<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended June 30, 1997
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from to
Commission file number 1-4802
BECTON, DICKINSON AND COMPANY SAVINGS INCENTIVE PLAN
(FULL TITLE OF THE PLAN)
BECTON, DICKINSON AND COMPANY
(NAME OF ISSUER OF SECURITIES HELD PURSUANT TO THE PLAN)
1 Becton Drive 07417-1880
Franklin Lakes, New Jersey (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICER)
(201) 847-6800
(TELEPHONE NUMBER)
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<PAGE>
1.FINANCIAL STATEMENTS AND SCHEDULES.
The following financial data for the Plan are submitted herewith:
Report of Independent Auditors
Statements of Net Assets Available for Benefits, with Fund Information as
of June 30, 1997 and 1996
Statement of Changes in Net Assets Available for Benefits, with Fund
Information for the year ended June 30, 1997
Notes to Financial Statements
Item 27a--Schedule of Assets Held for Investment Purposes as of June 30,
1997
Item 27d--Schedule of Reportable Transactions for the year ended June 30,
1997
2.1EXHIBITS.
See Exhibit Index for a list of Exhibits filed or incorporated by reference
as part of this report.
2
<PAGE>
AUDITED FINANCIAL STATEMENTS AND SCHEDULES
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
JUNE 30, 1997
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
AUDITED FINANCIAL STATEMENTS AND SCHEDULES
JUNE 30, 1997
CONTENTS
PAGE
----
Report of Independent Auditors............................................ F-1
FINANCIAL STATEMENTS
Statements of Net Assets Available for Benefits, with Fund Information as
of June 30, 1997 and 1996................................................ F-2
Statement of Changes in Net Assets Available for Benefits, with Fund
Information for the year ended June 30, 1997............................. F-4
Notes to Financial Statements............................................. F-5
SCHEDULES
Item 27a--Schedule of Assets Held for Investment Purposes as of June 30,
1997..................................................................... F-10
Item 27d--Schedule of Reportable Transactions for the year ended June 30,
1997..................................................................... F-12
<PAGE>
REPORT OF INDEPENDENT AUDITORS
Savings Incentive Plan Committee
Becton, Dickinson and Company
We have audited the accompanying statements of net assets available for
benefits of the Becton, Dickinson and Company Savings Incentive Plan as of
June 30, 1997 and 1996, and the related statement of changes in net assets
available for benefits for the year ended June 30, 1997. 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 Plan at
June 30, 1997 and 1996, and the changes in its net assets available for
benefits for the year ended June 30, 1997, 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 accompanying supplemental schedule
of assets held for investment purposes as of June 30, 1997, and schedule of
reportable transactions for the year then ended are presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974, and
are not a required part of the basic financial statements. The fund
information in the statements of net assets available for benefits and the
statement 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 supplemental schedules and fund information have been subjected
to the auditing procedures applied in our 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.
/s/ Ernst & Young LLP
_____________________________________
Ernst & Young LLP
Hackensack, New Jersey
November 11, 1997
F-1
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
JUNE 30, 1997
<TABLE>
<CAPTION>
FUND INFORMATION
------------------------------------------------------------------------------------------
BECTON, BECTON,
DICKINSON DICKINSON
FIXED S&P 500 AND COMPANY AND COMPANY MIDCAP LOANS
INCOME INDEX COMMON PREFERRED BALANCED INDEX RECEIVABLE
FUND FUND STOCK FUND STOCK FUND FUND FUND ACCOUNT TOTAL
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at fair
value:
Becton, Dickinson
and Company Common
Stock (3,358,931
shares, cost--
$40,165,998)....... $170,045,781 $ 82 $170,045,863
Becton, Dickinson
and Company Series
B ESOP Convertible
Preferred Stock
(873,698 shares,
cost--$51,548,141)
(Note 6)........... 141,539,050 141,539,050
State Street Bank
and Trust Company
S&P 500 Flagship
Index Fund (561,403
units, cost--
$41,764,079)....... $80,850,400 80,850,400
State Street Bank
