SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1997
Commission file number 1-2227
E. Full title of the plan:
Crown Cork & Seal Company, Inc.
401(K) Retirement Savings Plan
for Employees of Van Dorn Company
F. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
CROWN CORK & SEAL COMPANY, INC.
ONE CROWN WAY
PHILADELPHIA, PA 19154-4599
INDEX
Pages
Signatures .............................................................. 3
Report of Independent Accountants ....................................... 6
Audited Plan Financial Statements and Schedules in
accordance with the Financial Reporting Requirements of ERISA ...........7 to 14
Exhibit 23 - Consent of Independent Accountants ......................... 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee has duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Crown Cork & Seal Company, Inc.
401(K) Retirement Savings Plan
for Employees of Van Dorn Company
By: /s/ James T. Malec
--------------------------------
James T. Malec
Member, Benefit Plan Committee
Date: June 29, 1998
Crown Cork & Seal Company, Inc. 401(k)
Retirement Savings
Plan for Employees of
Van Dorn Company
Financial Statements
and Supplemental Information
December 31, 1997 and 1996
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan for
Employees of Van Dorn Company
Financial Statements and Supplemental Information
December 31, 1997 and 1996
- --------------------------------------------------------------------------------
Index
Page
Report of Independent Accountants 1
Statement of Net Assets Available for Plan Benefits 2
Statement of Changes in Net Assets Available for
Plan Benefits, with Fund Information 3 - 4
Notes to Financial Statements 5 - 7
Schedule I - Schedule of Assets Held for Investment Purposes 8
Schedule II - Schedule of Reportable Transactions 9
Note: Other schedules required by ERISA are not applicable.
Report of Independent Accountants
June 19, 1998
To the Benefit Plans Committee
and Participants of the Crown
Cork & Seal Company, Inc.
401(k) Retirement Savings Plan
for Employees of Van Dorn Company
In our opinion, the accompanying statements of net assets available for plan
benefits and the related statements of changes in net assets available for plan
benefits present fairly, in all material respects, the net assets available for
plan benefits of the Crown Cork & Seal Company, Inc. 401(k) Retirement Savings
Plan for Employees of Van Dorn Company (the "Plan") at December 31, 1997 and
1996, and the changes in net assets available for plan benefits for the years
then ended, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Plan's administrator; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted accounting standards which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
Schedules I and II is presented for purposes of additional analysis and is not a
required part of the basic financial statements but is additional information
required by ERISA. The fund information in the statement of changes in net
assets available for plan benefits is presented for purposes of additional
analysis rather than to present the changes in net assets available for benefits
of each fund. Schedules I and II and the fund information have been subjected to
the auditing procedures applied in the audits of the basic financial statements
and, in our opinion, are fairly stated in all material respects in relation to
the basic financial statements taken as a whole.
Price Waterhouse LLP
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Statement of Net Assets Available for Plan Benefits
December 31, 1997 and 1996
- --------------------------------------------------------------------------------
1997 1996
---- ----
Investments at fair value;
Crown Cork & Seal Common Stock* $ 3,708,528 $ 3,744,525
T. Rowe Price Mutual Funds:
Prime Reserve Fund* 1,465,040 2,199,564
Capital Appreciation Fund* 1,188,230 996,708
Spectrum Income Fund* 2,566,590 2,306,605
Spectrum Growth Fund* 6,968,257 6,162,855
Participant Loan Fund 234,395 224,092
------------ ------------
Total investments 16,131,040 15,634,349
Employer contributions receivable 21,353 --
Employee contributions receivable 71,178 --
Loan principal repayment receivable 5,067 --
Loan interest repayment receivable 1,734 --
Administrative expenses payable (9,200) (9,200)
------------ ------------
Net assets available for plan benefits $ 16,221,172 $ 15,625,149
============ ============
<FN>
* Represents more than 5% of net assets available for plan benefits at
December 31, 1997.
</FN>
The accompanying notes are an integral part of these financial statements.
