Exhibit 99c 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, 1998 Commission file number: 1-5256 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN (Full title of plan) 628 GREEN VALLEY ROAD, SUITE 500 GREENSBORO, NC 27408 (Address of principal executive offices) (336) 547-6000 (Registrant's telephone number, including area code) Item 1. Changes in the Plan There were no changes in the Plan. Item 2. Changes in Investment Policy Effective January 1, 1998 the following funds were added to the Plan: Vanguard Money Market Fund, Vanguard Institutional Index Fund, Longleaf Partners Small-Cap Fund and Baron Asset Fund. Effective January 1, 1998 the following funds were removed from the Plan: Kemper Money Market Fund and Fidelity Magellan Fund. Item 3. Contributions Under the Plan None. This is a frozen Plan. Item 4. Participating Employees There were approximately 1,452 enrolled participants in the Plan as of December 31, 1998. 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 Blue Bell Pension and Profit Sharing Committee, is comprised of the following officers of the Corporation: Robert Matthews, President - VF Workwear,Inc., Donald Laws, President - Western/Rugged Wear, division of VF Jeanswear, Inc., and Louis J. Fecile, Vice President - Employee Benefits - VF Corporation. Each of these individuals is an employee of VF Corporation (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 Plan. Item 6. Custodian of Investments (a) The Corporation has entered into a Trust Agreement under which Wachovia Bank & Trust Co., n.a., 301 North Main Street, Winston-Salem, NC 27150, has been appointed as Trustee under the Plan. Under the terms of the Trustee Agreement, Wachovia holds and invests all assets of the Plan, subject to the direction of each of the participants of the Plan regarding their investment fund or funds. The trustee manages the Fixed Income Fund and Wachovia Short-Term Investment Fund. (b) The custodian's compensation is paid by the Plan. (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 market values of investments as of the end of each quarter. 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 2 - Fixed Income/GIC Fund - Balanced Fund - Equity Growth & Income Fund - Index 500 Fund - Small-Cap Value Fund - Small-Cap Growth Fund - Foreign Fund - VF Corporation Common Stock Fund (investing in common stock of the Corporation) Brokerage commissions of $14,800, $2,042, and $5,775 for the years ended December 31, 1998, 1997 and 1996 were paid by the Trustee to acquire the Corporation's common stock for the Plan. Item 9. Financial Statements and Exhibits
(a) Financial Statements Page No. Report of Independent Accountants 5 Statements of Net Assets Available for Benefits, with Fund Information - December 31, 1998 and 1997 - Combined Plan 6 - Money Market Fund and Fixed Income Fund 7 - Balanced Fund and Equity Growth & Income Fund 8 - Equity Growth Fund 9 - Index 500 Fund and Small-Cap Value Fund 10 - Small-Cap Growth Fund and Foreign Fund 11 - VF Corporation Common Stock Fund 12 - Administrative Account 13
Statements of Changes in Net Assets Available for Benefits, with Fund Information For the Years Ended December 31, 1998, 1997 and 1996 - Combined Plan 14 - Money Market Fund 15 - Fixed Income Fund 16 - Balanced Fund 17 - Equity Growth & Income Fund 18 - Equity Growth Fund 19 - Index 500 Fund 20 - Small-Cap Value Fund 21 - Small-Cap Growth Fund 22 - Foreign Fund 23 - VF Corporation Common Stock Fund 24 - Administrative Account 25 Notes to Financial Statements 26
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. Blue Bell Savings, Profit Sharing and Retirement Plan ----------------------------------------------------- By: /s/ Louis J. Fecile ----------------------------------- Louis J. Fecile Vice President - Employee Benefits VF Corporation Date: March 22, 1999 4 Report of Independent Accountants Blue Bell Pension Committee Blue Bell Savings, Profit Sharing and Retirement Plan We have audited the accompanying statements of net assets available for benefits of the Blue Bell Savings, Profit Sharing and Retirement Plan as of December 31, 1998 and December 31, 1997, and the related statements of changes in net assets available for benefits for the three years in the period ended December 31, 1998. 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 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 Blue Bell Savings, Profit Sharing and Retirement Plan at December 31, 1998 and December 31, 1997, and the changes in its net assets available for benefits for the three years in the period ended December 31, 1998 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/ PricewaterhouseCoopers LLP Greensboro, North Carolina March 22, 1999 5 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS COMBINED PLAN
