UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1999
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-123
A. Full Title of Plan:
Brown-Forman Corporation Savings Plan
B. Name of Issuer of the Securities held Pursuant to the Plan and
the Address of its Principal Executive Office:
Brown-Forman Corporation
850 Dixie Highway
Louisville, Kentucky 40210
<PAGE>
INDEX
Pages
Report of Independent Accountants 2
Financial Statements:
Statement of Net Assets Available for Benefits,
December 31, 1999 and 1998 3
Statement of Changes in Net Assets Available for Benefits
for the years ended December 31, 1999 and 1998 4
Notes to Financial Statements 5-9
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes at End of Year,
December 31, 1999 10
Schedule of Reportable Transactions for the Year Ended
December 31, 1999 11
Signatures 12
Consent of Independent Accountants 13
<PAGE>
Report of Independent Accountants
To the Employee Benefits Committee
Brown-Forman Corporation
Brown-Forman Corporation Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Brown-Forman Corporation Savings Plan (the Plan) at December 31, 1999 and
1998 and the changes in net assets available for benefits for the years then
ended, in conformity with accounting principles generally accepted in the United
States. 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 of these statements in
accordance with auditing standards generally accepted in the United States,
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes at end of year and of reportable transactions are
presented for the purpose of additional analysis and are not a required part of
the basic financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules are the responsibility of the Plan's management. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ PricewaterhouseCoopers LLP
May 12, 2000
2
<PAGE>
Brown-Forman Corporation Savings Plan
Statements of Net Assets Available for Benefits
December 31, 1999 and 1998
<TABLE>
1999 1998
---------------------------------------------- ---------------------------------------------
Participant Nonparticipant Participant Nonparticipant
Directed Directed Total Directed Directed Total
----------- -------------- ----------- ----------- -------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Investments, at fair value:
Mutual funds $163,432,731 -- $163,432,731 $122,380,745 -- $122,380,745
Investment contract and
money market portfolios 26,645,017 -- 26,645,017 25,855,275 -- 25,855,275
Brown-Forman Corporation
Class B common stock 4,101,073 -- 4,101,073 -- -- --
----------- -------------- ----------- ----------- -------------- -----------
194,178,821 -- 194,178,821 148,236,020 -- 148,236,020
Employers' contributions receivable 1,042,197 -- 1,042,197 1,000,528 -- 1,000,528
Employees' contributions receivable 668,077 -- 668,077 588,982 -- 588,982
----------- -------------- ----------- ----------- -------------- -----------
Net assets available for benefits $195,889,095 -- $195,889,095 $149,825,530 -- $149,825,530
=========== ============== =========== =========== ============== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
Brown-Forman Corporation Savings Plan
Statement of Changes in Net Assets Available for Benefits
For the Years Ended December 31, 1999 and 1998
<TABLE>
1999 1998
---------------------------------------------- ---------------------------------------------
Participant Nonparticipant Participant Nonparticipant
Directed Directed Total Directed Directed Total
----------- -------------- ----------- ----------- -------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Contributions:
Employer $ 5,812,470 -- $ 5,812,470 $ 5,338,508 -- $ 5,338,508
Employee 8,894,485 -- 8,894,485 7,612,875 -- 7,612,875
----------- -------------- ----------- ----------- ------------- -----------
14,706,955 -- 14,706,955 12,951,383 -- 12,951,383
Interest income 1,312,210 -- 1,312,210 1,262,558 -- 1,262,558
Dividend income 1,233,579 -- 1,233,579 1,092,855 -- 1,092,855
Net appreciation in fair value 35,388,521 -- 35,388,521 21,115,004 -- 21,115,004
Net transfers from Lenox,
Incorporated Employee Savings
and Investment Plan 411,194 -- 411,194 78,825 -- 78,825
Net transfers from Lenox Retail
Savings and Investment Plan -- -- -- 2,493 -- 2,493
----------- -------------- ----------- ----------- -------------- -----------
Total additions 53,052,459 -- 53,052,459 36,503,118 -- 36,503,118
----------- -------------- ----------- ----------- -------------- -----------
Deductions:
Withdrawals by particpants 6,881,000 -- 6,881,000 6,009,047 -- 6,009,047
Net transfers to Hartmann Employee
Savings and Investment Plan 107,894 -- 107,894 -- -- --
----------- -------------- ----------- ----------- -------------- -----------
Total deductions 6,988,894 -- 6,988,894 6,009,047 -- 6,009,047
----------- -------------- ----------- ----------- -------------- -----------
Net increase 46,063,565 -- 46,063,565 30,494,071 -- 30,494,071
Net assets available for benefits:
Beginning of year 149,825,530 -- 149,825,530 119,331,459 -- 119,331,459
----------- -------------- ----------- ----------- -------------- -----------
End of year $195,889,095 -- $195,889,095 $149,825,530 -- $149,825,530
=========== ============== =========== =========== ============== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Brown-Forman Corporation Savings Plan
Notes to Financial Statements
1. Description of Plan:
The sponsor of the Brown-Forman Corporation Savings Plan (the Plan),
Brown-Forman Corporation (the Company), is a diversified producer and
marketer of fine quality consumer products in domestic and international
markets. The Company's operations include the production, importing, and
marketing of wines and distilled spirits and the manufacture and sale of
luggage and, through the Lenox, Incorporated division, the manufacture
and sale of china, crystal and silver.
