<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED JUNE 30, 1997
COMMISSION FILE NUMBER 1-2275
THE SEAGRAM COMPANY LTD.
(Exact name of registrant as specified in its charter)
Canada None
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1430 Peel Street, Montreal, Quebec, Canada H3A 1S9
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (514) 849-5271
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-K for the
fiscal year ended June 30, 1997 (the "Form 10-K") as set forth below and in the
pages attached hereto:
Item 14. Exhibits, Financial Statement Schedules and Reports on Form
8-K
Item 14 is hereby amended and supplemented pursuant to Rule
15d-21 under the Securities Exchange Act of 1934, as amended,
to include as Exhibits 99(a), 99(b), 99(c), 99(d), 99(e) and
99(f) to the Form 10-K the attached Forms 11-K with respect
to the Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates, the
Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Universal
Employees, the Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates -
UNI Employees, the Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates -
Spencer Employees, the Retirement Savings and Investment Plan
for Union Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates and the Retirement Savings and Investment Plan
for Union Employees of Tropicana Products, Inc. and
Affiliates, respectively.
<PAGE> 2
2
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
THE SEAGRAM COMPANY LTD.
By /s/ Daniel R. Paladino
---------------------------------------------------
Daniel R. Paladino
Executive Vice President, Legal and Environmental Affairs
Date: June 29, 1998
<PAGE> 1
EXHIBIT 99(a)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
375 Park Avenue
New York, New York 10152
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates (the "Plan") is subject to the
requirements of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"). Attached hereto are the financial statements of the
Plan for the fiscal year ended December 31, 1997 prepared in accordance
with the financial reporting requirements of ERISA.
EXHIBITS
1. Financial statements of the Plan for the fiscal year ended December 31,
1997 prepared in accordance with the financial reporting requirements
of ERISA.
2. Consent of Gutierrez & Co., independent accountants.
<PAGE> 3
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC. AND
AFFILIATES
By /s/ John Borgia
-------------------------------
John Borgia
Member of Investment Committee
Date: June 29, 1998
<PAGE> 4
4
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC.
AND AFFILIATES
FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
INDEX TO FINANCIAL STATEMENTS
Page
Independent Auditors' Report 1
Statements of Net Assets Available for
Benefits 2
Statements of Changes in Net Assets
Available for Benefits 3
Notes to Financial Statements 4
<PAGE> 6
INDEPENDENT AUDITORS' REPORT
To the Administrative Committee of the
Retirement Savings and Investment Plan for
Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates
We have audited the accompanying statements of net assets available for
benefits of the Retirement Savings and Investment Plan for Employees of Joseph
E. Seagram & Sons, Inc. and Affiliates (the "Plan") as of December 31, 1997 and
1996, and the related statements of changes in net assets available for benefits
for the years then ended. 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 audits 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
Retirement Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates at December 31, 1997 and 1996, and the changes in net
assets available for benefits for the years then ended in conformity with
generally accepted accounting principles.
/s/ Gutierrez & Co.
Flushing, New York
June 26, 1998
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------
1997 1996
------------- ------------
<S> <C> <C>
INVESTMENTS (Note 3)
Money Market Fund:
State Street STIF Unitized Fund (cost of $30,285,051) $ -- $ 13,467,503
Stable Income Fund:
The LaSalle Income Plus Fund (cost of $30,488,226) -- 30,488,226
Bond Fund:
Putnam Income Fund, Class A Shares (cost of $12,288,286) -- 12,814,725
S&P 500 Index Fund:
State Street S&P 500 Flagship Fund Series C (cost of $47,901,676) -- 51,590,899
Managed Equity Fund:
Lazard Equity Portfolio Fund (cost of $13,913,862) -- 15,144,694
Growth Equity Fund:
Brandywine Fund Inc. Common Shares (cost of $34,659,726) -- 42,827,130
Seagram Stock Fund:
The Seagram Company Ltd. Common Shares (cost of $11,494,075) -- 17,411,150
Collective Short Term Investment Fund (cost of $419,813) 419,813
The Coca-Cola Company Stock Fund:
The Coca-Cola Company Common Stock (cost of $618,567) -- 5,717,443
Collective Short Term Investment Fund (cost of $125,291) -- 125,291
Loans to Participants -- 8,807,386
------------- ------------
Total Investments $ -- $198,814,260
------------- ------------
RECEIVABLES
Dividends and Interest $ -- $ 224,992
Proceeds from Unsettled Sales -- 160,500
------------- ------------
Total Receivables -- 385,492
------------- ------------
TOTAL ASSETS -- 199,199,752
------------- ------------
LIABILITIES
Cost of Unsettled Purchases -- 100,213
------------- ------------
Total Liabilities -- 100,213
------------- ------------
Net assets held in trust by Bank of New York (Note 12) 233,648,433 --
------------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 233,648,433 $199,099,539
============= ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
-2-
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------
1997 1996
------------- -------------
<S> <C> <C>
CONTRIBUTIONS
Participating Employees $ 16,179,744 $ 15,803,003
Participating Companies 3,051,881 3,005,234
------------- -------------
19,231,625 18,808,237
------------- -------------
INVESTMENT ACTIVITIES
Investment Income
Money Market Fund -- 590,523
Stable Income Fund -- 1,727,962
Bond Fund -- 852,725
S&P 500 Index Fund -- --
Managed Equity Fund -- 221,938
Growth Equity Fund -- 352,361
Seagram Stock Fund -- 320,533
The Coca-Cola Company Stock Fund -- 69,537
------------- -------------
Total Investment Income -- 4,135,579
------------- -------------
Realized Net Gain on Sale of Investments
Bond Fund -- 269,530
S&P 500 Index Fund -- 14,010,351
Managed Equity Fund -- 998,472
Growth Equity Fund -- 2,207,821
Seagram Stock Fund -- 1,571,315
The Coca-Cola Company Stock Fund -- 1,198,239
-------------
Total Realized Net Gain on Sale of
Investments -- 20,255,728
-------------
Unrealized Appreciation (Depreciation) on
Investments
Bond Fund -- (641,908)
S&P 500 Index Fund -- (6,189,076)
Growth Equity Fund -- 5,557,795
Managed Equity Fund -- 781,628
Seagram Stock Fund -- 516,599
The Coca-Cola Company Stock Fund -- 725,091
------------- -------------
Total Unrealized Appreciation on Investments -- 750,129
------------- -------------
Investment Managers' and Other Fees
Money Market Fund -- (11,923)
S&P 500 Index Fund -- (60,833)
Seagram Stock Fund -- (20,458)
Stable Income Fund -- (58,399)
Growth Equity Fund -- (39,693)
------------- -------------
Total Investment Managers' and Other Fees -- (191,306)
------------- -------------
Increase in Plan Equity from Investment Activities -- 24,950,130
------------- -------------
INVESTMENT INCOME ON ASSETS HELD BY
BANK OF NEW YORK (NOTE 11)
Net appreciation in fair value of investments 25,269,817 --
Dividends 359,043 --
Interest 3,916,535 --
Administrative expenses (223,052) --
PARTICIPANT WITHDRAWALS (14,005,074) (8,687,945)
------------- -------------
INCREASE IN PLAN EQUITY 34,548,894 35,070,422
PLAN EQUITY AT BEGINNING OF YEAR 199,099,539 164,029,117
------------- -------------
PLAN EQUITY AT END OF YEAR $ 233,648,433 $ 199,099,539
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
-3-
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Retirement Savings and Investment Plan for Employees
of Joseph E. Seagram & Sons, Inc. and Affiliates (the "Plan") conform
with generally accepted accounting principles. The more significant
accounting policies are:
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the plan administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those
estimates.
Investment Valuation
Effective January 1, 1997, the assets are held in trust by Bank of New
York (Trustee) in the Joseph E. Seagram & Sons, Inc. Master Trust
(Master Trust), which also includes assets of the 401(k) plans of the
Company's affiliates, Universal Studios, Inc., Uni Distribution
Corporation and Spencer Gifts, Inc. The related investment income and
appreciation in fair value represents allocations to the Plan based
upon the ratio of the Plan's assets to total Master Trust Assets.
Investment securities are recorded and valued as follows:
United States government obligations at fair value based on the current
market yields; temporary investments in short-term investment funds at
cost which in the normal course approximates market value; securities
representing units of other funds at net asset value; The Seagram
Company Ltd. common shares and The Coca-Cola Company common stock at
the closing price reported on the composite tape of the New York Stock
Exchange on the valuation date.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States
Treasury Bonds are reflected as unrealized appreciation.
2. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan established as of August 1,
1985 by Joseph E. Seagram & Sons, Inc. (the "Company").
The Plan covers employees of the Company and certain of its United
States subsidiaries (collectively, the "Participating Companies") whose
annual base salary or regular wages, (excluding overtime, bonuses,
commissions or other special or contingent payments) exceeds $15,186 as
of December 31, 1997 (increased on the last day of each year by 4%) and
who are either (i) salaried employees, or (ii) hourly employees not
employed in a classification designated by the Participating Companies
from time to time, excluding various categories of employees specified
in the Plan (including persons represented by a collective bargaining
agent, persons employed on a special basis, and persons employed by an
operating unit of the Participating Companies to which the Plan has not
been extended).
