CVS 11-K 2014




UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
_________________________________________
 
FORM 11-K
 
_________________________________________
  
 
ý                ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the fiscal year ended December 31, 2013
 
OR
 
o                   TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from          to

Commission File Number:  001-01011
 
THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
(Full title of the Plan)
 
_________________________________________
 
CVS CAREMARK CORPORATION
(Name of issuer of the securities held pursuant to the plan)
 
One CVS Drive
Woonsocket, RI 02895
(Address of principal executive offices of issuer)


















THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
YEARS ENDED DECEMBER 31, 2013 AND 2012

CONTENTS


 

 
 
Page
 
 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 
 
 
FINANCIAL STATEMENTS:
 
 
 
 
 
Statements of Net Assets Available for Benefits
 
 
 
 
Statements of Changes in Net Assets Available for Benefits
 
 
 
 
Notes to Financial Statements
 
 
 
 
SUPPLEMENTAL SCHEDULE:
 
 
 
 
 
 
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
 
 
 
 
SIGNATURE
 
 
 
 
EXHIBIT INDEX
 
 
 
 
Exhibit 23.1  Consent of Ernst & Young LLP
 
34







Report of Independent Registered Public Accounting Firm
 
The Administrative Subcommittee of
The 401(k) Plan and the Employee Stock Ownership
Plan of CVS Caremark Corporation and Affiliated Companies
 
We have audited the accompanying Statements of Net Assets Available for Benefits of The 401(k) Plan and the Employee Stock Ownership Plan of CVS Caremark Corporation and Affiliated Companies as of December 31, 2013 and 2012, 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 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. We were not engaged to perform an audit of the Plan’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also 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.
 
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of The 401(k) Plan and the Employee Stock Ownership Plan of CVS Caremark Corporation and Affiliated Companies at December 31, 2013 and 2012, and the changes in its net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.
 
Our audits were conducted for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental Schedule of Assets (Held at End of Year) as of December 31, 2013, is presented for purposes of additional analysis and is not a required part of the 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. Such information has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole.
 
/s/ Ernst & Young LLP
 
Boston, Massachusetts
June 30, 2014

















1





THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Statements of Net Assets Available for Benefits
December 31, 2013 and 2012
 

 
 
2013
 
2012
Assets:
 
 
 
 
Investments, at fair value (Note 3):
 
 
 
 
Cash
 
$
658

 
$
6,147

Common collective trust funds (Note 2 (b))
 
987,889,778

 
1,065,954,378

Guaranteed investment contracts (Note 2 (b))
 
87,608,383

 
170,146,150

Synthetic guaranteed investment contract (Note 2 (b))
 
110,251,396

 
-

Pooled Accounts (Note 2 (b))
 
-

 
299,274,485

Security-backed investment contracts (Note 2 (b))
 
230,363,172

 
-

Mutual funds (Note 2 (b))
 
4,054,498,837

 
3,054,510,135

Common stock (Note 2 (b))
 
1,956,115,313

 
1,438,111,678

 
 
 
 
 
Total investments
 
7,426,727,537

 
6,028,002,973

Receivables:
 
 
 
 
Interest and dividends (Note 2 (g))
 
2,618,963

 
2,325,807

Employer contributions (Note 1 (c))
 
7,565,118

 
6,842,130

Notes receivable from participants (Note 4)
 
176,155,139

 
164,553,975

Total receivables
 
186,339,220

 
173,721,912

 
 
 
 
 
Total assets at fair value
 
7,613,066,757

 
6,201,724,885

 
 
 
 
 
Liabilities:
 
 
 
 
Accrued expenses and other liabilities
 
11,031,136

 
10,010,925

 
 
 
 
 
Total liabilities
 
11,031,136

 
10,010,925

 
 
 
 
 
Net assets available for benefits at fair value
 
7,602,035,621

 
6,191,713,960

 
 
 
 
 
Adjustments from fair value to contract value for fully benefit-responsive investment contracts
 
(4,053,649
)
 
(15,587,294
)
 
 
 
 
 
Net assets available for benefits
 
$
7,597,981,972

 
$
6,176,126,666

 
See accompanying notes to financial statements.









2






THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2013 and 2012
 

 
 
2013
 
2012
Investment activity:
 
 
 
 
Interest and dividend income (Note 2 (g))
 
$
120,514,388

 
$
117,026,104

Transfer into (out of) plan assets (Note 1 (a))
 
10,358,784

 
(241,000)

Realized and unrealized gains (losses) (Notes 3 and 5)
 
1,266,304,120

 
502,427,625

Total investment activity
 
1,397,177,292

 
619,212,729

 
 
 
 
 
Contributions:
 
 
 
 
Employer contributions (Note 1 (c))
 
205,507,806

 
165,902,980

Employee contributions (Note 1 (c))
 
342,008,237

 
273,478,224

Rollovers
 
15,452,524

 
9,368,308

Total contributions
 
562,968,567

 
448,749,512

 
 
 
 
 
Deductions:
 
 
 
 
Benefits paid to participants (Notes 1 (f) and 2 (c))
 
523,864,582

 
382,920,425

Administrative expenses (Note 1 (g))
 
14,425,971

 
13,283,224

Total deductions
 
538,290,553

 
396,203,649

 
 
 
 
 
Net increase in net assets for the year before transfers
 
1,421,855,306

 
671,758,592

 
 
 
 
 
CareSave Plan assets transferred in (Note 1 (a))
 

 
675,081,688

Net increase in net assets for the year
 
1,421,855,306

 
1,346,840,280

 
 
 
 
 
Net assets beginning of the year
 
6,176,126,666

 
4,829,286,386

 
 
 
 
 
Net assets end of the year
 
$
7,597,981,972

 
$
6,176,126,666

 
See accompanying notes to financial statements.













3




 THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements
Years Ended December 31, 2013 and 2012

Note 1 - Plan Description
 
The following description of The 401(k) Plan and the Employee Stock Ownership Plan (the “ESOP”) of CVS Caremark Corporation and Affiliated Companies (the “Plan”) provides only general information. Participants should refer to the Plan documents for a more complete description of the Plan’s provisions.
 
(a)                 Background
 
The Plan is a defined contribution plan subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. The general administration of the Plan and the responsibility for carrying out the provisions of the Plan are maintained by a committee (the “Benefit Plans Committee”) of not less than three persons appointed by the Board of Directors of CVS Caremark Corporation (“CVS Caremark” or the “Company”), the sponsor of the Plan. In accordance with the provisions of the Plan, the Benefit Plans Committee has appointed a plan administrator (the “Administrator”) and trustees (the “Trustee”). The Administrator maintains participant account records and instructs the Trustee to execute transactions such as benefit payments to participants. The Trustee holds the assets of the Plan and executes transactions at the direction of the Benefit Plans Committee and the Administrator. Effective January 2009, the Benefit Plans Committee further named an Administrative Subcommittee and an Investment Subcommittee and delegated certain fiduciary duties to each of the Committees.
 
The Plan was established as of January 1, 1989.
 
Effective December 31, 2012, the CareSave 401(k) Retirement Savings Plan was merged into the Plan. The CareSave 401(k) Retirement Savings Plan (“CareSave”) was the defined contribution plan established in 1998 by Caremark Rx, L.L.C. to provide benefits to eligible Caremark employees, not otherwise eligible to participate in this Plan. Caremark employees who were eligible to participate in the CareSave plan on or before December 31, 2012 became eligible to participate in the Plan effective January 1, 2013. The merger resulted in a transfer of assets with a value of $675,081,688 into the Plan on December 31, 2012, which have been included in the Statement of Net assets Available for Benefits and Statement of Changes in Net Assets Available for Benefits.