December 31 ---------------------------------- ASSETS 1998 1997 - ------ ------------ ------------ Investments, at fair value VF Corporation Common Stock - $ 22,792,594 $ 27,783,657 486,242 shares in 1998 597,498 shares in 1997 Other securities 180,137,617 154,749,905 ------------ ------------ Total investments 202,930,211 182,533,562 Dividends and interest receivable 2,738,483 2,623,100 ------------ ------------ TOTAL ASSETS 205,668,694 185,156,662 ------------ ------------ LIABILITIES Accrued Expenses 180,262 195,790 ------------ ------------ TOTAL LIABILITIES 180,262 195,790 ------------ ------------ Net Assets Available for Benefits $205,488,432 $184,960,872 ============ ============
See notes to financial statements. 6 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN 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 ----------------------------------- -------------------------------- ASSETS 1998 1997 1998 1997 ----------- ----------- ----------- ----------- Investments, at fair value Other securities $ 5,437,655 $ 4,633,800 $43,770,556 $38,571,431 ----------- ----------- ----------- ----------- Total investments 5,437,655 4,633,800 43,770,556 38,571,431 Dividends and interest receivable 0 0 2,738,483 2,604,627 ----------- ----------- ----------- ----------- Total Assets 5,437,655 4,633,800 46,509,039 41,176,058 Accrued Expenses 3,999 3,471 32,299 77,928 ----------- ----------- ----------- ----------- Net Assets Available for Benefits $ 5,433,656 $ 4,630,329 $46,476,740 $41,098,130 =========== =========== =========== ===========
See notes to financial statements. 7 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN 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 -------------------------------- --------------------------------- 1998 1997 1998 1997 ----------- ----------- ----------- ----------- ASSETS Investments, at fair value Other securities $18,192,977 $15,133,879 $66,458,690 $61,906,609 ----------- ----------- ----------- ----------- Total investments 18,192,977 15,133,879 66,458,690 61,906,609 Dividends and interest receivable 0 32 0 0 ----------- ----------- ----------- ----------- Total Assets 18,192,977 15,133,911 66,458,690 61,906,609 Accrued Expenses 5,532 3,457 39,588 31,896 ----------- ----------- ----------- ----------- Net Assets Available for Benefits $18,187,445 $15,130,454 $66,419,102 $61,874,713 =========== =========== =========== ===========
See notes to financial statements. 8 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) EQUITY GROWTH FUND
Equity Growth Fund December 31 -------------------------------- 1998 1997 ----------- ----------- ASSETS Investments, at fair value Other securities $ 0 $26,423,902 ----------- ----------- Total investments 0 26,423,902 Dividends and interest receivable 0 0 ----------- ----------- Total Assets 26,423,902 Accrued Expenses 0 20,408 ----------- ----------- Net Assets Available for Benefits $ 0 $26,403,494 =========== ===========
See notes to financial statements. 9 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) INDEX 500 FUND & SMALL-CAP VALUE FUND
Index 500 Small-Cap Value Fund Fund December 31 * December 31 * ----------- ------------ 1998 1998 ASSETS Investments, at fair value Other securities $34,163,406 $ 3,656,818 ----------- ----------- Total investments 34,163,406 3,656,818 Dividends and interest receivable 0 0 ----------- ----------- Total Assets 34,163,406 3,656,818 Accrued Expenses 35,512 330 ----------- ----------- Net Assets Available for Benefits $34,127,894 $ 3,656,488 =========== ===========