The Plan provides benefits to participants based upon amounts
voluntarily contributed to a participant's Accounts by the participant
and, amounts contributed, under certain circumstances, by the
Participating
-4-
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
2. DESCRIPTION OF THE PLAN (continued)
Companies (see Note 4). Under the Plan, a participant is not provided
with any fixed benefit. The ultimate benefit to be received by the
participant depends on the amounts contributed, the investment results
(and other adjustments), and the participant's vested interest at
termination of employment (see Note 5).
With respect to each participant, contributions are allocated among
various Accounts specified in the Plan including the Pre-Tax Account,
Company Match Account, After-Tax Account and Rollover Account. Such
contributions are invested as designated by the participants in one
or more of the investment funds referred to in Note 3, and are
accumulated and invested in the Master Trust. Plan assets are solely
available for the benefit of and used to satisfy the liabilities
incurred on behalf of employees covered by the Plan. The Plan is
administered by the Company through an Administrative Committee
appointed by the Board of Directors of the Company.
Effective November 1, 1987, the Thrift Plan for Employees of the Wine
Spectrum Companies (the "Wine Spectrum Plan") was merged with the Plan.
The eligible employees of the Wine Spectrum Plan became members of the
Plan. As a result of the merger, the Plan retains the Coca-Cola Company
Stock held by the Wine Spectrum Plan; however, no election may be made
to transfer any funds into the Coca-Cola Company Stock Fund.
3. INVESTMENT PROGRAM
During the year ended December 31, 1997, the Plan was comprised of
seven investment funds: (i) the Money Market Fund investing in the
State Street Yield Enhanced STIF Fund (which replaced the State Street
STIF Unitized Fund on October 4, 1997) managed by State Street Bank and
Trust Company; (ii) the Stable Income Fund investing in the Income Plus
Fund managed by LaSalle National Trust, N.A.; (iii) the Bond Fund
investing in Putnam Income Fund, Class A Shares managed by Putnam
Investment Management; (iv) the S&P 500 Index Fund investing in the S&P
500 Flagship Fund, Series C, managed by State Street Bank and Trust
Company; (v) the Managed Equity Fund investing in Lazard Equity
Portfolio managed by Lazard Freres Asset Management; (vi) the Growth
Equity Fund investing in Brandywine Fund, Inc. managed by Friess
Associates; and (vii) the Seagram Stock Fund investing primarily in The
Seagram Company Ltd. common shares. The investments are administered by
the Investment Committee appointed by the Board of Directors of the
Company.
4. CONTRIBUTIONS
Non-highly compensated employees, as defined, may elect to contribute
to their Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions")
and/or to their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 17% (in the
aggregate) of their annual salary (as defined in the Plan), in
multiples of 1%, in any combination. Highly-compensated employees, as
defined, may elect to contribute from 1% to 10% of their annual salary
on a pre-tax basis and from 1% to 17% of their annual salary on an
after-tax basis; provided, the aggregate percentage of the
contributions does not exceed 17% of their annual salary. Pre-tax
Contributions and After-Tax Contributions are subject to limitations
imposed by federal law for qualified retirement plans.
The Plan provides for mandatory matching contributions by the
Participating Companies payable to the participants' Company Match
Account. The Participating Companies, except as herein noted,
contribute on behalf of the participants 25% of the participants'
Pre-Tax Contributions not exceeding 6% of their Pre-Tax Contributions.
The maximum Company matching contribution is $1,125 a year. Tropicana
Products, Inc., a subsidiary of the Company, contributes, without a
cap, to the Company Match Account on behalf of the participants 50% of
the participants' aggregate Pre-tax and After-Tax Contributions not
exceeding 6% of their combined Contributions. The Participating
Companies' matching contributions are subject to limitations imposed
by federal law for qualified retirement plans.
The Plan will accept into participants' Rollover Accounts cash received
by participants from a qualified plan within the time prescribed by
applicable law ("Rollover Contributions").
-5-
<PAGE> 11
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
4. CONTRIBUTIONS (continued)
The Participating Companies may make discretionary contributions to
participants' Company Match Accounts, in an amount to be determined by
the Participating Companies. The Participating Companies have not made
discretionary contributions since the inception of the Plan.
5. VESTING
A participant in the Plan always has a fully vested interest in the
value of his or her Pre-Tax, After-Tax and Rollover Accounts. He or she
has a non-forfeitable right to the value of his or her Company Match
Account upon retirement, Disability (as defined in the Plan) or death.
Upon termination of employment for any other reason, a participant
vests in his or her Company Match Account in accordance with the
following vesting schedule:
<TABLE>
<CAPTION>
Years of Service Vested Percentage
---------------- -----------------
<S> <C>
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
</TABLE>
Upon termination of employment for reasons other than retirement,
Disability or death of a participant who was not fully vested in his or
her Company Match Account, the nonvested portion of the participant's
Company Match Account shall be forfeited. Any amount forfeited shall be
applied to reduce the Participating Companies' contributions. Any
amount forfeited shall be restored if the participant is re-employed by
a Participating Company before incurring a five year break in service
and if the participant repays to the Plan (within five years after his
or her reemployment commencement date) an amount in cash equal to the
full amount distributed to him or her from the Plan on account of
termination of employment, excluding amounts from the After-Tax and
Rollover Accounts at the participant's election.
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of
Disability or death, the participant or his or her beneficiary shall
receive the value of his or her Accounts. However, if the termination
of employment is for reasons other than retirement, Disability or
death, the participant shall receive only the value of the vested
portion of his or her Accounts (See Note 5). In accordance with the
Plan, a terminated employee may elect to receive an immediate
distribution of his or her Accounts.
Prior to termination of employment, the participant may withdraw
amounts from the participant's Accounts, in accordance with the
provisions of the Plan.
-6-
<PAGE> 12
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
7. LOANS TO PARTICIPANTS
A participant may apply for loans up to the lesser of $50,000 or 50% of
the value of the vested portion of the participant's Accounts. The
minimum loan amount is $1,000. The maximum repayment terms are 5 years
for general purpose loans and 25 years for principal residence loans.
Applications for loans must be approved by the Administrative
Committee. The amounts borrowed are transferred from the investment
funds in which the participant's Accounts are currently invested.
Repayments and interest thereon are credited to the participant's
current investment funds through payroll deductions made each pay
period. The interest rate for loans is based on the prime rate on the
first business day of the month in which the loan is made plus one
percentage point.
8. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated August 14,
1995 that the Plan is qualified under Section 401(a) of the Internal
Revenue Code. The Plan has been subsequently amended and a request
(dated March 16, 1998) to the Internal Revenue Service for a favorable
determination with respect to the Plan's continued qualification in
light of such amendments is currently pending. So long as the Plan
continues to be so qualified, it is not subject to Federal income
taxes.
Participants are not currently subject to income tax on the
Participating Companies' contributions to the Plan or on income earned
by the Plan. Benefits distributed to participants or to their
beneficiaries may be taxable to them. The tax treatment of the value of
such benefits depends on the event giving rise to the distribution and
the method of distribution selected.
9. RELATED PARTY TRANSACTIONS
Some of the expenses including trustee, custodial, and some
recordkeeping fees, are paid by the Company, and personnel and
facilities of the Company are used by the Plan at no charge.
10. TERMINATION OF THE PLAN
The Board of Directors of the Company may terminate the Plan at any
time. In the case of termination, the rights of participants to their
Accounts shall be vested as of the date of termination.
-7-
<PAGE> 13
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
11. ASSETS HELD IN TRUST
Effective January 1, 1997, the assets of the Plan are invested in the
Master Trust held by the Trustee where the assets of related employee
benefit plans of affiliates are invested on a commingled basis. Assets
of three affiliates' plans were transferred on January 1, 1997 to the
Master Trust.
The Master Trust net assets consist of the following classification of
assets and liabilities as of December 31, 1997.
Assets
Investments held in trust at fair value determined by quoted market
prices:
<TABLE>
<S> <C>
Money Market Fund
State Street Yield Enhanced STIF Fund $ 24,089,219
Stable Income Fund
The LaSalle Income Plus Fund 34,562,612
Bond Fund
Putnam Income Fund, Class A Shares 27,015,278
S&P 500 Index Fund
State Street S&P 500 Flagship Fund, Series C 133,217,637
Managed Equity Fund
Lazard Equity Portfolio Fund 30,054,896
Growth Equity Fund
Brandywine Fund Inc. Common Shares 58,963,046
Seagram Stock Fund
The Seagram Company Ltd. Common Shares 15,210,786
Collective Short Term Investment Fund 523,383
The Coca-Cola Company Stock Fund
The Coca-Cola Company Common Stock 3,922,692
Collective Short Term Investment Fund 103,633
Loans to Participants 10,426,983
------------
Total Investments 338,090,165
============
Receivables
Accrued interest and dividends 300,821
Proceeds from securities sold 5,274,926
------------
Total Receivables 5,575,747
------------
Total assets 343,665,912
============
</TABLE>
-8-
<PAGE> 14
11. ASSETS HELD IN TRUST (continued)
<TABLE>
<S> <C>
Liabilities
Accounts payable for securities purchased 4,865,553
Administrative expenses 8,834
Benefit payments 519,622
------------
Total liabilities 5,394,009
------------
Net Assets $338,271,903
============
</TABLE>
As of December 31, 1997, the equitable share of the Retirement Savings
and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates in the Master Trust is 69.1%.
