SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 11-K
Annual Report
/X/ Annual Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934 [Fee Required]
For the year ended December 31, 1994
-----------------
or
/ / Transition Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934 [No Fee Required)
For the transition period from to
---------------------- -----------------
Commission file number 1-5256
------
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
(Full title of plan)
1047 NORTH PARK ROAD, WYOMISSING, PA 19610
------------------------------------------
(Address of principal offices)
Registrant's telephone number, including area code (610) 378-1151
--------------
1
Item 1. Changes in the Plan
Effective April 1, 1994, the amount of compensation which eligible employees
may elect to contribute to the Plan increased from 8% to 10%.
Item 2. Changes in Investment Policy
There have been no changes during the year in the policy with respect to the
kind of securities or other investments in which funds held under the Plan may
be invested.
Item 3. Contributions Under the Plan
Contributions made by VF Corporation (the Corporation) are measured by
reference to the employee's contributions and are not discretionary.
Item 4. Participating Employees
There were approximately 7,482 enrolled participants in the Plan as of
December 31, 1994, out of approximately 8,512 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 Harold E. Addis, Vice President - Human Resources
and Administration. 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 Trust
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 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.
2
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 as of the end of each quarter. The statement also shows the
Corporation's matching contributions allocated to the participant through the
Employee Stock Ownership Plan, which are invested in 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.
Item 8. Investment of Funds
Each participant by written election directs the Trustee to invest his/her own
contributions in one or more of the following funds:
- Money Market Fund
- Fixed Income Fund
- Equity Growth & Income Fund
- Equity Growth Fund
- VF Corporation Common Stock Fund (investing in common stock of the
Corporation)
Brokerage commissions of $6,859, $6,436, and $6,166 for the years ended
December 31, 1994, 1993 and 1992 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 debt service on a loan
from the Corporation.
Item 9. Financial Statements and Exhibits
(a) Financial Statements Page No.
Report of Independent Auditors 5
Statements of Net Assets Available for Benefits -
For the Years Ended December 31, 1994 and 1993
- Combined Plan 6
- Money Market Fund and Fixed Income Fund 7
- Equity Growth & Income Fund and Equity Growth Fund 8
- VF Corporation Common Stock Fund and 9
Employee Stock Ownership Plan
Statements of Changes in Net Assets Available for Benefits -
For the Years Ended December 31, 1994, 1993 and 1992
- Combined Plan 10
- Money Market Fund 11
- Fixed Income Fund 12
- Equity Growth & Income Fund 13
- Equity Growth Fund 14
- VF Corporation Common Stock Fund 15
- Employee Stock Ownership Plan 16
Notes to Financial Statements 17
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
3
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/ HAROLD E. ADDIS
-------------------------------------
Harold E. Addis, Chairman of the
VF Corporation Pension Plan Committee
Date:
----------------------
4
Report of Independent Auditors
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, 1994 and 1993, and the related statements of
changes in net assets available for benefits for each of the three years in the
period ended December 31, 1994. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perfom 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,
1994 and 1993, and the changes in its net assets available for benefits for
each of the three years in the period ended December 31, 1994, in conformity
with generally accepted accounting principles.
/s/ ERNST & YOUNG LLP
Reading, Pennsylvania
March 10, 1995
5
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
COMBINED PLAN
December 31
--------------------------------------------------------
ASSETS 1994 1993
------ ---- ----
Investments at fair value
VF Corporation Common Stock -
396,815 shares in 1994
395,009 shares in 1993 $ 19,295,129 $ 18,219,790
VF Corporation ESOP
Preferred Stock -
2,014,427 shares in 1994
2,050,491 shares in 1993 78,361,197 75,663,118
United States goverment obligations 15,767,773 13,673,576
Other securities 48,287,278 40,149,325
---------------------- -----------------
Total investments 161,711,377 147,705,809
Dividends and interest receivable 275,090 246,092
Loans receivable from participants 7,283,233 5,718,544
---------------------- -----------------
TOTAL ASSETS 169,269,700 153,670,445
---------------------- -----------------
LIABILITIES
-----------
Withdrawals and terminations
payable to participants 1,965,876 861,855
Employee Stock Ownership
Plan obligation - payable to VF Corporation 51,667,392 56,121,089
Forfeitures related to withdrawals
and terminations 22,176 16,943
---------------------- -----------------
TOTAL LIABILITIES 53,655,444 56,999,887
---------------------- -----------------
Net assets available for benefits $115,614,256 $96,670,558
====================== =================
See notes to financial statements.
