SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
Commission File Number 1-2227
C. Full title of the plan:
Crown Cork & Seal Company, Inc.
401(K) Retirement Savings Plan
D. Name of issuer of the Securities held pursuant to the plan
and the address of its principal executive office:
CROWN CORK & SEAL COMPANY, INC.
ONE CROWN WAY
PHILADELPHIA, PA 19154-4599
<PAGE>
INDEX
Page(s)
Signatures......................................................... 3
Report of Independent Accountants.................................. 6
Audited Plan Financial Statements and Schedules in
accordance with the Financial Reporting Requirements of ERISA...... 7 to 16
Exhibit 23 - Consent of Independent Accountants.................... 17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee has duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Crown Cork & Seal Company, Inc.
401 (K) Retirement Savings Plan
By: /s/ James T. Malec
------------------------------
James T. Malec
Member, Benefit Plan Committee
Date: June 28, 2000
<PAGE>
CROWN CORK & SEAL COMPANY, INC.
401(k) RETIREMENT SAVINGS PLAN
Financial Statements as of and for the
years ended December 31, 1999 and 1998
Additional information required for Form 5500
as of and for the year ended December 31, 1999
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Table of Contents
--------------------------------------------------------------------------------
Page Number
Report of Independent Accountants 1
Basic Financial Statements
Statement of Net Assets Available for Benefits 2
Statement of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4 - 8
Additional Information *
Schedule I - Schedule of Assets Held for Investment Purposes 9
Schedule II - Schedule of Reportable Transactions 10
(Nonparticpant-Directed Investment Transactions
or Series of Transactions in Excess of 5% of
Plan Assets)
* Other supplemental schedules required by Section 2520.103-10 of the Department
of Labor Rules and Regulations for Reporting and Disclosure under ERISA have
been omitted because they are not applicable.
<PAGE>
Report of Independent Accountants
To the Benefit Plans Committee and Participants of the
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan
In our opinion, the accompanying statement of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Crown Cork & Seal Company, Inc. 401(k) Retirement 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 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.
PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
June 22, 2000
-1-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Statement of Net Assets Available for Benefits
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
As of December 31,
1999 1998
----------------- -----------------
<S> <C> <C>
Investments, at fair value
Registered investment companies:
Vanguard 500 Index Fund $ 66,544,350 * $ 36,925,536 *
Vanguard Balanced Index Fund 12,446,534 * 7,373,064
Vanguard Explorer Fund 9,550,804 * 3,113,920
Vanguard International Growth Fund 6,710,321 4,614,494
Vanguard Total Bond Market Index Fund 5,064,428 2,699,675
STI Classic Prime Quality Money Market Fund 68,332 -
----------------- -----------------
100,384,769 54,726,689
Crown Cork & Seal Company, Inc. Stock Fund 23,254,507 ** 29,064,510 **
Participant Loans 3,761,625 1,700,584
----------------- -----------------
127,400,901 85,491,783
----------------- -----------------
Investments, at contract value
Crown Cork & Seal Fixed Income Fund 57,438,771 * 52,839,270 *
----------------- -----------------
Total investments 184,839,672 138,331,053
----------------- -----------------
Asset transfer from the Crown Cork & Seal Company, Inc.
401(k) Retirement Savings Plan for Employees of
Risdon Corporation - 21,636,300 *
----------------- -----------------
Receivables
Employer's contributions 177,457 132,464
Participants' contributions 624,424 519,289
----------------- -----------------
Total receivables 801,881 651,753
----------------- -----------------
Net assets available for benefits $185,641,553 $160,619,106
================= ==================
<FN>
* Represents 5% or more of net assets available for benefits.
** Represents nonparticipant-directed investments that are 5% or more of net
assets available for benefits.