As of December 31, 1997, the net assets of the Master Trust available
to the Plan for benefits in the individual investment funds were as
follows:
<TABLE>
<S> <C>
Money Market Fund $11,471,985
Stable Income Fund 31,027,495
Bond Fund 15,400,892
S & P 500 Index Fund 74,878,658
Managed Equity Fund 23,293,060
Growth Equity Fund 50,642,884
Seagram Stock Fund 14,403,216
The Coca-Cola Company Stock Fund 4,025,633
Loan accounts 8,504,610
------------
Total $233,648,433
============
</TABLE>
12. INVESTMENT INCOME FROM MASTER TRUST
The appreciation in fair value and other income is as follows:
Investments held in trust at fair value determined by quoted market
prices:
<TABLE>
<CAPTION>
December 31,
1997
------------
<S> <C>
Bond Fund $ 436,843
S & P 500 Index Fund 35,154,443
Managed Equity Fund 4,172,355
Growth Equity Fund 5,076,157
Seagram Stock Fund (2,917,700)
The Coca-Cola Company Stock Fund 1,104,840
-----------
Investment gains (net of investment expenses/
losses) 43,026,938
-----------
Interest 5,497,996
Dividends 385,589
-----------
Investment Income $48,910,523
===========
</TABLE>
13. Subsequent Events
In connection with the proposed initial public offering of Tropicana
Products, Inc. ("Tropicana"), it is anticipated that Tropicana will
establish a separate plan and trust. Assets and liabilities of the Plan
attributable to Accounts of employees of Tropicana and its
subsidiaries presently held in the Master Trust will be transferred to
a new trust.
-9-
<PAGE> 15
The Seagram Company Ltd.
The Retirement Savings and Investment Plan for Employees of Joseph E. Seagram &
Sons, Inc. and Affiliates
We hereby consent to the incorporation by reference in Registration
Statement Nos. 33-2043 and 33-99122 on Form S-8 of our Report dated June 26,
1998 which appears in your Annual Report on Form 11-K of the Retirement Savings
and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates for the fiscal year ended December 31, 1997.
/s/ Gutierrez & Co.
Flushing, New York
June 29, 1998
-10-
<PAGE> 1
EXHIBIT 99(b)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC.
AND AFFILIATES - UNIVERSAL EMPLOYEES
375 Park Avenue
New York, New York 10152
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates-Universal Employees (the "Universal
Plan") is subject to the requirements of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). Attached hereto are the
financial statements of the Universal Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
EXHIBITS
1. Financial statements of the Universal Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
2. Consent of Price Waterhouse LLP, independent accountants.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC. AND
AFFILIATES - UNIVERSAL EMPLOYEES
By /s/ John Borgia
-----------------------------
John Borgia
Member of Investment Committee
Date: June 29, 1998
<PAGE> 4
RETIREMENT SAVINGS AND
INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E.
SEAGRAM & SONS, INC. AND
AFFILIATES - UNIVERSAL
EMPLOYEES
REPORT AND FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E.
SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
INDEX TO FINANCIAL STATEMENTS*
Page
Report of Independent Accountants....................................... 1
Statements of Net Assets Available for Plan Benefits (with Fund
Information) at December 31, 1997 and 1996........................... 2
Statement of Changes in Net Assets Available for Plan Benefits (with
Fund Information) for the year ended December 31, 1997.................. 3
Notes to Financial Statements........................................... 4
* All schedules required to be filed with the Department of
Labor have been omitted because the schedules are not applicable.
<PAGE> 6
REPORT OF INDEPENDENT ACCOUNTANTS
June 26, 1998
To the Participants and Administrative Committee
of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Universal Employees
In our opinion, the accompanying statements of net assets available for plan
benefits as of December 31, 1997 and 1996 and the related statement of changes
in net assets available for plan benefits for the year ended December 31, 1997
present fairly, in all material respects, the net assets available for plan
benefits of the Retirement Savings and Investment Plan for Employees of Joseph
E. Seagram & Sons, Inc. and Affiliates - Universal Employees (the Plan, formerly
the MCA INC. Employee Savings Plan) at December 31, 1997 and 1996, and the
changes in net assets available for plan benefits for the year ended December
31, 1997, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Plan's Administrative
Committee; 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 generally accepted auditing standards 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.
/s/ Price Waterhouse LLP
1
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
DECEMBER 31, 1997 AND 1996
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth
Market Income Bond Index Equity Equity
Fund Fund Fund Fund Fund Fund
---- ---- ---- ---- ---- ----
December 31, 1997
- -----------------
<S> <C> <C> <C> <C> <C> <C>
Assets held in Master Trust (Note 9) $11,422,325 $ 3,164,254 $10,672,837 $54,182,651 $ 6,357,839 $ 7,960,564
Contributions receivable 68,224 18,907 63,439 321,738 37,791 47,317
Accrued income 55,577 16,712 -- -- -- --
----------- ----------- ----------- ----------- ----------- -----------
Net assets available
for Plan benefits $11,546,126 $ 3,199,873 $10,736,276 $54,504,389 $ 6,395,630 $ 8,007,881
=========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
Seagram
Stock Loan
Fund Account Total
---- ------- -----
December 31, 1997
- -----------------
<S> <C> <C> <C>
Assets held in Master Trust (Note 9) $ 1,354,459 $ 1,621,555 $ 96,736,484
Contributions receivable 8,051 -- 565,467
Accrued income 134 -- 72,423
----------- ----------- ------------
Net assets available
for Plan benefits $ 1,362,644 $ 1,621,555 $ 97,374,374
=========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
Short Term Equity Intermediate
Investment Index Bond
Fund Fund Index Fund Total
---- ---- ---------- -----
December 31, 1996
- -----------------
<S> <C> <C> <C> <C>
Assets held in Master Trust (Note 9) $15,130,420 $48,054,390 $11,680,840 $74,865,650
Contributions receivable 250 1,520 40 1,810
Accrued income 65,680 22,860 1,700 90,240
----------- ----------- ----------- -----------
Net assets available
for Plan benefits $15,196,350 $48,078,770 $11,682,580 $74,957,700
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
FOR THE YEAR ENDED DECEMBER 31, 1997
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth
Market Income Bond Index Equity Equity
Fund Fund Fund Fund Fund Fund
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ -- $ -- $ 198,648 $15,623,854 $ 527,502 $ 329,767
Interest and dividends 699,403 108,038 714,620 -- 63,059 --
----------- ----------- ----------- ----------- ----------- -----------
Net investment income (loss) 699,403 108,038 913,268 15,623,854 590,561 329,767
----------- ----------- ----------- ----------- ----------- -----------
Contributions
Employee 1,295,290 358,974 1,204,438 6,108,487 717,487 898,356
Employer 368,877 105,352 344,196 1,760,264 209,517 260,901
----------- ----------- ----------- ----------- ----------- -----------
Total contributions 1,664,167 464,326 1,548,634 7,868,751 927,004 1,159,257
----------- ----------- ----------- ----------- ----------- -----------
Total additions 2,363,570 572,364 2,461,902 23,492,605 1,517,565 1,489,024
----------- ----------- ----------- ----------- ----------- -----------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (1,972,928) (90,306) (2,531,977) (4,504,794) (267,251) (176,818)
Interfund Transfers 11,155,484 2,717,815 10,806,351 35,516,578 5,145,316 6,695,675
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in Plan assets 11,546,126 3,199,873 10,736,276 54,504,389 6,395,630 8,007,881
Net assets available for Plan benefits:
Beginning of year -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- -----------
End of year $11,546,126 $ 3,199,873 $10,736,276 $54,504,389 $ 6,395,630 $ 8,007,881
=========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
Seagram Short-Term Equity Intermediate
Stock Loan Investment Index Bond
Fund Account Fund Fund Index Fund Total
---- ------- ---- ---- ---------- -----
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ (167,175) $ -- $ -- $ -- $ -- $16,512,596
Interest and dividends 19,639 58,446 -- -- -- 1,663,205
----------- ----------- ----------- ----------- ----------- -----------
Net investment income (loss) (147,536) 58,446 -- -- -- 18,175,801
----------- ----------- ----------- ----------- ----------- -----------
Contributions
Employee 152,866 -- -- -- -- 10,735,898
Employer 43,061 -- -- -- -- 3,092,168
----------- ----------- ----------- ----------- ----------- -----------
Total contributions 195,927 -- -- -- -- 13,828,066
----------- ----------- ----------- ----------- ----------- -----------
Total additions 48,391 58,446 -- -- -- 32,003,867
----------- ----------- ----------- ----------- ----------- -----------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (26,942) (16,177) -- -- -- (9,587,193)
Interfund Transfers 1,341,195 1,579,286 (15,196,350) (48,078,770) (11,682,580) --
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in Plan assets 1,362,644 1,621,555 (15,196,350) (48,078,770) (11,682,580) 22,416,674
Net assets available for Plan benefits:
Beginning of year -- -- 15,196,350 48,078,770 11,682,580 74,957,700
----------- ----------- ----------- ----------- ----------- -----------
End of year $ 1,362,644 $ 1,621,555 $ -- $ -- $ -- $97,374,374
=========== =========== =========== ============ =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan originally established as the MCA
INC. Employee Savings Plan ("MCA Plan") and is subject to the provisions
of the Employee Retirement Income Security Act of 1974 ("ERISA").
Effective January 1, 1997, the MCA Plan was amended and continued in
the form of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates ("the Seagram Plan").