and Trust Company
MidCap Index Fund
(524,824 units,
cost--$11,520,994). $15,939,941 15,939,941
Barclays Global
Investors
Commingled Fund
(987,486 units,
cost--$12,315,395). $17,295,264 17,295,264
Investment Contracts
at contract value
(equivalent to
cost):
Allstate Life
Insurance Company.. $ 16,648,345 16,648,345
Caisse des Depots
CDC................ 1,872,027 1,872,027
The Canada Life
Assurance Company.. 4,136,125 4,136,125
Hartford Life
Insurance Company.. 6,089,486 6,089,486
John Hancock Mutual
Life Insurance
Company............ 20,426,286 20,426,286
Metropolitan Life
Insurance Company.. 23,191,463 23,191,463
New York Life
Insurance Company.. 7,726,349 7,726,349
Provident Life and
Accident........... 17,006,989 17,006,989
Providian Capital
Management......... 24,541,124 24,541,124
Security Life of
Denver Insurance
Company............ 5,773,721 5,773,721
Trans America Life
& Annuity Company.. 5,098,926 5,098,926
State Street Bank
and Trust Company.. 16,593,121 16,593,121
------------ ----------- ------------ ------------ ----------- ----------- ------------
Total investments.. 149,103,962 80,850,400 170,045,781 141,539,132 17,295,264 15,939,941 574,774,480
Receivables:
Interest........... 795,059 1,466 4,449 77 801,051
Dividends.......... 837,800 837,800
Participants'
contributions...... 13,294 27,674 6,947 47,915
Employer
contributions...... 4,167,655 4,167,655
Loans receivable
from participants
(Note 2)........... $12,829,334 12,829,334
Cash and cash
equivalents......... 6,397,032 34 1,117,142 996,729 100,013 8,610,950
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
Total assets....... 156,296,053 80,863,728 171,164,389 147,545,765 17,423,028 15,946,888 12,829,334 602,069,185
LIABILITIES
Accrued interest
payable............. 1,974,436 1,974,436
Debt obligations
(Notes 6 and 7)..... 41,787,010 41,787,010
Payable for
investments
purchased........... 350,922 350,922
Investment
management fees
payable............. 16,019 24,067 17,364 10,336 67,786
Other............... 795,371 (889,378) 1,077,338 (642,960) (168,415) 171,956
Loan repayments..... 16,673 (2,491) (7,662) 1,588 490 8,598
------------ ----------- ------------ ------------ ----------- ----------- ------------
Total liabilities.. 828,063 (867,802) 1,437,962 43,761,446 (641,372) (157,589) 44,360,708
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
Net assets available
for benefits........ $155,467,990 $81,731,530 $169,726,427 $103,784,319 $18,064,400 $16,104,477 $12,829,334 $557,708,477
============ =========== ============ ============ =========== =========== =========== ============
</TABLE>
See accompanying notes.
F-2
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
JUNE 30, 1996
<TABLE>
<CAPTION>
FUND INFORMATION
-------------------------------------------------------------------------------------------------------
BECTON, BECTON,
DICKINSON DICKINSON
FIXED S&P 500 AND COMPANY AND COMPANY MIDCAP LOANS
INCOME INDEX COMMON PREFERRED BALANCED INDEX RECEIVABLE
FUND FUND STOCK FUND STOCK FUND FUND FUND ACCOUNT TOTAL
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments at fair
value:
Becton, Dickinson
and Company Common
Stock (3,386,028
shares, cost--
$36,183,085)....... $135,843,027 $ 21,347 $135,864,374
Becton, Dickinson
and Company Series
B ESOP Convertible
Preferred Stock
(903,868 shares,
cost--$53,328,196)
(Note 6)........... 116,056,616 116,056,616
State Street Bank
and Trust Company
S&P 500 Flagship
Index Fund (542,662
units, cost--
$35,944,467)....... $58,008,963 58,008,963
State Street Bank
and Trust Company
MidCap Index Fund
(457,488 units,
cost--$9,248,901).. $11,269,295 11,269,295
Barclays Global
Investors
Commingled Fund
(840,970 units,
cost--$9,753,823).. $11,952,505 11,952,505
Investment Contracts
at contract value
(equivalent to
cost):
Allstate Life
Insurance Company.. $ 18,602,822 18,602,822
Caisse des Depots
CDC................ 2,730,000 2,730,000
The Canada Life
Assurance Company.. 4,134,645 4,134,645
Hartford Life
Insurance Company.. 5,676,784 5,676,784
John Hancock Mutual
Life Insurance
Company............ 21,820,826 21,820,826
Metropolitan Life
Insurance Company.. 21,865,380 21,865,380
New York Life
Insurance Company.. 13,174,886 13,174,886
Provident Life and
Accident........... 18,769,385 18,769,385
Providian Capital
Management......... 24,587,578 24,587,578
The Prudential
Insurance Company
of America......... 4,513,191 4,513,191
Security Life of
Denver Insurance
