UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark one)
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x
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Annual Report Pursuant to
Section 15(d) of the Securities Exchange Act of 1934
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For the fiscal year ended December 31, 2007
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Or
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o
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Transition Report Pursuant to
Section 15(d) of the Securities Exchange Act of 1934
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For the transition period from
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to
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Commission
File Number 1-5057
A.
Full title
of the plan and the address of the plan, if different from that of the issuer
named below:
OFFICEMAX
SAVINGS PLAN
B.
Name of
the issuer of the securities held pursuant to the plan and the address of its
principal executive office:
OFFICEMAX INCORPORATED
263 Shuman Boulevard
Naperville,
IL 60563
OFFICEMAX
SAVINGS PLAN
Financial
Statements and Supplemental Schedule
(With
Report of Independent Registered Public Accounting Firm)
December 31,
2007
2
Report
of Independent Registered Public Accounting Firm
The Board of Directors and the Retirement Committee of
OfficeMax Incorporated and the Plan Administrator of the OfficeMax Savings
Plan:
We have audited the
accompanying statements of net assets available for benefits of the OfficeMax
Savings Plan (the Plan) as of December 31, 2007 and 2006, and the
related statement of changes in net assets available for benefits for the year
ended December 31, 2007. These financial statements are the responsibility
of the Plans management. Our responsibility is to express an opinion on these
financial statements based on our 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. 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,
2007 and 2006, and the changes in its net assets available for benefits for the
year ended December 31, 2007 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 H,
Line 4(i) Schedule of Assets (Held at End of Year) as of December 31,
2007 is presented for the purpose of additional analysis and is not a required
part of the basic financial statements, but is supplementary information
required by the Department of Labors Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974. This
supplemental schedule is the responsibility of the Plans 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/ KPMG LLP
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Chicago, Illinois
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June 30, 2008
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3
OFFICEMAX
SAVINGS PLAN
Statements
of Net Assets Available for Benefits
December 31,
2007 and 2006
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2007
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2006
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Investments, at
fair value:
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OfficeMax
Savings Plan Trust
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$
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486,842,072
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$
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510,173,328
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Self Managed
Account
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20,306,948
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20,655,694
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Participant
loans
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7,269,036
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11,252,010
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Total
investments
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514,418,056
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542,081,032
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Receivables:
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Participant
contributions
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898,032
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Employer
contributions
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255,671
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402,000
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Total
receivables
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255,671
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1,300,032
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Net assets
available for benefits, at fair value
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514,673,727
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543,381,064
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Adjustment from
fair value to contract value for interest in a common collective trust
relating to fully benefit-responsive investment contracts
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52,634
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2,326,596
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Net assets
available for benefits
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$
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514,726,361
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$
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545,707,660
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See accompanying notes to
financial statements.
4
OFFICEMAX
SAVINGS
PLAN
Statement of Changes in Net Assets Available
for Benefits
Year ended December 31, 2007
Additions:
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OfficeMax
Savings
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Plan Trust
investment income:
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Interest income
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$
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8,796,289
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Dividend income
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4,392,976
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Net appreciation
in fair value of investments
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964,135
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Net appreciation
Self Managed Account
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1,101,617
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Interest on
participant loans
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688,836
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Contributions:
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Participant
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25,600,406
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Company, net of
forfeitures
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8,002,094
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Total additions
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49,546,353
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Deductions:
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Participant
withdrawals
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(79,184,912
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Administrative
expenses
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(1,342,740
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Total deductions
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(80,527,652
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Net decrease
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(30,981,299
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Net assets
available for benefits, beginning of year
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545,707,660
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Net assets
available for benefits, end of year
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$
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514,726,361
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See
accompanying notes to financial statements.
5
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
(1)
Description of Plan
The following brief description of the OfficeMax
Savings Plan (Plan) is provided for general information purposes only.
Participants should refer to the Summary Plan Description and to the plan
document for more complete information.
(a)
General
The Plan is a defined
contribution plan containing a cash or deferred arrangement as described in Section 401(k) of
the Internal Revenue Code of 1986 (Code) which, subject to minimum age and
hours requirements, covers all eligible employees of OfficeMax Incorporated and
its subsidiaries (Company or we), including employees who had formerly
participated in the OfficeMax, Inc. Savings Plan, the Boise Cascade
Corporation Retirement Savings Plan (RSP), or the Boise Cascade Qualified
Employee Savings Trust (QUEST). The Plan is subject to provisions of the
Employee Retirement Income Security Act of 1974 (ERISA). The Plan is intended to
be an individual account plan in accordance with Section 404(c) of
ERISA and is intended to satisfy the requirements of Department of Labor
Regulation §2550.404c-1.
