1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended DECEMBER 31, 1996
Commission file number: 1-5256
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
(Full title of plan)
1047 NORTH PARK ROAD
WYOMISSING, PA 19610
(Address of principal executive offices)
(610) 378-1151
(Registrant's telephone number, including area code)
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Item 1. Changes in the Plan
There were no changes in the Plan.
Item 2. Changes in Investment Policy
There were no changes in investment policy.
Item 3. Contributions Under the Plan
Contributions made by VF Corporation (the Corporation) are measured by
reference to the employees' contributions and are not discretionary.
Item 4. Participating Employees
There were approximately 7,210 enrolled participants in the Plan as of December
31, 1996, out of approximately 7,782 eligible employees.
Item 5. Administration of the Plan
(a) The Plan provides that a Committee of three persons be appointed to
administer the Plan. The Committee, the VF Corporation Pension Plan
Committee, is comprised of the following officers of the Corporation:
Lori M. Tarnoski, Vice President - Secretary; Frank C. Pickard III,
Vice President - Treasurer; and Louis J. Fecile, Vice President -
Employee Benefits. All committee persons are located at the
Corporation's headquarters: 1047 North Park Road, Wyomissing, PA
19610. Each of these individuals is an employee of the Corporation.
The Committee has the power to adopt rules and regulations for
carrying out and administering the Plan and has the full authority and
power to construe, interpret and administer the Plan. Committee
members receive no compensation from the Plan.
(b) All expenses of administration of the Plan, including Trustee fees,
are paid by the Corporation.
Item 6. Custodian of Investments
(a) The Corporation has entered into a Trust Agreement under which UMB
Bank, n.a., 10th and Grand, P.O. Box 419692, Kansas City, MO
64141-6692, has been appointed as Trustee under the Plan. Under the
terms of the Trustee Agreement, UMB Bank, n.a., holds and invests all
assets of the Plan, subject to the direction of each of the
participants of the Plan regarding the investment fund or funds to
receive contributions.
(b) The custodian's compensation is paid by the Corporation.
(c) No bond was furnished or is required to be furnished by the Trustee.
Item 7. Reports to Participating Employees
Each participant receives a quarterly statement showing the amounts contributed
by him/her to each of the funds during the calendar quarter and the market
values of investments as of the end of each quarter. The statement also shows
the Corporation's matching contributions allocated to the participant through
the Employees Stock Ownership Plan, which are invested in VF Corporation Series
B Preferred Stock (ESOP Preferred Stock), and the fair values based on the
preferred stock's stated redemption price of $30.875 per share or 80% of the
market value of the Corporation's Common Stock, whichever is greater.
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Item 8. Investment of Funds
Each participant by calling the VF Savings Line directs the Plan Administrator
to notify the Trustee to invest his/her own contributions in one or more of the
following funds:
- Money Market Fund
- Fixed Income Fund
- Balanced Fund
- Equity Growth & Income Fund
- Equity Growth Fund
- Foreign Fund
- VF Corporation Common Stock Fund (investing in common stock of the
Corporation)
Brokerage commissions of $3,878, $8,909, and $6,859 for the years ended December
31, 1996, 1995 and 1994 were paid by the Trustee to acquire the Corporation's
common stock for the Plan.
The Corporation's matching contributions go solely to the ESOP. These
contributions are allocated to participants who receive full value in the form
of ESOP Preferred Stock and are used by the ESOP to pay principal and debt
service on a loan from the Corporation.
Item 9. Financial Statements and Exhibits
(a) Financial Statements Page No.
Report of Independent Accountants 5
Statements of Net Assets Available for Benefits -
December 31, 1996 and 1995
- Combined Plan 6
- Money Market Fund and Fixed Income Fund 7
- Balanced Fund and Equity Growth & Income Fund 8
- Equity Growth Fund and Foreign Fund 9
- VF Corporation Common Stock Fund and 10
Employee Stock Ownership Plan
- Loan Fund 11
Statements of Changes in Net Assets Available for Benefits -
For the Years Ended December 31, 1996, 1995 and 1994
- Combined Plan 12
- Money Market Fund 13
- Fixed Income Fund 14
- Balanced Fund 15
- Equity Growth & Income Fund 16
- Equity Growth Fund 17
- Foreign Fund 18
- VF Corporation Common Stock Fund 19
- Employee Stock Ownership Plan 20
- Loan Fund 21
Notes to Financial Statements 22
Schedules:
Schedules I, II and III have been omitted because the
required information is included in the financial statements
and the related notes.
