SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------
FORM 11-K
ANNUAL REPORT
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 [FEE REQUIRED].
For the fiscal year ended December 31, 1995
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED].
For the transition period from __________ to __________
Commission file number 1-724
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below: Phillips-Van Heusen Corporation (Crystal Brands
Division) Associates Investment Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office: Phillips-Van Heusen Corporation, 1290
Avenue of the Americas, New York, New York 10104
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrative Committee has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
PHILLIPS-VAN HEUSEN CORPORATION
(CRYSTAL BRANDS DIVISION)
ASSOCIATES INVESTMENT PLAN
Date: June 28, 1996 By /s/ PAMELA N. HOOTKIN
---------------------
Pamela N. Hootkin, Member of
Administrative Committee
<PAGE>
Financial Statements
and Supplemental Schedules
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Years ended December 31, 1995 and 1994
with Report of Independent Auditors
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Financial Statements
and Supplemental Schedules
Years ended December 31, 1995 and 1994
Contents
Report of Independent Auditors............................................. 1
Financial Statements
Statements of Net Assets Available for Benefits ........................... 2
Statements of Changes in Net Assets Available for Benefits ................ 4
Notes to Financial Statements ............................................. 5
Supplemental Schedules
Assets Held for Investment Purposes........................................ 16
Reportable Transactions ................................................... 17
<PAGE>
[Letterhead of Ernst & Young LLP]
Report of Independent Auditors
Administrative Committee of the Plan
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division)
New York, New York
We were engaged to audit the accompanying financial statements and supplemental
schedules of the Associates Investment Plan of Phillips-Van Heusen Corporation
(Crystal Brands Division), formerly the Voluntary Investment Plan of Crystal
Brands, Inc., as of December 31, 1995 and 1994, and for the years then ended, as
listed in the table of contents. These financial statements and schedules are
the responsibility of the Plan's management.
As permitted by Section 2520.103-8 of the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, the plan administrator instructed us not to perform, and
we did not perform, any auditing procedures with respect to the investment
information summarized in Note D, which was certified by the State Street Bank
and Trust Company, the trustee of the Plan, except for comparing such
information with the related information included in the financial statements
and supplemental schedules. We have been informed by the plan administrator that
the trustee holds the Plan's investment assets and executes investment
transactions. The plan administrator has obtained a certification from the
trustee as of and for the years ended December 31, 1995 and 1994, that the
information provided to the plan administrator by the trustee is complete and
accurate.
Because of the significance of the information that we did not audit, we are
unable to, and do not, express an opinion on the accompanying financial
statements and schedules taken as a whole. The form and content of the
information included in the financial statements and schedules, other than that
derived from the information certified by the trustee, have been audited by us
in accordance with generally accepted auditing standards and, in our opinion,
are presented in compliance with the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974.
As discussed in Note C to the financial statements, the Plan's investments
include interest contracts with insurance companies that have been placed into
conservatorship. Although rehabilitation plans have been approved by the courts,
the ultimate recoverability of these investments is uncertain, and the resulting
loss, if any, cannot presently be determined.
/s/ Ernst & Young LLP
New York, New York
June 26, 1996
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Net Assets Available for Benefits
December 31, 1995
<TABLE>
<CAPTION>
Phillips-Van
Money Heusen Corp.