Company............ 5,459,156 5,459,156
Trans America Life
& Annuity Company.. 2,091,366 2,091,366
United of Omaha
Life Insurance
Company............ 3,011,737 3,011,737
------------ ----------- ------------ ------------ ----------- ----------- ------------
Total investments.. 146,437,756 58,008,963 135,843,027 116,077,963 11,952,505 11,269,295 479,589,509
Receivables:
Interest........... 762,828 2,042 5,160 94 770,124
Participants'
contributions...... 23,475 72,590 31,511 38,472 166,048
Employer
contributions...... 3,906,674 3,906,674
Loan repayments.... (19,959) 10,806 23,199 5,345 5,787 25,178
Loans receivable
from participants
(Note 2)........... $12,023,496 12,023,496
Cash and cash
equivalents......... 4,967,911 959,059 1,915,520 109,970 7,952,460
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
Total assets....... 152,148,536 58,043,244 136,899,917 121,905,317 12,099,425 11,313,554 12,023,496 504,433,489
LIABILITIES
Accrued interest
payable............. 2,147,370 2,147,370
Debt obligations
(Notes 6 and 7)..... 45,446,973 45,446,973
Investment
management fees
payable............. 60,812 7,133 10,600 3,532 82,077
Other............... 763,301 (65,657) 211,315 (29,631) (571,730) 307,598
------------ ----------- ------------ ------------ ----------- ----------- ------------
Total liabilities.. 824,113 (58,524) 221,915 47,594,343 (29,631) (568,198) 47,984,018
------------ ----------- ------------ ------------ ----------- ----------- ----------- ------------
Net assets available
for benefits........ $151,324,423 $58,101,768 $136,678,002 $ 74,310,974 $12,129,056 $11,881,752 $12,023,496 $456,449,471
============ =========== ============ ============ =========== =========== =========== ============
</TABLE>
See accompanying notes.
F-3
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND
INFORMATION
YEAR ENDED JUNE 30, 1997
<TABLE>
<CAPTION>
FUND INFORMATION
------------------------------------------------------------------------------------------
BECTON, BECTON,
DICKINSON DICKINSON
AND AND
FIXED S&P 500 COMPANY COMPANY LOANS
INCOME INDEX COMMON PREFERRED BALANCED MIDCAP RECEIVABLE
FUND FUND STOCK FUND STOCK FUND FUND INDEX FUND ACCOUNT TOTAL
------------ ----------- ------------ ------------ ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions:
Participants'
contributions... $ 12,220,515 $ 6,607,415 $ 5,545,598 $ 1,983,407 $ 2,605,784 $ 28,962,719
Rollover
contributions... 1,561,974 524,368 295,382 251,017 313,850 2,946,591
Company
contributions... 194,980 $ 4,295,032 4,490,012
Loan repayments.. 2,081,496 1,106,302 2,136,339 225,812 321,047 $ (5,870,996) --
Interest income.. 9,578,534 472 33,585 30,038 30,429 92 997,299 10,670,449
Dividends........ 1,716,907 3,399,857 5,116,764
Transfers between
funds........... (3,087,657) 1,457,424 1,206,963 (138,332) 1,364,673 (803,071) --
------------ ----------- ------------ ------------ ----------- ----------- ------------ ------------
22,354,862 9,695,981 11,129,754 7,586,595 3,855,338 2,437,702 (4,873,697) 52,186,535
Deductions:
Distributions to
participants.... 15,778,456 5,245,615 9,320,911 3,616,332 743,302 891,176 497,065 36,092,857
Forfeitures...... 94,153 144,189 238,342
Loan withdrawals. 2,247,821 1,135,510 2,075,624 241,205 215,033 261,407 (6,176,600) --
Interest expense. 3,948,872 3,948,872
Administrative
expenses........ 185,018 49,495 40,253 29,587 22,889 327,242
------------ ----------- ------------ ------------ ----------- ----------- ------------ ------------
18,211,295 6,430,620 11,530,941 7,950,598 987,922 1,175,472 (5,679,535) 40,607,313
Net appreciation
in fair value of
investments...... 20,364,401 33,449,612 29,837,348 3,067,928 2,960,495 89,679,784
------------ ----------- ------------ ------------ ----------- ----------- ------------ ------------
Net increase...... 4,143,567 23,629,762 33,048,425 29,473,345 5,935,344 4,222,725 805,838 101,259,006
Net assets
available for
benefits at
beginning of
year............. 151,324,423 58,101,768 136,678,002 74,310,974 12,129,056 11,881,752 12,023,496 456,449,471
------------ ----------- ------------ ------------ ----------- ----------- ------------ ------------
Net assets
available for
benefits at end
of year (Note 3). $155,467,990 $81,731,530 $169,726,427 $103,784,319 $18,064,400 $16,104,477 $12,829,334 $557,708,477
============ =========== ============ ============ =========== =========== ============ ============
</TABLE>
See accompanying notes.