 
(b)                     Eligibility
 
Employees are eligible to participate in the Plan upon attainment of age 21 and on the earliest of:
 
The first payroll period of the first month after completion of 90 continuous days of service as a full-time employee;

Completion of 12 months of service beginning on the employee’s hire date with at least 1,000 hours worked; or

Completion of at least 1,000 hours of service in the course of one calendar year.









4



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

(b)                     Eligibility Continued
 
Employees referred to above are defined as regular employees of the Company other than:
 
A nonresident alien receiving no United States (“U.S.”) earned income from the Company;

An individual covered under a collective bargaining agreement (unless the agreement provides for membership);

A leased employee (as defined in the Internal Revenue Code (the “Code”));

A temporary employee (as determined by the Company); or

An independent contractor or consultant (as defined by the Company).
 
(c)                      Contributions
 
Participants may elect to have the Company contribute to their accounts from 1% to 85%, as a whole percentage or dollar amount, of the eligible compensation that would otherwise be due to them, in multiples of 1%, pursuant to a salary reduction agreement. Each participant’s total elective deferrals for any calendar year may not exceed 85% of annual compensation or the maximum allowed by the Code; whichever is less, as specified in the Plan document. The maximum elective deferral allowed by the Code was $17,500 and $17,000 for 2013 and 2012, respectively.
 
On a quarterly basis, the Company matches in cash 100% up to 5% of eligible pre-tax compensation contributed, up to an annual maximum per employee of $12,750 and $12,500 for 2013 and 2012, respectively.
 
All employees at least age 50 in the calendar year that contribute the maximum amount to the Plan are permitted to make additional pre-tax catch-up contributions. Catch-up contributions may be made up to an additional $5,500 for 2013 and 2012.

(d)                     Participant’s Account
 
Each participant’s account is credited with an allocable share of their selected Plan’s investments and any unrealized appreciation or depreciation and interest and dividends of those investments.
 
 (e)                      Vesting
 
Participants are 100% vested in participant and Company matching contributions.

Participants whose account balances have been transferred into the Plan from other defined contribution plans maintain at least the degree of vesting in the account they had at the time of the transfer. Notwithstanding the
foregoing, participants are fully vested in, and have a non-forfeitable right to (1) their accounts upon retirement, death or disability, and (2) any elective deferrals described in Note 1(c).
 
(f)                        Payment of Benefits
 
Upon termination of service by the participant, the Administrator will direct the Trustee to pay to the participant their benefit under one or more options, such as a single lump-sum, or in equal annual installments over a period not to exceed the participant's expected lifetime.



5



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012
 
(g)                      Administrative Expenses
 
Administrative expenses specifically attributable to the Plan and not covered by forfeitures were funded by the Plan for 2013 and 2012. Trustee’s fees were paid by the Plan for 2013 and 2012.
 
(h)                     Forfeitures
 
On a participant’s termination date, any unvested portion of their account is forfeited at the earlier of distribution or five years from the date of termination. If a former participant resumes employment and eligibility in the Plan within five years of termination, any amounts previously forfeited are restored to the participant’s account, but remain subject to the vesting provisions of the Plan. Forfeitures during any plan year are applied as follows: (i) to restore amounts previously forfeited by participants but required to be reinstated upon resumption of employment; (ii) to pay administrative expenses of the Plan; or (iii) to reduce future CVS Caremark contributions. If forfeitures for any plan year are insufficient to restore the required forfeitures, CVS Caremark shall contribute the balance required for that purpose.
 
Cash forfeitures for 2013 and 2012 were $38,632 and $14,162, respectively. There were no cash forfeitures restored to participants upon resumption of employment in 2013 or 2012. The remainder of the forfeitures for each year was applied to the administrative expenses of the plan and to reduce the CVS Caremark contribution.

(i)                        Investment Options
 
Upon enrollment in the Plan, a participant elects to direct contributions or investment balances to the investment fund options offered by the plan. Participants may modify investment elections daily thereafter. The Plan’s investments are comprised of guaranteed insurance contracts, securities of CVS Caremark and securities of unaffiliated issuers. The securities in unaffiliated issuers include marketable mutual funds, security-backed investment contracts, common collective trusts and separately managed funds, comprised of marketable securities. The following is a brief explanation of each fund’s investment objectives:
 
Aggressive Lifestyle Fund
 
The fund invests in the following Future Fund investment options: Small Cap Growth, Small Cap Value, International Equity, Large Cap Growth, Core Equity, Growth & Income, Diversified Bond, and U.S. Bond Index Fund. This fund has the following composite benchmarks: Russell 1000 Index, Barclays Capital Aggregate Bond Index, Standard & Poors (“S&P”) 500 Composite Stock Index (“S&P 500”), Morgan Stanley Capital International (“MSCI”) All Countries World Index excluding the United States (“ACWI EX US”) Index, and the Russell 2000 Index.

Conservative Lifestyle Fund
 
The fund invests in the following Future Fund investment options: Small Cap Growth, Small Cap Value, International Equity, Large Cap Growth, Core Equity, Growth & Income, Diversified Bond, U.S. Bond Index Fund, and Stable Value Fund. This fund has the following composite benchmarks: Russell 1000 Index, Barclays Capital Aggregate Bond Index, S&P 500 Index, 3-Year U.S. Treasury Index, Russell 2000 Index, and the MSCI ACWI EX US Index.
 
Core Equity Fund
 
The Institutional Vanguard Index Fund seeks to replicate the total return of the S&P 500 by investing in stocks that make up the index. The S&P 500 Index consists mainly of large companies and represents approximately 75% of the U.S. stock market value.
 
  

6



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012
  
CVS Caremark Common Stock Fund
 
CVS Caremark Common Stock Fund seeks long-term growth and dividend income by purchasing shares of CVS Caremark common stock.
 
Diversified Bond Fund
 
The PIMCO Total Return Institutional Class Fund is a core bond fund that seeks to outperform the Barclays Capital Aggregate Bond Index. Investments may include government and corporate debt securities, mortgage and other asset-backed securities, money market instruments, and derivatives.
 
Global Equity Fund
 
The American Funds New Perspective Fund seeks long-term growth of capital by investing in a variety of foreign and domestic companies. The fund tries to outperform the MSCI World Index, which measures the performance of U.S. and international stock markets.

Growth and Income Fund
 
This fund is co-managed by Columbia, Mellon Capital Management and Barrow Hanley and seeks long-term growth of capital and dividend income through participation in the stock market. This fund invests primarily in the common stock of U.S.-based, well-established, medium- to large-sized companies. This blended fund is benchmarked by the Russell 1000 Value Index (“RVI”).

Inflation-Protected Fund
 
The Vanguard Inflation-Protected Securities Fund Institutional Shares seeks to provide investors inflation protection and income consistent with investments in inflation-indexed securities. This fund invests primarily in high-quality inflation-indexed bonds issued by the U.S. government, its agencies and instrumentalities, and corporations.

International Equity Fund
 
The Templeton Foreign Equity Series-Primary Shares Fund seeks long-term growth of capital through participation in stock markets outside the United States. The fund invests mainly in the common stock of companies based in more developed countries, but may also include investments in developing countries. It is benchmarked by the MSCI ACWI EX US Index.
 