Bond Balanced Equity International Market Common Stock
Fund Fund Fund Fund Fund Fund
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments (Notes B and D)
Shares of registered investment
companies:
Fidelity Intermediate Bond Fund $ 386,205
Fidelity Puritan Fund $1,548,581
Fidelity Growth & Income $1,907,185
Portfolio
Templeton Foreign Fund $ 541,012
Short-term investments $3,998,085 $ 143,947
Common stock - Employer Company 190,923
Investment contracts:
Non-performing (Note C)
Participant loans receivable
-------------------------------------------------------------------------------
Total investments 386,205 1,548,581 1,907,185 541,012 3,998,085 334,870
Receivables:
Accrued interest and dividends 1,906 23,491 137
-------------------------------------------------------------------------------
Total assets 388,111 1,548,581 1,907,185 541,012 4,021,576 335,007
LIABILITIES
Payable for investments purchased 143,448
-------------------------------------------------------------------------------
Net assets available for benefits $ 388,111 $1,548,581 $1,907,185 $ 541,012 $4,021,576 $ 191,559
===============================================================================
<CAPTION>
Fixed Income Fund
--------------------------
Tax
Regular Deductible Participant
Investment Fund Loans Total
----------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments (Notes B and D)
Shares of registered investment
companies:
Fidelity Intermediate Bond Fund $ 386,205
Fidelity Puritan Fund 1,548,581
Fidelity Growth & Income 1,907,185
Portfolio
Templeton Foreign Fund 541,012
Short-term investments 4,142,032
Common stock - Employer Company 190,923
Investment contracts:
Non-performing (Note C) $4,571,600 $2,462 4,574,062
Participant loans receivable $ 209,838 209,838
----------------------------------------------------
Total investments 4,571,600 2,462 209,838 13,499,838
Receivables:
Accrued interest and dividends 45 25,579
----------------------------------------------------
Total assets 4,571,645 2,462 209,838 13,525,417
LIABILITIES
Payable for investments purchased 143,448
----------------------------------------------------
Net assets available for benefits $4,571,645 $2,462 $ 209,838 $13,381,969
====================================================
</TABLE>
See notes to financial statements
2
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Net Assets Available for Benefits
December 31, 1994
<TABLE>
<CAPTION>
Fixed Income Fund
-------------------------------
Government
Short-Term Tax
Participant Investment Regular Deductible
Loans Fund Investment Fund
--------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments (Notes B and D)
Short-term investments $ 2,157,822 $ 7,638,931 $ 229,380
Investment contracts:
Performing 463,130 4,903
Non-performing (Note C) 6,286,160 30,849
State Street Bank Index Fund
Participant loans receivable $ 832,428
--------------------------------------------------------------
Total investments 832,428 2,157,822 14,388,221 265,132
Receivables:
Accrued interest and dividends 5,734 9,225 41,852 1,134
==============================================================
Net assets available for benefits $ 838,162 $ 2,167,047 $ 14,430,073 $ 266,266
==============================================================
</TABLE>
Crystal
Brands, Inc.
Equity Common
Fund Stock Fund Total
-------------------------------------------
ASSETS
Investments (Notes B and D)
Short-term investments $ 126,948 $10,153,081
Investment contracts:
Performing 468,033
Non-performing (Note C) 6,317,009
State Street Bank Index Fund $ 5,554,908 5,554,908
Participant loans receivable 832,428
-------------------------------------------
Total investments 5,554,908 126,948 23,325,459
Receivables:
Accrued interest and dividends 580 58,525
===========================================
Net assets available for benefits $ 5,554,908 $ 127,528 $23,383,984
===========================================
See notes to financial statements
3
<PAGE>
Associates Investments Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 1995
<TABLE>
<CAPTION>
Fixed Income Fund
--------------------------
Government Crystal Phillips-Van
Short-Term Tax Brands, Inc. Heusen Corp.
Investment Regular Deductible Index Common Common Stock Bond
Fund Investment Fund Fund* Stock Fund Fund Fund
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions
Investment income:
Interest and dividend income $ 27,789 $ 664,789 $ 5,380 $ 581 $ 2,159 $ 1,036 $ 8,461
Net realized and unrealized
appreciation
(depreciation) of
investments (Note D) 643,070 (27,514) 7,810
---------------------------------------------------------------------------------------------
27,789 664,789 5,380 643,651 2,159 (26,478) 16,271
Contributions:
Participants 55,158 44,800 54,891 4,212 75,369 16,975
Employer 25,748
---------------------------------------------------------------------------------------------
55,158 44,800 54,891 4,212 101,117 16,975
---------------------------------------------------------------------------------------------
Total additions 82,947 709,589 5,380 698,542 6,371 74,639 33,246
Deductions
Transfer of assets to
another plan (Note F) 1,133,574 4,818,973 102,146 2,310,849 23,041
Payments to participants, net
of repayments 315,607 1,203,248 43,984 623,087 34,298 1,143 18,799
---------------------------------------------------------------------------------------------
Total deductions 1,449,181 6,022,221 146,130 2,933,936 57,339 1,143 18,799
---------------------------------------------------------------------------------------------