F-4
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
1. SIGNIFICANT ACCOUNTING POLICIES
Accounting records of the Becton, Dickinson and Company Savings Incentive
Plan (the "Plan") are maintained on the accrual basis whereby all income,
costs and expenses are recorded when earned or incurred. Investments are
recorded on the basis of cost but are reported in the Plan's financial
statements at fair value, redemption value or contract value. Fair value of
marketable equity securities is determined by quoted market prices in an
active market. The value of the Becton, Dickinson and Company Series B ESOP
Convertible Preferred Stock was determined based upon the guaranteed
redemption value of $59 per share or 320% of the fair value of the Becton,
Dickinson and Company Common Stock, whichever is higher. The underlying
investments in the Fixed Income Fund are contracts with insurance companies
which are fully benefit responsive and valued at contract value. Contract
value represents contributions made, plus interest at the contract rate and
transfers, less distributions. Interests in commingled trust funds and mutual
funds are valued at the redemption price established by the trustee or
investment manager of the respective fund. Participant loans are valued at
unpaid principal balances with maturities ranging from one to four and one-
half years for ordinary loans and twenty years for primary residence loans.
Cash equivalents are stated at cost, which approximates fair value. The
Company considers all highly-liquid investments with a maturity of 90 days or
less when purchased to be cash equivalents. Investment management fees,
brokerage fees, commissions, stock transfer taxes, and other expenses related
to each investment fund are paid out of the respective fund. Becton Dickinson
pays trustee fees and other administrative expenses directly from corporate
funds. All ESOP fees are paid by Becton Dickinson.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
2. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan established for the purpose of
encouraging and assisting employees in following a systematic savings program
and to provide an opportunity for employees, at no cost to themselves, to
become shareholders of Becton, Dickinson and Company. Employees of Becton,
Dickinson and Company and certain of its domestic subsidiaries (the "Company")
are eligible for participation in the Plan on the first enrollment date
coincident with or next following the date on which the employee commences
employment with the Company.
Eligible employees who are members of the Plan can authorize a payroll
deduction for a contribution to the Plan in an amount per payroll period equal
to any selected whole percentage of pay from 2% to 16% inclusive. For purposes
of the Plan, total pay includes base pay, overtime compensation and
commissions. Pre-tax contributions are subject to an annual limitation of
$9,500 for 1997, which may be increased annually based on the Consumer Price
Index.
Individual employee contributions of up to 6% of total pay are eligible for
a matching Company contribution. The Board of Directors of the Company may,
within prescribed limits, establish, from time to time, the rate of Company
contributions. It has authorized the Company to make a monthly contribution to
the Plan in an amount equal to 50% of eligible employee contributions during
said month minus any forfeitures.
Employee contributions can be in either before-tax ("401(k)") dollars or
after-tax dollars or a combination of both. Employee contributions in before-
tax dollars result in savings going into the Plan before most federal, state
or local taxes are withheld. Taxes are deferred until the employee withdraws
the 40l(k) contributions from the Plan.
F-5
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
Participating employees are not liable for federal income taxes on amounts
earned in the Plan or on amounts contributed by the Company until such time
that their participating interest is distributed to them. In general, a
participating employee is subject to tax on the amount by which the
distribution paid to him exceeds the amount of after-tax dollars he has
contributed to the Plan.