6
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
MONEY MARKET FUND AND FIXED INCOME FUND
Money Market Fund Fixed Income Fund
December 31 December 31
------------------------------------ --------------------------------------
ASSETS 1994 1993 1994 1993
------ ---- ---- ---- ----
Investments, at fair value
United States government obligations $ 0 $ 0 $15,767,773 $13,673,576
Other securities 5,717,176 5,406,831 1,236,587 1,460,947
---------------- --------------- ---------------- ----------------
Total investments 5,717,176 5,406,831 17,004,360 15,134,523
Dividends and interest receivable 27,978 15,686 242,709 228,310
Loans receivable from participants 1,224,845 1,040,317 1,406,351 1,133,339
---------------- --------------- ---------------- ----------------
TOTAL ASSETS 6,969,999 6,462,834 18,653,420 16,496,172
---------------- --------------- ---------------- ----------------
LIABILITIES
-----------
Withdrawals and terminations
payable to participants 90,309 100,468 526,219 136,218
Forfeitures related to withdrawals
and terminations 0 163 0 202
---------------- --------------- ---------------- ----------------
TOTAL LIABILITIES 90,309 100,631 526,219 136,420
---------------- --------------- ---------------- ----------------
Net assets available for benefits $ 6,879,690 $ 6,362,203 $18,127,201 $16,359,752
================ =============== ================ ================
See notes to financial statements.
7
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
EQUITY GROWTH & INCOME FUND AND EQUITY GROWTH FUND
Equity Growth & Income Fund Equity Growth Fund
December 31 December 31
------------------------------------------- ----------------------------------------
ASSETS 1994 1993 1994 1993
------ ---- ---- ---- ----
Investments, at fair value
Other securities $ 25,348,419 $ 22,366,528 $ 15,730,539 $ 10,684,033
--------------------- ----------------- ------------------- -----------------
Total investments 25,348,419 22,366,528 15,730,539 10,684,033
Dividends and interest receivable 125 82 148 67
Loans receivable from participants 1,986,103 1,550,713 543,483 379,273
--------------------- ----------------- ------------------- -----------------
TOTAL ASSETS 27,334,647 23,917,323 16,274,170 11,063,373
--------------------- ----------------- ------------------- -----------------
LIABILITIES
-----------
Withdrawals and terminations
payable to participants 387,091 225,221 294,676 97,948
Forfeitures related to withdrawals
and terminations 0 821 0 65
--------------------- ----------------- ------------------- -----------------
TOTAL LIABILITIES 387,091 226,042 294,676 98,013
--------------------- ----------------- ------------------- -----------------
Net assets available for benefits $ 26,947,556 $ 23,691,281 $ 15,979,494 $ 10,965,360
===================== ================= =================== =================
See notes to financial statements.
8
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
VF CORPORATION COMMON STOCK FUND AND EMPLOYEE STOCK OWNERSHIP PLAN
VF Corporation Common Stock Fund Employee Stock Ownership Plan
December 31 December 31
--------------------------------------- ------------------------------------
ASSETS 1994 1993 1994 1993
------ ---- ---- ---- ----
Investments, at fair value
VF Corporation Common Stock
396,815 shares in 1994
395,009 shares in 1993 $19,295,129 $18,219,790 $ 0 $ 0
VF Corporation ESOP
Preferred Stock
2,014,427 shares in 1994
2,050,491 shares in 1993 0 0 78,361,197 75,663,118
Other securities 177,387 189,091 77,170 41,895
---------------- --------------- --------------- ---------------
Total investments 19,472,516 18,408,881 78,438,367 75,705,013
Dividends and interest receivable 637 300 3,493 1,647
Loans receivable from participants 2,122,451 1,614,902 0 0
---------------- --------------- --------------- ---------------
TOTAL ASSETS 21,595,604 20,024,083 78,441,860 75,706,660
---------------- --------------- --------------- ---------------
LIABILITIES
-----------
Withdrawals and terminations
payable to participants 314,703 140,009 352,878 161,991
Employee Stock Ownership
Plan obligation - payable to VF Corporation 0 0 51,667,392 56,121,089
Forfeitures related to withdrawals
and terminations 0 600 22,176 15,092
---------------- --------------- --------------- ---------------
TOTAL LIABILITIES 314,703 140,609 52,042,446 56,298,172
---------------- --------------- --------------- ---------------
Net assets available for benefits $21,280,901 $19,883,474 $26,399,414 $19,408,488
================ =============== =============== ===============
See notes to financial statements.