The name of the MCA Plan was changed to the Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - Universal Employees (the "Plan"). To simplify plan
administration, the Plan was amended in the form of the Seagram Plan,
including certain modifications to the terms, to accommodate benefit
provisions solely applicable to eligible employees of Universal
Studios, Inc. ("Universal"). Notwithstanding the adoption of the terms
of the Seagram Plan, the Plan has continued its existence as a separate
plan. Plan assets are solely available for the benefit of and used to
satisfy the liabilities incurred on behalf of employees covered by the
Plan.
The Plan covers employees of Universal and certain of its United States
subsidiaries (collectively, the "Participating Companies") who are either
(i) salaried employees or (ii) hourly employees employed in a
classification designated by the Participating Companies from time to
time, excluding persons who are members of a labor union, guild or other
collective bargaining unit unless the employee is salaried and paid in
whole or part by Universal or whose employment is subject to a labor
agreement, persons employed on a special basis and persons employed by an
operating unit of the Participating Companies to which the Plan has not
been extended. In addition, non-salaried employees of Hilltop Service,
Inc., seasonal and temporary employees of the Universal Studios Tour,
certain temporary clerical employees and interns must complete one year of
service before they are eligible to participate in the Plan.
The Plan provides benefits to participants based upon amounts voluntarily
contributed to a participant's account by the participant, and amounts
contributed, under certain circumstances, by the Participating Companies
(see Note 4). The ultimate benefit to be received by the participant
depends on the amounts contributed, the investment results and the
participant's vested interest at termination of employment (see Note 5).
With respect to each participant, contributions are allocated among four
accounts: Pre-Tax Account, Company Match Account, After-Tax Account and
Rollover Account (collectively the "Accounts"). Such contributions are
invested as designated by each participant in one or more of the
investment funds referred to in Note 3, and are accumulated and invested
in a trust held by The
4
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
Bank of New York as trustee (the "Trustee"). The Plan is administered
through an Administrative Committee (the "Plan Administrator") appointed
by the Board of Directors of Joseph E. Seagram & Sons, Inc.
(the "Company").
Expenses including trustee, custodial and some record keeping fees, are
paid by the Company. Personnel and facilities of the Company are used by
the Plan at no charge.
The Board of Directors of the Company may terminate the Plan at anytime.
In the case of termination, the rights of participants to their accounts
shall be vested as of the date of termination.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Plan conform with generally accepted accounting
principles. The significant accounting policies are:
Basis of Accounting
The accompanying financial statements of the Plan are maintained on the
accrual basis of accounting.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan Administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those estimates.
Investment Valuation
Through December 31, 1996, the assets of the MCA Plan were held by Bank of
America NT&SA (the "Prior Trustee") and on January 1, 1997, the assets
were transferred to the Trustee. The Plan participates in the Joseph E.
Seagram & Sons, Inc. Master Trust (the "Master Trust") held by the
Trustee where the assets of other related employee benefit plans of the
Company and its affiliates are invested on a commingled basis. The Master
Trust is recorded based on individual plan participants' account balances.
Investments are recorded and valued as follows: (i) United States
government obligations at fair value based on the current market yields;
(ii) temporary investments in short-term investment funds at cost which in
the normal course approximates fair value; (iii) securities representing
units of other funds or equity securities at net asset value, as
determined by the Trustee based on underlying fair market values.
Participant loans are valued at cost plus accrued interest, which
approximates fair value.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States Treasury
bonds are reflected as net appreciation in fair value of investments.
5
<PAGE> 11
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
3. INVESTMENT PROGRAM
Subsequent to the transfer of funds from the Prior Trustee on January 1,
1997, the Plan has been comprised of seven investment funds: (i) the Money
Market Fund, investing in the State Street Yield Enhanced STIF Fund
(which replaced the State Street STIF Utilized on October 4, 1997); (ii)
the Stable Income Fund, investing in the Income Plus Fund managed by
LaSalle National Trust, N.A.; (iii) the Bond Fund, investing in Putnam
Income Fund, Class A Shares managed by Putnam Investment Management; (iv)
the S&P 500 Index Fund, investing in the S&P 500 Flagship Fund, Series C,
managed by State Street Bank and Trust Company; (v) the Managed Equity
Fund, investing in Lazard Equity Portfolio managed by Lazard Freres Asset
Management; (vi) the Growth Equity Fund, investing in Brandywine Fund,
Inc. managed by Friess Associates; and (vii) the Seagram Stock Fund,
investing primarily in The Seagram Company Ltd. common shares. The
investments are administered by the Investment Committee appointed by the
Board of Directors of the Company. Prior to the transfer of funds from
the Prior Trustee to the Trustee, the Plan was comprised of three
investment funds: (i) Short Term Investment Fund; (ii) Equity Index Fund;
(iii) Intermediate Bond Index Fund.
4. CONTRIBUTIONS
Non-highly compensated employees, as defined, may elect to contribute to
their Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions") and/or
to their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 14% (in the aggregate)
of their annual salary (as defined in the Plan), in any combination.
Highly compensated employees, as defined, may elect to contribute from 1%
to 10% of their annual salary on a pre-tax or after-tax basis, provided
the aggregate percentage of the contributions does not exceed 10% of their
annual salary. Contributions are subject to limitations imposed by federal
law for qualified retirement plans.
The Plan provides for mandatory matching contributions by the
Participating Companies payable to the participants' Company Match
Account. The Participating Companies, except as herein noted, contribute
on behalf of the participants 40% of the participants' contributions not
exceeding 5% of their salary. The Participating Companies matching
contributions are subject to limitations imposed by federal law for
qualified retirement plans.
The Participating Companies may make discretionary contributions to
participants' Company Match Accounts, in an amount to be determined by the
Participating Companies. The Participating Companies have not made
discretionary contributions since the inception of the Plan.
6
<PAGE> 12
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
The Plan will accept into participants' Rollover Accounts cash received by
participants from a qualified plan within the time prescribed by
applicable law.
5. VESTING
A participant in the Plan always has a fully vested interest in the value
of his or her contributions. He or she has a non-forfeitable right to the
value of his or her Company Match Account upon retirement, disability (as
defined in the Plan) or death. Upon termination of employment for any
other reason, a participant vests in his or her Company Match Account in
accordance with the following vesting schedule:
Years of Service Vested Percentage
------------------------------ --------------------------
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
Upon termination of employment for reasons other than retirement,
disability or death of a participant who was not fully vested in his or
her Company Match Account, the non-vested portion of the participant's
Company Match Account shall be forfeited. Any amount forfeited shall be
applied to reduce prospective Participating Companies' contributions. Any
amount forfeited shall be restored if the participant is re-employed by a
Participating Company before incurring a five year break in service and if
the participant repays to the Plan (within five years after his or her
re-employment commencement date) an amount in cash equal to the full
amount distributed to him or her from the Plan on account of termination
of employment, excluding amounts from the After-Tax and Rollover Accounts
at the participant's election.
The nonvested interest of terminated participants serves to reduce
Participating Company contributions in the month subsequent to
termination. The Participating Companies used $72,412 in forfeitures to
offset their contributions during the year ended December 31, 1997.
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of
disability or death, the participant or his or her beneficiary shall
receive the value of his or her Accounts. However, if the termination of
employment is for reasons other than
7
<PAGE> 13
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
retirement, disability or death, the participant shall receive only the
value of the vested portion of his or her Accounts (see Note 5). Benefits
are recorded when paid.
In accordance with the procedures established by the Administrative
Committee, a terminated employee may elect to defer final distribution
from the Plan. Upon such election, the amount of the participant's vested
interest in the Plan is entitled to continue to receive investment income
and is held by the Trustee until the date of distribution as elected by
the employee.
Prior to termination of employment, the participant may withdraw amounts
from the participant's Accounts in accordance with the provisions of the
plan.
7. LOANS TO PARTICIPANTS
A participant may apply for loans up to the lesser of $50,000 or 50% of
the value of the vested portion of the participant's Accounts. The minimum
loan amount is $1,000. The maximum repayment terms are 5 years for general
purpose loans and 25 years for principal residence loans. Applications for
loans must be approved by the Administrative Committee. The amounts
borrowed are transferred from the investment funds in which the
participant's Accounts are currently invested. Repayments and interest
thereon are credited to the participant's current investment funds through
payroll deductions made each pay period. The interest rate for loans is
based on the prime rate on the first business day of the month in which
the loan is made plus one percentage point.
8
<PAGE> 14
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
8. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated January 24, 1996
that the Plan is qualified under Section 401(a) of the Internal Revenue
Code (the "Code"). So long as the Plan continues to be so qualified, it is
not subject to federal income taxes. The Plan has since been amended, and
in March 1998 a new determination letter was requested. Management
believes that the Plan, as amended, is in accordance with all applicable
provisions of the Code and ERISA.
Management has applied under the Internal Revenue Service's Voluntary
Compliance Resolution program for the correction of an operational
violation. The application is expected to be successful and no adverse tax
qualification consequences are expected to affect the Plan.
Participants are not currently subject to income tax on the Participating
Companies' contributions to the Plan or on income earned by the Plan.
Benefits distributed to participants or to their beneficiaries may be
taxable to them. The tax treatment of the value of such benefits depends
on the event giving rise to the distribution and the method of
distribution selected.