* Fund was available beginning in 1998. See notes to financial statements. 10 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) SMALL-CAP GROWTH FUND & FOREIGN FUND
Small-Cap Growth Fund Foreign Fund December 31 * December 31 ------------ ----------------------------- 1998 1998 1997 ---------- ---------- ---------- ASSETS Investments, at fair value Other securities $5,447,216 $2,884,834 $7,840,772 ---------- ---------- ---------- Total investments 5,447,216 2,884,834 7,840,772 Dividends and interest receivable 0 0 0 ---------- ---------- ---------- Total Assets 5,447,216 2,884,834 7,840,772 Accrued Expenses 432 1,637 850 ---------- ---------- ---------- Net Assets Available for Benefits $5,446,784 $2,883,197 $7,839,922 ========== ========== ==========
* Fund was available beginning in 1998. See notes to financial statements. 11 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) VF CORPORATION COMMON STOCK FUND
VF Corporation Common Stock Fund December 31 -------------------------------- 1998 1997 ----------- ----------- ASSETS Investments, at fair value VF Corporation Common Stock $22,792,594 $27,783,657 486,242 shares in 1998 597,498 shares in 1997 Other securities 7,106 119,164 ----------- ----------- Total investments 22,799,700 27,902,821 Dividends and interest receivable 0 18,441 ----------- ----------- Total Assets 22,799,700 27,921,262 LIABILITIES Accrued Expenses 60,933 57,780 ----------- ----------- Net Assets Available for Benefits $22,738,767 $27,863,482 =========== ===========
See notes to financial statements. 12 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) ADMINISTRATIVE ACCOUNT
December 31 ------------------------- 1998 1997 -------- -------- ASSETS Investments, at Fair Value Other Securities $118,359 $120,348 -------- -------- Net Assets Available for Benefits $118,359 $120,348 ======== ========
See notes to financial statements. 13 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS COMBINED PLAN
Year Ended December 31 ------------------------------------------------------------- 1998 1997 1996 ------------- ------------- ------------- Investment income Dividends on VF Corporation Common Stock $ 421,579 $ 454,214 $ 477,072 Interest 2,667,976 621,733 1,347,738 Income from mutual funds and bank common trust funds 7,477,108 9,086,591 9,977,884 ------------- ------------- ------------- 10,566,663 10,162,538 11,802,694 ------------- ------------- ------------- Withdrawals (8,869,337) (7,951,720) (8,352,685) Expenses (189,117) (162,703) (254,165) Net realized and unrealized appreciation in fair value of investments 19,019,351 24,150,836 9,531,300 ------------- ------------- ------------- Net increase 20,527,560 26,198,951 12,727,144 Net assets available for benefits at beginning of year 184,960,872 158,761,921 146,034,777 ------------- ------------- ------------- Net assets available for benefits at end of year $ 205,488,432 $ 184,960,872 $ 158,761,921 ============= ============= =============
See notes to financial statements. 14 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) MONEY MARKET FUND
Year Ended December 31 ------------------------------------------------------ 1998 1997 1996 ----------- ----------- ----------- Investment income Income from mutual funds and bank common trust funds $ 287,902 $ 235,718 $ 219,951 ----------- ----------- ----------- 287,902 235,718 219,951 ----------- ----------- ----------- Withdrawals (286,461) (866,763) (610,531) Expenses (552) (2,182) (6,131) Fund transfers, net 802,438 674,444 457,642 ----------- ----------- ----------- Net increase 803,327 41,217 60,931 Net assets available for benefits Beginning of year 4,630,329 4,589,112 4,528,181 ----------- ----------- ----------- End of year $ 5,433,656 $ 4,630,329 $ 4,589,112 =========== =========== ===========
See notes to financial statements. 15 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) FIXED INCOME FUND