9
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
COMBINED PLAN
Year Ended December 31
---------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Dividends on VF Corporation
Common Stock $ 497,205 $ 492,821 $ 432,281
Dividends on ESOP
Preferred Stock 4,228,632 4,290,967 4,335,278
Interest 979,143 1,052,117 975,168
Income from mutual funds and
bank common trust funds 2,614,714 2,285,814 3,257,792
---------------------- ----------------- -------------------
8,319,694 8,121,719 9,000,519
---------------------- ----------------- -------------------
Contributions
Interest on loan repayment 402,626 288,773 204,448
Participants 15,290,975 10,822,389 9,485,940
VF Corporation 5,570,215 4,542,628 3,960,222
---------------------- ----------------- -------------------
21,263,816 15,653,790 13,650,610
---------------------- ----------------- -------------------
Withdrawals (8,128,767) (4,975,559) (4,862,648)
Forfeitures that reduce
VF Corporation contributions (118,128) (146,621) (71,919)
Interest paid to VF Corporation on Employee
Stock Ownership Plan obligation (5,344,502) (5,698,769) (5,954,445)
Net realized gain on investments 1,224,507 794,846 421,571
Net unrealized appreciation (depreciation)
in fair value of investments 1,727,078 (12,820,932) 26,406,953
---------------------- ----------------- -------------------
Net increase 18,943,698 928,474 38,590,641
Net assets available for benefits
at beginning of year 96,670,558 95,742,084 57,151,443
---------------------- ----------------- -------------------
Net assets available for benefits
at end of year $115,614,256 $96,670,558 $95,742,084
====================== ================= ===================
See notes to financial statements.
10
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
MONEY MARKET FUND
Year Ended December 31
----------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Income from mutual funds and
bank common trust funds $ 204,216 $ 185,319 $ 196,134
---------------- ----------------- -------------------
204,216 185,319 196,134
---------------- ----------------- -------------------
Contributions
Interest on loan repayments 34,933 29,013 26,475
Participants 1,024,192 965,642 1,160,453
---------------- ----------------- -------------------
1,059,125 994,655 1,186,928
---------------- ----------------- -------------------
Withdrawals (434,310) (427,805) (582,038)
Forfeitures that reduce
VF Corporation contributions (435) (2,177) (1,268)
Fund transfers, net (311,109) (1,106,278) (1,063,530)
---------------- ----------------- -------------------
Net increase (decrease) 517,487 (356,286) (263,774)
Net assets available for benefits at
beginning of year 6,362,203 6,718,489 6,982,263
---------------- ----------------- -------------------
Net assets available for benefits at
end of year $ 6,879,690 $ 6,362,203 $ 6,718,489
================ ================= ===================
See notes to financial statements.
11
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FIXED INCOME FUND
Year Ended December 31
--------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Interest $ 979,143 $ 1,052,117 $ 975,168
Income from mutual funds and
bank common trust funds 38,440 10,278 18,207
-------------------- ------------------- -----------------
1,017,583 1,062,395 993,375
-------------------- ------------------- -----------------
Contributions
Interest on loan repayments 59,901 51,108 40,561
Participants 2,598,897 2,339,497 2,240,187
-------------------- ------------------- -----------------
2,658,798 2,390,605 2,280,748
-------------------- ------------------- -----------------
Withdrawals (1,771,571) (1,157,076) (1,286,865)
Forfeitures that reduce
VF Corporation contributions (890) (1,946) (3,233)
Net realized gain (loss) on investments 22,892 (12,656) (15,069)
Net unrealized depreciation
in fair value of investments (146,268) (12,832) (30,255)
Fund transfers (net) (13,095) (303,898) 209,157
-------------------- ------------------- -----------------
Net increase 1,767,449 1,964,592 2,147,858
Net assets available for benefits at
beginning of year 16,359,752 14,395,160 12,247,302
-------------------- ------------------- -----------------
Net assets available for benefits at
end of year $ 18,127,201 $ 16,359,752 $ 14,395,160
==================== =================== =================
See notes to financial statements.