The Plan is administered
by OfficeMax Incorporated. State Street Bank and Trust Company (State Street)
is the plan trustee and Citistreet L.L.C. (Citistreet) is the recordkeeper
for the Plan. The Plan is part of a bundled service arrangement through
Citistreet with various investment
options.
(b)
Participant Contributions
As of January 1,
2005, participants not identified as highly compensated individuals may
contribute to the Plan, in whole percentages, 1% to 50% of eligible
compensation except that Puerto Rico participants may contribute 1% to 10% of
eligible compensation. Contributions may only be made on a before-tax basis.
Contributions by highly
compensated participants who have been classified as such for two or more
consecutive years are restricted to 3% of eligible earnings. Contributions by
highly compensated participants who have been classified as such for only one
year are restricted to 7% of eligible earnings.
(c)
Company Match
Once a participant is
eligible, the participant can receive Company matching contributions in the
form of cash in the amount of $0.50 for every dollar contributed up to the
first 6% of eligible earnings. Prior to January 1, 2005, slightly
different matching rates applied under the predecessor plans.
For participants hired on
or before October 31, 2003 (except participants formerly in QUEST, RSP or
the OfficeMax, Inc. Savings Plan who were merged into the Savings and
Supplemental Retirement Plan (SSRP) on December 31, 2004), the Company
matched eligible participant contributions through allocations of stock in the
Employee Stock Ownership Plan (ESOP) component of the Plan. The Company made
cash contributions to the ESOP component of the Plan through 2004 which, when
aggregated with dividends paid on the Companys Series D Convertible
Preferred Stock (Preferred Stock) held in the ESOP component, equaled the
amount necessary to enable the trustee to make its regularly scheduled payments
of principal and interest due on the term loan, proceeds of which were used by
the trustee to acquire the Preferred Stock. The final loan payment was made on June 28,
2004, resulting in no further contributions of this kind being made to the
Plan.
6
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
However, the Company
contributed additional cash to settle retired shares for a short period in late
2003 and early 2004. The additional contributions ensured that there were
enough shares available to allocate for the Company match through September 23,
2005. After that date, the Company match for those participants formerly
receiving their match in shares was made in cash.
(d)
Participant Accounts
Each participants
account is credited with the participants contributions, the Company match,
and an allocation of plan earnings and expenses based upon the relative account
balances and investment funds in which the participants account is invested.
The benefit to which a participant is entitled upon retirement or termination
of employment is the amount of the participants vested account balance.
(e)
Vesting
A Participants Before
Tax Contribution Account, After Tax Contribution Account (if applicable to the
extent the participant was able to make such contributions under a predecessor
plan prior to January 1, 2005), and Rollover Contribution Account are
always 100% vested and nonforfeitable.
For participants who are
hired on or after January 1, 2005, a Participants Employer Account shall
be 100% vested and nonforfeitable upon the earliest of: attaining age 65;
completing three years of service; or death while employed by the Plan sponsor.
For participants who
began participating in the SSRP prior to January 1, 2005, a Participants
Employer Account shall be 100% vested and nonforfeitable upon the earliest of:
attaining age 65; completing 3 years of service; completing 3 years of
participation; death while employed by an Employer; disability while employed
by an Employer; termination of employment as a result of the sale of the
participants location or division; or termination of employment as a result of
the closure, without planned resumption of operations, of the facility at which
the participant is employed.
With respect to
participants who were participating in the OfficeMax, Inc. Savings Plan
prior to January 1, 2005, a Participants Employer Account shall be 100%
vested and nonforfeitable upon the earliest of: attaining age 65; completing
three years of service; or death while employed by an Employer. With respect to
participants who were participating in the OfficeMax, Inc. Savings Plan
prior to January 1, 2005, and who were hired on or before December 31,
2003, in addition to the above, a Participants Employer Account shall become
50% vested upon completing two years of service.
(f)
Forfeitures
Upon a participants
termination of employment, amounts not fully vested are forfeited and generally
used to reduce the amount of current Company contributions to the Plan.
7
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
(g)
Investment Options
Beginning
January 1, 2005, participants may direct their contributions to any of the
following investment options. The investment manager for each fund is listed
below.