Year Ended December 31 ---------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Investment income $ 2,667,976 $ 2,645,610 $ 2,519,956 Interest ------------ ------------ ------------ 2,667,976 2,645,610 2,519,956 ------------ ------------ ------------ Withdrawals (3,665,951) (3,414,702) (3,501,348) Expenses (5,297) (31,828) (89,415) Net realized and unrealized appreciation (depreciation) in fair value of investments 210,642 73,254 (171,577) Fund transfers, net 6,171,240 979,681 699,625 ------------ ------------ ------------ Net increase (decrease) 5,378,610 252,015 (542,759) Net assets available for benefits Beginning of year 41,098,134 40,846,119 41,388,878 ------------ ------------ ------------ End of year $ 46,476,744 $ 41,098,134 $ 40,846,119 ============ ============ ============
See notes to financial statements. 16 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) BALANCED FUND
Year Ended December 31 ---------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Investment income Income from mutual funds and bank common trust funds $ 1,913,885 $ 1,213,816 $ 1,315,574 ------------ ------------ ------------ 1,913,885 1,213,816 1,315,574 ------------ ------------ ------------ Withdrawals (343,159) (240,518) (232,392) Expenses (2,105) (2,988) (8,393) Net realized and unrealized appreciation in fair value of investments 653,651 1,496,785 145,857 Fund transfers, net 834,719 101,309 3,884,729 ------------ ------------ ------------ Net increase 3,056,991 2,568,404 5,105,375 Net assets available for benefits Beginning of year 15,130,454 12,562,050 7,456,675 ------------ ------------ ------------ End of year $ 18,187,445 $ 15,130,454 $ 12,562,050 ============ ============ ============
See notes to financial statements. 17 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) EQUITY GROWTH & INCOME FUND
Year Ended December 31 ---------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Investment income Income from mutual funds and bank common trust funds $ 3,674,047 $ 2,852,255 $ 2,443,422 ------------ ------------ ------------ $ 3,674,047 $ 2,852,255 $ 2,443,422 ------------ ------------ ------------ Withdrawals (2,325,388) (1,273,785) (1,531,919) Expenses (7,818) (16,018) (45,001) Net realized and unrealized appreciation in fair value of investments 11,788,441 11,654,248 5,797,617 Fund transfers, net (8,584,893) (1,126,768) 1,857,781 ------------ ------------ ------------ Net increase 4,544,389 12,089,932 8,521,900 Net assets available for benefits Beginning of year 61,874,713 49,784,781 41,262,881 ------------ ------------ ------------ End of year $ 66,419,102 $ 61,874,713 $ 49,784,781 ============ ============ ============
See notes to financial statements. 18 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) EQUITY GROWTH FUND
Year Ended December 31 ---------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Investment income Income from mutual funds and bank common trust funds $ 8,624 $ 1,722,985 $ 4,432,448 ------------ ------------ ------------ 8,624 1,722,985 4,432,448 ------------ ------------ ------------ Withdrawals (313,682) (799,578) (900,512) Expenses 20,177 (11,134) (31,309) Net realized and unrealized appreciation (depreciation) in fair value of investments 73,902 3,835,616 (1,655,267) Fund transfers, net (26,192,515) (1,477,297) (7,047,456) ------------ ------------ ------------ Net increase (decrease) (26,403,494) 3,270,592 (5,202,096) Net assets available for benefits Beginning of year 26,403,494 23,132,902 28,334,998 ------------ ------------ ------------ End of year $ 0 $ 26,403,494 $ 23,132,902 ============ ============ ============
See notes to financial statements. 19 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) INDEX 500 FUND
Year Ended December 31 1998* ------------ Investment income Income from mutual funds and bank common trust funds $ 676,211 ------------ 676,211 ------------ Withdrawals (743,969) Expenses (35,540) Net realized and unrealized appreciation in fair value of investments 6,673,045 Fund transfers, net 27,558,147 ------------ Net increase 34,127,894 Net assets available for benefits Beginning of year 0 ------------ End of year $ 34,127,894 ============
* Fund was available beginning in 1998. See notes to financial statements. 20 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) SMALL-CAP VALUE FUND