- 2 -
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Statement of Changes in Net Assets Available for Plan Benefits,
with Fund Information
For the Year Ended December 31, 1997
- --------------------------------------------------------------------------------
Fund Information
---------------------------------------------------------------------------------
T. Rowe Price
-------------------------------------------------
Crown Cork
& Seal Prime Capital Spectrum Spectrum Participant
Common Reserve Appreciation Income Growth Loan
Stock Fund Fund Fund Fund Fund Total
Additions:
Contributions:
Employer $ 220,161 $ 220,161
Employee 64,415 $ 158,043 $ 137,256 $ 169,382 $ 242,791 771,887
Investment income 71,349 92,517 146,978 178,637 706,155 $ 19,093 1,214,729
Net appreciation/(depreciation)
in fair value of investments (301,030) -- 19,786 94,546 356,142 169,444
------------ ---------- ---------- ---------- ---------- ---------- -----------
54,895 250,560 304,020 442,565 1,305,088 19,093 2,376,221
Deductions:
Benefits paid to participants and
rollovers to other plans (189,812) (857,168) (74,873) (70,531) (533,891) (41,108) (1,767,383)
Transfers:
Loan principal repayment 6,877 11,723 7,583 15,260 15,047 (56,490)
Loan interest allocated 2,001 4,638 2,573 5,145 4,736 (19,093)
Loans issued (40,693) (18,731) (10,167) (12,746) (25,564) 107,901
Interfund transfers 158,174 (98,381) (23,174) (102,109) 65,490
Administrative expenses (12,815) (12,815)
------------ ---------- ---------- ---------- ---------- ---------- -----------
(63,453) (970,734) (98,058) (164,981) (474,182) (8,790) (1,780,198)
Net increase/(decrease) in net
assets available for plan benefits (8,558) (720,174) 205,962 277,584 830,906 10,303 596,023
Net assets at beginning of year 3,744,525 2,190,364 996,708 2,306,605 6,162,855 224,092 15,625,149
------------ ---------- ---------- ---------- ---------- ---------- -----------
Net assets at end of year $ 3,735,967 $1,470,190 $1,202,670 $2,584,189 $6,993,761 $ 234,395 $16,221,172
============ ========== ========== ========== ========== ========== ===========
The accompanying notes are an integral part of these financial statements.
-3-
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Statement of Changes in Net Assets Available for Plan Benefits,
with Fund Information
For the Year Ended December 31, 1996
- --------------------------------------------------------------------------------
Fund Information
---------------------------------------------------------------------------------
T. Rowe Price
-------------------------------------------------
Crown Cork
& Seal Prime Capital Spectrum Spectrum Participant
Common Reserve Appreciation Income Growth Loan
Stock Fund Fund Fund Fund Fund Total
Additions:
Contributions:
Employer $ 224,975 $ 224,975
Employee 50,298 $ 157,544 $ 146,363 $ 178,514 $ 252,424 785,143
Investment income 79,839 105,366 92,496 201,947 427,375 $ 28,655 935,678
Net appreciation/(depreciation)
in fair value of investments 970,831 51,549 (22,760) 755,175 1,754,795
---------- ---------- ---------- ---------- ---------- ---------- ------------
1,325,943 262,910 290,408 357,701 1,434,974 28,655 3,700,591
Deductions:
Benefits paid to participants and
rollovers to other plans (904,904) (507,552) (208,959) (797,287) (1,821,420) (102,453) (4,342,575)
Transfers:
Loan principal repayment 7,215 14,424 9,728 22,027 23,612 (77,006)
Loan interest allocated 3,039 5,725 3,958 7,664 8,269 (28,655)
Loans issued (17,617) (28,958) (11,704) (27,590) (32,150) 118,019
Interfund transfers (323,933) 209,528 92,197 (75,718) 97,926
Administrative expenses (16,389) (16,389)
---------- ---------- ---------- ---------- ---------- ---------- ------------
(1,236,200) (323,222) (114,780) (870,904) (1,723,763) (90,095) (4,358,964)
Net increase/(decrease) in net
assets available for plan benefits 89,743 (60,312) 175,628 (513,203) (288,789) (61,440) (658,373)
Net assets at beginning of year 3,654,782 2,250,676 821,080 2,819,808 6,451,644 285,532 16,283,522
---------- ---------- ---------- ---------- ---------- ---------- ------------
Net assets at end of year $3,744,525 $2,190,364 $ 996,708 $2,306,605 $6,162,855 $ 224,092 $ 15,625,149
========== ========== ========== ========== ========== ========== ============
The accompanying notes are an integral part of these financial statements.
