,000
minimum amount and limited to 50% of a Participant's vested
account balance, not to exceed $50,000.
5
(h) Payment of Benefits
Benefits are paid upon retirement (on or after age 55), death or
termination of employment, and may also be distributed prior to
termination of employment upon reaching age 59-1/2 or because of
financial hardship. Participants' benefits are paid in a lump sum
equal to the vested value of the Participant's account at the time
of payment. With respect to accounts from the former Pension Plan
that was merged into this Plan in 1993, an annuity (joint and
50%survivor for married Participants and single life for unmarried
Participants) is the standard form of payment. With respect to
such Pension Plan accounts, Participants may elect a lump sum
payment instead of the annuity, with spousal consent as
applicable.
(i) Plan Termination
Although it has not expressed any intent to do so, the Company
reserves the right to fully or partially terminate the Plan at any
time by action of the Board of Directors or its designee. In such
an event, all participants will become fully vested in their
account balance as of the date of full or partial termination.
(2) Summary of Significant Accounting Policies
(a) Basis of Accounting
The financial statements have been prepared using the accrual
basis of accounting.
(b) Valuation of Investments
The Plan's investments are valued at fair value based upon market
prices quoted for the respective funds. Shares of registered
company investments are valued at the net asset value of shares
held by the Plan at year end.
(c) Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make significant estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosures of
contingent assets and liabilities at the date of the financial
statements, and the reported amounts of additions to and
deductions from net assets during the reporting period. Actual
results could differ from those estimates.
(d) Risks and Uncertainties
The Plan provides for various investment options. Investment
securities are exposed to various risks such as interest rate,
market and credit. Due to the risk associated with investment
securities and the uncertainty related to changes in the value of
such securities, it is at least reasonably possible that changes
in risks in the near term could materially affect participant's
account balances and the amounts reported in the statements of net
assets available for plan benefits and the statements of changes
in net assets available for plan benefits.
6
(e) Investment Transactions and Related Income
Purchases and sales of interests in the investment funds, along
with realized gains and losses, are accounted for on the trade
date. Realized gains and losses on the sale of investments are
calculated based upon the difference between the net sale proceeds
and the quoted market value of the fund shares at the beginning of
the year or the purchase date, if later. Unrealized gains and
losses on investments held by the Plan at December 31, 2001 and
2000, respectively, are calculated based upon the difference
between the quoted market value of fund shares held at the end of
the year less their quoted market value at the beginning of the
year or acquisition date if acquired during the year. Realized and
unrealized gains and losses are included in net (depreciation)
appreciation in fair value of investments in the accompanying
statement of changes in net assets available for benefits.
Dividends represent the Plan's share in dividend income of the
investment funds in which the Plan participates. Income from other
investments is recorded as earned on an accrual basis.
(3) Investments
Substantially all of the Plan's assets are invested in commingled
investment funds managed by Fidelity. A brief description of the funds
and investments is as follows:
(a) Gartner, Inc. Stock Fund
The assets of this fund are substantially invested in Gartner,
Inc. Class A Common Stock. This Fund also maintains
interest-bearing cash, $220,674 and $110,661 at December 31, 2001
and 2000, respectively, to meet liquidity needs from participant
withdrawals or transfers.
(b) Fidelity Retirement Money Market Fund
Investments are held in a diversified portfolio of domestic and
international short term fixed income securities such as corporate
commercial paper, certificates of deposit, Treasury notes and
bills and bankers acceptances.
(c) Other Funds
The Magellan, Growth Company, OTC Portfolio and Overseas Funds
invest in debt and equity securities of companies of varying sizes
with above average growth potential to achieve long-term capital
appreciation. The US Equity Index Fund seeks to match the total
return of the Standard & Poor 500 Index. The Puritan, Equity
Income and Intermediate Bond Funds seek current income and capital
preservation as well as the potential for capital appreciation by
investing in a diversified portfolio of common and preferred
stocks and bonds. The Fidelity Freedom Funds are asset allocation
funds that invest in other Fidelity mutual funds; there are four
funds that are managed to specific target retirement dates - 2000,
2010, 2020, 2030, and 2040 and a fifth fund, the Fidelity Freedom
Income Fund, for those actively seeking high current income. The
Fidelity Select Portfolios are mutual funds that invest in
specific sectors or industries. Investors are able to obtain
targeted diversification with industry specific mutual funds and
an opportunity to invest in industries with high growth potential.