</FN>
</TABLE>
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended December 31,
1999 1998
----------------- -----------------
<S> <C> <C>
Additions
Investment income:
Interest and dividend income, investments $ 7,553,898 $ 4,800,002
Interest income, participant loans 267,745 68,305
Net appreciation (depreciation) in fair value of investments 5,046,209 (5,778,108)
----------------- -----------------
12,867,852 (909,801)
----------------- -----------------
Contributions:
Employer 2,056,808 1,301,613
Participant 7,996,719 5,579,224
----------------- -----------------
10,053,527 6,880,837
----------------- -----------------
Asset transfers in 23,290,214 34,844,528
----------------- -----------------
Total additions 46,211,593 40,815,564
----------------- -----------------
Deductions
Payment of benefits 21,185,006 14,379,173
Administrative expenses 4,140 1,260
----------------- -----------------
Total deductions 21,189,146 14,380,433
----------------- -----------------
Net increase 25,022,447 26,435,131
Net assets available for plan benefits:
Beginning of period 160,619,106 134,183,975
----------------- -----------------
End of period $185,641,553 $160,619,106
================= =================
</TABLE>
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
NOTE 1 - DESCRIPTION OF PLAN
The following description of the Crown Cork & Seal Company, Inc. 401 (k)
Retirement Savings Plan (the "Plan") provides only general information.
Participants should refer to the Plan document for a more complete description
of the Plan's provisions.
General
The plan is a defined contribution plan. The purpose of the Plan is to provide a
convenient method by which eligible employees of Crown Cork & Seal Company, Inc.
(the "Company") may save regularly through salary deferrals and through Company
matching contributions. Generally, employees are eligible to participate in the
Plan after completing one year of service and attaining age 21. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974
("ERISA").
The Plan is administered by the Crown Cork & Seal Company, Inc. Benefit Plans
Committee (the "Committee"). The Committee has appointed Vanguard Fiduciary
Trust Company ("VFTC") and Suntrust Bank ("Suntrust") to assume both trustee and
recordkeeping responsibilities.
The Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan for Salaried
Employees of CONSTAR International, Inc. ("CONSTAR Salaried 401(k)"), the
participant accounts of the salaried employees of Zeller Plastik, Inc. 401(k)
Savings Plan ("Zeller") and the Crown Cork & Seal Company, Inc. 401(k)
Retirement Savings Plan for Employees of Golden Aluminum ("Golden Aluminum")
were merged with and into the Plan effective March 31, 1999, August 31, 1999 and
December 31, 1999, respectively. The assets transferred totaled $20,982,739,
$966,188 and $1,110,242 for CONSTAR Salaried 401(k), Golden Aluminun, and
Zeller, respectively.
The Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan for Employees
of Van Dorn Company ("Van Dorn 401(k)") and the participant accounts of the
salaried employees of Crown Cork & Seal Company, Inc. 401(k) Retirement Savings
Plan for Employees of Risdon Corporation ("Risdon 401(k)") were merged with and
into the Plan effective September 30, 1998 and December 31, 1998, respectively.
The assets transferred in 1998 totaled $13,208,228 and $21,636,300 for Van Dorn
401(k) and Risdon 401(k), respectively. An additional $231,045 of assets for the
Risdon 401(k) were transferred in February 1999.
During the conversion process freeze periods were enforced to restrict
transactions. Once the freeze periods were lifted participants could change
investment elections.
Contributions
The Plan has two components: a participant salary deferral 401(k) component and
a Company matching contribution component. The salary deferral 401(k) component
of the plan allows before-tax employee contributions of 2% to 12% of annual
compensation. Contribution rates are subject to certain limitations, $10,000 in
1999 and 1998, as prescribed by law. The Company makes matching contributions
equal to 50 percent of the employee's contribution which ranges from 3 - 6
percent of compensation depending on the employer company. Company contributions
are invested in Company common stock.
-4-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
Participant Accounts
Each participant's account is credited with participant's contribution and the
participant's allocation of the Company's contribution, as described above. Plan
earnings are allocated to the participant's account based on participant's
account balances. The benefit to which a participant is entitled is the benefit
that can be provided from the participant's vested account.
Vesting
Participants are immediately vested in their contributions plus actual earnings
thereon. Vesting in the Company's contribution plus actual earnings thereon is
based on years of continuous service. A participant is 100 percent vested after
four years of credited service.