International Equity Index Fund
 
The Vanguard Developed Markets Index Fund seeks to track the performance of a benchmark index that measures the investment return of stocks issued by companies located in the major markets of Europe and the Pacific region.
 
Large Cap Growth Fund
 
This fund is co-managed by Columbus Circle, T. Rowe Price and Mellon Capital Management and seeks long-term growth of capital through participation in the stock market. The fund invests primarily in the common stock of established large companies that are based in the United States and that represent industries expected to out-perform the stock market as a whole. This fund is benchmarked by the Russell 1000 Growth Index.




7



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012
 
Mid Cap Index Fund
 
The Vanguard Mid Cap Index Fund Institutional Plus Shares seeks to track the performance of a benchmark index that measures the investment return of mid-capitalization stocks. 

Moderate Lifestyle Fund
 
The fund invests in the following Future Fund investment options: Small Cap Growth, Small Cap Value, International Equity, Large Cap Growth, Core Equity, Growth & Income, Diversified Bond, U.S. Bond Index Fund, and Stable Value Fund. The composite benchmark has been determined as follows: Russell 1000 Index, Barclays Capital Aggregate Bond Index, S&P 500 Index, MSCI EAFE Index, Russell 2000 Index, and the 3-Year U.S. Treasury Index.
 
Small Cap Growth Fund
 
The Vanguard® ExplorerTM Fund AdmiralTM Shares seeks long-term growth of capital and dividend income through participation in the stock market. The fund invests primarily in stocks of relatively small companies, making it a high-risk investment with potential for large rewards. This fund is benchmarked by the Russell 2500 Growth Index.

Small Cap Index Fund
 
The Vanguard Small Cap Index Fund seeks to track the performance of a benchmark index that measures the investment return of small capitalization stocks.
 
Small Cap Value Fund
 
This fund is co-managed by Dimensional Fund Advisors and Wells Capital. This blended fund seeks long-term growth by investing primarily in stocks of small to medium-sized companies, which are believed to offer superior earnings growth or appear to be undervalued. This fund is benchmarked by the Russell 2000 Value Index.
 
Stable Value Fund
 
This fund is managed by Galliard Capital Management and seeks to preserve capital while generating a steady rate of return higher than money market funds provide. The fund’s investments consist of cash, highly rated insurance company contracts (guaranteed investment contracts (“GICs” and “synthetic GICs”)), security-backed investment contracts and bank investment contracts (common collective trusts (“CCTs”)). 

U.S. Bond Index Fund
 
The Vanguard Total Bond Market Index Fund Institutional Plus Shares seeks to generate returns that track the performance of the Barclays Capital Aggregate Bond Index and will maintain a dollar-weighted average maturity consistent with that of the index.
 










8



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

Note 2 - Summary of Significant Accounting Policies
 
(a)                     Basis of Presentation
 
The Plan prepares its financial statements in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP), which includes the application of accrual accounting. 
(b)                      Investment Valuation
 
The value of the investments held at December 31, 2013 and 2012 is based on their fair value. Shares of mutual funds are valued at quoted market prices, which represent the net asset values of shares held by the Plan at year end. CVS Caremark common stock and common stock owned directly in the Small Cap Value Fund, Growth and Income Fund, and the Large Cap Growth Fund separately managed funds, are valued based upon quoted market prices.

The fair value of most of the Plan’s common collective trust funds represents the net asset value of the underlying investments.
 
The Plan invests in fully benefit-responsive GICs and synthetic GICs, certain fully benefit-responsive Common Collective Trusts (“CCTs”), fully benefit-responsive security-backed investment contracts, and fully benefit-responsive insurance company separate accounts. Security-backed contracts are investment contracts issued by an insurance company or other financial institution, backed by a portfolio of bonds that are owned by the Plan. The portfolio underlying the contract is maintained separately from the contract issuer’s general assets. In the case of insurance company separate accounts, the portfolio underlying the contract is maintained by the issuer, but segregated from general account assets. These investment contracts are recorded at fair value; however, since these contracts are fully benefit-responsive, an adjustment is reflected in the Statement of Net Assets Available for Benefits to present these investments at contract value. Contract value is the relevant measurement 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. The contract value of the fully benefit-responsive investment contracts represents contributions plus earnings, less participant withdrawals and administrative expenses.
 
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 Statements of Net Assets Available for Benefits.
 
(c)                      Benefits Paid
 
Distribution of benefits are recorded when paid.

(d)                        Use of Estimates
 
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of changes in net assets available for benefits during the reporting period. Actual results could differ from those estimates.






9



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

(e)                      Accrual Basis of Accounting
 
The Plan utilizes the accrual basis of accounting.
 
(f)                     Purchase and Sale of Securities
 
Purchases and sales of securities are made on a trade-date basis.
 
(g)                      Investment Income
 
Dividend and interest income is recorded when earned.

Note 3 - Fair Value Measurements
 
The Plan uses the three-level hierarchy for the recognition and disclosure of fair value measurements. The categorization of assets and liabilities within this hierarchy is based upon the lowest level of the input that is significant to the measurement of fair value. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of the fair value hierarchy consist of the following:
 
Level 1 — Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Plan has the ability to access at the measurement date.

Level 2 — Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument.

Level 3 — Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions about risk.

Following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2013 and 2012.
 
CCT funds: Valued at the net asset value (“NAV”) as permitted by practical expedient and reported by the respective funds at each valuation date. The use of NAV is deemed appropriate as these types of investments do not have finite lives or significant restrictions on redemptions.
 
GICs and Synthetic GICs: Valued at fair value by discounting the related cash flows based on current yields of similar instruments with comparable durations, and adjusting for the credit-worthiness of the issuer, if necessary. The discount rates range from 0.41% to 1.84% and from 0.05% to 5.56% as of December 31, 2013 and 2012, respectively.












10



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

Security-backed investment contracts:  Valued on the basis of the cumulative fair value of the underlying securities, collective funds, and wrapper contracts. Valuations for securities are furnished by independent pricing services, which determine valuations for normal institutional-size trading units of such securities using methods based on market transactions and various relationships, generally recognized by institutional traders, between securities (which includes consideration of such factors as security prices, yields, maturities and ratings). Valuation of collective funds are based on the number of units held multiplied by the net asset value of the fund.  Valuations for wrapper contracts are calculated as the present value of the difference between the current wrapper fee and the contracted wrapper fee. Both the fees and discount rate used to calculate the present value are observable inputs.
 
Pooled separate accounts: Valued at the NAV of shares held by the plan at year end. The use of NAV is deemed appropriate as these types of investments do not have finite lives or significant restrictions on redemptions.

Mutual funds: Valued at the NAV of shares held by the plan at year end which are reported on an active market.
 
Common stock: Valued at the closing price reported on the active market on which the individual securities are traded.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The market value of CVS Caremark Common Stock was $71.57 and $48.35 per share at December 31, 2013 and 2012, respectively.
 