(b) Exhibits - none
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the VF Corporation Pension Plan Committee has duly caused this annual
report to be signed by the undersigned thereunto duly authorized.
VF Corporation Tax-Advantaged Savings Plan
for Salaried Employees
-------------------------------------------
By: /s/ Louis J. Fecile
----------------------------------------
Louis J. Fecile
Vice President - Employee Benefits
Date: March 21, 1997
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Report of Independent Accountants
VF Corporation Pension Plan Committee
VF Corporation Tax-Advantaged Savings Plan
for Salaried Employees
We have audited the accompanying statements of net assets available for
benefits of the VF Corporation Tax-Advantaged Savings Plan for Salaried
Employees as of December 31, 1996 and December 31, 1995, 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. The financial statements of the VF Corporation
Tax-Advantaged Savings Plan for Salaried Employees for the year ended December
31, 1994 were audited by other auditors whose report dated March 10, 1995
expressed an unqualified opinion on these statements.
We conducted our audits in accordance with generally accepted auditing
standards. 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 VF
Corporation Tax-Advantaged Savings Plan for Salaried Employees at December 31,
1996 and December 31, 1995, and the changes in its net assets available for
benefits for the years then ended in conformity with 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 fund information in the statements
of net assets available for benefits and in the statements of changes in net
assets available for benefits is presented for purposes of additional analysis
rather than to present the net assets available for benefits and changes in net
assets available for benefits of each fund. The fund information has been
subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ Coopers & Lybrand L.L.P.
Philadelphia, Pennsylvania
March 10, 1997
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
COMBINED PLAN
December 31
-----------------------------------
ASSETS 1996 1995
----- ----
Investments, at fair value
VF Corporation Common Stock -
326,618 shares in 1996
340,506 shares in 1995 $ 22,046,715 $ 17,961,692
VF Corporation ESOP Preferred Stock -
1,881,515 shares in 1996
1,964,942 shares in 1995 101,601,810 82,920,550
United States government obligations 16,991,039 17,329,048
Other securities 90,076,616 73,881,463
------------ ------------
Total investments 230,716,180 192,092,753
Dividends and interest receivable 312,017 338,457
Loans receivable from participants 9,374,718 8,705,631
------------ ------------
TOTAL ASSETS 240,402,915 201,136,841
------------ ------------
LIABILITIES
Employee Stock Ownership
Plan obligation - payable to VF Corporation 41,563,481 46,650,286
------------ ------------
TOTAL LIABILITIES 41,563,481 46,650,286
------------ ------------
Net assets available for benefits $198,839,434 $154,486,555
============ ============
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
MONEY MARKET FUND AND FIXED INCOME FUND
Money Market Fund Fixed Income Fund
December 31 December 31
-------------------------------- ------------------------------
1996 1995 1996 1995
---- ---- ---- ----
ASSETS
Investments, at fair value
United States government obligations $ 0 $ 0 $16,991,039 $17,329,048
Other securities 6,629,950 6,187,337 2,250,229 1,175,779
---------- ---------- ----------- -----------
Total investments 6,629,950 6,187,337 19,241,268 18,504,827
Dividends and interest receivable 180 31,938 307,497 302,060
Loans receivable from participants 0 1,423,668 0 1,630,963
---------- ---------- ----------- -----------
Net assets available for benefits $6,630,130 $7,642,943 $19,548,765 $20,437,850
========== ========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
BALANCED FUND AND EQUITY GROWTH & INCOME FUND
Balanced Fund Equity Growth & Income Fund
December 31 December 31
--------------------------------- ----------------------------------
1996 1995 1996 1995
---- ---- ---- ----
ASSETS
- ------
Investments, at fair value
Other securities $7,045,986 $3,932,420 $44,337,501 $34,980,125
---------- ---------- ----------- -----------
Total investments 7,045,986 3,932,420 44,337,501 34,980,125
Dividends and interest receivable 181 30 378 223
Loans receivable from participants 0 53,297 0 2,457,411
---------- ---------- ----------- -----------
Net assets available for benefits $7,046,167 $3,985,747 $44,337,879 $37,437,759