Employee contributions are invested in five funds as described below:
Fixed Income Fund: A fixed income fund with the full principal amount of
employee contributions guaranteed by the Company.
S&P 500 Index Fund: A diversified portfolio of common stocks and
securities convertible into common stock. The Trustee's investment approach
will be to hold all the common stocks included in Standard and Poor's 500
Stock Index (S&P 500) and, as a result, to produce an investment return
very similar to that of the Index.
Becton, Dickinson and Company Common Stock Fund: A fund which is
comprised entirely of the Company's common stock.
Balanced Fund: A balanced fund comprised of fixed income securities,
common stocks and convertible securities.
MidCap Index Fund: A diversified portfolio of common stocks and
securities convertible into common stock that make up the S&P MidCap 400
Stock Index. These stocks represent companies whose total market values are
generally below those of the stocks in the S&P 500 Index. The fund seeks
greater capital appreciation than the S&P 500 Index Fund, but with greater
volatility.
Employee contributions are invested, at the option of the employee, in the
Fixed Income, the S&P 500 Index, the Becton, Dickinson and Company Common
Stock, the Balanced and the MidCap Index Funds in any combination of 1%, with
a maximum of 100% (50% prior to August 1, 1996) of the employee's contribution
being contributed to the Becton, Dickinson and Company Common Stock Fund.
The assets of the Fixed Income Fund are invested in contracts with various
insurance companies, which provide known rates of return on deposited funds,
provided that the contracts remain in force until their maturity. The weighted
average yield for the investment contracts is 6.42% and 6.33% at June 30, 1997
and 1996, respectively. The crediting interest rates range from 5.28% to 7.27%
at June 30, 1997 and 4.95% to 8.96% at June 30, 1996. Crediting interest rates
are determined based on the balance and duration of the contract, with certain
contracts subject to quarterly rate resets based on market indices. There are
no minimum crediting interest rates or limitations on guarantees under the
terms of the contracts. No valuation reserves have been established to adjust
contract amounts. The fair value of the investment contracts recorded at
contract value is approximately $150,405,000 at June 30, 1997.
State Street Bank & Trust Company ("State Street Bank") is the Plan's
Trustee. State Street Bank is also the investment manager of the S&P 500 Index
Fund, the MidCap Index Fund and the Becton, Dickinson and Company Common Stock
Fund. PRIMCO Capital Management Inc. is the investment manager of the Fixed
Income Fund. Barclays Global Investors is the investment manager of the
Balanced Fund.
The assets of the Company Common Stock Fund are invested in shares of the
Company's common stock. The Trustee has advised that its present intention is
to purchase the Company's common stock exclusively on the open market.
Contributions to the Company Common Stock Fund are comprised of both employee
contributions, as well as employer matching contributions. For recordkeeping
purposes, separate funds have been created to account for the respective
contributions. These funds are referred to as Fund C for employer matching
F-6
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
contributions and Fund D for employee contributions. Funds C and D have been
combined into one investment fund, referred to as the Becton, Dickinson and
Company Common Stock Fund, for financial statement purposes.
Any portion of the Funds, pending permanent investment or distribution, may
be held on a short-term basis in cash or cash equivalents.
The Company implemented an Employee Stock Ownership Plan (ESOP) whereby the
Becton, Dickinson and Company Preferred Stock Fund was created to account for
employer matching contributions being invested in convertible preferred stock
on behalf of employees. Refer to Note 6.
The Plan also has a loan provision whereby employees are allowed to take
loans on their vested account balances. Loans bear a rate of interest which is
set annually and employees are required to pay installment payments at each
payroll date. The outstanding balance of a loan becomes due and payable upon
an employee's termination. Should an employee, upon his termination, elect not
to repay the outstanding balance, the loan is canceled and deemed a
distribution under the Plan.