11




THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

The following tables set forth by level, within the fair value hierarchy, the Plan’s assets at fair value as of December 31, 2013 and 2012:

 
 
 
 
Investments at estimated fair value
at December 31, 2013
 
 
 
 
Investments at
fair value as
determined by
quoted prices
in active
markets
(Level I)
 
Valuation
techniques
based on
observable
market data
(Level II)
 
Valuation
techniques
incorporating
information
other than
observable
market data
(Level III)
 
Total
Cash
 
$
658

 
$

 
$

 
$
658

Common collective trust funds
 

 
987,889,778

 

 
987,889,778

Guaranteed investment contracts
 

 

 
87,608,383

 
87,608,383

Synthetic guaranteed investment contract
 

 
110,251,396

 

 
110,251,396

Security-backed investment contracts
 

 

 
230,363,172

 
230,363,172

Mutual funds:
 
 
 
 
 
 
 
0

Small cap equity
 
498,997,618

 

 

 
498,997,618

Mid cap equity
 
354,600,384

 

 

 
354,600,384

Large cap equity
 
1,048,884,028

 

 

 
1,048,884,028

International
 
1,184,855,220

 

 

 
1,184,855,220

Bond
 
967,161,587

 

 

 
967,161,587

Total mutual funds
 
4,054,498,837

 

 

 
4,054,498,837

Common stock:
 
 
 
 
 
 
 
 
Small cap equity
 
128,463,543

 

 

 
128,463,543

Large cap equity
 
845,678,307

 

 

 
845,678,307

CVS Caremark Common Stock Fund
 
981,973,463

 

 

 
981,973,463

Total common stock
 
1,956,115,313

 

 

 
1,956,115,313

Total investments
 
$
6,010,614,808

 
$
1,098,141,174

 
$
317,971,555

 
$
7,426,727,537

















12



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012
 
 
 
 
 
Investments at estimated fair value
at December 31, 2012
 
 
 
 
Investments at
fair value as
determined by
quoted prices
in active
markets
(Level I)
 
Valuation
techniques
based on
observable
market data
(Level II)
 
Valuation
techniques
incorporating
information
other than
observable
market data
(Level III)
 
Total
Cash
 
$
6,147
 
 
$
 
 
$
 
 
$
6,147
 
Common collective trust funds
 
 
 
1,065,954,378
 
 
 
 
1,065,954,378
 
Guaranteed investment contracts
 
 
 
 
 
170,146,150
 
 
170,146,150
 
Pooled separate accounts
 
0
 
 
299,274,485
 
 
 
 
299,274,485
 
Mutual funds:
 
 
 
 
 
 
 
0
 
Small cap equity
 
304,978,480
 
 
 
 
 
 
304,978,480
 
Mid cap equity
 
198,388,968
 
 
 
 
 
 
198,388,968
 
Large cap equity
 
782,464,094
 
 
 
 
 
 
782,464,094
 
International
 
901,455,269
 
 
 
 
 
 
901,455,269
 
Bond
 
867,223,324
 
 
 
 
 
 
867,223,324
 
Total mutual funds
 
3,054,510,135
 
 
 
 
 
 
3,054,510,135
 
Common stock:
 
 
 
 
 
 
 
 
Small cap equity
 
87,565,436
 
 
 
 
 
 
87,565,436
 
Large cap equity
 
652,812,519
 
 
 
 
 
 
652,812,519
 
CVS Caremark Common Stock Fund
 
697,733,723
 
 
 
 
 
 
697,733,723
 
Total common stock
 
1,438,111,678
 
 
 
 
 
 
1,438,111,678
 
Total investments
 
$
4,492,627,960
 
 
$
1,365,228,863
 
 
$
170,146,150
 
 
$
6,028,002,973
 


Level 3 Gains and Losses
 
The table below sets forth a summary of changes in the fair value of the Plan’s Level 3 assets for the year ended December 31, 2013 and 2012.

 
 
Level 3 Assets
Year Ended December 31,
 
 
2013
 
2012
Balance, beginning of year
 
$
170,146,150
 
 
$
242,024,341
 
Unrealized gains/(losses) relating to instruments still held at the reporting date
 
193,337
 
 
(20,722,111
)
Purchases
 
230,363,172
 
 
45,782,204
 
Sales
 
(82,731,104
)
 
(96,938,284
)
Balance, end of year
 
$
317,971,555
 
 
$
170,146,150
 





13



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012
 

Note 4 - Notes Receivable from Participants
 
Participants may obtain loans from the Plan utilizing funds accumulated in their accounts. The minimum amount which may be borrowed is $1,000. Participants can borrow up to 50% of their vested account balance but not more than $50,000, less their highest outstanding loan balance during the previous twelve months. The loans are repaid to the Plan through after-tax payroll deductions. The term of the loan is selected at the discretion of the participant, but may not exceed five years for a general loan and twenty-five years for a primary residence loan. Primary residence loans initiated under the former CareSave plan, which transferred into the Plan as of December 31, 2012, were permitted to have a maximum loan repayment period of up to ten years. Participants may have two loans outstanding at any time. Interest on loans is equal to the Prime Rate as of the prior month end plus 1%.
 
Note 5 - Investment Policy
 
At December 31, 2013 and 2012, most of the Plan’s 401(k) related assets were allocated among the investment options discussed in Note 1(i) based on employees’ elections. The investment options are recommended by an independent investment consultant and approved by the Investment Subcommittee. Employee contributions that are waiting to be processed are temporarily invested in a common collective trust fund. This common collective trust fund is also used to account for and administer notes receivable from participants. The note repayments and interest earned are allocated to each of the investment funds based upon the participants’ contribution election percentages.
 
During 2013 and 2012, the Plan’s investments, including investments purchased, sold, as well as held during the year appreciated in fair value as follows:

Asset Category
 
2013
 
2012
Common collective trust funds
 
$
56,764,264

 
$
10,405,449

Mutual funds
 
627,068,855

 
285,447,670

Common stock
 
582,471,001

 
206,574,506

 
 
$
1,266,304,120

 
$
502,427,625

 

Note 6 - Plan Termination and Related Commitments
 
Although it has not expressed any intention 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. If the Company terminates the Plan, all participants in the Plan become fully vested.
 

Note 7 - Federal Income Taxes
 
The Plan has received a determination letter from the Internal Revenue Service (“IRS”) dated December 17, 2013, stating that the Plan is qualified under Section 401(a) of the Code and, therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. Subsequent to this determination by the IRS, the Plan was amended. The plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes the Plan, as amended, is qualified and the related trust is tax exempt.
 




14


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

U.S. GAAP requires plan management to evaluate uncertain tax positions taken by the Plan and recognize a tax liability if the organization has taken an uncertain position that more likely than not would not be sustained upon examination by the
IRS. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The plan administrator believes it is no longer subject to income tax examinations for years prior to 2010.
 
Note 8 - Transactions with Parties-In-Interest
 
As of December 31, 2013 and 2012, certain Plan investments are investment funds managed by The Bank of New York Mellon and The Principal Trust Company. The Bank of New York Mellon is the Trustee as of December 31, 2013. The Bank of New York Mellon and The Principal Trust Company are the Trustees as of December 31, 2012, as defined by the Plan, and therefore, these transactions qualify as party-in-interest transactions.
 

Note 9 - Reconciliation of Financial Statements to Form 5500
 
The following is a reconciliation of the net assets available for benefits per the financial statements to the Form 5500 as of December 31, 2013 and 2012:

 
 
2013
 
2012
Net assets available for benefits per the financial statements
 
$
7,597,981,972

 
$
6,176,126,666

Adjustment from contract value to fair value for certain fully benefit responsive
 
 
 
 
investment contracts
 
4,566,563

 
15,587,294

Net assets available for benefits per the Form 5500
 
$
7,602,548,535

 
$
6,191,713,960

 

The following is a reconciliation of total additions per the financial statements to total income per the Form 5500 for the year ended December 31, 2013:

 
 
2013
Total additions per the financial statements
 
$
1,949,787,075

Add: Adjustment from contract value to fair value for certain fully benefit responsive investment
 
 
contracts as of December 31, 2013
 
4,566,563

Less: Adjustment from contract value to fair value for certain fully benefit responsive investment
 
 
contracts as of December 31, 2013
 
(15,587,294
)
Total income per the Form 5500
 
$
1,938,766,344














15


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

Note 10 - Investments
 
The following table presents investments of the Plan at fair value that represent 5% or more of the total fair value of the Plan’s assets.