========== ========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
EQUITY GROWTH FUND & FOREIGN FUND
Equity Growth Fund Foreign Fund
December 31 December 31
---------------------------------- -------------------------------
1996 1995 1996 1995
---- ---- ---- ----
ASSETS
Investments, at fair value
Other securities $24,163,579 $24,727,939 $5,329,365 $2,370,207
----------- ----------- ---------- ----------
Total investments 24,163,579 24,727,939 5,329,365 2,370,207
Dividends and interest receivable 382 321 124 12
Loans receivable from participants 0 994,276 0 (34,572)
----------- ----------- ---------- ----------
Net assets available for benefits $24,163,961 $25,722,536 $5,329,489 $2,335,647
=========== =========== ========== ==========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
VF CORPORATION COMMON STOCK FUND AND EMPLOYEE STOCK OWNERSHIP PLAN
VF Corporation Common Stock Fund Employee Stock Ownership Plan
December 31 December 31
-------------------------------- -----------------------------
1996 1995 1996 1995
---- ---- ---- ----
ASSETS
Investments, at fair value
VF Corporation Common Stock
326,616 shares in 1996
340,506 shares in 1995 $22,046,715 $17,961,692 $ 0 $ 0
VF Corporation ESOP
Preferred Stock
1,881,515 shares in 1996
1,964,942 shares in 1995 0 0 101,601,810 82,920,550
Other securities 240,255 315,239 79,751 192,417
----------- ----------- ------------ -----------
Total investments 22,286,970 18,276,931 101,681,561 83,112,967
Dividends and interest receivable 454 514 2,821 3,359
Loans receivable from participants 0 2,180,588 0 0
----------- ----------- ------------ -----------
TOTAL ASSETS 22,287,424 20,458,033 101,684,382 83,116,326
----------- ----------- ------------ -----------
LIABILITIES
Employee Stock Ownership
Plan obligation - payable to VF Corporation 0 0 41,563,481 46,650,286
----------- ----------- ------------ -----------
TOTAL LIABILITIES 0 0 41,563,481 46,650,286
----------- ----------- ------------ -----------
Net assets available for benefits $22,287,424 $20,458,033 $60,120,901 $36,466,040
=========== =========== ============ ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
LOAN FUND
Loan Fund
December 31
-----------
1996
----
ASSETS
Investments, at fair value
Other securities $ 0
----------
Total investments 0
Dividends and interest receivable 0
Loans receivable from participants 9,374,718
----------
Net assets available for benefits $9,374,718
==========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
COMBINED PLAN
YEAR ENDED DECEMBER 31
----------------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Dividends on VF Corporation Common Stock $ 469,018 $ 538,867 $497,205
Dividends on ESOP Preferred Stock 3,971,574 4,131,256 4,228,632
Interest 1,234,816 1,255,562 979,143
Income from mutual funds and
bank common trust funds 4,639,609 3,693,225 2,614,714
----------- ----------- ----------
10,315,017 9,618,910 8,319,694
----------- ----------- ----------
Contributions
Interest on loan repayments 637,885 548,512 402,626
Participants 14,670,636 14,883,216 15,290,975
VF Corporation 5,527,985 5,762,864 5,570,215
----------- ----------- ----------
20,836,506 21,194,592 21,263,816
----------- ----------- ----------
Withdrawals (16,191,145) (6,901,351) (8,128,767)
Forfeitures that reduce
VF Corporation contributions (301,873) (255,310) (118,128)
Interest paid to VF Corporation on Employee
Stock Ownership Plan obligation (4,386,805) (4,878,310) (5,344,502)
Expenses 0 (53,764) 0
Net realized and unrealized appreciation
in fair value of investments 34,081,179 20,147,532 2,951,585
----------- ----------- ----------
Net increase 44,352,879 38,872,299 18,943,698
Net assets available for benefits
at beginning of year 154,486,555 115,614,256 96,670,558
----------- ----------- ----------
Net assets available for benefits
at end of year $198,839,434 $154,486,555 $115,614,256
============ ============ ============
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
MONEY MARKET FUND
Year Ended December 31
-------------------------------------------------------------
1996 1995 1994
Investment income
Income from mutual funds and
bank common trust funds $ 313,675 $ 338,605 $ 204,216
----------- ----------- ----------
313,675 338,605 204,216
----------- ----------- ----------
Contributions
Interest on loan repayments 0 49,368 34,933
Participants 1,537,425 1,146,077 1,024,192
----------- ----------- ----------
1,537,425 1,195,445 1,059,125
----------- ----------- ----------