12
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
EQUITY GROWTH & INCOME FUND
Year Ended December 31
----------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Income from mutual funds and
bank common trust funds $ 1,833,144 $ 1,197,977 $ 2,219,621
-------------------- -------------------- --------------------
1,833,144 1,197,977 2,219,621
-------------------- -------------------- --------------------
Contributions
Interest on loan repayments 123,536 84,286 55,468
Participants 4,624,489 3,056,697 2,486,856
-------------------- -------------------- --------------------
4,748,025 3,140,983 2,542,324
-------------------- -------------------- --------------------
Withdrawals (2,031,249) (1,170,331) (1,171,833)
Forfeitures that reduce
VF Corporation contributions (1,164) (3,966) (2,564)
Net realized gain on investments 170,735 117,328 29,069
Net unrealized (depreciation) appreciation
in fair Value of investments (1,437,737) 2,097,687 (565,714)
Fund transfers, net (25,479) 628,464 442,288
-------------------- -------------------- --------------------
Net increase 3,256,275 6,008,142 3,493,191
Net assets available for benefits at
beginning of year 23,691,281 17,683,139 14,189,948
-------------------- -------------------- --------------------
Net assets available for benefits at
end of year $ 26,947,556 $ 23,691,281 $ 17,683,139
==================== ==================== ====================
See notes to financial statements.
13
VF COPPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
EQUITY GROWTH FUND
Year Ended December 31
----------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Income from Mutual funds and
bank common trust funds $ 515,020 $ 877,085 $ 807,786
------------------- ------------------ ------------------
515,020 877,085 807,786
------------------- ------------------ ------------------
Contributions
Interest on loan repayments 81,580 35,211 21,514
Participants 3,834,443 1,450,084 1,067,754
------------------- ------------------ ------------------
3,916,023 1,485,295 1,089,268
------------------- ------------------ ------------------
Withdrawals (1,129,617) (409,898) (93,788)
Forfeitures that reduce
VF Corporation contributions (118) (1,512) (641)
Net realized (loss) gain on investments (10,760) 5,543 (27,894)
Net unrealized (depreciation) appreciation
in fair value of investments (715,960) 651,820 (417,780)
Fund transfers, net 2,439,546 2,471,670 501,959
------------------- ------------------ ------------------
Net increase 5,014,134 5,080,003 1,858,910
Net assets available for benefits at
beginning of year 10,965,360 5,885,357 4,026,447
------------------- ------------------ ------------------
Net assets available for benefits at
end of year $ 15,979,494 $ 10,965,360 $ 5,885,357
=================== ================== ==================
See notes to financial statements.
14
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
VF CORPORATION COMMON STOCK FUND
Year Ended December 31
---------------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Dividends on VF Corporation
Common Stock $ 497,205 $ 492,821 $ 432,281
Income from mutual funds and
bank common trust funds 4,284 2,559 2,725
----------------------- ---------------------- ---------------------
501,489 495,380 435,006
----------------------- ---------------------- ---------------------
Contributions
Interest on loan repayments 102,676 89,155 60,430
Participants 3,208,954 3,010,469 2,530,690
----------------------- ---------------------- ---------------------
3,311,630 3,099,624 2,591,120
----------------------- ---------------------- ---------------------
Withdrawals (1,310,494) (1,023,379) (1,152,194)
Forfeitures that reduce
VF Corporation contributions (841) (4,057) (3,145)
Net realized gain on investments 770,499 506,187 435,465
Net unrealized appreciation (depreciation)
in fair value of investments 215,007 (3,612,779) 4,831,401
Fund transfers, net (2,089,863) (1,689,958) (89,874)
----------------------- ---------------------- ---------------------
Net increase (decrease) 1,397,427 (2,228,982) 7,047,779
Net assets available for benefits at
beginning of year 19,883,474 22,112,456 15,064,677
----------------------- ---------------------- ---------------------
Net assets available for benefits at
end of year $ 21,280,901 $ 19,883,474 $ 22,112,456
======================= ====================== =====================
See notes to financial statements.