 
 
2013
 
2012
Vanguard Institutional Index Fund, Institutional Plus Shares
 
$
1,048,884,028

 
$
696,529,081

CVS Caremark Corporation Common Stock
 
983,476,435

 
699,218,067

Vanguard Developed Markets Index Fund, Institutional Plus Shares

 
492,900,191

 
367,571,884

Vanguard Total Bond Market Fund, Institutional Plus Shares
 
472,771,885

 
359,657,646

PIMCO Total Return Fund Institutional Class
 
459,099,397

 
383,849,489

Templeton Foreign Equity Series-Primary Shares Fund
 
441,863,482

 

EB Temporary Investment Fund II
 

 
538,850,429

 

Note 11 – Investment Contracts with Insurance Companies
 
The Plan invests in fully benefit-responsive GICs. The issuer maintains the contributions in a general account. The account is credited with participant contributions plus earnings and charged for participant withdrawals and administrative expenses. The issuer is contractually obligated to repay the principal and a specified interest rate that is guaranteed to the Plan. The crediting interest rate is fixed at the time the contract is entered into with the issuer and does not reset.
 
The Plan also invests in fully benefit-responsive security-backed investment contracts that credit a stated interest rate for a specified period of time. Investment gains and losses are amortized over the expected duration through the calculation of the interest rate applicable to the Plan on a prospective basis. Security-backed investment contracts provide for a variable crediting rate that resets at least quarterly, and the issuer of the wrap contract provides assurance that future adjustments to the crediting rate cannot result in a crediting rate less than zero. The crediting rate is primarily based on the current yield-to-maturity of the covered investments, plus or minus amortization of the difference between the market value and contract value of the covered investments over the duration of the covered investments at the time of computation. The crediting rate is most affected by the change in the annual effective yield to maturity of the underlying securities, but is also affected by the difference between the contract value and the market value of the covered investments. This difference is amortized over the duration of the covered investments. Depending on the change in duration from reset period to reset period, the magnitude of the impact to the crediting rate of the contract to market difference is heightened or lessened. The crediting rate can be adjusted periodically and is usually adjusted either monthly or quarterly, but in no event is the crediting rate less than zero percent.

Certain events limit the ability of the Plan to transact at contract value with the issuers. Such events may include (i) amendments to the plan documents (including complete or partial plan termination or merger with another plan), (ii) changes to the plan’s prohibition on competing investment options or deletion of equity wash provisions, (iii) bankruptcy of the plan sponsor or other plan sponsor events (for example, divestitures or spin-offs of a subsidiary) that cause a significant withdrawal from the Plan, or (iv) the failure of the trust to qualify for exemption from federal income taxes or any required prohibited transaction exemption under ERISA. The plan administrator does not believe that the occurrence of any such events that would limit the Plan’s ability to transact at contract value with participants is probable.
 






16



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
 
Notes to Financial Statements (Continued)
Years Ended December 31, 2013 and 2012

The GICs generally do not permit issuers to terminate the agreement prior to the scheduled maturity date; however, the security-backed investment contracts generally impose conditions on both the Plan and the issuer. If an event of default occurs and is not cured, the non-defaulting party may terminate the contract. The following may cause the Plan to be in default a breach of material obligation under the contract, a material misrepresentation, or a material amendment to the plan agreement. The issuer may be in default if it breaches a material obligation under the investment contract, makes a material misrepresentation, has a decline in its long term credit rating below a threshold set forth in the contract, or is acquired or reorganized and the successor issuer does not satisfy the investment or credit guidelines applicable to issuers. If, in the event of default of an issuer, the Plan were unable to obtain a replacement investment contract, withdrawing participants may experience losses if the value of the Plan’s assets no longer covered by the contract is below contract value. The Plan may seek to add additional issuers over time to diversify the Plan’s exposure to such risk, but there is no assurance the Plan may be able to do so. The combination of the default of an issuer and an inability to obtain a replacement agreement could render the Plan unable to achieve its objective of maintaining a stable contract value. For GICs and security-backed investment contracts, payments for participant withdrawals would generally be made pro-rata, based on the percentage of investments covered by each issuer. Contract termination occurs whenever the contract value or market value of the covered investments reaches zero or upon certain events of default. If the contract terminates due to issuer default (other than a default occurring because of a decline in its rating), the issuer will generally be required to pay to the Plan the excess, if any, of contract value over market value on the date of termination. If a security-backed investment contract terminates due to a decline in the ratings of the issuer, the issuer may be required to pay to the Plan the cost of acquiring a replacement contract (that is, replacement cost) within the meaning of the contract. If the contract terminates when the market value equals zero, the issuer will pay the excess of contract value over market value to the Plan to the extent necessary for the Plan to satisfy outstanding contract value withdrawal requests. Contract termination also may occur by either party upon election and notice. As GICs and security-backed investment contracts are fully benefit-responsive, contract value is the relevant measurement attribute for that portion of the net assets available for benefits attributable to the GICs and security-backed investment contracts. Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment at contract value. Additionally, the Plan can make deposit or redeem investments in security-backed investment contracts, with the issuer's consent, for portfolio reallocation as part of the ongoing management of Plan assets. No deposits may be made to a GIC contract. Except for benefit responsive participant withdrawals, no redemptions may be made to a GIC contract other than any payments scheduled in the contract before the maturity date.

Average Yields for GICs and security-backed investment contracts
 
2013
 
2012
Based on actual earnings

 
1.2
%
 
1.3
%
Based on interest rate credited to participants
 
1.1
%
 
1.3
%















17


























SUPPLEMENTAL SCHEDULE

























18



THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013

Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
International Equity Fund
 
19,448,217
 
Templeton Foreign Equity Series-Primary Shares Fund
 
Mutual Fund
 
$
441,863,482

 
 
 
 
 
 
 
 
 
Core Equity Fund
 
6,196,149
 
Vanguard Institutional Index Fund, Institutional Plus Shares
 
Mutual Fund
 
1,048,884,028

 
 
 
 
 
 
 
 
 
Small Cap Growth Fund
 
2,337,586
 
Vanguard Explorer Fund, Admiral Shares
 
Mutual Fund
 
224,758,934

 
 
 
 
 
 
 
 
 
Small Cap Index Fund
 
2,684,602
 
Vanguard Small Cap Index Fund, Institutional Shares
 
Mutual Fund
 
141,505,365

 
 
 
 
 
 
 
 
 
Mid Cap Index Fund
 
2,389,974
 
Vanguard Mid Cap Index Fund, Institutional Plus Shares
 
Mutual Fund
 
354,600,384

 
 
 
 
 
 
 
 
 
International Equity Index Fund
 
4,123,653
 
Vanguard Developed Markets Fund, Institutional Plus Shares
 
Mutual Fund
 
492,900,191

 
 
 
 
 
 
 
 