Fund
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Investment Manager(s)
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Conservative Asset
Allocation Fund
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State Street Global
Advisors (SSGA)
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Moderate Asset
Allocation Fund
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State Street Global
Advisors
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Aggressive Asset
Allocation Fund
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State Street Global
Advisors
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Stable Value Fund
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INVESCO Institutional
(N.A.), Inc. (INVESCO)
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Bond Market Index Fund
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State Street Global
Advisors
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S&P 500 Index Fund
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State Street Global
Advisors
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Mid/Small Cap Index
Fund
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State Street Global
Advisors
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International Equity
Index Fund
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State Street Global
Advisors
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Real Estate Index Fund
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State Street Global
Advisors
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OfficeMax Common Stock
Fund
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Not applicable
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Self Managed Account
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Not applicable
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Investments in these
funds include corporate debt and equity securities; interests in pooled or
collective investment funds; mutual funds; interest rate contracts with banks,
insurance companies, and corporations; and government obligations. The Plan
also offers a Self Managed Account which is a brokerage option. This
option affords more flexibility in choosing retirement savings investments by
allowing participants, at their discretion, to invest in New York Stock
Exchange, American Stock Exchange, and NASDAQ listed stock, most corporate and
government bonds, and approximately 5,000 different Mutual Funds from over 300
fund families. Investments will be made in accordance with guidelines in the
plan document; the Trust Agreement between State Street Bank and Trust Company,
as trustee, and the Company; and in accordance with investment policies
established by the Company and incorporated into investment management
agreements with each investment manager.
The Company sends
participant contributions to the trustee as soon as administratively feasible
and the trustee invests participants contributions and earnings thereon, among
the investment funds as directed by each participant.
Participants have the
right to change the amount of their contributions, the investment funds in
which contributions are invested, and to transfer existing account balances
among the Plans investment funds on a daily basis with some restrictions.
8
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
(h)
Participant Loans
Beginning January 1,
2005, a participant may borrow the lesser of (1) $50,000 reduced by the
highest outstanding loan balance during the previous 12 months, or (2) 50%
of his or her vested account balance in all contribution accounts not invested
in the Self Managed Account, with a minimum loan amount of $1,000. For years
prior to 2005, a participant could borrow the lesser of (1) $50,000
reduced by the highest outstanding loan balance during the previous
12 months, (2) 50% of his or her combined balance in the before-tax
account, rollover account, and vested Company contribution account, or (3) the
total market value of the participants before-tax, after-tax and rollover
account balances not invested in the Self Managed Account, with a minimum loan
amount of $1,000. However, for participants in the OfficeMax, Inc. Savings
Plan for years prior to 2005,
participants could borrow from their investment fund accounts a minimum
of $1,000 up to a maximum equal to the lesser of $50,000 or one-half of the
current value of their vested account balance.
Beginning January 1,
2005, new loans are repayable over a maximum of five years. Loans issued prior
to January 1, 2005, are repayable through payroll deductions over periods
ranging from one to ten years, except that loans issued from the OfficeMax, Inc.
Savings Plan have a maximum term of five years.
As of January 1,
2005, the participant loan rate for all new loans is equal to the Prime Rate
plus 1% and set once a month. For participant loans prior to January 1,
2005, the plan administrator determined the interest rate, which was based on
prevailing market conditions and fixed over the life of the note. However, for
participant loans in the OfficeMax, Inc. Savings Plan prior to January 1,
2005, the interest rate on participant loans was equal to the Prime Rate
published in the Wall Street Journal on the first day of the calendar quarter
in which the loan was effective plus 1%. Interest rates on loans outstanding in
the Plan at December 31, 2007 ranged from 4.0% to 9.5%. Interest rates on
loans outstanding in the Plan at December 31, 2006 ranged from 8.5% to
9.25%.
(i)
Distributions
On termination of
employment, where an account balance is greater than $1,000, a participant may
elect to receive either a lump-sum amount equal to the value of the participants
vested interest in his or her account, or partial withdrawals or payments over
varying periods. On termination of employment, where an account balance is
$1,000 or less, a participant will receive a lump-sum amount equal to the value
of the participants vested interest in his or her account. The $1,000 limit
was $5,000 prior to March 28, 2005.
(2)
Summary of Accounting Policies
The
Plan follows the significant accounting policies listed below:
(a)
Basis of Accounting
The
financial statements of the Plan are prepared on the accrual method of
accounting.
As described in Financial
Accounting Standards Board Staff Position FSP AAG INV-1 and Statement of
Position No. 94-4-1,
Reporting of Fully
Benefit-Responsive Investment Contracts Held by Certain Investment Companies
Subject to the AICPA Investment Company Guide and Defined-Contribution Health
and Welfare and Pension Plans
(the FSP), investment contracts held
by a defined-contribution plan are required to be reported at fair value. However, contract value is the relevant
measurement attribute for that portion of the net assets available for benefits
of a defined-contribution plan attributable to fully benefit-responsive
investment contracts because contract value is the amount participants would
receive if they were to initiate permitted transactions under the terms of the
plan. As required by the FSP, the
statement of net assets available for benefits present the fair value of the
investment contracts as well as the adjustment of the fully benefit-
9
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
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responsive investment
contracts from fair value to contract value. The statement of changes in net
assets available for benefits is prepared on a contract value basis.