Net (decrease) increase prior
to interfund transfers (1,366,234) (5,312,632) (140,750) (2,235,394) (50,968) 73,496 14,447
Interfund transfers (net) (800,813) (4,545,796) (123,054) (3,319,514) (76,560) 118,063 373,664
---------------------------------------------------------------------------------------------
Net (decrease) increase (2,167,047) (9,858,428) (263,804) (5,554,908) (127,528) 191,559 388,111
Net assets available for
benefits at beginning of year 2,167,047 14,430,073 266,266 5,554,908 127,528 -- --
---------------------------------------------------------------------------------------------
Net assets available for
benefits at end of year $ -- $ 4,571,645 $ 2,462 $ -- $ -- $191,559 $388,111
=============================================================================================
<CAPTION>
Money
Balanced Equity International Market Participant
Fund Fund Fund Fund Loans Total
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions
Investment income:
Interest and dividend income $ 55,857 $ 60,771 $ 18,535 $ 121,453 $ 966,811
Net realized and unrealized
appreciation
(depreciation) of
investments (Note D) 30,491 115,611 (14,681) 754,787
------------------------------------------------------------------------------
86,348 176,382 3,854 121,453 1,721,598
Contributions:
Participants 44,120 73,460 19,904 136,746 525,635
Employer 39,967 65,715
------------------------------------------------------------------------------
44,120 73,460 19,904 176,713 591,350
------------------------------------------------------------------------------
Total additions 130,468 249,842 23,758 298,166 2,312,948
Deductions
Transfer of assets to
another plan (Note F) 8,388,583
Payments to participants, net
of repayments 29,985 91,254 57,361 849,314 $658,300 3,926,380
------------------------------------------------------------------------------
Total deductions 29,985 91,254 57,361 849,314 658,300 12,314,963
------------------------------------------------------------------------------
Net (decrease) increase prior
to interfund transfers 100,483 158,588 (33,603) (551,148) (658,300) (10,002,015)
Interfund transfers (net) 1,448,098 1,748,597 574,615 4,572,724 29,976 --
------------------------------------------------------------------------------
Net (decrease) increase 1,548,581 1,907,185 541,012 4,021,576 (628,324) (10,002,015)
Net assets available for
benefits at beginning of year 838,162 23,383,984
------------------------------------------------------------------------------
Net assets available for
benefits at end of year $1,548,581 $1,907,185 $541,012 $4,021,576 $209,838 $13,381,969
==============================================================================
</TABLE>
See notes to financial statements
* Formerly called the Equity Fund.
4
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
December 31, 1995
A. Description of the Plan
The following description of the Associates Investment Plan of Phillips-Van
Heusen Corporation (Crystal Brands Division) (the "Plan") provides only general
information. Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
Plan Amendments
On February 17, 1995, the net assets of Crystal Brands, Inc. were acquired by
the Phillips-Van Heusen Corporation. As a result of the acquisition,
responsibility for administering the Voluntary Investment Plan of Crystal
Brands, Inc. was assumed by the Phillips-Van Heusen Corporation.
Prior to February 17, 1995, the Plan was known as the Voluntary Investment Plan
of Crystal Brands, Inc. Prior to July 1, 1995, the Plan was known as the
Voluntary Investment Plan of Phillips-Van Heusen Corporation (Crystal Brands
Division). On July 1, 1995, the Plan changed its name to the Associates
Investment Plan of Phillips-Van Heusen Corporation (Crystal Brands Division).
Effective July 1, 1995, the Plan was restructured to mirror the Phillips-Van
Heusen Corporation Associates Investment Plan. As a result, the investment
options previously offered under the Voluntary Investment Plan of Phillips-Van
Heusen Corporation (Crystal Brands Division) were dissolved, with the exception
of the Fixed Income Fund whose remaining balances represent frozen assets. All
contribution, payment and loan policies have been amended to mirror the policies
of the Phillips-Van Heusen Corporation Associates Investment Plan.
5
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
General
The Plan is a defined contribution plan sponsored by Phillips-Van Heusen
Corporation (the "Company") covering non-union associates of the Company and
those of its domestic subsidiaries which have adopted the Plan who are employed
by the former Crystal Brands Division of the Company and who have at least one
year of service (1,000 hours in a year). The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 ("ERISA").
Contributions
Each year, participants may contribute up to 15% of pretax annual compensation,
as defined by the Plan. The Company contributes 50% of the first 6% of base
compensation that a participant contributes to the Plan.
Participant Accounts
Each participant's account is credited with the participant's contributions and
allocations of (a) the Company's contributions and (b) Plan earnings. Forfeited
balances of terminated participants' nonvested accounts are used to reduce
future Company contributions. One hundred percent of the Company contributions
are automatically invested in the common stock of the Company and may not
thereafter be transferred until the participant has reached the age of
fifty-five.