 
U.S. Bond Index Fund
 
44,770,065
 
Vanguard Total Bond Market Fund, Institutional Plus Shares
 
Mutual Fund
 
472,771,885

 
 
 
 
 
 
 
 
 
Inflation-Protected Bond Fund
 
3,403,115
 
Vanguard Inflation-Protected Securities Fund, Institutional Shares
 
Mutual Fund
 
35,290,302

 
 
 
 
 
 
 
 
 
Diversified Bond Fund
 
42,946,623
 
PIMCO Total Return Fund Institutional Class
 
Mutual Fund
 
459,099,397

 
 
 
 
 
 
 
 
 
Global Equity Fund
 
6,656,682
 
American Funds New Perspective Fund
 
Mutual Fund
 
250,091,547

 
 
 
 
 
 
 
 
 
CVS Caremark Common Stock Fund
 
13,720,462
*
CVS Caremark Common Stock
 
CVS Caremark Corporation Common Stock
 
981,973,465

 
 
16,414,384
*
EB Temporary Investment Fund II
 
Common Collective Trust Fund
 
16,414,384

 
 
 
 
CVS Caremark Common Stock Fund Subtotal
 
 
 
$
998,387,849

 
 
 
 
 
 
 
 
 
 
 
5,070,014
*
EB Temporary Investment Fund II
 
Common Collective Trust Fund
 
$
5,070,014


















THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013

Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
Stable Value Fund
 
 
 
 
 
Separately Managed Fund
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ING Life Insurance Co.
 
Guaranteed Investment Contract (GIC)
 
 
 
 
10,493,852
 
1.84%, due 5/12/2014
 
 
 
$
10,493,852

 
 
 
 
Metropolitan Life Ins. Co.
 
 
 
 
 
 
10,335,330
 
1.31%, due 6/20/2014
 
GIC
 
10,335,330

 
 
10,301,647
 
1.33%, due 10/3/2014
 
GIC
 
10,301,647

 
 
 
 
New York Life Ins. Co.
 
 
 
 
 
 
9,109,238
 
0.7%, due 9/30/2014
 
GIC
 
9,109,238

 
 
7,084,137
 
0.6%, due 1/3/2014
 
GIC
 
7,084,137

 
 
 
 
Principal Life Ins. Co.
 
 
 
 
 
 
10,287,413
 
1.34%, due 9/30/2014
 
GIC
 
10,287,413

 
 
5,125,608
 
1.25%, due 10/1/2014
 
GIC
 
5,125,608

 
 
5,098,677
 
1.14%, due 12/14/2014
 
GIC
 
5,098,677

 
 
 
 
Protective Life Insurance Co.
 
 
 
 
 
 
9,113,972
 
1.10%, due 5/8/2015
 
GIC
 
9,113,972

 
 
 
 
United of Omaha Life Insurance Co.
 
 
 
 
 
 
10,347,195
 
1.35%, due 3/30/2014
 
GIC
 
10,347,195

 
 
 
 
 
 
 
 
 
 
 
1,186,417
 
Metropolitan Life Ins Co, 1.41%
 
Security-backed investment contract
 
120,801,419

 
 
 
 
 
 
 
 
 
 
 
54,908
 
Massachusetts Mutual Life Ins., 1.84%
 
Security-backed investment contract
 
55,256,103

 
 
 
 
 
 
 
 
 
 
 
53,591
 
Massachusetts Mutual Life Ins., 0.93%
 
Security-backed investment contract
 
55,129,878

 
 
 
 
 
 
 
 
 
 
 
9,186,192
 
Prudential Life Insurance Co., 1.21%
 
Synthetic GIC
 
110,251,396

 
 
 
 
 
 
 
 
 
 
 
162,557,676
 
Wells Fargo Stable Value Fund D
 
Common Collective Trust Fund
 
166,296,503

 
 
161,074,427
 
Putnam Stable Value Fund
 
Common Collective Trust Fund
 
162,201,948

 
 
279,041,344
*
EB Temporary Investment Fund II
 
Common Collective Trust Fund
 
279,041,344

 
 
 
 
 
 
 
 
 
 
 
 
 
Stable Value Fund Subtotal
 
 
 
$
1,036,275,660

 
 
 
 
 
 
 
 
 
Small Cap Value Fund
 
 
 
Wells Capital Management and Dimensional Fund Advisors, Small Cap Value Fund
 
Separately Managed Fund
 
 
 
 
67,550
 
ENERGY XXI BERMUDA LTD
 
Common Stock
 
$
1,827,903

 
 
25,542
 
ESSENT GROUP LTD
 
Common Stock
 
614,541

 
 
99,500
 
AERCAP HOLDINGS N V SHS
 
Common Stock
 
3,815,825




20


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013
Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
158,400

 
AMN HEALTHCARE SERVICES INC
 
Common Stock
 
2,328,480

 
 
43,550

 
ATMI INC
 
Common Stock
 
1,315,646

 
 
65,000

 
ABERCROMBIE & FITCH CO
 
Common Stock
 
2,139,150

 
 
106,650

 
ASCENA RETAIL GROUP INC
 
Common Stock
 
2,256,714

 
 
106,550

 
ASSOCIATED BANC-CORP
 
Common Stock
 
1,853,970

 
 
185,800

 
AVID TECHNOLOGY INC
 
Common Stock
 
1,514,270

 
 
91,100

 
BERRY PLASTICS GROUP INC
 
Common Stock
 
2,167,269

 
 
66,138

 
BIG LOTS INC
 
Common Stock
 
2,135,596

 
 
17,800

 
BIO-RAD LABORATORIES INC
 
Common Stock
 
2,200,258

 
 
38,450

 
CATHAY GENERAL BANCORP
 
Common Stock
 
1,027,769

 
 
28,550

 
CHARLES RIVER LABORATORIES INT
 
Common Stock
 
1,514,292

 
 
104,150

 
CHICO'S FAS INC
 
Common Stock
 
1,962,186

 
 
49,850

 
COMMONWEALTH REIT
 
Common Stock
 
1,162,004

 
 
117,000

 
CUBESMART
 
Common Stock
 
1,864,980

 
 
31,900

 
DSW INC
 
Common Stock
 
1,363,087

 
 
54,900

 
DANA HOLDING CORP
 
Common Stock
 
1,077,138

 
 
119,500

 
DEAN FOODS CO
 
Common Stock
 
2,054,205

 
 
73,050

 
DIEBOLD INC
 
Common Stock
 
2,411,381

 
 
72,700

 
E*TRADE FINANCIAL CORP
 
Common Stock
 
1,427,828

 
 
45,450

 
EMCOR GROUP INC
 
Common Stock
 
1,928,898

 
 
120,801

 
EVERTEC INC
 
Common Stock
 
2,978,953

 
 
89,750

 
FLOWERS FOODS INC
 
Common Stock
 
1,926,933

 
 
74,500

 
FORUM ENERGY TECHNOLOGIES INC
 
Common Stock
 
2,105,370

 
 
80,300

 
GENERAL COMMUNICATION INC
 
Common Stock
 
895,345

 
 
46,050

 
HANCOCK HOLDING CO
 
Common Stock
 
1,689,114

 
 
72,687

 
HARSCO CORP
 
Common Stock
 
2,037,417

 
 
65,350

 
HELIX ENERGY SOLUTIONS GROUP I
 
Common Stock
 
1,514,813

 
 
61,500

 
HUDSON PACIFIC PROPERTIES INC
 
Common Stock
 
1,345,005

 
 