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(b)
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Use
of Estimates
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The preparation of
financial statements in conformity with U.S. generally accepted accounting
principles 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.
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(c)
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Payment of Benefits
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Benefit payments to
participants are recorded upon distribution.
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(d)
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Expenses
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The Plan provides that
all expenses of administration of the Plan shall be paid out of the assets of
the Plan, except for those administration expenses paid by the Company.
Substantially all expenses of administration of the Plan are paid by the
Plan. Investment management fees and expenses incident to the purchase and
sale of securities incurred by the investment funds of the Plan are paid from
the assets of the fund to which they relate.
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(e)
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Rollovers from
Other Plans
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During the plan year
ended December 31, 2007, certain participants transferred their account
balances from other tax-qualified profit sharing/401(k) plans sponsored
by previous employers into the Plan. These rollover contributions totaled
$1,572,947.
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(f)
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New Accounting
Standards
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The
Plan adopted Financial Accounting Standards Board (FASB) Interpretation
No. 48, Accounting for Uncertainty in Income Taxes, an interpretation
of FASB Statement No. 109 (FIN 48), as required, on January 1,
2007. FIN 48 requires the sponsor to determine whether a tax position of the
Plan is more likely than not to be sustained upon examination by the
applicable taxing authority, including resolution of any related appeals or
litigation processes, based on the technical merits of the position. The tax
benefit to be recognized is measured as the largest amount of the benefit
that is greater than fifty percent likely of being realized upon ultimate
settlement, which could result in the Plan recording a tax liability that
would reduce net assets. FIN 48 must be applied to all existing tax positions
upon initital adoption and the cumulative effect, if any, is to be reported
as an adjustment to net assets as of January 1, 2007.
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The Plans adoption of FIN 48 did not impact the
amounts reported on the financial statements of the Plan due to the fact that
the Plan is qualified and tax-exempt.
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In September 2006, Statement of Financial
Accounting Standards No. 157, Fair Value Measurements (SFAS 157), was
issued and is effective for fiscal years beginning after November 15, 2007.
SFAS 157 defines fair value, establishes a framework for measuring fair value
and expands disclosures about fair value measurements. Management is
currently evaluating the impact, if any, the adoption of SFAS 157 will have
on financial statements.
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In February 2007, the FASB issued Statement on
Financial Accounting Standards No. 159 (SFAS 159), Fair Value Option for
Financial Assets and Financial Liabilities. SFAS 159 permits entities to
choose to measure many financial instruments and certain other items at fair
value that are not currently required to be measured at fair value and
establish disclosure requirements designed to facilitate comparison between
entities that choose different measurement attributes for similar types of
assets and liabilities. SFAS 159 is effective for financial statements issued
for fiscal years beginning after November 15, 2007. The Company is currently
assessing the impact of adopting SFAS 159 for the Plan.
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10
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
(3)
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Risk
and Uncertainties
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The Plan offers
a number of investment options including the OfficeMax Common Stock Fund and
a variety of pooled or collective investment funds. The investment funds
include U.S. equities, international equities, and fixed income securities.
Investment securities, in general, are exposed to various risks, such as
interest rate, credit, and overall market volatility risk. Due to the level
of risk associated with certain investment securities, it is reasonable to
expect that changes in the values of investment securities will occur in the
near term and that such changes could materially affect participant account
balances.
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The Plans exposure to
a concentration of credit risk is limited by the diversification of
investments across several participant-directed fund elections (see
note 1). Additionally, the investments within each participant-directed
fund election are further diversified into varied financial instruments, with
the exception of the OfficeMax Common Stock Fund, which invests in securities
of a single issuer. As of December 31, 2007, the Plans total investment
in OfficeMax Common Stock is $9,707,494.
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(4)
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Plan Termination
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While the Company has
not expressed any intention to do so, it has the right to terminate the Plan
at any time. In the event of plan termination, participants will become fully
vested in their accounts.
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(5)
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Nonparticipant-directed
Investments
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Information
about the net assets and the significant components of the changes in net
assets relating to the nonparticipant-directed investments is as follows:
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December 31,
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2007
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2006
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Net assets:
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OfficeMax
Savings Plan Trust
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$
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51,575,111
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$
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57,276,855
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Year ended
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December 31,
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2007
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Changes in net
assets:
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Dividend income
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$
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4,140,167
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Transfers
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(5,729,333
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)
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Participant
withdrawals
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(4,111,319
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Administrative
expenses
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(1,259
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)
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$
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(5,701,744
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)
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(6)
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OfficeMax
Savings Plan Trust
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On December 31,
2004, the Company merged the QUEST, RSP, and OfficeMax, Inc. Savings Plan
into the Boise Cascade Corporation Savings and SSRP. This left the Company
with one consolidated savings plan. Effective January 1, 2005, the
resulting combined plan was renamed the OfficeMax Savings Plan.