Withdrawals (991,225) (373,362) (434,310)
Forfeitures that reduce
VF Corporation contributions (9) (579) (435)
Fund transfers, net (449,011) (396,856) (311,109)
----------- ----------- ----------
Net increase 410,855 763,253 517,487
Net assets available for benefits
Beginning of year, as reported 7,642,943 6,879,690 6,362,203
Reclassify loan balances to separate fund (1,423,668) 0 0
----------- ----------- ----------
Beginning of year, as adjusted 6,219,275 6,879,690 6,362,203
----------- ----------- ----------
End of year $6,630,130 $ 7,642,943 $6,879,690
=========== =========== ==========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
FIXED INCOME FUND
Year Ended December 31
---------------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Interest $1,234,816 $ 1,255,562 $979,143
Income from mutual funds and
bank common trust funds 42,437 41,620 38,440
----------- ----------- ----------
1,277,253 1,297,182 1,017,583
----------- ----------- ----------
Contributions
Interest on loan repayments 0 96,211 59,901
Participants 2,109,713 2,700,460 2,598,897
----------- ----------- ----------
2,109,713 2,796,671 2,658,798
----------- ----------- ----------
Withdrawals (2,565,214) (1,402,288) (1,771,571)
Forfeitures that reduce
VF Corporation contributions (11) (706) (890)
Net realized and unrealized appreciation
(depreciation) in fair value of investments (109,871) 191,476 (123,376)
Fund transfers, net 30,008 (571,686) (13,095)
----------- ----------- ----------
Net increase 741,878 2,310,649 1,767,449
Net assets available for benefits
Beginning of year, as reported 20,437,850 18,127,201 16,359,752
Reclassify loan balances to separate fund (1,630,963) 0 0
----------- ----------- ----------
Beginning of year, as adjusted 18,806,887 18,127,201 16,359,752
----------- ----------- ----------
End of year $19,548,765 $ 20,437,850 $18,127,201
=========== ============ ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
BALANCED FUND
Year Ended December 31
-----------------------------------
1996 1995
---- ----
Investment income
Income from mutual funds and
bank common trust funds $ 721,016 $ 141,331
---------- -----------
721,016 141,331
---------- -----------
Contributions
Interest on loan repayments 0 7,685
Participants 703,667 226,246
---------- -----------
703,667 233,931
---------- -----------
Withdrawals (317,576) (40,993)
Forfeitures that reduce
VF Corporation contributions (238) 0
Net realized and unrealized appreciation
in fair value of investments 70,842 90,964
Fund transfers, net 1,936,006 3,560,514
---------- -----------
Net increase 3,113,717 3,985,747
Net assets available for benefits
Beginning of year, as reported 3,985,747 0
Reclassify loan balances to separate fund (53,297) 0
---------- -----------
Beginning of year, as adjusted 3,932,450 0
---------- -----------
End of year $7,046,167 $ 3,985,747
========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
EQUITY GROWTH & INCOME FUND
Year Ended December 31
-------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Income from mutual funds and
bank common trust funds $2,148,023 $ 1,688,047 1,833,144
----------- ----------- -----------
2,148,023 1,688,047 1,833,144
----------- ----------- -----------
Contributions
Interest on loan repayments 0 154,780 123,536
Participants 4,131,053 4,215,860 4,624,489
----------- ----------- -----------
4,131,053 4,370,640 4,748,025
----------- ----------- -----------
Withdrawals (3,484,495) (1,378,118) (2,031,249)
Forfeitures that reduce
VF Corporation contributions (391) (1,272) (1,164)
Net realized and unrealized appreciation
(depreciation) in fair value of investments 5,037,526 7,296,660 (1,267,002)
Fund transfers, net 1,525,815 (1,485,754) (25,479)
----------- ----------- -----------
Net increase 9,357,531 10,490,203 3,256,275
Net assets available for benefits
Beginning of year, as reported 37,437,759 26,947,556 23,691,281
Reclassify loan balances to separate fund (2,457,411) 0 0
----------- ----------- -----------
Beginning of year, as adjusted 34,980,348 26,947,556 23,691,281
----------- ----------- -----------
End of year $44,337,879 $37,437,759 $26,947,556
=========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
EQUITY GROWTH FUND
Year Ended December 31
----------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Income from mutual funds and
bank common trust funds $ 1,130,443 $ 1,353,455 $515,020
----------- ----------- -----------
1,130,443 1,353,455 515,020
----------- ----------- -----------
Contributions