15
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
EMPLOYEE STOCK OWNERSHIP PLAN
Year Ended December 31
---------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
Investment income
Dividends on ESOP Preferred Stock $ 4,228,632 $ 4,290,967 $ 4,335,278
Income from mutual funds and
bank common trust funds 19,610 12,596 13,319
------------------ ------------------ ------------------
4,248,242 4,303,563 4,348,597
------------------ ------------------ ------------------
Contributions
VF Corporation 5,570,215 4,542,628 3,960,222
------------------ ------------------ ------------------
5,570,215 4,542,628 3,960,222
------------------ ------------------ ------------------
Withdrawals (1,451,526) (787,070) (575,930)
Forfeitures that reduce
VF Corporation contributions (114,680) (132,963) (61,068)
Interest paid to VF Corporation on Employee Stock
Ownership Plan obligation (5,344,502) (5,698,769) (5,954,445)
Net realized gain on investments 271,141 178,444 0
Net unrealized appreciation (depreciation)
in fair value of investments 3,812,036 (11,944,828) 22,589,301
------------------ ------------------ ------------------
Net increase (decrease) 6,990,926 (9,538,995) 24,306,677
Net assets available for benefits at
beginning of year 19,408,488 28,947,483 4,640,806
------------------ ------------------ ------------------
Net assets available for benefits at
end of year $ 26,399,414 $ 19,408,488 $ 28,947,483
================== ================== ==================
See notes to financial statements.
16
VP CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
NOTE A -- DESCRIPTION OF THE PLAN
VF Corporation (the Corporation) sponsors the VP 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 an 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 to the ESOP, are
allocated to employees in shares of ESOP Preferred Stock. Of the shares of ESOP
Preferred Stock owned by the ESOP, 637,947 shares in 1994 and 503,616 shares in
1993 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 obligation will
be repaid in increasing installments through 2003 from future Corporation
matching contributions to the ESOP and dividends on the ESOP Preferred Stock.
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 investment vehicles that
provide a fixed rate of return.
(c) Equity Growth & Income-Fund: Monies are invested in investments
with emphasis on capital appreciation.
(d) Equity Growth Fund: Monies are primarily invested in common stock,
securities convertible into common stock and debt securities.
(e) 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.
17
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE A -- DESCRIPTION OF THE PLAN (Continued)
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
VP Corporation's obligation to pay plan expenses.
Participants may borrow from their individual account. They 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 the
Money Market Fund and 75% of remaining funds, not to exceed 50% of the
participant's vested account balance, but may not borrow from the Corporation
matching portion. Payment in full is required at termination of employment.
There were 2,383 loans outstanding at December 31, 1994.
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
----------------------
1994 1993 1992
---- ---- ----
Money Market Fund 2,818 2,549 2,657
Fixed Income Fund 4,382 3,818 3,734
Equity Growth & Income Fund 5,603 4,665 4,125
Equity Growth Fund 3,999 2,776 3,914
VF Corporation Common Stock Fund 4,839 4,327 1,666
Employee Stock Ownership Plan 7,317 6,214 5,552
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.
18
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE B -- SIGNIFICANT ACCOUNTING 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. 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. Unallocated insurance contracts are
valued at contract values as estimated by the insurer. Contract value
represents contributions made under the contract, plus interest at the contract
rate, less funds used to pay the insurance company's administrative expenses.
The changes in the difference between fair value and cost of investments are
reflected as unrealized appreciation or depreciation in fair value of
investments in the statements of changes in net assets available for benefits.
In determining the realized gain or loss on investments sold, the cost of
investments has been determined on the average cost basis for marketable
securities and on the identified cost basis for mutual funds and bank common
trust funds, commercial notes and unallocated insurance contracts.
Administrative expenses consisting primarily of fees for legal, accounting and
other services are paid directly by the Corporation in accordance with the
Plan Agreement and are based on customary and reasonable rates for such
services.
NOTE C -- INCOME TAX STATUS
The Internal Revenue Service has issued a Favorable Determination Letter dated
May 12, 1987, 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 effect the Plan's Qualified Status.