9
<PAGE> 15
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
9. ASSETS HELD IN MASTER TRUST
The assets and investment income of the Master Trust as of and for the year
ended December 31, 1997 consisted of the following:
<TABLE>
<CAPTION>
December 31,
Assets 1997
------ ------------
<S> <C>
Money Market Fund - State Street Yield
Enhanced STIF Fund $ 24,089,219
Stable Income Fund
The LaSalle Income Plus Fund 34,562,612
Bond Fund
Putnam Income Fund, Class A Shares 27,015,278
S&P 500 Index Fund - State Street S&P 500
Flagship Fund, Series C 133,217,637
Managed Equity Fund
Lazard Equity Portfolio Fund 30,054,896
Growth Equity Fund
Brandywine Fund, Inc. Common Shares 58,963,046
Seagram Stock Fund
The Seagram Company Ltd. Common Shares 15,210,786
Collective Short Term Investment Fund 523,383
The Coca-Cola Company Stock Fund
The Coca-Cola Company Common Stock 3,922,692
Collective Short Term Investment Fund 103,633
Loans to Participants 10,426,983
------------
Total Investments $338,090,165
============
</TABLE>
As of December 31, 1997, the Plan's share of the Master Trust investments
approximated 28.6%.
10
<PAGE> 16
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNIVERSAL EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Year ended
December 31,
Investment Income 1997
- ----------------- ------------
<S> <C>
Bond Fund $ 436,843
S&P 500 Index Fund 35,154,443
Managed Equity Fund 4,172,355
Growth Equity Fund 5,076,157
Seagram Stock Fund (2,917,700)
The Coca-Cola Company Stock
Fund 1,104,840
------------
Investment gains (net of
investment expenses/losses) 43,026,938
Interest 5,497,996
Dividends 385,589
------------
Investment Income $ 48,910,523
============
</TABLE>
As of December 31, 1996, the net assets of the Plan were invested in the MCA
INC. Employee Savings Plan Single Trust ("MCA Single Trust"). The assets of
the MCA Single Trust as of December 31, 1996 consisted of the following:
<TABLE>
<CAPTION>
December 31,
Assets 1996
- ------ ------------
<S> <C>
Short Term Investment Fund $ 16,817,560
Equity Index Fund 51,757,120
Intermediate Bond Index Fund 12,572,930
------------
Total Investments $ 81,147,610
============
</TABLE>
As of December 31, 1996, the Plan's share of the MCA Single Trust approximated
92.3%.
11
<PAGE> 17
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-19059) of The Seagram Company Ltd. of our report
dated June 26, 1998 relating to the financial statements of the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates -- Universal Employees for the year ended December 31, 1997 included
with this Form 11-K.
/s/ Price Waterhouse LLP
Century City, California
June 26, 1998
<PAGE> 1
EXHIBIT 99(c)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC.
AND AFFILIATES - UNI EMPLOYEES
375 Park Avenue
New York, New York 10152
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - UNI Employees (the "UNI Plan") is
subject to the requirements of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). Attached hereto are the financial
statements of the UNI Plan for the fiscal year ended December 31, 1997
prepared in accordance with the financial reporting requirements of
ERISA.
EXHIBITS
1. Financial statements of the UNI Plan for the fiscal year ended December
31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
2. Consent of Price Waterhouse LLP, independent accountants.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC. AND
AFFILIATES - UNI EMPLOYEES
By /s/ John Borgia
-----------------------------
John Borgia
Member of Investment Committee
Date: June 29, 1998
<PAGE> 4
RETIREMENT SAVINGS AND
INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E.
SEAGRAM & SONS, INC. AND
AFFILIATES - UNI EMPLOYEES
REPORT AND FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E.
SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
INDEX TO FINANCIAL STATEMENTS*
Page
Report of Independent Accountants......................................... 1
Statements of Net Assets Available for Plan Benefits (with Fund
Information) at December 31, 1997 and 1996............................. 2
Statement of Changes in Net Assets Available for Plan Benefits (with Fund
Information) for the year ended December 31, 1997...................... 3
Notes to Financial Statements............................................. 4
* All schedules required to be filed with the Department of Labor have been
omitted because the schedules are not applicable.
<PAGE> 6
REPORT OF INDEPENDENT ACCOUNTANTS
June 26, 1998
To the Participants and Administrative Committee
of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - UNI Employees
In our opinion, the accompanying statements of net assets available for Plan
benefits as of December 31, 1997 and 1996 and the related statement of changes
in net assets available for plan benefits for the year ended December 31, 1997
present fairly, in all material respects, the net assets available for plan
benefits of the Retirement Savings and Investment Plan for Employees of Joseph
E. Seagram & Sons, Inc. and Affiliates - UNI Employees (the Plan, formerly the
UNI Distribution Corp. Employee Savings Plan) at December 31, 1997 and 1996, and
the changes in net assets available for plan benefits for the year ended
December 31, 1997, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Plan's Administrative
Committee; 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 generally accepted auditing standards 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.
/s/ Price Waterhouse LLP
1
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
DECEMBER 31, 1997 AND 1996
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth Seagram
Market Income Bond Index Equity Equity Stock Loan
Fund Fund Fund Fund Fund Fund Fund Account Total
-------- ------- ------- -------- ------- ------- ------- ------- --------
December 31, 1997
- -----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets held in Master Trust (Note 9) $121,973 $32,999 $87,358 $585,970 $20,386 $28,723 $14,178 $15,730 $907,317
Contributions receivable 1,752 475 1,249 8,374 292 410 202 -- 12,754
Accrued interest income 593 174 -- -- -- -- 1 -- 768
-------- ------- ------- -------- ------- ------- ------- ------- --------
Net assets available
for Plan benefits $124,318 $33,648 $88,607 $594,344 $20,678 $29,133 $14,381 $15,730 $920,839
======== ======= ======= ======== ======= ======= ======= ======= ========
</TABLE>
<TABLE>
<CAPTION>
Short Term Equity Intermediate
Investment Index Bond
Fund Fund Index Fund Total
---------- -------- ------------- --------
<S> <C> <C> <C> <C>
December 31, 1996
- -----------------
Assets held in Master Trust (Note 9) $248,470 $505,620 $88,030 $842,120
Contributions receivable 650 1,490 430 2,570
Accrued interest income 1,070 240 20 1,330
-------- -------- ------- --------
Net assets available for Plan
benefits $250,190 $507,350 $88,480 $846,020
======== ======== ======= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
FOR THE YEAR ENDED DECEMBER 31, 1997
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth
Market Income Bond Index Equity Equity
Fund Fund Fund Fund Fund Fund
--------- -------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ -- $ -- $ 1,635 $ 151,648 $ 653 $ (1,218)
Interest and dividends 15,926 1,080 5,884 -- 78 --
--------- -------- -------- --------- -------- --------
Net investment income (loss) 15,926 1,080 7,519 151,648 731 (1,218)
--------- -------- -------- --------- -------- --------
Contributions
Employee 24,581 6,653 17,520 117,514 4,089 5,760
Employer 6,988 1,946 4,788 33,882 1,126 1,620
--------- -------- -------- --------- -------- --------
Total contributions 31,569 8,599 22,308 151,396 5,215 7,380
--------- -------- -------- --------- -------- --------
Total additions 47,495 9,679 29,827 303,044 5,946 6,162
--------- -------- -------- --------- -------- --------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (296,774) (36) (16,581) (14,672) (520) (462)
Interfund Transfers 373,597 24,005 75,361 305,972 15,252 23,433
--------- -------- -------- --------- -------- --------
Net increase (decrease) in Plan assets 124,318 33,648 88,607 594,344 20,678 29,133
Net assets available for Plan benefits:
Beginning of year -- -- -- -- -- --
--------- -------- -------- --------- -------- --------
End of year $ 124,318 $ 33,648 $ 88,607 $ 594,344 $ 20,678 $ 29,133
========= ======== ======== ========= ======== ========
</TABLE>
<TABLE>
<CAPTION>
Seagram Short Term Equity Intermediate
Stock Loan Investment Index Bond
Fund Account Fund Fund Index Fund Total
-------- ------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ (2,417) $ -- $ -- $ -- $ -- $ 150,301
Interest and dividends 284 444 -- -- -- 23,696
-------- ------- --------- --------- -------- ---------
Net investment income (loss) (2,133) 444 -- -- -- 173,997
-------- ------- --------- --------- -------- ---------
Contributions
Employee 2,843 -- -- -- -- 178,960
Employer 793 -- -- -- -- 51,143
-------- ------- --------- --------- -------- ---------
Total contributions 3,636 -- -- -- -- 230,103
-------- ------- --------- --------- -------- ---------
Total additions 1,503 444 -- -- -- 404,100
-------- ------- --------- --------- -------- ---------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (236) -- -- -- -- (329,281)
Interfund Transfers 13,114 15,286 (250,190) (507,350) (88,480) --
-------- ------- --------- --------- -------- ---------
Net increase (decrease) in Plan assets 14,381 15,730 (250,190) (507,350) (88,480) 74,819
Net assets available for Plan benefits:
Beginning of year -- -- 250,190 507,350 88,480 846,020
-------- ------- --------- --------- -------- ---------
End of year $ 14,381 $15,730 $ -- $ -- $ -- $ 920,839
======== ======= ========= ========= ======== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan originally established as the
UNI Distribution Corp. Employee Savings Plan ("UNI Plan") and is
subject to the provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA").