-4-
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Notes to Financial Statements
December 31, 1997 and 1996
- --------------------------------------------------------------------------------
1. Summary of Significant Accounting Policies
The Plan maintains its financial records and prepares its financial
statements using the accrual basis of accounting. Investment income earned,
but not received, is accrued. Dividends are recorded on the ex-dividend
date. Purchases and sales of securities are recorded on a trade-date basis.
Shares of registered investment companies are valued at quoted market
prices which represent the net asset values of shares held by the Plan at
year end. The Company stock is valued at its quoted market price at year
end. Participant notes receivable are valued at cost which approximates
fair value.
T. Rowe Price Retirement Plan Services, Inc. (the "Trustee") manages a
Trust Fund for the Plan under the terms of a trust agreement. All of the
Plan's investments and cash are held in the Trust Fund. The Trustee has
been granted discretionary authority with regard to the investment of
temporary cash balances.
2. Description of Plan
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a more complete
description of Plan's provisions.
In 1993, the Van Dorn Company (the "Company") was acquired by Crown Cork &
Seal Company, Inc. ("Crown") at which time Crown became the sponsor of the
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan for
Employees of Van Dorn Company (the "Plan"), formerly the Van Dorn Company
401(k) Plan and Trust. The Company was legally dissolved as of December 31,
1996. The Plan is administered by the Crown Cork & Seal Company, Inc.
Benefit Plans Committee.
General. The Plan is a defined contribution plan designed to provide a
convenient method by which eligible employees may save regularly through
salary elections and through sponsor matching contributions.
The Plan covers salaried employees of the Company's corporate office,
Central States Can Company and Davies Can Company. Employees are eligible
to participate in the Plan after completing one year of service and
attaining the age of 21. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
On June 17, 1996, Crown sold Davies Can Company ("Davies"), a division of
the Company, to Brockway Standard, Inc. ("Brockway"), a subsidiary of BWAY
Corporation. Employees of Davies participating in the Plan were given the
option of either rolling over their account balances into the Brockway
sponsored plan or their individual retirement accounts or keeping their
balances invested with the Plan. Their accounts became fully vested at
termination.
-5-
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Notes to Financial Statements
December 31, 1997 and 1996
- --------------------------------------------------------------------------------
Employee Contributions. Employees who participate in the Plan can direct
the Company to withhold wages and make tax deferred contributions on their
behalf. Contributions may range from 1 percent to 16 percent of annual
compensation, plus bonuses, subject to certain limitations.
A participant's 401(k) account balance attributable to tax deferred
contributions, taxable employee contributions, and rollover contributions
is 100 percent vested at all times.
Loans. The Plan allows for loans to participants in excess of $1,000 and
not to exceed 50% of the participant's vested account balance up to $50,000
(subject to restrictions further described in the Plan document).
Employer Contributions. The Company matches 50 percent of employee
contributions up to a maximum employee contribution of 4 percent of
compensation. Employer contributions vest 100 percent over five years of
service. All employer matching contributions are invested automatically in
the Crown Cork & Seal Common Stock Fund.
Forfeitures of $12,815 and $16,381 were applied against administrative
expenses during 1997 and 1996, respectively. Total unallocated forfeitures
were $16,308 and $27,166 at December 31, 1997 and 1996, respectively.