The Plan provides for vesting in employer matching contributions based on
months of participation as follows:
<TABLE>
<CAPTION>
FULL MONTHS OF PARTICIPATION PERCENTAGE
---------------------------- ----------
<S> <C>
Less than 24 months........................................... 0%
24 but less than 36 months.................................... 50%
36 but less than 48 months.................................... 75%
48 months or more............................................. 100%
</TABLE>
Any participating employee with 5 or more years of service regardless of
months of participation will have a 100% vested percentage in the Company's
matching contributions. Also, participants may become fully vested on the date
of termination of employment by reasons of death, retirement or disability, or
attainment of age 65. Participants may be partially vested under certain
conditions in the event of termination of employment or participation in the
Plan for any other reason. Non-vested Company contributions forfeited by
participants are applied to reduce future Company contributions. Participants'
contributions are always 100% vested.
The Board of Directors of the Company reserves the right to terminate,
modify, alter or amend the Plan at any time and at its own discretion,
provided that no such termination, modification, alteration or amendment shall
permit any of the funds established pursuant to the Plan to be used for any
purpose other than the exclusive benefit of the participating employees. The
right to modify, alter or amend includes the right to change the percentage of
the Company's contributions.
Amounts allocated to withdrawn participants which have not yet been
distributed from the Plan as of June 30, 1997 and 1996 amounted to $5,562,000
and $3,486,000, respectively. For the purpose of preparing the Plan's Form
5500 such amounts are recorded as liabilities.
F-7
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
3. UNIT VALUES
The number of units and unit values of each Fund at June 30, 1997 and 1996
were as follows:
<TABLE>
<CAPTION>
NUMBER OF UNIT/SHARE
UNITS/SHARES VALUE
------------ -----------
<S> <C> <C>
June 30, 1997:
Fixed Income Fund................................ 19,243,372 $ 8.079041
S&P 500 Index Fund............................... 2,914,202 28.045943
Becton, Dickinson and Company Common Stock Fund.. 7,275,641 23.328037
Becton, Dickinson and Company Preferred Stock
Fund............................................ 351,199 162.000000
Balanced Fund.................................... 10,277,335 1.757693
MidCap Index Fund................................ 8,748,582 1.840810
June 30, 1996:
Fixed Income Fund................................ 19,905,658 $ 7.602081
S&P 500 Index Fund............................... 2,796,585 20.775974
Becton, Dickinson and Company Common Stock Fund.. 7,460,018 18.321405
Becton, Dickinson and Company Preferred Stock
Fund............................................ 317,458 128.400000
Balanced Fund.................................... 8,516,878 1.424120
MidCap Index Fund................................ 7,955,621 1.493504
</TABLE>
5,207,371 units and 2,068,270 units of the Company Common Stock Fund were
allocated to participant accounts in Funds C and D, respectively, as of June
30, 1997. As of June 30, 1996, 5,764,712 units and 1,695,306 units of the
Company Common Stock Fund were allocated to participant accounts in Funds C
and D, respectively. In the Becton, Dickinson and Company Preferred Stock
Fund, 351,199 and 317,458 of the total preferred shares of 873,698 and 903,868
held as of June 30, 1997 and 1996, respectively, were allocated to participant
accounts.
4. INCOME TAX STATUS
The Internal Revenue Service has ruled (December 30, 1994) that the Plan
qualifies under Section 401(a) and 401(k) 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 Administrator is not aware of any course
of action or series of events that have occurred that might adversely affect
the Plan's qualified status.
5. RELATED PARTY TRANSACTIONS
During the year ended June 30, 1997, the Plan purchased and distributed
231,184 shares and 258,281 shares, respectively, of the Company's common stock
and recorded $1,716,907 in dividends on the common stock from the Company. In
addition, the Plan distributed 30,170 shares of the Series B ESOP convertible
preferred stock of the Company and recorded $3,399,857 in dividends on the
preferred stock from the Company.
6. EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)
The Company maintains an Employee Stock Ownership Plan (ESOP) as part of the
Savings Incentive Plan. The ESOP operates to satisfy all or part of the
Company's obligation to match 50% of employees' contributions, up to a maximum
of 3% of each participant's covered compensation. To accomplish this, the ESOP
borrowed $60,000,000 in a private debt offering and used the proceeds to buy
the Company's Series B ESOP convertible preferred stock.