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The Plans investments
in the collective common trust funds are stated at fair value which is
calculated as net asset value per share/unit times the number of shares/units
at year end less allocated plan administrative expenses. The Company common
stock held by the Plan is valued at its quoted market price less allocated
plan administrative expenses. Participant loans are valued at cost, which
approximates fair value. The Series D Preferred Stock held by the ESOP
component of the Plan Trust is valued at $45 per share, which represents the minimum
amount at which it can be redeemed.
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The Plan Trusts Stable
Value Fund holds certain guaranteed investment contracts and other fixed
income securities (together, the Contracts). These Contracts were reported at
estimated fair value as determined by the investment manager. The estimated
fair value of the Contracts was based on current interest rates for similar
investments with like maturities at December 31, 2007 and 2006.
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These Contracts are fully benefit-responsive, which
allows participants to initiate all permitted transactions, such as
withdrawals, loans or transfers to other funds within the Plan at contract
value.
As described in note 2:
Summary of
Significant
Accounting
Policies
, because the Contracts are fully-benefit responsive, contract
value is the relevant measurement attribute for that portion of the net
assets available for benefits attributed to the Contracts. Contract value
represents contributions made plus interest accrued at the contract rate,
less withdrawals.
Certain events limit the ability of the Plan to
transact at contract value with the issuer. These events include, but are not
limited to, the following: (1) termination of the Plan, (2) a material
adverse change to the provisions to the Plan, (3) Employer elects to withdraw
from a wrapper contract in order to switch to a different investment
provider, (4) terms of a successor plan do not meet the wrapper contract
issuers underwriting criteria for issuance of a clone wrapper contract. The
Company does not believe that the occurrence of any event limiting the Plans
ability to transact at contract value with participants is probable.
Contract issuers can terminate the Contracts and
settle at other than contract value under very limited circumstances, such as
a change in the qualification status of participant, employer, or plan;
breach of material obligations under the Contracts and misrepresentation by
the contract holder: or failure of the underlying portfolio to conform to the
pre-established investment guidelines. The Company does not believe it is
likely that any of the fully benefit-responsive contracts will be terminated.
There are no reserves against contract value for
credit risk of the contract issuer or otherwise. The interest crediting rates
for the Contracts are based upon formulas agreed upon with the issuer and,
depending on the type of investment, are either fixed over the life of the
investment or are reset each quarter based on the performance of the
underlying investment portfolio. During the year ended December 31, 2007, the
average annual yield earned by the Trust was 4.53% and the average yield to
participants was 5.19%.
|
11
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
Purchases and sales of
securities are recorded on a trade-date basis. Interest income is recorded on
the accrual basis. Dividends are recorded on the ex-dividend date.
The net assets of the
OfficeMax Savings Plan Trust as of December 31, 2007 are as follows:
|
|
Participant
directed
|
|
Nonparticipant-
directed
Employee
Stock
Ownership
Plan Component
|
|
Total
combined
funds
|
|
Investments, at
fair value:
|
|
|
|
|
|
|
|
Commoncollective
trust funds
|
|
$
|
425,559,467
|
|
$
|
|
|
$
|
425,559,467
|
|
OfficeMax common
stock fund
|
|
9,707,494
|
|
|
|
9,707,494
|
|
OfficeMax ESOP
component
|
|
|
|
51,575,111
|
|
51,575,111
|
|
Net assets
available for benefits, at fair value
|
|
435,266,961
|
|
51,575,111
|
|
486,842,072
|
|
Adjustment from
fair value to contract value for interest in a common collective trust
relating to fully benefit-responsive investment contracts
|
|
52,634
|
|
|
|
52,634
|
|
Net assets
available for benefits
|
|
$
|
435,319,595
|
|
$
|
51,575,111
|
|
$
|
486,894,706
|
|
The net assets of the
OfficeMax Savings Plan Trust as of December 31, 2006 are as follows:
|
|
Participant
directed
|
|
Nonparticipant-
directed
Employee
Stock
Ownership
Plan Component
|