Participant Loans
Participants may borrow from their account a minimum of $1,000 up to a maximum
equal to the lesser of $50,000 or 50 percent of the participant's vested
balance. Loan transactions are treated as a transfer to (from) the investment
fund from (to) Participant loans. Loan terms range from 1 to 5 years or up to 10
years for the purchase of a primary residence. The loans are secured by the
balance in the participant's account and bear interest at a rate commensurate
with a prevailing commercial rate for a secured personal loan. Principal and
interest is paid ratably through monthly payroll deductions. A participant may
not have more than two outstanding loans at any one time.
Payment of Benefits
On termination of service due to death, disability or retirement, a participant
may elect to receive either a lump sum amount equal to the value of the
participant's vested interest in his or her account, or substantially equal
periodic installments over a period equal to the life expectancy of the
recipient or beneficiary. For termination of service due to other reasons, a
participant may receive the value of the vested interest in his or her account
as a lump-sum distribution. All distributions are paid in either cash or company
stock at the participant's election.
Forfeited Accounts
Forfeited balances of terminated participants' non-vested accounts are used to
reduce future Company contributions. At December 31, 1999 and 1998 forfeited
non-vested accounts totaled $1,485 and $66,474, respectively. Also, in 1999 and
1998, Company contributions were reduced by forfeitures of $74,181 and $0,
respectively.
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 percent vested in their accounts.
Investment Options
During the plan years ending December 31, 1999 and 1998, participants were able
to allocate their contributions among the following investment options:
Vanguard 500 Index Fund: Seeks to provide long-term growth of capital
and income from dividends by holding all of the 500 stocks that make up
the unmanaged Standard & Poor's 500 Composite Stock Price Index, a
widely recognized benchmark of U.S. stock market performance.
Vanguard Balanced Index Fund: Seeks to provide income and long-term
growth of capital and income by dividing its assets between indexed
portfolios of stocks (60%) and bonds (40%).
-5-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
Vanguard Explorer Fund: Seeks to provide long-term growth of capital by
investing in a diversified group of small-company stocks with prospects
for above-average growth.
Vanguard International Growth Fund: Seeks to provide long-term growth
of capital by investing in stocks of high-quality, seasoned companies
based outside the United States. Stocks are selected from more than 15
countries.
Vanguard Total Bond Market Index Fund: Seeks to provide a high level of
interest income by attempting to match the performance of the unmanaged
Lehman Brothers Aggregate Bond Index, which is a widely recognized
measure of the entire taxable U.S. bond market.
STI Classic Prime Quality Money Market Fund: Invests in high quality
short-term debt securities. These include CDs, bankers' acceptances,
commercial paper, U.S. Treasury securities and some municipal
securities and repurchase agreements. It is designed to maintain a
constant $1.00 share value.
Crown Cork & Seal Company, Inc. Stock Fund: Invests in Crown Cork &
Seal stock to provide the possibility of long-term growth through
increases in the value of the stock and the reinvestment of its
dividends.
Crown Cork & Seal Fixed Income Fund: Seeks to preserve the value of
your original investment and provide an attractive level of interest by
investing primarily in investment contracts issued by insurance
companies and banks and other types of fixed principal investments. It
is designed to maintain a constant $1.00 unit value.
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES
The following accounting policies, which conform with accounting principles
generally accepted in the United States, have been used consistently in the
preparation of the Plan's financial statements:
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method of
accounting.
Financial Statement Presentation
The plan adopted Statement of Position ("SOP") 99-3, Accounting for and
Reporting of Certain Defined Contribution Benefit Plan Investments and Other
Disclosure Matters. Certain reclassifications of the 1998 amounts have been made
to conform to the 1999 presentation in accordance with SOP 99-3. This SOP
eliminated the previously required reporting of changes in net assets by
investment option for participant-directed investments.
-6-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
Use of Estimates
The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States, requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements, as well as reported amounts of additions and
deductions during the reporting period. Actual results could differ from those
estimates.