Vesting
Amounts attributable to Company contributions become vested on the participant's
sixty-fifth birthday or if the participant's employment by the Company
terminates by reason of the participant's death or permanent disability or the
participant has completed five years of service with the Company.
6
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
Investment Options
Upon enrollment in the Plan, a participant may direct employee contributions in
5% increments into any of the six investment options. A participant may
contribute a maximum of 25% of employee contributions into the Phillips-Van
Heusen Corporation Common Stock Fund.
Phillips-Van Heusen Corporation Common Stock Fund - Funds are invested by
the trustee in common shares of the Company. Common shares of the Company
are purchased by the trustee in the open market.
Money Market Fund - Funds are invested by the trustee in short-term
obligations and money market instruments.
Equity Fund - Funds are invested in shares of a registered investment
company that invests primarily in common stocks. (Fidelity Growth & Income
Portfolio)
Bond Fund - Funds are invested in shares of a registered investment company
that invests in corporate bonds and U.S. government securities. (Fidelity
Intermediate Bond Fund)
Balanced Fund - Funds are invested in shares of a registered investment
company that invests in common stocks, preferred stocks, and bonds.
(Fidelity Puritan Fund)
International Fund - Funds are invested in shares of a registered
investment company that invests in common stocks and bonds of companies and
governments outside the United States. (Templeton Foreign Fund)
7
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
Fixed Income Fund - The Fixed Income Fund, consisting of the Regular
Investment and the Tax Deductible Account, are invested in interest
contracts. The balance in this fund represents interest contracts with
Executive Life Insurance Company and Mutual Benefit Life Insurance Company
which, as discussed in Note C, have been classified as non-performing at
December 31, 1995 and 1994. No new uncommitted investments in interest
contracts were made subsequent to June 30, 1991. As of July 1, 1995, future
contributions to this fund are prohibited. Upon release of frozen assets,
funds will be transferred into the Money Market Fund where participants may
elect to withdraw or transfer the funds to other investment options.
Participant Loans Receivable
Participants may borrow from the Plan, with certain restrictions, using their
vested account balance as collateral. The minimum loan amount is $1,000 and the
maximum loan amount is the lesser of (i) $50,000 reduced by the participant's
highest outstanding loan balance during the previous twelve months or (ii) 50%
of the vested value of the participant's account. Interest is fixed for the term
of the loan at the prime rate as of the first business day of the month of
application as published in the Wall Street Journal, plus 1%. Loan repayments
are made through payroll deductions which may be specified for a term of 1 to 5
years or up to 15 years for the purchase of a primary residence.
Participants maintaining outstanding loans from the Plan as in effect prior to
July 1, 1995 will continue to have their loans governed by the loan provisions
of the Plan as in effect at the time of the loan. However, loan repayment
deductions may be adjusted to comply with their new payroll frequency effective
July 1, 1995.
Payment of Benefits
Participants entitled to final distributions generally will receive payment in
the form of a lump sum amount equal to the value of their vested account.
8
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
A. Description of the Plan (continued)
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.
B. Significant Accounting Policies
In accordance with accounting guidance, the Plan accounts for payments to
participants using the cash method. Accordingly, the Plan's statements of net
assets available for benefits do not reflect amounts payable to terminated,
retired or other participants as a liability. The Plan's financial statements
for the year ended December 31, 1994 have been restated for consistency
purposes.
The accounting records of the Plan are maintained on the accrual basis.
The Plan's investments are stated at fair value. The shares of registered
investment companies are valued at quoted market prices which represent the net
asset values of shares held by the Plan at year-end. Investments in the Money
Market Fund and participant loans receivable are stated at cost, which
approximates fair value. Interest contracts, except those with Executive Life
Insurance Company, are stated at cost plus accumulated interest. As discussed in
Note C, Executive Life Insurance Company interest contracts are stated at net
realizable value.
Purchases and sales of securities are reflected on a trade date basis.
Substantially all administrative expenses are paid by the Company.
The preparation of the 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 the estimates.
9
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
C. Non-Performing Interest Contracts
The investment alternatives of the Plan have included interest contracts with
insurance companies.
On April 11, 1991, the California Department of Insurance placed Executive Life
Insurance Company ("ELIC") into conservatorship and suspended all payments on
interest contracts issued by ELIC. Effective March 31, 1991, allocation of
interest on the Plan's ELIC interest contracts to participant accounts was
suspended, and on May 1, 1991, accrual of interest on the Plan's ELIC interest
contracts was suspended.