The following brief description of the Plan is provided for general
information purposes only. Participants should refer to the plan
agreement for more complete information.
a. General: The Plan is a defined contribution plan covering
substantially all salaried employees of the Company and nonunion
salaried and hourly employees of the Company's subsidiaries who have
one year of service and are not members of a collective bargaining
unit, except for employees of Lenox, Inc. and its division and certain
employees of Fetzer, Jekel, and Sonoma-Cutrer Vineyards. Effective
May 1, 1997, the Plan was amended to include sales and brand support
employees of Fetzer Vineyards and Jekel Vineyards. Effective May 1,
1998, the Plan was amended to include employees of Jack Daniel's
Properties, Inc., a subsidiary of the Company. An employee becomes
eligible to participate in the Plan after the completion of one year
of service. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
b. Contributions: Employees may contribute to the Plan an amount of not
less than 2% nor more than 10% of their annual compensation. New
employees may transfer assets from their former employers' qualified
plans to the Plan, but cannot make any further contributions until
they meet the eligibility requirements to participate in the Plan.
Effective April 1, 1999, the Plan was amended to allow for non-highly
compensated employees to contribute to the Plan an amount of not less
than 2% nor more than 15% of their annual compensation.
The Company's matching contribution is equal to 100% of the
participant's elective deferral for the first 2% of the participant's
annual compensation and 75% of the participant's elective deferral for
the next 3% of the participant's annual compensation.
5
<PAGE>
Each participant's account is credited with the participant's
contribution and an allocation of (i) the Company's matching
contribution on a quarterly basis, and (ii) plan earnings on a daily
basis. Allocations are based on the participants' contributions and
compensation as defined in the Plan. The total annual additions, as
defined by the Plan, credited to a participant's account in a plan
year may not exceed the lesser of (i) $30,000, or (ii) 25% of the
participant's compensation in the plan year. Additional maximum
limits exist if the employee participates in a qualified defined
benefit plan maintained by the Company. Forfeited balances of
terminated participants' nonvested accounts are used first to
reinstate previously forfeited account balances of re-employed
participants, if any, and the remaining amounts are used to reduce
future company contributions. The forfeited balances totaled $53,145
and $23,906 for 1999 and 1998, respectively.
Participants can allocate contributions among various investment
options in 1% increments. The Plan currently offers ten mutual funds,
one investment contract portfolio, and the Brown-Forman Corporation
Class B common stock fund as investment options to participants.
c. Vesting: Participants are immediately vested in their employee
contributions plus actual earnings thereon. Vesting in the Company's
contribution is 25% per year of continuous service with the Company.
Participants will become 100% vested in their company contributions
account in case of death, normal retirement, or total and permanent
disability.
d. Withdrawals: Upon termination of service, a participant can elect to
transfer his vested interest in the Plan to the qualified plan of his
new employer, roll over his funds into an Individual Retirement
Account, or receive his vested interest in the Plan in a lump-sum
amount or in the form of installment payments over a period of time
not to exceed his life expectancy. If the vested account balance is
less than $3,500, a lump-sum distribution will be made. Effective
January 1, 1999, the involuntary cash-out limit was increased to
$5,000. In the event of death, the participant's beneficiary will
receive the vested interest in the participant directed portion of
the plan in a lump-sum payment. Upon approval of the Employee
Benefits Committee, a participant may also withdraw vested interest
in the case of financial hardship under guidelines promulgated by the
Internal Revenue Service.
The distribution to a terminated participant is based on the market
value of his vested interest in the Plan on the valuation date
available immediately preceding the date of the benefit payment.
6
<PAGE>
2. Summary of Significant Accounting Policies:
a. Basis of Accounting: The financial statements of the Plan are
prepared under the accrual method of accounting. Withdrawals by
participants are recorded when paid. Purchases and sales of
securities are recorded on a trade-date basis. Interest income is
recorded on the accrual basis. Dividends are recorded on the ex-
dividend date.
b. Valuation of Investments: Investment contract and money market
portfolios are valued at cost which approximates fair value. Mutual
funds are valued at their net asset value per share as quoted by the
National Association of Securities Dealers. The Brown-Forman
Corporation Stock Fund is comprised of Brown-Forman Corporation
Class B shares, which are valued at the quoted closing market price.
The Plan presents in the accompanying statements of changes in net
assets available for benefits the net appreciation or depreciation
in the fair value of its investments which consists of the realized
gains or losses and the unrealized appreciation or depreciation on
those investments.
c. Management Estimates: The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of net assets available for benefits and disclosure of
contingent assets and liabilities at the dates of the financial
statements and the reported amounts of additions to and deductions
from net assets during the reporting periods. Actual results could
differ from those estimates.