F-8
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS--(CONTINUED)
Each share of preferred stock has a guaranteed liquidation value of $59 per
share and is convertible into 3.2 shares of the Company's common stock at a
conversion price of $18.44 per share. The preferred stock pays an annual
dividend of $3.835 per share which will be used by the ESOP, together with
Company contributions to repay the ESOP borrowings. The allocated and
unallocated shares at cost and market at June 30 were as follows:
<TABLE>
<CAPTION>
JUNE 30, 1997 JUNE 30, 1996
----------------------- -----------------------
ALLOCATED UNALLOCATED ALLOCATED UNALLOCATED
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Becton, Dickinson and Company
Series B ESOP Convertible
Preferred Stock:
Number of shares............ 351,199 522,499 317,458 586,410
Cost........................ $20,720,725 $30,827,416 $18,730,016 $34,598,180
Market...................... 56,894,228 84,644,822 40,761,595 75,295,021
</TABLE>
Over a 15 year period, the trust will repay the loan; and as the loan is
gradually repaid, a portion of the preferred stock will be released and used
to match participants' contributions in the Plan. The initial allocation of
preferred stock to plan participants began in March 1990. Each year, a pre-
determined number of preferred shares will be released and available to be
allocated to participants' accounts. If the total value of the preferred
shares released (as the ESOP loan is repaid) is not sufficient to fully match
the participants' contributions, the remaining portion of the match will be
made to the Company Common Stock Fund (Fund C).
7. DEBT OBLIGATIONS
In connection with the Employee Stock Ownership Plan feature, the Plan
issued $60,000,000 of ESOP notes in a private placement. The notes bear
interest at 9.45% and are guaranteed by the Company. The notes, which are due
July 1, 2004, require semi-annual interest payments and annual principal
payments. The aggregate annual maturities of the debt obligations during the
years ended June 30, 1998 to 2002 are as follows: 1998--$4,023,000; 1999--
$4,422,000; 2000--$4,861,000; 2001--$5,343,000 and 2002--$5,873,000.
8. SUBSEQUENT EVENT
On September 23, 1997, the Board of Directors of Becton, Dickinson and
Company passed a resolution to amend the Plan effective January 1, 1998, to
increase, from 16% to 20%, the percentage of total pay that may be contributed
by employees.
F-9
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
ITEM 27A--SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
JUNE 30, 1997
<TABLE>
<CAPTION>
IDENTITY OF ISSUE, BORROWER, LESSOR OR NUMBER CONTRACT
SIMILAR OF UNITS OR FAIR
PARTY AND DESCRIPTION OF INVESTMENT OR SHARES COST VALUE
-------------------------------------- --------- ------------ ------------
<S> <C> <C> <C>
STATE STREET BANK & TRUST COMPANY
*Becton, Dickinson and Company Common
Stock..................................... 3,358,931 $ 40,165,998 $170,045,863
STATE STREET BANK & TRUST COMPANY
*Becton, Dickinson and Company Series B
ESOP Convertible Preferred Stock.......... 873,698 51,548,141 141,539,050
STATE STREET BANK & TRUST COMPANY
S&P 500 Flagship Index Fund................ 561,403 41,764,079 80,850,400
STATE STREET BANK & TRUST COMPANY
MidCap Index Fund.......................... 524,824 11,520,994 15,939,941
BARCLAYS GLOBAL INVESTORS
Commingled Fund............................ 987,486 12,315,395 17,295,264
ALLSTATE LIFE INSURANCE COMPANY
GIC #GA/5483A, due 7/28/98, at 5.85%....... 3,685,169 3,685,169
GIC #GA/5537A, due 4/1/98, at 5.35%........ 3,013,773 3,013,773
GIC #GA/5506A, due 9/16/98, at 5.73%....... 3,526,408 3,526,408
GIC #GA/31028, due 2/15/02, at 6.06%....... 6,422,995 6,422,995
CAISSE DES DEPOTS
BR-239-01, due 5/31/00, at 6.08%........... 1,872,027 1,872,027
THE CANADA LIFE ASSURANCE COMPANY
GIC #P/45685, due 11/25/97, at 6.75%....... 4,136,125 4,136,125