27,026

 
IDEX CORP
 
Common Stock
 
1,995,870












21


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013
Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
50,300

 
INFORMATICA CORP
 
Common Stock
 
$
2,087,450

 
 
45,952

 
INTEGRA LIFESCIENCES HOLDINGS
 
Common Stock
 
2,192,370

 
 
74,000

 
INTERNATIONAL RECTIFIER CORP
 
Common Stock
 
1,929,180

 
 
14,750

 
J&J SNACK FOODS CORP
 
Common Stock
 
1,306,703

 
 
142,000

 
JABIL CIRCUIT INC
 
Common Stock
 
2,476,480

 
 
34,750

 
JONES LANG LASALLE INC
 
Common Stock
 
3,558,053

 
 
160,682

 
KAR AUCTION SERVICES INC
 
Common Stock
 
4,748,153

 
 
52,950

 
KORN/FERRY INTERNATIONAL
 
Common Stock
 
1,383,054

 
 
32,700

 
LANDSTAR SYSTEM INC
 
Common Stock
 
1,878,615

 
 
57,250

 
HERMAN MILLER INC
 
Common Stock
 
1,690,020

 
 
45,250

 
OASIS PETROLEUM INC
 
Common Stock
 
2,125,393

 
 
730,650

 
OFFICE DEPOT INC
 
Common Stock
 
3,865,139

 
 
110,500

 
PENNYMAC MORTGAGE INVESTMENT T
 
Common Stock
 
2,537,080

 
 
268,900

 
PIKE CORPORATION
 
Common Stock
 
2,842,273

 
 
18,600

 
PLANTRONICS INC
 
Common Stock
 
863,970

 
 
132,000

 
REDWOOD TRUST INC
 
Common Stock
 
2,556,840

 
 
154,050

 
RESOURCES CONNECTION INC
 
Common Stock
 
2,207,537

 
 
67,350

 
SCHAWK INC
 
Common Stock
 
1,001,495

 
 
52,310

 
SILGAN HOLDINGS INC
 
Common Stock
 
2,511,926

 
 
65,800

 
SIX FLAGS ENTERTAINMENT CORP
 
Common Stock
 
2,422,756

 
 
39,900

 
STERIS CORP
 
Common Stock
 
1,917,195

 
 
64,154

 
TCF FINANCIAL CORP
 
Common Stock
 
1,042,503

 
 
95,550

 
TAYLOR MORRISON HOME CORP
 
Common Stock
 
2,145,098

 
 
55,275

 
TETRA TECH INC
 
Common Stock
 
1,546,595

 
 
14,500

 
TEXAS INDUSTRIES INC
 
Common Stock
 
997,310

 
 
414,800

 
TREASURY WINE ESTATES LTD
 
Common Stock
 
1,783,640

 
 
134,550

 
UMPQUA HOLDINGS CORP
 
Common Stock
 
2,575,287

 
 
31,700

 
UNITED STATIONERS INC
 
Common Stock
 
1,454,713

 
 
131,050

 
VERIFONE SYSTEMS INC
 
Common Stock
 
3,514,761











22


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013

Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
24,650

 
WABTEC CORP/DE
 
Common Stock
 
$
1,830,756

 
 
85,150

 
WALTER ENERGY INC
 
Common Stock
 
1,416,045

 
 
49,600

 
WESTAR ENERGY INC
 
Common Stock
 
1,595,632

 
 
67,000

 
ZIONS BANCORPORATION
 
Common Stock
 
2,007,320

 
 
5,829,307

 
DFA US TARGETED VALUE I FUND
 
Mutual Fund
 
132,733,319

 
 
 
 
Cash
 
Cash
 

 
 
7,685,284

*
 EB Temporary Investment Fund II
 
Common Collective Trust Fund
 
7,685,942

 
 
 
 
 
 
 
 
 
 
 
 
 
Small Cap Value Fund Subtotal
 
 
 
$
268,882,804

 
 
 
 
 
 
 
 
 
Growth & Income Fund
 
 
 
Columbia Management, Mellon Large Cap Value, and Barrow, Hanley, Mewhinney & Strauss, Growth & Income Fund
 
Separately Managed Fund
 
 
 
 
735,000

 
AES CORP/THE
 
Common Stock
 
$
10,664,850

 
 
294,500

 
ALTRIA GROUP INC
 
Common Stock
 
11,305,855

 
 
23,100

 
AMERICAN EXPRESS CO
 
Common Stock
 
2,095,863

 
 
51,500

 
AMERICAN INTERNATIONAL GROUP I
 
Common Stock
 
2,629,075

 
 
19,200

 
AMERIPRISE FINANCIAL INC
 
Common Stock
 
2,208,960

 
 
105,000

 
ANADARKO PETROLEUM CORP
 
Common Stock
 
8,328,600

 
 
670,000

 
APPLIED MATERIALS INC
 
Common Stock
 
11,852,300

 
 
1,022,200

 
BANK OF AMERICA CORP
 
Common Stock
 
15,915,654

 
 
100,000

 
BAXTER INTERNATIONAL INC
 
Common Stock
 
6,955,000

 
 
47,500

 
BP PLC
 
Common Stock
 
2,308,975

 
 
245,000

 
BRISTOL-MYERS SQUIBB CO
 
Common Stock
 
13,021,750

 
 
67,400

 
CA INC
 
Common Stock
 
2,268,010

 
 
67,400

 
CAPITAL ONE FINANCIAL CORP
 
Common Stock
 
5,163,514

 
 
30,200

 
CARDINAL HEALTH INC
 
Common Stock
 
2,017,662

 
 
58,800

 
CARNIVAL CORP
 
Common Stock
 
2,361,996

 
 
43,500

 
CHEVRON CORP
 
Common Stock
 
5,433,585

 
 
22,200

 
CIGNA CORPORATION COM
 
Common Stock
 
1,942,056

 
 
30,300

 
CIT GROUP INC
 
Common Stock
 
1,579,539

 
 
300,950

 
CITIGROUP INC
 
Common Stock
 
15,682,505

 
 
133,800

 
CONOCOPHILLIPS
 
Common Stock
 
9,452,970

 
 
59,500

 
COSTCO WHOLESALE CORP
 
Common Stock
 
7,081,095

 
 
99,400

 
CRH PLC
 
Common Stock
 
2,539,670

 
 
280,000

 
CSX CORP
 
Common Stock
 
8,055,600






23


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013
Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
21,000

*
CVS CAREMARK CORP
 
Common Stock
 
$
1,502,970

 
 
26,600

 
DAIMLER AG
 
Common Stock
 
2,323,244

 
 
45,700

 
DELPHI AUTOMOTIVE PLC
 
Common Stock
 
2,747,941

 
 
36,700

 
DISCOVER FINANCIAL SERVICES
 
Common Stock
 
2,053,365

 
 
92,300

 
E*TRADE FINANCIAL CORP
 
Common Stock
 
1,812,772

 
 
32,200

 
EATON CORP PLC
 
Common Stock
 
2,451,064

 
 
167,200

 
EI DU PONT DE NEMOURS & CO
 
Common Stock
 
10,862,984

 
 
24,500

 
EMERSON ELECTRIC CO
 
Common Stock
 
1,719,410

 
 
126,000

 
FAIRCHILD SEMICONDUCTOR INTERN
 
Common Stock
 
1,682,100

 
 
101,400

 
FIFTH THIRD BANCORP
 
Common Stock
 
2,132,442

 
 