Year Ended December 31 1998* ----------- Investment income Income from mutual funds and bank common trust funds $ 444,579 ----------- 444,579 ----------- Withdrawals (17,368) Expenses (354) Net realized and unrealized (depreciation) in fair value of investments (144,257) Fund transfers, net 3,373,888 ----------- Net increase 3,656,488 Net assets available for benefits Beginning of year 0 ----------- End of year $ 3,656,488 ===========
* Fund was available beginning in 1998. See notes to financial statements. 21 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) SMALL-CAP GROWTH FUND
Year Ended December 31 1998* ----------- Investment income Income from mutual funds and bank common trust funds $ 5,265 ----------- 5,265 ----------- Withdrawals (25,518) Expenses (456) Net realized and unrealized appreciation in fair value of investments 42,545 Fund transfers, net 5,424,948 ----------- Net increase 5,446,784 Net assets available for benefits Beginning of year 0 ----------- End of year $ 5,446,784 ===========
* Fund was available beginning in 1998. See notes to financial statements. 22 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) FOREIGN FUND
Year Ended December 31 ------------------------------------------------------- 1998 1997 1996 ----------- ----------- ----------- Investment income Income from mutual funds and bank common trust funds $ 319,949 $ 889,786 $ 296,565 ----------- ----------- ----------- 319,949 889,786 296,565 ----------- ----------- ----------- Withdrawals (19,866) (582,359) (221,361) Expenses (816) (1,423) (3,996) Net realized and unrealized appreciation (depreciation) in fair value of investments (447,132) (397,395) 578,374 Fund transfers, net (4,808,860) 306,721 3,726,434 ----------- ----------- ----------- Net increase (decrease) (4,956,725) 215,330 4,376,016 Net assets available for benefits Beginning of year 7,839,922 7,624,592 3,248,576 ----------- ----------- ----------- End of year $ 2,883,197 $ 7,839,922 $ 7,624,592 =========== =========== ===========
See notes to financial statements. 23 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) VF CORPORATION COMMON STOCK FUND
Year Ended December 31 ---------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Investment income Dividends on VF Corporation Common Stock $ 421,579 $ 454,214 $ 477,072 Income from mutual funds and bank common trust funds 3,087 8,026 6,046 ------------ ------------ ------------ 424,666 462,240 483,118 ------------ ------------ ------------ Withdrawals (1,135,545) (774,015) (1,354,622) Expenses (3,238) (11,219) (31,514) Net realized and unrealized appreciation in fair value of investments 168,515 7,488,332 4,836,295 Fund transfers, net (4,579,113) 541,910 (3,577,831) ------------ ------------ ------------ Net increase (decrease) 5,124,715 7,707,248 355,446 Net assets available for benefits Beginning of year, as reported 27,863,482 20,156,234 19,800,788 ------------ ------------ ------------ End of year $ 22,738,767 $ 27,863,482 $ 20,156,234 ============ ============ ============
See notes to financial statements 24 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED) ADMINISTRATIVE ACCOUNT
Year Ended December 31 ------------------------------------------------- 1998 1997 1996 --------- --------- --------- Investment income Income from mutual funds and bank common trust funds $ 143,559 $ 140,128 $ 6,139 --------- --------- --------- 143,559 140,128 6,139 Withdrawals 7,570 0 0 Expenses (153,118) (85,911) 47,117 Fund transfers, net 0 0 (924) --------- --------- --------- Net increase (decrease) (1,989) 54,217 52,332 Net assets available for benefits Beginning of year 120,348 66,131 13,799 --------- --------- --------- End of year $ 118,359 $ 120,348 $ 66,131 ========= ========= =========
See notes to financial statements. 