HARTFORD LIFE INSURANCE COMPANY
GIC #GA/10120, due 8/2/99, at 7.27%........ 6,089,486 6,089,486
JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY
GIC #GA/7238, due 11/12/98, at 5.59%....... 6,141,723 6,141,723
GIC #GA/7433, due 5/1/04, at 7.01%......... 14,284,563 14,284,563
METROPOLITAN LIFE INSURANCE COMPANY
GIC #GA/13669, due 2/15/99, at 5.61%....... 12,063,270 12,063,270
GIC #GA/13817, due 1/2/01, at 6.55%........ 11,128,193 11,128,193
NEW YORK LIFE INSURANCE COMPANY
GIC #GA/06487002, due 9/2/97, at 6.00%..... 5,225,206 5,225,206
GIC #GA/20038/18D, due 9/30/98, at 5.28%... 2,501,143 2,501,143
PROVIDENT LIFE AND ACCIDENT
GIC #630/05752, due 7/2/01, at 7.16%....... 17,006,989 17,006,989
PROVIDIAN CAPITAL MANAGEMENT
#BDA00027TR1, due 6/15/04, at 6.97%........ 24,541,124 24,541,124
SECURITY LIFE OF DENVER INSURANCE COMPANY
GIC #FR108, due 9/28/97, at 5.96%.......... 5,773,721 5,773,721
STATE STREET BANK AND TRUST
GIC #96034, due 12/31/00, at 5.26%......... 16,593,121 16,593,121
</TABLE>
F-10
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
ITEM 27A--SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES--(CONTINUED)
<TABLE>
<CAPTION>
IDENTITY OF ISSUE, BORROWER, LESSOR OR NUMBER CONTRACT
SIMILAR OF UNITS OR FAIR
PARTY AND DESCRIPTION OF INVESTMENT OR SHARES COST VALUE
-------------------------------------- --------- ------------ ------------
<S> <C> <C> <C>
TRANS AMERICA LIFE INSURANCE AND ANNUITY
COMPANY
GIC #76572, due 11/15/04, at 6.11%........ $ 5,098,926 $ 5,098,926
------------ ------------
Total investments......................... 306,418,569 574,774,480
Loans receivable from participants
(original loan amounts ranging from
$1,000 to $50,000 bearing interest at
rates ranging from 7% to 11.5%).......... 12,829,334 12,829,334
------------ ------------
$319,247,903 $587,603,814
============ ============
</TABLE>
- --------
* As Becton, Dickinson and Company is the plan sponsor, these represent party-
in-interest transactions.
F-11
<PAGE>
BECTON, DICKINSON AND COMPANY
SAVINGS INCENTIVE PLAN
ITEM 27D--SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED JUNE 30, 1997
<TABLE>
<CAPTION>
TOTAL
NUMBER OF AGGREGATE AGGREGATE GAIN
DESCRIPTION PURCHASES VALUE OF VALUE OF OR
IDENTITY OF PARTY INVOLVED OF ASSETS OR SALES PURCHASES SALES (LOSS)
-------------------------- ----------- --------- ----------- ---------- ------
<S> <C> <C> <C> <C> <C>
CATEGORY (III)--SERIES OF
TRANSACTIONS IN EXCESS OF 5%
Purchases:
State Street Bank and Trust
Company
GIC #96034................ GIC 6 $20,685,259
Sales:
State Street Bank and Trust
Company
GIC #96034................ GIC 1 $4,092,138
</TABLE>
- --------
There were no category (i), (ii), or (iv) reportable transactions during
1997.
F-12
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
MEMBERS OF THE SAVINGS INCENTIVE PLAN COMMITTEE HAVE DULY CAUSED THIS ANNUAL
REPORT TO BE SIGNED BY THE UNDERSIGNED HEREUNTO DULY AUTHORIZED.
Becton, Dickinson and Company
Savings Incentive Plan
/s/ Gerald Caporicci
_____________________________________
GERALD CAPORICCI
MEMBER, SAVINGS INCENTIVE PLAN
COMMITTEE
Date: December 18, 1997
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION METHOD OF FILING
- ------- ----------- ----------------
<S> <C> <C>
23 Consent of Independent Auditors Filed with this report
</TABLE>
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statements
(Form S-8 Nos. 33-33791 and 33-32055) pertaining to the Becton, Dickinson and
Company Savings Incentive Plan and in the related prospectuses of our report
dated November 11, 1997, with respect to the financial statements and
schedules of the Becton, Dickinson and Company Savings Incentive Plan included
in this Annual Report (Form 11-K) for the year ended June 30, 1997.
/s/ Ernst & Young LLP
_____________________________________
Ernst & Young LLP
Hackensack, New Jersey
December 16, 1997