7
The market value of investments exceeding 5% of Plan assets as of
December 31, 2001 and 2000 are summarized as follows:
2001 2000
------------------- -------------------
Investments at fair value was determined by
quoted at market price:
Retirement Money Market Fund $ 17,006,407 15,488,820
Magellan Fund 33,392,044 33,595,004
Growth Company Fund 33,063,696 42,478,667
Puritan Fund 12,629,037 11,558,706
Equity Income Fund 17,078,303 15,952,448
OTC Portfolio Fund 9,403,824 10,779,024
During 2001 and 2000, the Plan's investments (including
investments bought, sold, and held during the year) depreciated in
value by $21,462,273 and $24,276,362, respectively, as follows:
Year ended December 31,
-------------------------------------------
2001 2000
-------------------- --------------------
Registered investment company shares $ (23,302,006) (22,497,445)
Gartner, Inc. common stock 1,839,733 (1,778,917)
-------------------- --------------------
$ (21,462,273) (24,276,362)
==================== ====================
(4) Plan Tax Status
The Plan obtained its latest determination letter on July 24, 1995, in
which the IRS stated that the Plan, as then designed, was in compliance
with the applicable requirements of the Internal Revenue Code. The Plan
has been amended since receiving the determination letter; however, the
Plan administrator continues to believe that the Plan is designed and
operated in compliance with the applicable requirements of the Internal
Revenue Code.
(5) Subsequent Plan Changes
On February 22, 2002, the Plan was amended and restated as of January 1,
2002 to incorporate all amendments made in 1999, 2000, and 2001 as well
as the applicable requirements of the Uruguay Round Agreements Act
(GATT), the Uniformed Services Employment and Reemployment Rights Act of
1994, the Small Business Job Protection Act of 1996, the Taxpayer Relief
Act of 1997, the Internal Revenue Service Restructuring and Reform Act of
1998, and the Community Renewal Tax Relief Act of 2000 (collectively
referred to as GUST).
8
On March 25, 2002, the Plan was amended, effective January 1, 2002 to
clarify the rights of an alternative payee under a qualified domestic
relations order to receive an immediate distribution.
As of January 1, 2002, the Plan operationally implemented certain
provisions in the Economic Growth and Tax Relief Reconciliation Act of
2001 as required by law.
9
Schedule 1
GARTNER, INC.
SAVINGS AND INVESTMENT PLAN
Schedule of Assets Held for Investment Purposes at End of Year
December 31, 2001
Current
Description Shares value
------------------------------------------------------------------------------- ----------------- -----------------
FMTC Institutional Cash Portfolio* 220,674 $ 220,674
Fidelity Retirement Money Market Fund* 17,006,407 17,006,407
Fidelity Magellan Fund* 320,400 33,392,044
Fidelity Growth Company Fund* 621,264 33,063,696
Fidelity Puritan Fund* 714,716 12,629,037
Fidelity Equity Income Fund* 350,180 17,078,303
Fidelity Intermediate Bond Fund* 511,386 5,277,503
Fidelity Overseas Fund* 193,489 5,305,471
Fidelity OTC Fund* 301,695 9,403,824
Spartan U.S. Equity Index Fund* 128,337 5,215,608
Fidelity Freedom Income Fund* 13,155 143,785
Fidelity Freedom 2000 Fund* 150,036 1,728,420
Fidelity Freedom 2010 Fund* 67,568 852,036
Fidelity Freedom 2020 Fund* 134,290 1,689,371
Fidelity Freedom 2030 Fund* 102,570 1,288,279
Fidelity Freedom 2040 Fund* 7,070 52,248
Fidelity Select Health Care* 1,001 127,427
Fidelity Select Technology* 2,677 162,220
Fidelity Utilities Growth* 683 26,359
Fidelity Financial Services* 955 96,565
Fidelity Select Natural Resources* 1,045 13,112
Fidelity Select Cyclical Industries* 1,509 22,460
Fidelity Select Consumer Industries* 69 1,601
Loans to Plan participants (interest rates
ranging from 7 percent to 11 percent) -- 2,799,179
Gartner, Inc. Class A Common Stock** 379,953 4,441,651
-----------------
$ 152,037,280
=================
* Party-in-interest - affiliate of Plan custodian
** Party-in-interest - Sponsor of the Plan
10
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act
of 1934, the trustees (or other persons who administer the employee
benefit plan) have duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
Gartner, Inc. Savings and Investment Plan
Date: June 27, 2002 By: / s / Regina M. Paolillo
-------------- ----------------------------------------
Name: Regina M. Paolillo
--------------------------------------
Title: Committee Chairman
-------------------------------------
Executive Vice President &
Chief Financial Officer
Gartner, Inc.
EXHIBITS
Exhibit Number Description of Exhibits
1* Independent Auditors' Consent, KPMG LLP.
-------------
* Filed herewith.
Exhibit 1
Consent of Independent Auditors
The Board of Directors
Gartner, Inc.:
We consent to the incorporation by reference in the registration statement ( No.
1-14443) on Form S-8 of Gartner, Inc. of our report dated May 10, 2002, relating
to the statements of net assets available for plan benefits of the Gartner, Inc.
Savings and Investment Plan as of December 31, 2001 and 2000, the related
statements of changes in net assets available for plan benefits for the years
ended December 31, 2001 and 2000, and the related supplemental schedule of
assets held for investment purposes at end of year as of December 31, 2001 which
report appears in the December 31, 2001 annual report on Form 11-K of the
Gartner, Inc. Savings and Investment Plan.
/s/ KPMG LLP
St. Petersburg, Florida
June 26, 2002