|
Total
combined
funds
|
|
Investments, at
fair value:
|
|
|
|
|
|
|
|
Commoncollective
trust funds
|
|
$
|
431,264,336
|
|
$
|
|
|
$
|
431,264,336
|
|
OfficeMax common
stock fund
|
|
21,632,137
|
|
|
|
21,632,137
|
|
OfficeMax ESOP
component
|
|
|
|
57,276,855
|
|
57,276,855
|
|
Net assets
available for benefits, at fair value
|
|
452,896,473
|
|
57,276,855
|
|
510,173,328
|
|
Adjustment from
fair value to contract value for interest in a common collective trust
relating to fully benefit-responsive investment contracts
|
|
2,326,596
|
|
|
|
2,326,596
|
|
Net assets
available for benefits
|
|
$
|
455,223,069
|
|
$
|
57,276,855
|
|
$
|
512,499,924
|
|
12
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
Changes in the assets and liabilities of the OfficeMax
Savings Plan Trust for the year ended December 31, 2007 are as follows:
|
|
|
|
Nonparticipant
directed
|
|
|
|
|
|
Participant
|
|
Employee Stock
Ownership Plan
Component
|
|
Total
combined
|
|
|
|
Directed
|
|
Allocated
|
|
funds
|
|
Net appreciation
(depreciation) in fair value of investments:
|
|
|
|
|
|
|
|
Commoncollective
trust funds
|
|
$
|
12,386,473
|
|
$
|
|
|
$
|
12,386,473
|
|
OfficeMax common
stock fund
|
|
(11,422,338
|
)
|
|
|
(11,422,338
|
)
|
|
|
964,135
|
|
|
|
964,135
|
|
Interest income
|
|
8,796,289
|
|
|
|
8,796,289
|
|
Dividend
income
|
|
252,809
|
|
4,140,167
|
|
4,392,976
|
|
Transfers
|
|
5,729,333
|
|
(5,729,333
|
)
|
|
|
Net amounts
withdrawn by participating plans
|
|
(74,067,396
|
)
|
(4,112,578
|
)
|
(78,179,974
|
)
|
Net transfers
into the OfficeMax Savings Plan Trust
|
|
38,421,356
|
|
|
|
38,421,356
|
|
Net decrease
|
|
$
|
(19,903,474
|
)
|
$
|
(5,701,744
|
)
|
$
|
(25,605,218
|
)
|
The following presents investments, at fair value,
that represent 5% or more of the OfficeMax Savings Plan Trusts net assets at December 31,
2007:
INVESCO Stable
Value Fund, 16,600,992 units
|
|
$
|
189,116,823
|
|
SSGA S&P 500
Index Fund, 7,815,264 units
|
|
99,257,940
|
|
SSGA Mid/Small
Cap Index Fund, 2,678,222 units
|
|
35,148,666
|
|
SSGA
International Equity Index Fund, 2,081,857 units
|
|
33,009,918
|
|
SSGA Moderate
Asset Allocation Fund, 2,452,867 units
|
|
30,404,584
|
|
OfficeMax ESOP
Component (1,110,867 shares of OfficeMax Incorporated Preferred Stock)
|
|
51,575,111
|
|
State Street Bank and
Trust Company is the trustee as defined by the OfficeMax Savings Plan Trust and
therefore, the SSGA transactions qualify as exempt transactions with a party in
interest. Administrative expenses consisting of investment management fees,
recordkeeping fees, and other administrative expenses for the OfficeMax Savings
Plan totaled $1,342,740 for the year ended December 31, 2007.
13
OFFICEMAX
SAVINGS PLAN
Notes to Financial
Statements
December 31, 2007
(7)
Employee Stock Ownership Plan (ESOP) Component
The ESOP is a financial component added to the Plan in
1989 to facilitate the Companys matching contributions for certain participants
as described in Note 1. The eligibility requirements associated with the ESOP
fund component are described in Note 1. The ESOP fund consists of Company
matching contributions as described below; employees cannot invest any other
contributions in the ESOP fund component.
On July 10, 1989, the plan trustee acquired
6,745,347 shares of OfficeMax Incorporated (formerly Boise Cascade Corporation)
Series D Convertible Preferred Stock (Preferred Stock) for $303,541,000
using proceeds from loans made or guaranteed by the Company. Shares of
Preferred Stock were allocated to certain participants accounts in accordance
with the terms of the ESOP component. Matching allocations were made to
eligible participants ESOP accounts equal in value at the time made in 2004,
for employee participants not in the contract office supply business, at a rate
of 70% of the participants contributions to the Plan, up to the first 6% of
the participants eligible compensation, and at a rate of 50% for employee
participants in the contract office supply business, up to the first 6% of the
participants eligible compensation. The Company made cash contributions to the
ESOP component of the Plan through 2004 which, when aggregated with dividends
paid on the Companys Series D Convertible Preferred Stock (Preferred
Stock) held in the ESOP component, equaled the amount necessary to enable the
trustee to make its regularly scheduled payments of principal and interest due
on the term loan, proceeds of which were used by the trustee to acquire the
Preferred Stock. The final loan payment was made on June 28, 2004,
resulting in no further contributions of this kind being made to the Plan.