Interest on loan repayments 0 100,380 81,580
Participants 3,389,402 3,329,947 3,834,443
----------- ----------- -----------
3,389,402 3,430,327 3,916,023
----------- ----------- -----------
Withdrawals (2,420,165) (1,087,899) (1,129,617)
Forfeitures that reduce
VF Corporation contributions (236) (1,444) (118)
Net realized and unrealized appreciation
(depreciation) in fair value of investments 1,604,220 4,253,881 (726,720)
Fund transfers, net (4,267,963) 1,794,722 2,439,546
----------- ----------- -----------
Net increase (decrease) (564,299) 9,743,042 5,014,134
Net assets available for benefits
Beginning of year, as reported 25,722,536 15,979,494 10,965,360
Reclassify loan balances to separate fund (994,276) 0 0
----------- ----------- -----------
Beginning of year, as adjusted 24,728,260 15,979,494 10,965,360
----------- ----------- -----------
End of year $24,163,961 $25,722,536 $15,979,494
=========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
FOREIGN FUND
Year Ended December 31
--------------------------------------
1996 1995
---- ----
Investment income
Income from mutual funds and
bank common trust funds $ 257,147 $ 98,277
---------- ----------
257,147 98,277
---------- ----------
Contributions
Interest on loan repayments 0 5,537
Participants 504,049 165,453
---------- ----------
504,049 170,990
---------- ----------
Withdrawals (217,661) (9,708)
Forfeitures that reduce
VF Corporation contributions (234) 0
Net realized and unrealized appreciation
(depreciation) in fair value of investments 428,766 (122,155)
Fund transfers, net 1,987,203 2,198,243
---------- ----------
Net increase 2,959,270 2,335,647
Net assets available for benefits
Beginning of year, as reported 2,335,647 0
Reclassify loan balances to separate fund 34,572 0
---------- ----------
Beginning of year, as adjusted 2,370,219 0
---------- ----------
End of year $5,329,489 $2,335,647
========== ==========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
VF CORPORATION COMMON STOCK FUND
Year Ended December 31
-----------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Dividends on VF Corporation
Common Stock $ 469,018 $ 538,867 $ 497,205
Income from mutual funds and
bank common trust funds 5,963 6,622 4,284
----------- ----------- -----------
474,981 545,489 501,489
----------- ----------- -----------
Contributions
Interest on loan repayments 0 134,551 102,676
Participants 2,295,327 3,099,173 3,208,954
----------- ----------- -----------
2,295,327 3,233,724 3,311,630
----------- ----------- -----------
Withdrawals (1,888,739) (1,137,459) (1,310,494)
Forfeitures that reduce
VF Corporation contributions (143) (802) (841)
Net realized and unrealized appreciation
in fair value of investments 4,701,766 1,635,363 985,506
Fund transfers, net (1,573,213) (5,099,183) (2,089,863)
----------- ----------- -----------
Net increase (decrease) 4,009,979 (822,868) 1,397,427
Net assets available for benefits
Beginning of year, as reported 20,458,033 21,280,901 19,883,474
Reclassify loan balances to separate fund (2,180,588)
----------- ----------- -----------
Beginning of year, as adjusted 18,277,445 21,280,901 19,883,474
----------- ----------- -----------
End of year $22,287,424 $20,458,033 $21,280,901
=========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
EMPLOYEE STOCK OWNERSHIP PLAN
Year Ended December 31
-----------------------------------------------------------
1996 1995 1994
---- ---- ----
Investment income
Dividends on ESOP Preferred Stock $ 3,971,574 $ 4,131,256 $ 4,228,632
Income from mutual funds and
bank common trust funds 20,905 25,268 19,610
----------- ----------- -----------
3,992,479 4,156,524 4,248,242
----------- ----------- -----------
Contributions
VF Corporation 5,527,985 5,762,864 5,570,215
----------- ----------- -----------
5,527,985 5,762,864 5,570,215
----------- ----------- -----------
Withdrawals (3,526,117) (1,471,524) (1,451,526)
Forfeitures that reduce
VF Corporation contributions (300,611) (250,507) (114,680)
Expenses 0 (53,764) 0
Interest paid to VF Corporation on Employee Stock
Ownership Plan Obligation (4,386,805) (4,878,310) (5,344,502)
Net realized and unrealized appreciation
in fair value of investments 22,347,930 6,801,343 4,083,177
----------- ----------- -----------
Net increase 23,654,861 10,066,626 6,990,926
Net assets available for benefits
Beginning of year 36,466,040 26,399,414 19,408,488
----------- ----------- -----------
End of year $60,120,901 $36,466,040 $26,399,414
=========== =========== ===========
See notes to financial statements.