25 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN NOTES TO FINANCIAL STATEMENTS NOTE A - DESCRIPTION OF THE PLAN General - The Plan is an employee contributory defined contribution plan covering all salaried employees of Blue Bell, Inc. and certain subsidiaries (the "Company") who met age and service requirements and were employed prior to September 30, 1988. VF Corporation ("VF") assumed responsibility for sponsorship of the plan following VF's acquisition of Blue Bell, Inc. The Plan is a frozen plan, under which particpants no longer accrue benefits but that will remain in existence as long as necessary to pay accrued benefits. It is subject to provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Details of the Plan are available in the booklet "Blue Bell Savings, Profit Sharing and Retirement Plan". Vesting - The Plan is frozen, and all participants are fully vested. No further contributions have or will be made by either the Company or participants. Participant Accounts - Each participant's account is credited with an allocation of earnings. Allocation of Plan earnings is based upon the balance each of the participants has in each of the respective funds. Employee accounts are invested at the direction of the employee in one or more of the funds administered by the Plan's trustee. The Trustee also manages the Wachovia Diversified Short-Term Bond Fund, Wachovia Stable Value Fund, and Wachovia Short-Term Investment Fund. Members have the opportunity to change investment elections monthly. A member's investment election will continue in effect until changed by the member pursuant to a subsequent investment election. 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) Index 500 Fund: Monies are invested in the 500 stocks that make up the S&P 500 Stock Price Index. (f) Small-Cap Value Fund: monies are invested in U.S. common stocks of small companies whose price is under valued. (g) Small-Cap Growth Fund: monies invested in small and medium size companies with under valued assets or favorable growth prospects. (h) Foreign Fund: Monies are invested in stocks and debt obligations of companies and governments outside the United States. (i) VF Corporation Common Stock Fund: Monies are invested in Common Stock of the Corporation purchased 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. 26 Distributions - Distributions to participants or their beneficiaries are payable at the time of normal retirement, early retirement for those who qualify, qualifying layoff, death, or disability while employed by the Company. In addition, participants are entitled annually to withdraw the lesser of up to 25% of their individual account balance or $10,000, for any reason. Various methods are available for settlement of a participant's vested account balance including lump-sum cash settlement, periodic payments, and purchase of an annuity. Distributions are recorded when paid. Plan Termination - The Board of Directors of the Company may amend, modify, or terminate the Plan at any time. In the event the Plan is terminated, each member is entitled to his proportionate share of net assets available for benefits as of the termination date. NOTE B - SIGNIFICANT ACCOUNTING POLICIES General - Accounts of the Plan are maintained on the accrual basis. Administrative expenses of the Plan are charged to the Plan. Purchases and sales of securities are recorded on a trade date basis. Investment income is recorded on the accrual basis. 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 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. Fair value for group insurance contracts with life insurance companies approximates contract value. Contract value represents contributions made under the contract, plus interest at the contract rate, less administrative expenses changed by the insurance companies and less benefits paid. 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 realized gains or losses and unrealized appreciation or depreciation on those investments. Realized gains or losses are calculated on an average cost basis. 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. Payment of Benefits: Benefits are recorded when paid. NOTE C - INCOME TAXES The Internal Revenue Service has ruled by letter dated March 5, 1987 that the Plan qualifies under Section 401(a) 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 Plan has been amended since receiving a tax determination letter. However, the Pension Administrative Committee is not aware of any course of action or series of events that have occurred that might adversely affect the Plan's qualified status. 