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value except for its investment
contracts, which are valued at contract value (Note 5). Shares of registered
investment companies are valued at quoted market prices which represent the net
asset value of shares held by the Plan at year-end. The Company stock fund is
valued at its year-end unit closing price (comprised of year-end market price
plus uninvested cash position). Units of the Company's fixed income fund are
valued at net asset value at year-end. Participant loans are valued at cost,
which approximates fair value.
Purchases and sales of investments are recorded on a trade-date basis. Interest
income is accrued when earned. Dividend income is recorded on the ex-dividend
date. Capital gain distributions are included in dividend income.
Payment of Benefits
Benefits are recorded when paid.
NOTE 3 - NON PARTICIPANT-DIRECTED INVESTMENTS
Information about the significant components of changes in net assets relating
to the nonparticipant-directed investments is as follows:
Crown Cork & Seal Company, Inc. Stock Fund
------------------------------------------
1999 1998
---- ----
Changes in Net Assets:
Interest & dividend income $ 949,443 $ 809,143
Net appreciation/(depreciation) (8,094,832) (14,622,225)
Contributions 3,339,432 2,736,414
Distributions (2,165,507) (2,417,974)
Interfund transfers (1,626,671) (1,785,480)
Asset transfers in 1,862,670 2,187,859
NOTE 4 - INVESTMENTS
During 1999 and 1998, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
(depreciated) in value as follows:
1999 1998
---- ----
Registered investment companies $13,141,041 $ 8,844,117
Common stock (8,094,832) (14,622,225)
------------- -------------
$ 5,046,209 $(5,778,108)
============= =============
-7-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k)
RETIREMENT SAVINGS PLAN
Notes to Financial Statements
--------------------------------------------------------------------------------
NOTE 5 - CROWN CORK & SEAL FIXED INCOME FUND
The Crown Cork & Seal Fixed Income Fund (the "Fund") consists of guaranteed
investment contracts, $27,245,170, and synthetic investment contracts with
various banks and insurance companies ("Issuers"). Additionally, the Fund holds
units of the Vanguard Retirement Savings Trust, a common/commingled trust
sponsored by VFTC with a value of $14,714,956. The Vanguard Retirement Savings
Trust (the "Trust") is a tax-exempt collective trust invested primarily in
investment contracts issued by insurance companies and commercial banks, and
similar types of fixed-principal investments. The Trust intends to maintain a
constant net asset value of $1.00 per unit. The Fund is credited with earnings
on the underlying investments and charged for Plan withdrawals and
administrative expenses charged by the Issuers. The investment contracts
included in the Fund are carried at contract value, which approximates fair
value, because the contracts are fully benefit responsive. The synthetic
investment contracts constitute investments in common collective trusts and
mortgage backed securities, $16,206,608, and wrapper contracts, $(705,561). The
value provided (reduced) by the wrapper contracts represents the difference
between the value of the synthetic investment contracts and the underlying
investments. The Fund also included net other liabilities (including units
receivable and payable) in the amount of $22,402. The crediting interest rates
of the investment contracts ranged from 5.95% to 6.69% at December 31, 1999. As
the contracts mature, the proceeds are invested in the Vanguard Retirement
Savings Trust.
NOTE 6 - RELATED PARTY TRANSACTIONS
The Plan invests in shares of registered investment companies managed by
affiliates of VFTC and Suntrust. VFTC and Suntrust act as trustees for those
investments as defined by the Plan. The Plan also invests in shares of the
Company's stock through the Crown Cork & Seal Company, Inc. Stock Fund.
Transactions in such investments qualify as party-in-interest transactions and
are exempt from the prohibited transaction rules.
NOTE 7 - PLAN EXPENSES
All recordkeeping expenses for the administration of the Plan, with the
exception of certain miscellaneous fees, are paid by the Company.
NOTE 8 - TAX STATUS
The Internal Revenue Service has determined and informed the company by a letter
dated February 22, 1996 that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code ("IRC"). The
Plan has been amended since receiving the determination letter. However, the
Plan administrator and the Plan's tax counsel believe that the Plan is designed
and is currently being operated in compliance with the applicable provisions of
the IRC.