On August 13, 1993, the Los Angeles Superior Court approved a plan of
rehabilitation for ELIC that became effective on September 3, 1993. Immediately
prior to the effective date of the rehabilitation plan, ELIC restructured its
obligations, including interest contracts, downward to approximate the value of
the underlying assets. Pursuant to the plan, Aurora National Life Assurance
Company ("Aurora") assumed the restructured obligations in exchange for which it
received most of ELIC's liquid assets. The remaining assets were placed into
trusts managed by a board of trustees separate from Aurora. These trusts will be
liquidated over a five-year period and the proceeds will be used to fund
payments to investors.
Investors had two alternatives consisting of participating either (1) fully
("opt-in") or (2) partially ("opt-out") in the rehabilitation plan. After
performing an extensive credit review of Aurora and a financial analysis of the
two alternatives available under the plan, the Plan Trustee made the decision to
opt-out of the rehabilitation plan. The Trustee also considered the uncertainty
of how the Plan's investments would be treated in a liquidation of Aurora, the
ability of Aurora to fund the substantial maturation of contracts scheduled to
occur in 1998, and the limited historical and prospective financial information
available about Aurora.
The Plan's investment in ELIC interest contracts was $276,523 and $1,232,117 at
December 31, 1995 and 1994, respectively.
10
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
C. Non-Performing Interest Contracts (continued)
On July 16, 1991, on application of the Insurance Commissioner of the State of
New Jersey, the Superior Court of New Jersey placed the Mutual Benefit Life
Insurance Company ("MBLIC") into rehabilitation. Effective June 30, 1991,
allocation of interest on MBLIC interest contracts to participants was
suspended, and on January 1, 1992, the interest accrual rate on all MBLIC
contracts was reduced to 3% in accordance with the recommendation of the Deputy
Rehabilitator of MBLIC.
On November 10, 1993, the court approved a plan of rehabilitation for MBLIC. The
rehabilitation plan provides investors with two alternatives consisting of
either (1) participating ("opt-in") in the plan or (2) not participating
("opt-out") in the plan. Investors electing to opt-in are projected to receive
100% of their July 16, 1991 investment balance over a four-year period from
December 31, 1999 to December 31, 2003. Investors electing to opt-out will
receive approximately 55% of their July 16, 1991 investment balance no later
than mid-1996. The Plan's interest contracts with MBLIC are not covered by state
guaranty associations. For certain investments not covered by state guaranty
associations, including the Plan's interest contracts, the rehabilitation
provides, for those investors electing to opt-in, reinsurance by a consortium of
insurance companies including the Prudential Insurance Company of America and
the Metropolitan Life Insurance Company.
The Plan Trustee elected to opt-in to the MBLIC rehabilitation plan. The Trustee
made this decision after review and analysis of the rehabilitation plan and the
financial strength of the reinsurers. Based on the MBLIC rehabilitation plan,
including the reinsurance provision, no adjustment to the carrying values of
MBLIC interest contracts has been made.
The Plan's MBLIC interest contracts were credited with interest at 3.55% for
1995 and 1994, and at a rate to be determined based on performance of the
underlying assets for years after 1995.
Based on the above, interest contracts with ELIC and MBLIC were classified as
non-performing at December 31, 1995 and 1994.
11
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
D. Assets of the Plan
Assets of the Plan are held by State Street Bank and are presented in the
following table. Investments that represent 5% or more of the Plan's net assets
are identified by an asterisk.