Effective January 1, 1997, the UNI Plan was amended and continued in
the form of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates ("the Seagram Plan"). The
name of the UNI Plan was changed to the Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - UNI Employees (the "Plan"). To simplify plan
administration, the Plan was amended in the form of the Seagram Plan,
including certain modifications to the terms, to accommodate benefit
provisions solely applicable to eligible employees of Universal Music
and Video Distribution, Inc. ("UNI"). Notwithstanding the adoption of
the terms of the Seagram Plan, the Plan has continued its existence as
a separate plan. Plan assets are solely available for the benefit of
and used to satisfy the liabilities incurred on behalf of employees
covered by the Plan.
The Plan covers certain employees of UNI and certain of its United
States subsidiaries (collectively, the "Participating Companies"),
excluding persons who are members of a labor union, guild or other
collective bargaining unit unless the employee is salaried and paid in
whole or part by UNI. In addition, employees of the Memphis and Reno
locations and interns must complete one year of service before they are
eligible to participate in the Plan.
The Plan provides benefits to participants based upon amounts
voluntarily contributed to a participant's account by the participant
and, amounts contributed, under certain circumstances, by the
Participating Companies (see Note 4). The ultimate benefit to be
received by the participant depends on the amounts contributed, the
investment results and the participant's vested interest at termination
of employment (see Note 5).
With respect to each participant, contributions are allocated among
four accounts: Pre-Tax Account, Company Match Account, After-Tax
Account and Rollover Account (collectively the "Accounts"). Such
contributions are invested as designated by each participant in one or
more of the investment funds referred to in Note 3, and are accumulated
and invested in a Trust Fund held by The Bank of New York as trustee
(the "Trustee"). The Plan is administered through an Administrative
Committee (the "Plan Administrator") appointed by the Board of
Directors of Joseph E. Seagram & Sons, Inc. ("the Company").
Expenses including trustee, custodial and some record keeping fees, are
paid by the Company. Personnel and facilities of the Company are used
by the Plan at no charge.
The Board of Directors of the Company may terminate the Plan at any
time. In the case of termination, the rights of participants to their
accounts shall be vested as of the date of termination.
4
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Plan conform with generally accepted accounting
principles. The significant accounting policies are:
Basis of Accounting
The accompanying financial statements of the Plan are maintained on the
accrual basis of accounting.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan Administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those
estimates.
Investment Valuation
Through December 31, 1996, the assets of the MCA Plan were held by Bank
of America NT & SA (the "Prior Trustee") and on January 1, 1997, the
assets were transferred to the Trustee. The Plan participates in the
Joseph E. Seagram & Sons, Inc. Master Trust (the "Master Trust") held
by the Trustee where the assets of other related employee benefit
plans of the Company and its affiliates are invested on a commingled
basis. The Master Trust is recorded based on individual plan
participants' account balances.
Investments are recorded and valued as follows: (i) United States
government obligations at fair value based on the current market
yields; (ii) temporary investments in short-term investment funds at
cost which in the normal course approximates fair value; (iii)
securities representing units of other funds or equity securities at
net asset value, as determined by the Trustee, based on underlying fair
market values. Participant loans are valued at cost plus accrued
interest, which approximates fair value.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States
Treasury bonds are reflected as net appreciation in fair value of
investments.
5
<PAGE> 11
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
3. INVESTMENT PROGRAM
Subsequent to the transfer of funds from the Prior Trustee on January
1, 1977, the Plan has been comprised of seven investment funds: (i) the
Money Market Fund, investing in the State Street Yield Enhanced
STIF Fund (which replaced the State Street STIF Utilized on October 4,
1997) and high-quality bank certificates of deposit managed by State
Street Bank and Trust Company; (ii) the Stable Income Fund, investing
in the Income Plus Fund managed by LaSalle National Trust, N.A.; (iii)
the Bond Fund, investing in Putnam Income Fund, Class A Shares managed
by Putnam Investment Management; (iv) the S&P 500 Index Fund,
investing in the S&P 500 Flagship Fund, Series C, managed by State
Street Bank and Trust Company; (v) the Managed Equity Fund, investing
in Lazard Equity Portfolio managed by Lazard Freres Asset Management;
(vi) the Growth Equity Fund, investing in Brandywine Fund, Inc.
managed by Friess Associates; and (vii) the Seagram Stock Fund,
investing primarily in The Seagram Company Ltd. common shares. The
investments are administered by the Investment Committee appointed by
the Board of Directors of the Company. Prior to the transfer of funds
from the Prior Trustee to the Trustee, the Plan was comprised of three
investment funds: (i) Short Term Investment Fund; (ii) Equity Index
Fund; (iii) Intermediate Bond Index Fund.
4. CONTRIBUTIONS
Non-highly compensated employees, as defined, may elect to contribute
to their Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions")
and/or to their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 14% (in the
aggregate) of their annual salary (as defined in the Plan), in any
combination. Highly compensated employees, as defined, may elect to
contribute from 1% to 10% of their annual salary on a pre-tax or
after-tax basis, provided the aggregate percentage of the contributions
does not exceed 10% of their annual salary. Contributions are subject
to limitations imposed by federal law for qualified retirement plans.
The Plan provides for mandatory matching contributions by the
Participating Companies payable to the participants' Company Match
Account. The Participating Companies, except as herein noted,
contribute on behalf of the participants 40% of the participants'
contributions not exceeding 5% of their salary. The Participating
Companies matching contributions are subject to limitations imposed by
federal law for qualified retirement plans.
The Participating Companies may make discretionary contributions to
participants' Company Match Accounts, in an amount to be determined by
the Participating Companies. The Participating Companies have not made
discretionary contributions since the inception of the Plan.
6
<PAGE> 12
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
The Plan will accept into participants' Rollover Accounts cash received
by participants from a qualified plan within the time prescribed by
applicable law.
5. VESTING
A participant in the Plan always has a fully vested interest in the
value of his or her contributions. He or she has a non-forfeitable
right to the value of his or her Company Match Account upon retirement,
disability (as defined in the Plan) or death. Upon termination of
employment for any other reason, a participant vests in his or her
Company Match Account in accordance with the following vesting
schedule:
<TABLE>
<CAPTION>
Years of Service Vested Percentage
---------------------------------- ---------------------
<S> <C>
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
</TABLE>
Upon termination of employment for reasons other than retirement,
disability or death of a participant who was not fully vested in his or
her Company Match Account, the non-vested portion of the participant's
Company Match Account shall be forfeited. Any amount forfeited shall be
applied to reduce prospective Participating Companies' contributions.
Any amount forfeited shall be restored if the participant is
re-employed by a Participating Company before incurring a five year
break in service and if the participant repays to the Plan (within five
years after his or her re-employment commencement date) an amount in
cash equal to the full amount distributed to him or her from the Plan
on account of termination of employment, excluding amounts from the
After-Tax and Rollover Accounts at the participant's election.
The nonvested interest of terminated participants serves to reduce
Participating Company contributions in the month subsequent to
termination. The Participating Companies used $1,351 in forfeitures to
offset their contributions during the year ended December 31, 1997.
7
<PAGE> 13
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of
disability or death, the participant or his or her beneficiary shall
receive the value of his or her Accounts. However, if the termination
of employment is for reasons other than retirement, disability or
death, the participant shall receive only the value of the vested
portion of his or her Accounts (see Note 5). Benefits are recorded when
paid.
In accordance with the procedures established by the Administrative
Committee, a terminated employee may elect to defer final distribution
from the Plan. Upon such election, the amount of the participant's
vested interest in the Plan is entitled to continue to receive
investment income and is held by the Trustee until the date of
distribution as elected by the employee.
Prior to termination of employment, the participant may withdraw
amounts from the participant's Accounts in accordance with provisions
of the plan.
7. LOANS TO PARTICIPANTS
A participant may apply for loans up to the lesser of $50,000 or 50% of
the value of the vested portion of the participant's Accounts. The
minimum loan amount is $1,000. The maximum repayment terms are 5 years
for general purpose loans and 25 years for principal residence loans.
Applications for loans must be approved by the Administrative
Committee. The amounts borrowed are transferred from the investment
funds in which the participant's Accounts are currently invested.
Repayments and interest thereon are credited to the participant's
current investment funds through payroll deductions made each pay
8
<PAGE> 14
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
period. The interest rate for loans is based on the prime rate on the
first business day of the month in which the loan is made plus one
percentage point.
8. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated December 23,
1996 that the Plan is qualified under Section 401(a) of the Internal
Revenue Code (the "Code"). So long as the Plan continues to be so
qualified, it is not subject to federal income taxes. The Plan has
since been amended, and in March 1998, a new determination letter was
requested. Management believes that the Plan, as amended, is in
accordance with all applicable provisions of the Code and ERISA.
Participants are not currently subject to income tax on the
Participating Companies' contributions to the Plan or on income earned
by the Plan. Benefits distributed to participants or to their
beneficiaries may be taxable to them. The tax treatment of the value of
such benefits depends on the event giving rise to the distribution and
the method of distribution selected.