However, the Company contributed additional cash to settle retired shares for a
short period in late 2003 and early 2004. This allowed the retired shares to
stay in the ESOP component and be reissued for use as Company match. The
purpose of making the additional contributions was to make certain that there
were enough shares available to allocate for Company match through the end of
2004. A small balance of 85,019 recycled shares remained in the ESOP component
to be allocated at December 31, 2004, and was used for Company match in
2005. The matching rate for all participants in 2005 was 50%, up to the first 6%
of the participants eligible compensation. Since the shares ran out on September 23,
2005, the Company match has been made in cash.
The Preferred Stock had an issue price of $45 per
share, can be converted by the Plans trustee at any time into Common Stock at
a conversion ratio of .80357 share of Common Stock for each share of Preferred
Stock, and pays an annual dividend, in semiannual installments, of $3.31875 per
share. Subject to certain restrictions prior to June 28, 1993, and at any
time thereafter, the Company can redeem the Preferred Stock. The Preferred
Stock may not be redeemed for less than the $45 per share liquidation
preference. At December 31, 2007 and December 31, 2006, the Preferred
Stock was valued at $45 per share, which represents the minimum amount at which
it can be redeemed.
The Preferred Stock is held by the trustee in a
separate ESOP Component Suspense Account and is pledged as collateral for any
remaining unpaid portion of the loan drawn by the trustee to fund the ESOP
component (ESOP Loan). At December 31, 2007 and December 31, 2006,
there were no shares of Preferred Stock held in the ESOP Component Suspense
Account to be allocated to participants, since the ESOP Loan was fully repaid
on June 28, 2004.
(8)
Other Investments
Other than participant loans, investments outside of
the OfficeMax Savings Plan Trust were in a Self Managed Account. The Plans
investments in the Self Managed Account are stated at fair value which is
calculated as net asset value per share/unit times the number of shares/units
at year end. At December 31, 2007,
the balance in the Self Managed Account was less than 5% of the Plans total
net assets.
14
OFFICEMAX
SAVINGS PLAN
Notes to Financial Statements
December 31, 2007
(9)
Income Tax Status
The Plan obtained its latest determination letter on August 18,
2003, wherein the Internal Revenue Service stated the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue
Code. The Plan has been amended since filing for the determination letter.
However, the Company believes that the Plan, as modified, continues to be in
compliance with the applicable requirements of the Internal Revenue Code.
Therefore, the Company believes that the Plan was qualified and the related
Trust was tax exempt as of the financial statement date.
The Plan covers participants who are Puerto Rican
residents. As such, a separate determination letter application must be made to
the Puerto Rican Hacienda (Puerto Rican equivalent of the United States
Internal Revenue Service) for qualification under the Puerto Rican Internal
Revenue Code. The Plans application for a favorable determination letter to
the Hacienda is in process by outside counsel and is expected to be completed
in 2008. The Company believes that the Plan will be found to have been in
compliance with the applicable requirements of the Puerto Rican Hacienda and,
therefore, qualified and tax exempt as of the financial statement date. The
Company does not expect associated fines or penalties, if any, to be material.
(10)
Reconciliation of Financial
Statements to Form 5500
The following is a reconciliation of net assets
available for benefits per the financial statements at December 31, 2007
to the Form 5500:
Net assets
available for benefits per the financial statements
|
|
$
|
514,726,361
|
|
Adjustment from
fair value to contract value for interest in a common collective trust relating
to fully benefit-responsive investment contracts
|
|
(52,634
|
)
|
|
|
|
|
Net assets
available for benefits per the Form 5500
|
|
$
|
514,673,727
|
|
Net decrease in net assets available for benefits
per the financial statements
|
|
$
|
(30,981,299
|
)
|
Adjustment from
fair value to contract value for interect in a common collective
trust relating to fully benefit-responsive
investment contracts
|
|
2,273,962
|
|
Net decrease in net assets available for benefits
per the form 5500
|
|
(28,707,337
|
)
|
The accompanying financial statements present the
interest in a common collective trust relating to fully benefit-responsive
investment contracts at contract value. The Form 5500 requires the
interest in a common collective trust relating to fully benefit-responsive
investment contracts to be reported at fair value. Therefore, the adjustment
from fair value to contract value for interest in a common collective trust
relating to fully benefit-responsive investment contracts represents a
reconciling item.
(11)
Party-in-interest
Certain Plan investments consist of shares of mutual
funds managed by SSGA, which is a division of State Street, the Trustee, as
defined by the Plan. Transactions in these funds qualify as permitted
party-in-interest transactions (as defined by ERISA). OfficeMax as the Plan
sponsor is also a related party. Plan
investments in OfficeMax common and preferred stock are permitted
party-in-interest transactions.