Investments. Participants may direct their contributions among any of the
following investment options:
1. Crown Cork and Seal Common Stock - Investing in Crown common stock.
2. T. Rowe Price Prime Reserve Fund - A money market fund investing in a
diversified portfolio of domestic and foreign U.S. dollar-denominated
high-quality money market securities.
3. T. Rowe Price Capital Appreciation Fund - Investing primarily in
common stocks. The fund may hold fixed income and other securities.
4. T. Rowe Price Spectrum Income Fund - Investing primarily in domestic
bond funds and also in two foreign bond funds. The fund may allocate
25% of assets to a stock fund.
5. T. Rowe Price Spectrum Growth Fund - Investing primarily in domestic
stock funds and also in a foreign stock fund.
Distributions. Benefit payments from the Plan are limited to lump sum
distributions.
Plan Termination. Although it has not expressed any intent to do so, Crown
has the right under the Plan to terminate the Plan subject to the
provisions of ERISA. In the event of Plan termination, participants will
become fully vested in their accounts.
-6-
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Notes to Financial Statements
December 31, 1997 and 1996
- --------------------------------------------------------------------------------
3. Tax Status of the Plan
The Company has received a favorable determination letter, dated February
22, 1996, from the Internal Revenue Service (IRS) and accordingly, the
Trust is not subject to federal or local income taxes. The Plan has been
amended since receiving the determination letter. However, the Plan
administrator and the Plan's tax counsel believe that the Plan is designed
and is currently being operated in compliance with the applicable
provisions of the Internal Revenue Code.
4. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by the Trustee
and Crown common stock. Therefore, these transactions qualify as
parties-in-interest transactions which are exempt from the prohibited
transactions rules.
-7-
Schedule I
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Schedule 27a - Schedule of Assets Held for Investment Purposes
at December 31, 1997
- --------------------------------------------------------------------------------
Description Number Current
Identity of issue of Investment of Shares Cost Value
----------------- ------------- --------- ---- -------
Crown Cork & Seal Common Common Stock 73,986 $ 2,585,547 $ 3,708,528
Stock*
T. Rowe Price Prime Registered Investment Company 1,465,040 1,465,040 1,465,040
Reserve Fund*
T. Rowe Price Capital Registered Investment Company 80,777 1,115,320 1,188,230
Appreciation Fund*
T. Rowe Price Spectrum Registered Investment Company 220,119 2,407,329 2,566,590
Income Fund*
T. Rowe Price Spectrum Registered Investment Company 437,430 5,420,208 6,968,257
Growth Fund*
Participant Loan Fund (at 9.25% -
12.95% interest rates, maturities
ranging from 1998 to 2002) 234,395 234,395
----------- -----------
Total assets held for investment
purposes at December 31, 1997 $13,227,839 $16,131,040
=========== ===========
<FN>
* Party-in-interest.
</FN>
-8-
Schedule II
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
for Employees of Van Dorn Company
Schedule 27d - Schedule of Reportable Transactions*
For the Year Ended December 31, 1997
- --------------------------------------------------------------------------------
Aggregate
Description Purchase Selling Cost of Net
Identity of Party Involved of Asset Price Price Asset Gain
- -------------------------- ----------- -------- --------- ------- ----
Crown Cork & Seal Co., Inc. Common Stock $ 551,678 $ 304,208 $ 215,497 $ 88,711
T. Rowe Price
Prime Reserve Fund Registered Investment Co. 431,559 1,165,763 1,165,763 --
T. Rowe Price
Spectrum Growth Fund Registered Investment Co. 1,157,430 707,998 548,165 159,833
<FN>
* Transactions or a series of transactions in excess of 5% of the current value
of the Plan's assets as of the beginning of the plan year as defined in
Section 2520.103-6 of the Department of Labor Rules and Regulations for
Reporting and Disclosure unde ERISA.
</FN>
-9-