9
<PAGE> 15
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
9. ASSETS HELD IN MASTER TRUST
The assets and investment income of the Master Trust as of and for the
year ended December 31, 1997 consisted of the following:
<TABLE>
<CAPTION>
December 31,
Assets 1997
- ------ ------------
<S> <C>
Money Market Fund - State Street Yield
Enhanced STIF Fund $ 24,089,219
Stable Income Fund
The LaSalle Income Plus Fund 34,562,612
Bond Fund
Putnam Income Fund, Class A Shares 27,015,278
S&P 500 Index Fund - State Street S&P 500
Flagship Fund, Series C 133,217,637
Managed Equity Fund
Lazard Equity Portfolio Fund 30,054,896
Growth Equity Fund
Brandywine Fund, Inc. Common Shares 58,963,046
Seagram Stock Fund
The Seagram Company Ltd. Common Shares 15,210,786
Collective Short Term Investment Fund 523,383
The Coca-Cola Company Stock Fund
The Coca-Cola Company Common Stock 3,922,692
Collective Short Term Investment Fund 103,633
Loans to Participants 10,426,983
------------
Total Investments $338,090,165
============
</TABLE>
As of December 31, 1997, the Plan's share of the Master Trust investments
approximated 0.3%.
10
<PAGE> 16
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - UNI EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Year ended
December 31,
Investment Income 1997
- ----------------- ------------
<S> <C>
Bond Fund $ 436,843
S&P 500 Index Fund 35,154,443
Managed Equity Fund 4,172,355
Growth Equity Fund 5,076,157
Seagram Stock Fund (2,917,700)
The Coca-Cola Company Stock
Fund 1,104,840
-----------
Investment gains (net of
investment expenses/losses) 43,026,938
Interest 5,497,996
Dividends 385,589
-----------
Investment Income $48,910,523
===========
</TABLE>
As of December 31, 1996, the net assets of the Plan were invested in the MCA
INC. Employee Savings Plan Single Trust ("MCA Single Trust"). The assets of the
MCA Single Trust as of December 31, 1996 consisted of the following:
<TABLE>
<CAPTION>
December 31,
Assets 1996
- ------ ------------
<S> <C>
Short Term Investment Fund $16,817,560
Equity Index Fund 51,757,120
Intermediate Bond Index Fund 12,572,930
-----------
Total Investments $81,147,610
===========
</TABLE>
As of December 31, 1996, the Plan's share of the MCA Single Trust approximated
1.0%.
11
<PAGE> 17
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-19059) of The Seagram Company Ltd., of our report
dated June 26, 1998 relating to the financial statements of the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates -- UNI Employees for the year ended December 31, 1997 included with
this Form 11-K.
/s/ Price Waterhouse LLP
Century City, California
June 26, 1998
<PAGE> 1
EXHIBIT 99(d)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC.
AND AFFILIATES - SPENCER EMPLOYEES
375 Park Avenue
New York, New York 10152
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates - Spencer Employees (the "Spencer
Plan") is subject to the requirements of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). Attached hereto are the
financial statements of the Spencer Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
EXHIBITS
1. Financial statements of the Spencer Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
2. Consent of Price Waterhouse LLP, independent accountants.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC. AND
AFFILIATES - SPENCER EMPLOYEES
By /s/ John Borgia
-----------------------------
John Borgia
Member of Investment Committee
Date: June 29, 1998
<PAGE> 4
RETIREMENT SAVINGS AND
INVESTMENT PLAN FOR
EMPLOYEES OF JOSEPH E.
SEAGRAM & SONS, INC. AND
AFFILIATES - SPENCER
EMPLOYEES
REPORT AND FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF JOSEPH E. SEAGRAM &
SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
INDEX TO FINANCIAL STATEMENTS*
Page
Report of Independent Accountants....................................... 1
Statements of Net Assets Available for Plan Benefits (with Fund
Information) at December 31, 1997 and 1996........................... 2
Statement of Changes in Net Assets Available for Plan Benefits (with
Fund Information) for the year ended December 31, 1997............... 3
Notes to Financial Statements........................................... 4
* All schedules required to be filed with the Department of Labor have
been omitted because the schedules are not applicable.
<PAGE> 6
REPORT OF INDEPENDENT ACCOUNTANTS
June 26, 1998
To the Participants and Administrative Committee
of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates - Spencer Employees
In our opinion, the accompanying statements of net assets available for plan
benefits as of December 31, 1997 and 1996 and the related statement of changes
in net assets available for plan benefits for the year ended December 31, 1997
present fairly, in all material respects, the net assets available for plan
benefits of the Retirement Savings and Investment Plan for Employees of Joseph
E. Seagram & Sons, Inc. and Affiliates - Spencer Employees (the Plan, formerly
the Spencer Gifts, Inc. Employee Savings Plan) at December 31, 1997 and 1996,
and the changes in net assets available for plan benefits for the year ended
December 31, 1997, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Plan's Administrative
Committee; 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 generally accepted auditing standards 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.
/s/ Price Waterhouse LLP
1
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
DECEMBER 31, 1997 AND 1996
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth Seagram
Market Income Bond Index Equity Equity Stock
Fund Fund Fund Fund Fund Fund Fund
---- ---- ---- ---- ---- ---- ----
December 31, 1997
<S> <C> <C> <C> <C> <C> <C> <C>
Assets held in Master Trust (Note 9) $1,126,387 $ 319,297 $ 854,189 $3,613,822 $ 361,091 $ 325,729 $ 39,380
Contributions receivable 13,144 3,727 9,919 41,965 4,194 3,783 457
Accrued income 5,481 1,686 -- -- -- -- 4
---------- ---------- ---------- ---------- --------- ---------- ----------
Net assets available
for Plan benefits $1,145,012 $ 324,710 $ 864,108 $3,655,787 $ 365,285 $ 329,512 $ 39,841
========== ========== ========== ========== ========= ========== ==========
</TABLE>
<TABLE>
<CAPTION>
Loan
Account Total
------- -----
December 31, 1997
<S> <C> <C>
Assets held in Master Trust (Note 9) $ 259,412 $6,899,307
Contributions receivable -- 77,189
Accrued income -- 7,171
---------- ----------
Net assets available
for Plan benefits $ 259,412 $6,983,667
========== ==========
</TABLE>
<TABLE>
<CAPTION>
Short-Term Equity Intermediate
Investment Index Bond
Fund Fund Index Fund Total
---- ---- ---------- -----
December 31, 1996
<S> <C> <C> <C> <C>
Assets held in Master Trust
(Note 9) $1,438,670 $3,197,110 $ 804,060 $5,439,840
Contributions receivable 7,730 11,750 2,740 22,220
Accrued income 6,210 1,510 120 7,840
---------- ---------- --------- ----------
Net assets available
for Plan benefits $1,452,610 $3,210,370 $ 806,920 $5,469,900
========== ========== ========= ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
FOR THE YEAR ENDED DECEMBER 31, 1997
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)
<TABLE>
<CAPTION>
Money Stable S&P 500 Managed Growth
Market Income Bond Index Equity Equity
Fund Fund Fund Fund Fund Fund
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ -- $ -- $ 14,500 $1,052,365 $ 32,142 $ 9,574
Interest and dividends 65,301 10,473 52,164 -- 3,842 --
---------- ---------- ---------- ---------- ---------- ----------
Net investment income (loss) 65,301 10,473 66,664 1,052,365 35,984 9,574
---------- ---------- ---------- ---------- ---------- ----------
Contributions
Employee 132,699 37,632 100,144 423,680 42,334 38,188
Employer 36,071 11,263 29,483 124,540 12,639 11,406
---------- ---------- ---------- ---------- ---------- ----------
Total contributions 168,770 48,895 129,627 548,220 54,973 49,594
---------- ---------- ---------- ---------- ---------- ----------
Total additions 234,071 59,368 196,291 1,600,585 90,957 59,168
---------- ---------- ---------- ---------- ---------- ----------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (537,039) (1,020) (36,347) (148,315) (2,976) (3,539)
Interfund Transfers 1,447,980 266,362 704,164 2,203,517 277,304 273,883
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) in Plan assets 1,145,012 324,710 864,108 3,655,787 365,285 329,512
Net assets available for Plan benefits:
Beginning of year -- -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
End of year $1,145,012 $ 324,710 $ 864,108 $3,655,787 $ 365,285 $ 329,512
========== ========== ========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
Seagram Short Term Equity Intermediate
Stock Loan Investment Index Bond
Fund Account Fund Fund Index Fund Total
---- ------- ---- ---- ---------- -----
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in
fair value of investments $ (14,357) $ -- $ -- $ -- $ -- $1,094,224
Interest and dividends 1,687 10,691 -- -- -- 144,158
---------- ---------- ---------- ---------- ---------- ----------
Net investment income (loss) (12,670) 10,691 -- -- -- 1,238,382
---------- ---------- ---------- ---------- ---------- ----------
Contributions
Employee 4,607 -- -- -- -- 779,284
Employer 1,379 -- -- -- -- 226,781
---------- ---------- ---------- ---------- ---------- ----------
Total contributions 5,986 -- -- -- -- 1,006,065
---------- ---------- ---------- ---------- ---------- ----------
Total additions (6,684) 10,691 -- -- -- 2,244,447
---------- ---------- ---------- ---------- ---------- ----------
Decreases from net assets attributed to:
Distributions to participants for
withdrawals (95) (1,349) -- -- -- (730,680)
Interfund Transfers 46,620 250,070 (1,452,610) (3,210,370) (806,920) --
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) in Plan assets 39,841 259,412 (1,452,610) (3,210,370) (806,920) 1,513,767
Net assets available for Plan benefits:
Beginning of year -- -- 1,452,610 3,210,370 806,920 5,469,900
---------- ---------- ---------- ---------- ---------- ----------
End of year $ 39,841 $ 259,412 $ -- $ -- $ -- $6,983,667
========== ========== ========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan originally established as the
Spencer Gifts, Inc. Employee Savings Plan ("Spencer Plan") and is subject
to the provisions of the Employee Retirement Income Security Act of 1974
("ERISA").