19
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D INVESTMENTS
The net unrealized appreciation (depreciation) in fair value of investments
included in Plan equity is as follows:
Net Unrealized
Appreciation (Depreciation) Fair value
in Fair Value for the Year Ended December 31 at December 31
------------------------------------------------ -----------------------------------------------
1994 1993 1992 1994 1993 1992
------------- ---------------- ------------- -------------- -------------- --------------
Fair value as determined by
quoted market or stated
redemption price:
VF Corporation Common Stock $ 215,007 $ (3,612,779) $ 4,831,401 $ 19,295,129 $ 18,219,790 $ 21,206,226
ESOP Preferred Stock 3,812,036 (11,944,828) 22,589,301 78,361,197 75,663,118 88,284,786
Mutual Funds and
bank common trust funds (2,153,697) 2,749,507 (983,494) 46,457,343 38,268,505 28,631,723
------------- ---------------- ------------- -------------- -------------- --------------
1,873,346 (12,808,100) 26,437,208 144,113,669 132,151,413 138,122,735
Fair value as determined by
Plan trustee:
United States government
obligations 15,767,773 13,673,576 11,024,047
Commercial notes (146,268) (12,832) (30,255) 249,552 1,041,341 2,044,427
Mutual funds and
bank common trust funds 1,580,383 621,992 807,326
Unallocated insurance
contracts 0 217,487 206,132
------------- ---------------- ------------- -------------- -------------- --------------
(146,268) (12,832) (30,255) 17,597,708 15,554,396 14,081,932
------------- ---------------- ------------- -------------- -------------- --------------
$ 1,727,078 $(12,820,932) $ 26,406,953 $161,711,377 $147,705,809 $152,204,667
============= ================ ============= ============== ============== ==============
Unrealized appreciation in fair value of investments at December 31, 1994 and
1993 was $21,770,129 and $20,043,051, respectively.
20
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D -- INVESTMENTS (Continued)
The net realized gain on the disposition of investments was as follows:
Year Ended December 31
1994 1993 1992
-------------- -------------- --------------
Aggregate proceeds $49,419,023 $47,003,365 $42,047,185
Aggregate cost 48,194,516 46,208,519 41,625,614
-------------- -------------- --------------
Net realized gain $ 1,224,507 $ 794,846 $ 421,571
============== ============== ==============
Of the net realized gain, $1,041,640, $684,631, and $435,465 related to gains
recognized on the sale of VF Common Stock and the redemption of VF Preferred
Stock for the years ended 1994, 1993, and 1992, respectively.
The fair value of individual investments that represent 5% or more of the
Plan's net assets at December 31, 1994 and 1993 are as follows:
1994 1993
----------- -----------
ESOP Preferred Stock $78,361,197 $75,663,118
Fidelity Growth & Income Fund 25,189,257 22,264,551
VF Corporation Common Stock 19,295,129 18,219,790
Fidelity Magellan Fund 15,590,208 10,617,124
Kemper Money Market Fund 5,386,830
21
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN FOR SALARIED EMPLOYEES
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D -- INVESTMENTS (Continued)
Investment held at December 31, 1994:
NUMBER OF SHARES
NAME OF ISSUER AND TITLE OF ISSUE OR PRINCIPAL AMOUNT FAIR VALUE COST
--------------------------------- ------------------- ---------- ----
Securities of participating employer:
VF Corporation Common Stock 396,815 $ 19,295,129 $ 13,824,745
VF Corporation 6.75% Series B ESOP
Convertible Preferred Stock 2,014,427 78,361,197 62,195,433
---------------- ----------------
97,656,326 76,020,178
---------------- ----------------
United States Government Obligations:
Small Business Administration Loans: $ 14,518,471 14,396,787 14,492,120
(Rates of 5.37% to 10.625%),
maturities of 9/15/96 to 2/22/09)
N.O.A.A. loan (rate of 7.975%, matures 1/2/97) $ 149,710 149,583 149,583
F.M.H.A. loans Rates of 6.475% to 9.875%,
maturities of 2/01/96 to 11/15/08) $ 1,212,620 1,221,403 1,221,403
---------------- ----------------
15,767,773 15,863,106
---------------- ----------------
Other Securities;
Mutual funds and bank common trust funds:
Kemper Money Market Fund 5,677,878 5,677,878 5,677,878
Fidelity Growth & Income Fund 1,194,370 25,189,257 24,491,123
Fidelity Magellan Fund 233,386 15,590,208 16,059,937
UMB Bank Funds:
Money Market Account 1,064,205 1,064,205 1,064,205
UMB Prime - I 516,178 516,178 516,178
Deere and Company (Due 1/10/95) $ 250,000 249,552 248,643
---------------- ----------------
48,287,278 48,057,964
---------------- ----------------
$161,711,377 $139,941,248
================ ================
22