Assets of the Plan held at December 31, 1995 are as follows:
December 31,
1995
-----------------
Shares of Registered Investment Companies:
Fidelity Intermediate Bond Fund, 37,099 shares $ 386,205
Fidelity Puritan Fund, 91,039 shares* 1,548,581
Fidelity Growth & Income Portfolio, 70,506 shares* 1,907,185
Templeton Foreign Fund, 58,934 shares 541,012
State Street Bank and Trust Company:
Short Term Investment Fund, 4,142,032 shares* 4,142,032
Phillips-Van Heusen Corporation Common Stock, 19,334 shares 190,923
Insurance Investment Contracts:
Executive Life Insurance Company 276,523
Mutual Benefit Life Insurance Company* 4,297,539
Promissory Notes (Participant Loans) 209,838
Interest and Dividend Receivable 25,579
=================
$ 13,525,417
=================
12
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
D. Assets of the Plan (continued)
Assets of the Plan held at December 31, 1994 are as follows:
December 31,
1994
--------------------
State Street Bank and Trust Co:
Government Short Term Investment Fund * $ 2,157,822
Short Term Investment Fund * 7,995,259
Insurance Investment Contracts:
CNA Insurance Company 349,699
Executive Life Insurance Company * 1,232,117
Mutual Benefit Life Insurance Company * 5,084,892
Principal Mutual Life Insurance Company 118,334
State Street Bank Index Fund, 78,725 shares* 5,554,908
Promissory Notes (Participant Loans) * 832,428
Interest and Dividend Receivable 58,525
--------------------
$ 23,383,984
====================
During the years ended December 31, 1995 and 1994, the Plan investments
appreciated by $754,787 and $35,047, respectively.
Net Appreciation
(Depreciation) in Fair
Value During Year Ended
December 31,
1995 1994
-----------------------------
Fair Value of Assets Determined by Quoted
Market Price:
Crystal Brands, Inc. Common Stock Fund $ - $ (1)
Phillips-Van Heusen Corp. Common Stock (27,514) -
Fidelity Intermediate Bond Fund 7,810 -
Fidelity Puritan Fund 30,491 -
Fidelity Growth & Income Fund 115,611 -
Templeton Foreign Fund (14,681) -
Fair value estimated by trustee:
State Street Bank Index Fund 643,070 35,048
=============================
$ 754,787 $ 35,047
=============================
13
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
E. Transactions with Parties-in-Interest
During the year ended December 31, 1995, the Plan purchased 19,334 shares of the
Company's common stock and received $191 from the Company as payment of
dividends on its common stock.
F. Sale of Subsidiary
On December 13, 1994, Crystal Brands, Inc. sold the Monet Group, Inc., a
wholly-owned subsidiary. As a result, the net assets of the Plan pertaining to
the participants from the Monet Group, Inc., amounting to $8,388,583, were
transferred during 1995 to a plan of the purchaser.
G. Income Taxes
The Internal Revenue Service has ruled that the Plan qualifies under Section
401(a) of the Internal Revenue Code ("IRC") and therefore its related trust is
tax-exempt under Section 501(a) of the IRC. The Plan's most recent determination
letter is dated September 13, 1995. The Administrative Committee of the Plan is
not aware of any course of action or series of events that have occurred that
might adversely affect the qualified status of the Plan.
H. Differences Between Financial Statements and Form 5500
The following is a reconciliation of net assets available for benefits per the
financial statements to the Form 5500:
<TABLE>
<CAPTION>
December 31,
1995
-------------
<S> <C>
Net assets available for plan benefits per the financial statements $ 13,381,969
Amounts allocated to withdrawn participants at December 31, 1995 (703,948)
-------------
Net assets available for plan benefits per the Form 5500 $ 12,678,021
=============
</TABLE>
14
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements (continued)
H. Differences Between Financial Statements and Form 5500 (continued)
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500:
<TABLE>
<CAPTION>
December 31,
1995
-------------
<S> <C>
Benefits paid to participants per the financial statements $ 3,926,380
Add: Amounts allocated to withdrawn participants at December 31, 1995 703,948
Less: Amounts allocated to withdrawn participants at December 31, 1994 (594,241)
-------------
Benefits paid to participants per the Form 5500 $ 4,036,087
=============
</TABLE>
Amounts allocated to withdrawn participants on the Form 5500 represent benefit
claims that have been processed and approved for payment prior to year-end but
not yet paid.
15
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Assets Held for Investment Purposes
December 31, 1995
<TABLE>
<CAPTION>
Identity of Issuer Description Cost Balance
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
State Street Bank and Trust Company:
Short Term Investment Fund 4,142,032 shares $ 4,142,032 $ 4,142,032
Fidelity Intermediate Bond Fund 37,099 shares 378,425 386,205
Fidelity Puritan Fund 91,039 shares 1,518,101 1,548,581
Fidelity Growth & Income Portfolio 70,506 shares 1,791,602 1,907,185
Templeton Foreign Fund 58,934 shares 555,513 541,012
Phillips-Van Heusen Corporation Common
Stock 19,334 shares 218,437 190,923
Executive Life Insurance Company Interest Contracts* 276,523 276,523
Mutual Benefit Life Insurance Company Interest Contracts* 4,297,539 4,297,539
Promissory Notes Participant loans 209,838 209,838
---------------------------------
$ 13,388,010 $ 13,499,838
=================================
</TABLE>
* Maturity dates and interest rates are subject to statutory conservatorship
rules. See Note C for further information.