181,100

 
FIRST NIAGARA FINANCIAL GROUP
 
Common Stock
 
1,923,282

 
 
260,000

 
FREEPORT-MCMORAN COPPER & GOLD
 
Common Stock
 
9,812,400

 
 
220,000

 
GAP INC/THE
 
Common Stock
 
8,597,600

 
 
85,600

 
GENERAL DYNAMICS CORP
 
Common Stock
 
8,179,080

 
 
61,900

 
GENERAL MOTORS CO
 
Common Stock
 
2,529,853

 
 
35,400

 
HANESBRANDS INC
 
Common Stock
 
2,487,558

 
 
118,300

 
HONEYWELL INTERNATIONAL INC
 
Common Stock
 
10,809,071

 
 
100,000

 
HUMANA INC
 
Common Stock
 
10,322,000

 
 
20,700

 
ILLINOIS TOOL WORKS INC
 
Common Stock
 
1,740,456

 
 
104,300

 
INTERNATIONAL GAME TECHNOLOGY
 
Common Stock
 
1,894,088

 
 
18,350

 
ITT CORP
 
Common Stock
 
796,757

 
 
24,500

 
JOHNSON & JOHNSON
 
Common Stock
 
2,243,955

 
 
34,600

 
JOY GLOBAL INC
 
Common Stock
 
2,023,754

 
 
218,200

 
JPMORGAN CHASE & CO
 
Common Stock
 
12,760,336

 
 
410,000

 
JUNIPER NETWORKS INC
 
Common Stock
 
9,253,700

 
 
64,900

 
KBR INC
 
Common Stock
 
2,069,661

 
 
170,000

 
LOWE'S COS INC
 
Common Stock
 
8,423,500

 
 
241,900

 
MARATHON OIL CORP
 
Common Stock
 
8,539,070

 
 
80,000

 
MARATHON PETROLEUM CORP
 
Common Stock
 
7,338,400

 
 
40,400

 
MEDTRONIC INC
 
Common Stock
 
2,318,556

 
 
28,100

 
MERCK & CO INC
 
Common Stock
 
1,406,405

 
 
140,000

 
METLIFE INC
 
Common Stock
 
7,548,800

 
 
52,500

 
MICROCHIP TECHNOLOGY INC
 
Common Stock
 
2,349,375

 
 
64,000

 
MICROSOFT CORP
 
Common Stock
 
2,395,520

 
 
275,000

 
MORGAN STANLEY
 
Common Stock
 
8,624,000

 
 
27,700

 
NATIONAL OILWELL VARCO INC
 
Common Stock
 
2,202,981

 
 
144,500

 
NEW YORK COMMUNITY BANCORP INC
 
Common Stock
 
2,434,825


24


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013
Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
46,700

 
NOBLE CORP PLC
 
Common Stock
 
$
1,749,849

 
 
100,000

 
NORDSTROM INC
 
Common Stock
 
6,180,000

 
 
22,700

 
OCCIDENTAL PETROLEUM CORP
 
Common Stock
 
2,158,770

 
 
44,400

 
OMNICARE INC
 
Common Stock
 
2,679,984

 
 
34,714

 
PENTAIR LTD
 
Common Stock
 
2,696,236

 
 
144,500

 
PEOPLE'S UNITED FINANCIAL INC
 
Common Stock
 
2,184,840

 
 
71,622

 
PFIZER INC
 
Common Stock
 
2,193,782

 
 
97,100

 
PHILIP MORRIS INTERNATIONAL IN
 
Common Stock
 
8,460,323

 
 
29,400

 
PNC FINANCIAL SERVICES GROUP I
 
Common Stock
 
2,280,852

 
 
36,000

 
PRAXAIR INC
 
Common Stock
 
4,681,080

 
 
91,000

 
PRUDENTIAL FINANCIAL INC
 
Common Stock
 
8,392,020

 
 
32,900

 
RAYTHEON CO
 
Common Stock
 
2,984,030

 
 
31,400

 
ROCKWOOD HOLDINGS INC
 
Common Stock
 
2,258,288

 
 
61,500

 
ROYAL CARIBBEAN CRUISES LTD
 
Common Stock
 
2,916,330

 
 
34,500

 
SANOFI
 
Common Stock
 
1,850,235

 
 
46,800

 
SEADRILL LTD
 
Common Stock
 
1,922,076

 
 
144,300

 
SLM CORP
 
Common Stock
 
3,792,204

 
 
26,100

 
SPX CORP
 
Common Stock
 
2,599,821

 
 
25,000

 
STANLEY BLACK & DECKER INC
 
Common Stock
 
2,017,250

 
 
16,500

 
STATE STREET CORP
 
Common Stock
 
1,210,935

 
 
29,000

 
TARGET CORP
 
Common Stock
 
1,834,830

 
 
56,200

 
TEXAS INSTRUMENTS INC
 
Common Stock
 
2,467,742

 
 
62,700

 
TYCO INTERNATIONAL LTD SHS
 
Common Stock
 
2,573,208

 
 
335,000

 
TYSON FOODS INC
 
Common Stock
 
11,209,100

 
 
60,000

 
UNION PACIFIC CORP
 
Common Stock
 
10,080,000

 
 
64,000

 
UNITED TECHNOLOGIES CORP
 
Common Stock
 
7,283,200

 
 
31,700

 
UNITEDHEALTH GROUP INC
 
Common Stock
 
2,387,010

 
 
310,000

 
UNUM GROUP
 
Common Stock
 
10,874,800

 
 
220,000

 
VALERO ENERGY CORP
 
Common Stock
 
11,088,000

 
 
44,700

 
VERIZON COMMUNICATIONS INC
 
Common Stock
 
2,196,558

 
 
41,400

 
VODAFONE GROUP PLC
 
Common Stock
 
1,627,434










25


THE 401(k) PLAN AND THE EMPLOYEE STOCK OWNERSHIP PLAN
OF CVS CAREMARK CORPORATION AND AFFILIATED COMPANIES
Plan Number: 017
EIN 05-0494040
 
Schedule H, Line 4i — Schedule of Assets (Held at End of Year)
December 31, 2013
Fund
 
Par value /number of shares
 
Identity of issue
 
Description
 
Current Value**
 
 
25,900

 
WALGREEN CO
 
Common Stock
 
$
1,487,696

 
 
26,800

 
WELLPOINT INC
 
Common Stock
 
2,476,052

 
 
268,400

 
WELLS FARGO & CO
 
Common Stock
 
12,185,360

 
 
190,000

 
WILLIAMS COS INC/THE
 
Common Stock
 
7,328,300

 
 
868,860

 
Mellon Capital Management Large Cap Value Stock Fund
 
Common Collective Trust Fund
 
158,099,731

 
 
537,191

*
EB Temporary Investment Fund II
 
Common Collective Trust Fund
 
1,134,796

 
 
 
 
 
 
 
 
 
 
 
 
 
Growth & Income Fund Subtotal
 
 
 
$
632,721,081

 
 
 
 
 
 
 
 
 
Large Cap Growth Fund
 
 
 
TRowe Price, Columbus Circle and Mellon Large Cap Growth, Large Cap Growth Fund
 
Separately Managed Fund
 
 
 
 
1,500

 
3M CO
 
Common Stock
 
$
210,375

 
 
500

 
ACCENTURE PLC
 
Common Stock
 
41,110

 
 
23,000

 
ACTAVIS PLC