Participant loans are also permitted party-in-interest transactions.
(12)
Subsequent
Events
Effective April 1, 2008, Vanguard Fiduciary Trust
Company
replaced State Street as the Plan
trustee and Vanguard Group, Inc. replaced Citistreet as recordkeeper,
respectively.
The investment options available to employees prior to
April 1, 2008 were also replaced with the following investment options:
Vanguard 500 Index Fund
Vanguard Small-Cap Index Fund
Vanguard Total Bond Market Index Fund
Vanguard Total International Stock Index Fund
15
Vanguard Target Retirement Income Fund
Vanguard Target Retirement Fund 2005
Vanguard Target Retirement Fund 2010
Vanguard Target Retirement Fund 2015
Vanguard Target Retirement Fund 2020
Vanguard Target Retirement Fund 2025
Vanguard Target Retirement Fund 2030
Vanguard Target Retirement Fund 2035
Vanguard Target Retirement Fund 2040
Vanguard Target Retirement Fund 2045
Vanguard Target Retirement Fund 2050
Vanguard Retirement Savings Trust V
Vanguard REIT Index Fund
OfficeMax Stock Fund
VBO Vanguard Brokerage Option
16
Signatures
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.
|
|
OfficeMax Savings Plan
|
|
|
|
|
By:
|
/s/ Jeff Johnson
|
|
|
Jeff Johnson
|
|
|
Chair, Retirement Committee
|
Date: June 30, 2008
17
OFFICEMAX
SAVINGS PLAN
Filed with the Report
on Form 11-K for the Plan Year Ended
December 31, 2007
Index to Exhibits
Reference
|
|
Description
|
|
Page number
|
Exhibit A
|
|
Consent of Independent Registered
Public Accounting Firm
Dated June 30, 2008
|
|
19
|
18
Exhibit A
Consent of Independent Registered
Public Accounting Firm
The Board of Directors and the Retirement Committee of OfficeMax
Incorporated and the Plan Administrator of the OfficeMax Savings Plan:
We consent to the incorporation by reference in the Registration
Statement (No. 333-113648) on Form S-8 of OfficeMax Incorporated of
our report dated June 30, 2008, with respect to the statements of net
assets available for benefits of the OfficeMax Savings Plan as of December 31,
2007 and 2006, the related statement of changes in net assets available for
benefits for the year ended December 31, 2007, and the related
supplemental schedule as of December 31, 2007, which report appears in the
December 31, 2007 Annual Report on Form 11-K of the OfficeMax Savings
Plan.
/s/ KPMG LLP
|
|
|
Chicago, Illinois
|
June 30, 2008
|
19
Schedule 1
OFFICEMAX
SAVINGS PLAN
Form 5500 Schedule H, Line 4(i) Schedule of
Assets (Held at End of Year)
December 31, 2007
Identity of issue, borrower,
lessor, or similar party
|
|
Description of investment including
maturity date, rate of interest,
collateral, par, or maturity value
|
|
Units
|
|
Current value
|
|
Participation in
OfficeMax Savings Plan Trust*
|
|
Conservative asset allocation fund*
|
|
438,326
|
|
$
|
5,145,717
|
|
|
|
Moderate asset allocation fund*
|
|
2,452,867
|
|
30,404,584
|
|
|
|
Aggressive asset allocation fund*
|
|
1,234,229
|
|
16,010,802
|
|
|
|
Stable value fund, at fair value*
|
|
16,600,992
|
|
189,116,823
|
|
|
|
Bond market index fund*
|
|
1,056,742
|
|
11,957,914
|
|
|
|
S&P 500 index fund*
|
|
7,815,264
|
|
99,257,940
|
|
|
|
MidSmall cap index fund*
|
|
2,678,222
|
|
35,148,666
|
|
|
|
International equity fund*
|
|
2,081,857
|
|
33,009,918
|
|
|
|
Real estate index fund*
|
|
423,937
|
|
5,507,103
|
|
|
|
OfficeMax common stock fund*
|
|
1,389,350
|
|
9,707,494
|
|
|
|
OfficeMax ESOP component* (OfficeMax Incorporated
Preferred Stock) (Cost $51,575,111)
|
|
333,213
|
|
51,575,111
|
|
Participant Self
Managed Account
|
|
Self Managed Account
|
|
n/a
|
|
20,306,948
|
|
Participant
loans*
|
|
2,103 loans to participants, varying maturity dates
thru 2012, interest rates ranging from 4.0% 9.25%
|
|
n/a
|
|
7,269,036
|
|
|
|
Total of assets
|
|
|
|
$
|
514,418,056
|
|
*
Party
in interest.
See accompanying report of independent registered public accounting
firm.
20
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