16
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Reportable Transactions
Year ended December 31, 1995
<TABLE>
<CAPTION>
Purchase
Party Involved Description Price
- -----------------------------------------------------------------------------------
<S> <C> <C>
Category (i)--individual transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Fidelity Growth & Income Portfolio $1,300,000
State Street Bank and Trust Co. Fidelity Puritan Fund $1,300,000
State Street Bank and Trust Co. Government Short Term Investment
Fund
State Street Bank and Trust Co. Government Short Term Investment
Fund
State Street Bank and Trust Co. Short Term Investment Fund
State Street Bank and Trust Co. Short Term Investment Fund
State Street Bank and Trust Co. Short Term Investment Fund $3,254,684
State Street Bank and Trust Co. Short Term Investment Fund $1,957,431
State Street Bank and Trust Co. Short Term Investment Fund
State Street Bank and Trust Co. State Street Bank S&P 500 Index
Fund
State Street Bank and Trust Co. State Street Bank S&P 500 Index
Fund
<CAPTION>
Selling Cost of Net Gain Number of
Party Involved Description Price Asset Sold or (Loss) Transactions
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Category (i)--individual transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Fidelity Growth & Income Portfolio 1
State Street Bank and Trust Co. Fidelity Puritan Fund 1
State Street Bank and Trust Co. Government Short Term Investment $1,075,325 $1,075,325 1
Fund
State Street Bank and Trust Co. Government Short Term Investment $ 802,684 $ 802,684 1
Fund
State Street Bank and Trust Co. Short Term Investment Fund $2,845,534 $2,845,534 1
State Street Bank and Trust Co. Short Term Investment Fund $4,368,198 $4,368,198 1
State Street Bank and Trust Co. Short Term Investment Fund 1
State Street Bank and Trust Co. Short Term Investment Fund 1
State Street Bank and Trust Co. Short Term Investment Fund $ 803,089 $ 803,089 1
State Street Bank and Trust Co. State Street Bank S&P 500 Index $2,052,115 $1,445,110 $ 607,005 1
Fund
State Street Bank and Trust Co. State Street Bank S&P 500 Index $3,242,928 $1,942,410 $1,300,518 1
Fund
</TABLE>
17
<PAGE>
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Reportable Transactions (continued)
Year ended December 31, 1995
<TABLE>
<CAPTION>
Purchase Selling
Party Involved Description Price Price
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Category (iii)--series of transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Government Short Term Investment $ 138,069 $ 2,295,891
Fund
State Street Bank and Trust Co. State Street S&P 500 Index Fund $ 132,321 $ 6,330,299
State Street Bank and Trust Co. Short Term Investment Fund $7,611,840 $11,475,234
State Street Bank and Trust Co. Fidelity Puritan Fund $1,520,783 $ 2,689
State Street Bank and Trust Co. Fidelity Growth & Income Portfolio $1,818,760 $ 27,092
<CAPTION>
Cost of Net Gain Number of
Party Involved Description Asset Sold or (Loss) Transactions
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Category (iii)--series of transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Government Short Term Investment $ 2,295,891 38
Fund
State Street Bank and Trust Co. State Street S&P 500 Index Fund $ 4,043,119 $2,287,180 33
State Street Bank and Trust Co. Short Term Investment Fund $11,475,234 190
State Street Bank and Trust Co. Fidelity Puritan Fund $ 2,683 $ 6 10
State Street Bank and Trust Co. Fidelity Growth & Income Portfolio $ 27,158 $ (66) 10
</TABLE>
There are no category (ii) or (iv) reportable transactions for the year ended
December 31, 1995.
18
[LETTERHEAD OF ERNST & YOUNG LLP]
Consent of Independent Accountants
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Associates Investment Plan of the Phillips-Van Heusen
Corporation (Crystal Brands Division), formerly the Voluntary Investment Plan of
Crystal Brands, Inc., of our reports dated June 26, 1996, with respect to the
financial statements and supplemental schedules of the above mentioned plan
included in this Annual Report (Form 11K) for the year ended December 31, 1995.
/s/ Ernst & Young LLP
June 26, 1996
New York, New York