7
<PAGE>
3. Investments:
The Plan's investments are held by a custodian trust company. The
following table presents the fair value of investments. Investments
that represent 5% or more of the Plan's net assets are separately
identified.
<TABLE>
December 31
--------------------------------------------------------------
1999 1998
---------------------------- ----------------------------
Number of Number of
Shares, Units Shares, Units
or Principal or Principal
Amount Fair Value Amount Fair Value
------------- ---------- ------------- ----------
<S> <C> <C> <C> <C>
PBHG Growth Fund 180,385 $ 8,546,620 217,688 $ 5,559,747
Janus Worldwide Fund 330,710 25,276,190 299,868 14,201,770
Fidelity Magellan Fund 521,917 71,309,482 467,931 56,535,426
Fidelity Equity-Income Fund 614,029 32,838,272 621,377 34,517,514
Fidelity Growth Company 173,840 14,654,718 98,609 5,031,044
Fidelity Retirement
Money Market Portfolio 16,569,628 16,569,628 15,486,378 15,486,378
Managed Income Portfolio 10,075,389 10,075,389 10,368,897 10,368,897
Brown-Forman Corporation Class B
Common Stock Fund 430,785 4,101,073 -- --
Other investments 482,816 10,807,449 473,129 6,535,244
----------- -----------
$194,178,821 $148,236,020
=========== ===========
</TABLE>
During 1999 and 1998, the Plan's investments, including investments
bought, sold, and held during the year, appreciated in value as follows:
1999 1998
---------- ----------
Mutual funds $35,811,614 $21,115,004
Brown-Forman Corporation
Class B common stock (423,093) --
---------- ----------
$35,388,521 $21,115,004
========== ==========
8
<PAGE>
4. Tax Status:
The Internal Revenue Service has determined, and informed the Company
by a letter dated April 12, 1996, that the Plan and related trust are
designed in accordance with the applicable sections of the Internal
Revenue Code (IRC). The Plan has been amended since receiving the
determination letter. However, the Company believes that the Plan is
designed and is currently being operated in compliance with the
applicable requirements of the IRC.
5. Plan Termination:
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
plan termination, participants will become 100% vested in their accounts.
6. Related Party Transactions:
Certain administrative costs incurred by the Plan are paid by the
Company.
9
<PAGE>
Brown-Forman Corporation Savings Plan
Plan #006 EIN #61-0143150
Schedule H, Line 4i --
Schedule of Assets Held for Investment Purposes at End of Year
December 31, 1999
<TABLE>
Description of Investment Including
Identity of Issue, Borrower, Maturity Date, Rate of Interest, Current
Lessor or Similar Party Collateral, Par or Maturity Value Value
---------------------------- ----------------------------------- -----------
<S> <C> <C>
PBHG Growth Fund Mutual fund, variable rate and maturity $ 8,546,620
Janus Enterprise Fund Mutual fund, variable rate and maturity 4,067,500
Janus Worldwide Fund Mutual fund, variable rate and maturity 25,276,190
PIMCO Total Return Fund Mutual fund, variable rate and maturity 1,802,715
Fidelity Magellan Fund* Mutual fund, variable rate and maturity 71,309,482
Fidelity Equity-Income Fund* Mutual fund, variable rate and maturity 32,838,272
Fidelity Growth Company Fund* Mutual fund, variable rate and maturity 14,654,718
Fidelity Asset Manager* Mutual fund, variable rate and maturity 4,342,258
Fidelity Retirement Money Money market portfolio, variable rate
Market Portfolio* and maturity 16,569,628
Fidelity Spartan U.S.
Equity Index Fund* Mutual fund, variable rate and maturity 594,976
Managed Income Portfolio* Investment contract portfolio, variable
rate and maturity 10,075,389
Brown-Forman Corporation* Class B common stock fund 4,101,073
-----------
$194,178,821
===========
*Party-in-interest to the Plan
</TABLE>
10
<PAGE>
Brown-Forman Corporation Savings Plan
Plan #006 EIN #61-0143150
Schedule H, Line 4j --
Schedule of Reportable Transactions
For the Year Ended December 31, 1999
<TABLE>
Expense Current Value
Purchase Selling Lease Incurred with Cost of of Asset on Net Gain
Identity of Party Involved Description of Asset Price Price Rental Transaction Asset Transaction Date (Loss)
-------------------------- -------------------- -------- ------- ------ ------------- ------- ---------------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
No reportable transactions.
</TABLE>
11
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Brown-Forman Corporation Savings Plan has duly caused this report to be signed
by the undersigned thereunto duly authorized.
BROWN-FORMAN CORPORATION SAVINGS PLAN
BY:
/s/ Steven B. Ratoff
Steven B. Ratoff
Executive Vice President and
Chief Financial Officer
(On behalf of the Principal and
as Principal Financial Officer)
June 23, 2000
12