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VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
LOAN FUND
Year Ended December 31
1996
----------------------
Contributions
Interest on loan repayments $ 637,885
-----------
637,885
-----------
Withdrawals (779,953)
Forfeitures that reduce
VF Corporation contributions 0
Expenses 0
Net realized and unrealized appreciation
in fair value of investments 0
Fund transfers, net 811,155
-----------
Net increase 669,087
-----------
Net assets available for benefits
beginning of year, as reported 0
Reclassify loan balances to separate fund 8,705,631
-----------
Beginning of year, as adjusted 8,705,631
-----------
End of year $9,374,718
==========
See notes to financial statements.
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22
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
NOTE A -- DESCRIPTION OF THE PLAN
VF Corporation (the Corporation) sponsors the VF Corporation Tax-Advantaged
Savings Plan for Salaried Employees (the Plan), which is a cash or deferred
plan under Section 401(k) of the Internal Revenue Code. Under the Plan,
certain salaried employees of specified subsidiaries, having at least one year
of credited service, may elect to contribute between 2% and 10% of their
compensation to the Plan. The Corporation matches employee contributions by
50% for up to 6% of compensation contributed by the employee. Employees remain
fully vested in their contributions to the Plan. The Corporation's matching
contributions are vested monthly on a pro rata basis, with full vesting after
five years of service or upon normal or late retirement, disability or death.
The Plan includes an Employee Stock Ownership Plan (ESOP). In 1990, the ESOP
purchased 2,105,263 shares of VF Corporation 6.75% Series B ESOP Convertible
Preferred Stock (ESOP Preferred Stock) for $65.0 million. Each share of ESOP
Preferred Stock, which has a redemption value of $30.88 plus cumulative accrued
dividends, is convertible into eight-tenths share of VF Corporation Common
Stock and is entitled to one vote. The trustee for the ESOP may convert the
ESOP Preferred Stock to Common Stock at any time or may cause the Corporation
to redeem the ESOP Preferred Stock under certain circumstances. The ESOP
Preferred Stock also has preference in liquidation over all other stock issues.
The Corporation's matching contributions, all of which go into the ESOP, are
allocated to employees in shares of ESOP Preferred Stock. Of the shares of
ESOP Preferred Stock owned by the ESOP, 854,856 shares in 1996 and 765,568
shares in 1995 have been allocated to employees.
The ESOP's purchase of the ESOP Preferred Stock was funded by a loan of $65.0
million from the Corporation that bears interest at 9.8%. The loan will be
repaid in increasing installments through 2003 from future minimum Corporation
matching contributions to the ESOP and dividends on the ESOP Preferred Stock.
The Corporation's minimum required matching contributions and dividends are
$8.7 million in 1997 and increases each year to $9.6 million over the following
four years.
Employee contributions are invested at the direction of the employee in one or
more of the funds administered by the Plan's trustee. The investment programs
of the Plan are as follows:
(a) Money Market Fund: Monies are invested in a money
market fund.
(b) Fixed Income Fund: Monies are invested in investments
that provide a fixed rate of return.
(c) Balanced Fund: Monies are invested in investments to obtain
as much income as possible, consistent with the preservation
and conservation of capital.
(d) Equity Growth & Income Fund: Monies are invested in
investments that are currently paying dividends and/or offer
prospects for growth of capital and future income, with
emphasis on capital appreciation.
(e) Equity Growth Fund: Monies are primarily invested in
common stock, securities convertible into common stock and
debt securities, with emphasis on long-term growth
opportunities.
(f) Foreign Fund: Monies are invested in stocks and debt
obligations of companies and governments outside the United
States.
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23
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE A -- DESCRIPTION OF THE PLAN (Continued)
(g) VF Corporation Common Stock Fund: Monies are invested in
Common Stock of the Corporation purchased on the open market
at prevailing prices on the New York Stock Exchange on the
date of purchase. Employees can direct no more than 50% of
their contributions to the VF Corporation Common Stock Fund.
Individual accounts are maintained for each participant; each account includes
the individual's contributions, Corporation matching contributions and
investment funds' earnings. Accounts may become payable upon retirement,
disability, death or termination of employment. Participants may also withdraw
all or a portion of their accounts by filing a written request that
demonstrates financial hardship. Participants may elect to receive
distributions in a lump sum or in an annuity, or accounts may be rolled over
into another IRS-approved tax deferral vehicle. Forfeitures are used to reduce
VF Corporation's obligation to pay plan expenses.