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 currently designed and is currently being operated in compliance with the applicable requirements of the IRC. 27 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN 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 -------------------------------------------- ----------------------------------------- 1998 1997 1996 1998 1997 1996 ------------ ------------ ------------ ------------ ------------ ------------ Fair value as determined by quoted market or stated redemption price: VF Corporation Common Stock $ (5,714,569) $ 6,625,575 $ 811,617 $ 22,792,594 $ 27,783,657 $ 20,077,403 Mutual funds and bank common trust funds 8,205,950 14,174,768 3,209,886 180,137,617 154,749,905 137,378,097 ------------ ------------ ------------ ------------ ------------ ------------ $ 2,491,381 $ 20,800,343 $ 4,021,503 $202,930,211 $182,533,562 $157,455,500 ============ ============ ============ ============ ============ ============
Unrealized appreciation in fair value of investments at December 31, 1998, 1997 and 1996 was $59,151,106, $56,659,770, and $35,859,426, respectively. Net realized appreciation in fair value of investments includes the following:
Year Ended December 31 -------------------------------------------------------- 1998 1997 1996 ------------ ------------ ------------ Aggregate proceeds $148,218,936 $ 48,602,478 $ 78,554,102 Aggregate cost 131,690,966 45,251,984 73,044,305 ------------ ------------ ------------ Net realized gain $ 16,527,970 $ 3,350,494 $ 5,509,797 ============ ============ ============
Of the net realized gain, $5,883,084, $862,757, and $4,024,678, related to gains recognized on the sale of VF Common Stock for the years ended 1998, 1997 and 1996, respectively. The fair value of individual investments that represent 5% or more of the Plan's net assets available for benefits at December 31, 1998 and 1997 are as follows:
1998 1997 ----------- ----------- VF Corporation Common Stock $22,792,594 $27,783,657 Wachovia Diversified Fixed Income Fund 21,964,538 17,661,482
28 BLUE BELL SAVINGS, PROFIT SHARING AND RETIREMENT PLAN NOTE TO FINANCIAL STATEMENTS (Continued) NOTE D -- INVESTMENTS (Continued) Wachovia Diversified GIC Fund 14,640,485 13,778,360 Fidelity Magellan Fund 0 26,076,221 Fidelity Growth & Income Fund 66,417,407 61,539,648 Fidelity Puritan Fund 18,182,547 15,079,068 Vanguard Institutional Index Fund 34,156,487 0
Investments held at December 31, 1998:
NUMBER OF SHARES Name of Issuer and Title of Issue OR PRINCIPAL AMOUNT FAIR VALUE COST - --------------------------------- ------------------- ------------ ------------ Securities of participating employer: VF Corporation Common Stock 486,242 $ 22,792,594 $ 3,303,890 Other Securities: Mutual funds and bank common trust funds: Vanguard Money Market Fund 5,430,313 5,430,313 5,430,313 Fidelity Puritan Fund 905,957 18,182,547 15,970,046 Fidelity Growth & Income Fund 1,448,896 66,417,407 35,432,253 Vanguard Institutional Index Fund 302,672 34,156,487 27,624,276 Longleaf Partners Small Cap Fund 166,597 3,656,815 3,752,461 Baron Asset Fund 107,779 5,447,170 5,198,967 Templeton Foreign Fund 343,816 2,884,616 3,328,233 Wachovia Diversified Short-Term Bond Fund 96,008 21,964,538 21,740,931 Wachovia Stable Value Fund 69,515 14,640,485 14,640,498 New York Life GIC, 7.36%, due 5/12/99 7,000,000 7,000,000 7,000,000 Wachovia Short-Term Investment Fund 357,238 357,238 357,238 ------------ ------------ $202,930,211 $143,779,105 ============ ============
29 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:
1998 1997 ------------ ------------ Net assets available for benefits per the financial statements $205,488,432 $184,960,872 Less amounts allocated to withdrawing participants 869,934 1,861,064 ------------ ------------ Net assets available for benefits per Form 5500 $204,618,498 $183,099,808 ============ ============
The following is a reconciliation of withdrawals paid to participants per the financial statements to Form 5500:
1998 ----------- Withdrawals paid to participants per the financial statements $ 8,869,337 Add amounts allocated to withdrawing participants at December 31, 1998 869,934 Less amounts allocated to withdrawing participants at December 31, 1997 (1,861,064) ----------- withdrawals paid to participants per Form 5500 $ 7,878,207 ===========
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. 30