NOTE 9 - BENEFIT OBLIGATIONS
Benefit obligations for persons who have recently withdrawn from participating
in the Plan were $306,843 as of December 31, 1998. This amount was paid in
January 1999, and is reflected as a liability in the Plan's Form 5500. There
were no benefits payable at December 31, 1999.
-8-
<PAGE>
Additional Information
Required for Form 5500
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k) Schedule I
RETIREMENT SAVINGS PLAN
Schedule of Assets Held for Investment Purposes
As of December 31, 1999
--------------------------------------------------------------------------------
Crown Cork & Company, Inc. 401(k) Retirement Savings Plan, EIN 23-1526444
Form 5500, Schedule H, Part IV, Line i
<TABLE>
<CAPTION>
Identity of Participant-Directed Issues Investment Type Current Value
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
* Vanguard 500 Index Fund Registered Investment Company $ 66,544,350
* Vanguard Balanced Index Registered Investment Company 12,446,534
* Vanguard Explorer Fund Registered Investment Company 9,550,804
* Vanguard International Growth Fund Registered Investment Company 6,710,321
* Vanguard Total Bond Market Index Registered Investment Company 5,064,428
* Vanguard Retirement Savings Trust Common/Commingled Trust 14,714,956
* STI Classic Prime Quality Money Market Fund Registered Investment Company 68,332
* Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan Participant Loans (7.5% - 13.7%) 3,761,625
Caisse des Depots et Consignations 6.08% 3/31/2000 Synthetic Investment Contract 1,589,963
Caisse des Depots et Consignations 5.95% 10/25/2000 Synthetic Investment Contract 1,515,999
John Hancock Mutual Life Insurance Company 6.69% 9/15/2000 Guaranteed Investment Contract 2,548,363
Life of Virginia 6.37% 5/31/2001 Guaranteed Investment Contract 5,030,547
Massachusetts Mutual Life Insurance Company 6.42% 6/25/2002 Guaranteed Investment Contract 928,468
Metropolitan Life 6.00% 1/2/2001 Guaranteed Investment Contract 3,351,930
New York Life Insurance Company 6.28% 9/30/2001 Guaranteed Investment Contract 5,131,267
Principal Mutual Life Insurance 6.07% 6/30/2001 Guaranteed Investment Contract 5,202,575
Transamerica Occidental Life Insurance Company 6.18% 12/31/2000 Guaranteed Investment Contract 5,052,020
Union Bank of Switzerland 6.27% 6/30/2000 Synthetic Investment Contract 6,410,713
West Deutsche Landesbank 6.32% 3/31/2001 Synthetic Investment Contract 5,984,372
</TABLE>
<TABLE>
<CAPTION>
Identity of Nonparticipant-Directed Issues Investment Type Cost Current Value
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
* Crown Cork & Seal Company, Inc. Common Stock $ 33,825,006 $ 23,254,507
------------
Total assets held for investment purposes $184,862,074
============
<FN>
* Party in Interest
</FN>
</TABLE>
-9-
<PAGE>
CROWN CORK & SEAL COMPANY, INC. 401(k) Schedule II
RETIREMENT SAVINGS PLAN
Schedule of Reportable Transactions *
Year Ended December 31, 1999
--------------------------------------------------------------------------------
Crown Cork & Seal Company, Inc. 401(k) Retirement Savings Plan, EIN 23-1526444
Form 5500, Schedule H, Part IV, Line j
<TABLE>
<CAPTION>
Current Value of
Historical Asset on
Identity of Purchase Selling Cost of Transaction Historical
Party Involved Description of Asset Price Price Asset Date Gain(Loss)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
The Vanguard Group Crown Cork & Seal Company, Inc. Stock Fund $9,214,730 $9,214,730
The Vanguard Group Crown Cork & Seal Company, Inc. Stock Fund $6,083,594 $7,145,183 $6,083,594 $(1,061,589)
<FN>
* Nonparticipant-directed transactions or a series of transactions in excess of
5% of the current value of the Plan's assets as of the beginning of the plan
year as defined in section 2520.103-6 of the Department of Labor Rules and
Regulations for Reporting and Disclosure under ERISA.
</FN>
</TABLE>
-10-