Participants may borrow from their individual account. Participants are
charged interest at the Morgan Guaranty "Published" prime rate at the time of
the loan and repay the principal within 60 months, or 120 months if the loan is
for the purchase of their primary residence. Participants may borrow up to
100% of their account balance in the Money Market Fund and 75% of their account
balance of remaining funds, not to exceed 50% of the participant's total vested
account balance, but may not borrow from the Corporation matching portion.
Payment in full is required at termination of employment. There were 1,772
loans outstanding at December 31, 1996.
Although it has no intent to do so, the Corporation may terminate the Plan in
whole or in part at any time. In the event of termination, participants become
fully vested in their accounts.
The number of participants in each fund was as follows:
Year Ended December 31
--------------------------------------
1996 1995 1994
---- ---- ----
Money Market Fund 2,862 2,805 2,818
Fixed Income Fund 3,731 4,308 4,382
Balanced Fund 1,393 1,035 0
Equity Growth & Income Fund 5,420 5,725 5,603
Equity Growth Fund 4,040 4,513 3,999
Foreign Fund 1,032 700 0
VF Corporation Common Stock Fund 4,146 4,553 4,839
Employee Stock Ownership Plan 7,077 7,461 7,317
The total number of participants in the Plan was less than the sum of
participants shown above because many were participating in more than one fund.
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24
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE B -- SIGNIFICANT ACCOUNT POLICIES
Investments are stated at fair value. Securities traded on a national
securities exchange are valued at the last reported sales price on the last
business day of the plan year. The ESOP Preferred Stock is stated at fair
value, based on the greater of 80% of the fair value of the Corporation's
Common Stock or the preferred stock's stated redemption price of $30.875 per
share. For commercial notes and United States government obligations, the Plan
trustee has established a fair value based on yields currently available on
comparable instruments. The fair value of the participation units owned by the
Plan in mutual funds and bank common trust funds is based on quoted redemption
values on the last business day of the plan year.
The plan presents in the statement of changes in net assets the net
appreciation (depreciation) in the fair value of its investments, which
consists of the realized gains or losses and unrealized appreciation or
depreciation on those investments.
Administrative expenses consisting primarily of fees for legal, accounting and
other services are paid by the corporation in accordance with the Plan
Agreement and are based on customary and reasonable rates for such services.
Payment of Benefits: Benefits are recorded when paid.
Use of Estimates: In preparing financial statements in accordance with
generally accepted accounting principles, management makes estimates and
assumptions that affect amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimates.
NOTE C -- INCOME TAX STATUS
The Internal Revenue Service has issued a favorable Determination Letter dated
January 16, 1996 stating that the Plan qualifies under the appropriate sections
of the Internal Revenue Code (IRC) and is, therefore, not subject to tax under
present income tax law. Once qualified, the Plan is required to operate in
conformity with the IRC to maintain its qualification. The Pension Plan
Committee is not aware of any action or series of events that have occurred
that might adversely affect the Plan's qualified status.
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25
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D -- INVESTMENTS
Net unrealized appreciation (depreciation) in fair value of investments
included in Plan equity includes the following:
Net Unrealized
Appreciation (Depreciation) in Fair Value
Fair Value for the Year Ended December 31 at December 31
----------------------------------------------- --------------------------------------------
1996 1995 1994 1996 1995 1994
----------- ----------- ----------- ------------ ------------- -------------
Fair value as determined by
quoted market or stated
redemption price:
VF Corporation Common Stock $ 4,168,463 $ 52,620 $ 215,007 $ 22,046,715 $ 17,961,692 $ 19,295,129
ESOP Preferred Stock 22,201,877 6,484,308 3,812,036 101,601,810 82,920,550 78,361,197
Mutual funds and
bank common trust funds 6,121,697 11,083,328 (2,153,697) 86,921,008 71,875,357 46,457,343
----------- ----------- ----------- ------------ ------------ ------------
32,492,037 17,620,256 1,873,346 210,569,533 172,757,599 144,113,669
Fair value as determined by
Plan trustee:
United States government
obligations 0 0 0 16,991,039 17,329,048 15,767,773
Commercial notes (109,067) 191,467 (146,268) 812,427 678,070 249,552
Mutual funds and
bank common trust funds 0 0 0 2,343,181 1,328,036 1,580,383
----------- ----------- ----------- ------------ ------------ ------------
(109,067) 191,467 (146,268) 20,146,647 19,335,154 17,597,708
----------- ----------- ----------- ------------ ------------ ------------
$32,382,970 $17,811,723 $ 1,727,078 $230,716,180 $192,092,753 $161,711,377
=========== =========== =========== ============ ============ ============
Unrealized appreciation in fair value of investments at December 31,
1996, 1995 and 1994 was $70,620,796, $39,182,641 and $21,770,129,
respectively.
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26
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D -- INVESTMENTS (CONTINUED)
Net unrealized appreciation (depreciation) in fair value of investments
includes the following:
Year Ended December 31
---------------------------------------------------
1996 1995 1994
----------- ------------ -----------
Aggregate proceeds $62,417,960 $57,592,059 49,419,023
Aggregate cost 60,719,750 55,256,250 48,194,516
----------- ----------- ----------
Net realized gain $ 1,698,210 $ 2,335,809 $1,224,507
=========== =========== ==========
Of the net realized gain, $679,356, $1,690,513 and $1,041,640 related to gains
recognized on the sale of VF Common Stock and the redemption of VF Preferred
Stock for the years ended 1996, 1995 and 1994, respectively.
The fair value of individual investments that represent 5% or more of the
Plan's net assets at December 31, 1996 and 1995 are as follows:
1996 1995
---- ----
ESOP Preferred Stock $101,601,810 $82,920,550
Fidelity Growth & Income Fund 44,076,501 34,838,023
Fidelity Magellan Fund 23,976,308 24,637,151
VF Corporation Common Stock 22,046,715 17,961,692
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27
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTE TO FINANCIAL STATEMENTS (Continued)
NOTE D -- INVESTMENTS (Continued)
Investment held at December 31, 1996:
NUMBER OF SHARES
NAME OF ISSUER AND TITLE OF ISSUE OR PRINCIPAL AMOUNT FAIR VALUE COST
- --------------------------------- ------------------- ---------- ----
Securities of participating employer:
VF Corporation Common Stock 326,618 $ 22,046,715 12,356,875
VF Corporation 6.75% Series B ESOP
Convertible Preferred Stock 1,881,515 101,601,810 58,091,776
------------ ------------
123,648,525 70,448,651
------------ ------------
United States Government Obligations:
Small Business Administration Loans:
(Rates of 5.20% to 8.83%,
maturities of 03/02/97 to 05/23/11) $15,907,048 15,543,917 15,555,391
N.O.A.A. loans (Rates of 7.975%, matures 01/02/97) $ 114,831 114,687 114,687
F.M.H.A. loans (Rates of 5.675% to 9.875%, of maturities
05/01/98 to 11/19/08) $ 1,340,258 1,332,435 1,332,435
------------ ------------
16,991,039 17,002,513
------------ ------------
Other Securities:
Mutual funds and bank common trust funds:
Kemper Money Market Fund 6,588,972 6,588,972 6,588,972
Fidelity Puritan Fund 404,454 6,972,787 6,813,359
Fidelity Growth & Income Fund 1,434,315 44,076,501 31,587,314
Fidelity Magellan Fund 297,288 23,976,308 19,500,582
Templeton Foreign Fund 512,205 5,306,439 4,997,831
UMB Bank Fund: Scout Prime - R 2,343,182 2,343,182 2,343,182
American Commercial Lines (Due 07/15/01) $ 183,000 184,386 184,386
Private Export Funding Corp. (Due 04/30/04) $ 187,500 189,618 183,486
Raytheon Co. (Due 01/10/97) $ 200,000 199,729 199,108
Smith Enron Cogeneration LP (Due 12/15/06) $ 246,000 238,694 246,000
------------ ------------
$230,716,180 $160,095,384
============ ============
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28
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE E -- RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits per the
financial statements to Form 5500:
1996 1995
---- ----
Net assets available for benefits per the
financial statements 198,839,434 154,486,555
Amounts allocated to withdrawing participants 709,083 2,881,962
------------ ------------
Net assets available for benefits per Form 5500 $198,130,351 $151,604,593
============ ============
The following is a reconciliation of withdrawals paid to participants per the
financial statements to Form 5500:
1996
----
Withdrawals paid to participants and forfeitures
per the financial statements $16,493,018
Add amounts allocated to withdrawing participants at December 31, 1996 709,083
Less amounts allocated to withdrawing participants at December 31, 1995 (2,881,962)
-----------
Withdrawals paid to participants and forfeitures per Form 5500 $14,320,139
===========
Amounts allocated to withdrawing participants are recorded on Form 5500 as
withdrawal claims that have been processed and approved for payment prior to
December 31 but not yet paid as of that date.
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