Effective January 1, 1997, the Spencer Plan was amended and continued in
the form of the Retirement Savings and Investment Plan for Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates ("the Seagram Plan"). The
name of the Spencer Plan was changed to the Retirement Savings and
Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates - Spencer Employees (the "Plan"). To simplify plan
administration, the Plan was amended in the form of the Seagram Plan,
including certain modifications to the terms, to accommodate benefit
provisions solely applicable to eligible employees of Spencer Gifts, Inc.
("Spencer"). Notwithstanding the adoption of the terms of the Seagram
Plan, the Plan has continued its existence as a separate plan. Plan assets
are solely available for the benefit of and used to satisfy the
liabilities incurred on behalf of employees covered by the Plan.
The Plan covers certain employees of Spencer who have completed one year
of service and who are either (i) salaried employees or (ii) hourly
employees employed in a classification designated by Spencer, excluding
employees classified as Highly Compensated employees.
The Plan provides benefits to participants based upon amounts voluntarily
contributed to a participant's account by the participant and, amounts
contributed, under certain circumstances, by Spencer (see Note 4). The
ultimate benefit to be received by the participant depends on the amounts
contributed, the investment results and the participant's vested interest
at termination of employment (see Note 5).
With respect to each participant, contributions are allocated among four
accounts: Pre-Tax Account, Company Match Account, After-Tax Account and
Rollover Account (collectively, the "Accounts"). Such contributions are
invested as designated by each participant in one or more of the
investment funds referred to in Note 3, and are accumulated and invested
in a Trust Fund held by The Bank of New York as trustee (the "Trustee").
The Plan is administered through an Administrative Committee appointed by
the Board of Directors of Joseph E. Seagram & Sons, Inc. ("the Company").
Expenses including trustee, custodial and some record keeping fees, are
paid by the Company. Personnel and facilities of the Company are used by
the Plan at no charge.
The Board of Directors of the Company may terminate the Plan at any time.
In the case of termination, the rights of participants to their accounts
shall be vested as of the date of termination.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Plan conform with generally accepted accounting
principles. The significant accounting policies are:
4
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
Basis of Accounting
The accompanying financial statements of the Plan are maintained on the
accrual basis of accounting.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan Administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those estimates.
Investment Valuation
Through December 31, 1996, the assets of the MCA Plan were held by Bank of
America NT & SA (the "Prior Trustee") and on January 1, 1997, the assets
were transferred to the Trustee. The Plan participates in the Joseph E.
Seagram & Sons, Inc. Master Trust (the "Master Trust") held by the
Trustee where the assets of other related employee benefit plans of the
Company and its affiliates are invested on a commingled basis. The Master
Trust is recorded based on individual plan participants' account balances.
Investments are recorded and valued as follows: (i) United States
government obligations at fair value based on the current market yields;
(ii) temporary investments in short-term investment funds at cost which in
the normal course approximates fair value; (iii) securities representing
units of other funds or equity securities at net asset value, as
determined by the Trustee, based on underlying fair market values.
Participant loans are valued at cost plus accrued interest, which
approximates fair value.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States Treasury
bonds are reflected as net appreciation in fair value of investments.
3. INVESTMENT PROGRAM
Subsequent to the transfer of funds from the Prior Trustee on January 1,
1997, the Plan has been comprised of seven investment funds: (i) the Money
Market Fund, investing in the State Street Yield Enhanced STIF Fund
(which replaced the State Street STIF Utilized on October 4, 1997); (ii)
the Stable Income Fund, investing in the Income Plus Fund managed by
LaSalle National Trust, N.A.; (iii) the Bond Fund, investing in Putnam
Income Fund, Class A Shares managed by Putnam Investment Management; (iv)
the S&P 500 Index Fund, investing in the S&P 500
5
<PAGE> 11
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
Flagship Fund, Series C, managed by State Street Bank and Trust Company;
(v) the Managed Equity Fund, investing in Lazard Equity Portfolio managed
by Lazard Freres Asset Management; (vi) the Growth Equity Fund, investing
in Brandywine Fund, Inc. managed by Friess Associates; and (vii) the
Seagram Stock Fund, investing primarily in The Seagram Company Ltd. common
shares. The investments are administered by the Investment Committee
appointed by the Board of Directors of the Company. Prior to the transfer
of funds from the Prior Trustee, the Plan was comprised of three
investment funds: (i) Short Term Investment Fund; (ii) Equity Index Fund;
(iii) Intermediate Bond Index Fund.
4. CONTRIBUTIONS
Non-highly compensated employees, as defined, may elect to contribute to
their Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions") and/or
to their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 14% (in the aggregate)
of their annual salary (as defined in the Plan), in any combination.
Highly compensated employees, as defined, may elect to contribute from 1%
to 10% of their annual salary on a pre-tax basis or after-tax basis,
provided the aggregate percentage of the contributions does not exceed 10%
of their annual salary. Contributions are subject to limitations imposed
by federal law for qualified retirement plans.
The Plan provides for mandatory matching contributions by Spencer payable
to the participants' Company Match Account. Spencer, except as herein
noted, contributes on behalf of the participants 40% of the participants'
contributions not exceeding 5% of their salary. Spencer's matching
contributions are subject to limitations imposed by federal law for
qualified retirement plans.
Spencer may make discretionary contributions to participants' Company
Match Accounts, in an amount to be determined by Spencer. Spencer has not
made discretionary contributions since the inception of the Plan.
The Plan will accept into participants' Rollover Accounts cash received by
participants from a qualified plan within the time prescribed by
applicable law.
5. VESTING
A participant in the Plan always has a fully vested interest in the value
of his or her contributions. He or she has a non-forfeitable right to the
value of his or her Company Match Account upon retirement, disability (as
defined in the Plan) or death. Upon termination of employment for any
other reason, a participant vests in his or her Company Match Account in
accordance with the following vesting schedule:
6
<PAGE> 12
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
Years of Service Vested Percentage
------------------------------ --------------------------
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
Upon termination of employment for reasons other than retirement,
disability or death of a participant who was not fully vested in his or
her Company Match Account, the non-vested portion of the participant's
Company Match Account shall be forfeited. Any amount forfeited shall be
applied to reduce Spencer's prospective contributions. Any amount
forfeited shall be restored if the participant is re-employed by Spencer
before incurring a five year break in service and if the participant
repays to the Plan (within five years after his or her re-employment
commencement date) an amount in cash equal to the full amount distributed
to him or her from the Plan on account of termination of employment,
excluding amounts from the After-Tax and Rollover Accounts at the
participant's election.
The nonvested interest of terminated participants serves to reduce
Spencer's contributions in the month subsequent to termination. The
Participating Companies used $6,475 in forfeitures to offset their
contributions during the year ended December 31, 1997.
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of
disability or death, the participant or his or her beneficiary shall
receive the value of his or her Accounts. However, if the termination of
employment is for reasons other than retirement, disability or death, the
participant shall receive only the value of the vested portion of his or
her Accounts (see Note 5). Benefits are recorded when paid.
In accordance with the procedures established by the Administrative
Committee, a terminated employee may elect to defer final distribution
from the Plan. Upon such election, the amount of the participant's vested
interest in the Plan is entitled to continue to receive investment income
and is held by the Trustee until the date of distribution as elected by
the employee.
Prior to termination of employment, the participant may withdraw amounts
from the participant's Accounts in accordance with provisions of the
Plan.
7
<PAGE> 13
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
7. LOANS TO PARTICIPANTS
A participant may apply for loans up to the lesser of $50,000 or 50% of
the value of the vested portion of the participant's Accounts. The minimum
loan amount is $1,000. The maximum repayment terms are 5 years for general
purpose loans and 25 years for principal residence loans. Applications for
loans must be approved by the Administrative Committee. The amounts
borrowed are transferred from the investment funds in which the
participant's Accounts are currently invested. Repayments and interest
thereon are credited to the participant's current investment funds through
payroll deductions made each pay period. The interest rate for loans is
based on the prime rate on the first business day of the month in which
the loan is made plus one percentage point.
8. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated August 12, 1995
that the Plan is qualified under Section 401(a) of the Internal Revenue
Code (the "Code"). So long as the Plan continues to be so qualified, it is
not subject to federal income taxes. The Plan has since been amended, and
in March 1998 a new determination letter was requested. Management
believes that the Plan, as amended, is in accordance with all applicable
provisions of the Code and ERISA.
8
<PAGE> 14
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
Participants are not currently subject to income tax on Spencer's
contributions to the Plan or on income earned by the Plan. Benefits
distributed to participants or to their beneficiaries may be taxable to
them. The tax treatment of the value of such benefits depends on the event
giving rise to the distribution and the method of distribution selected.
9
<PAGE> 15
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
10. ASSETS HELD IN MASTER TRUST
---------------------------
The assets and investment income of the Master Trust as of and for the
year ended December 31, 1997 consisted of the following:
<TABLE>
<CAPTION>
December 31,
Assets 1997
------ ------------
<S> <C>
Money Market Fund - State Street Yield
Enhanced STIF Fund $ 24,089,219
Stable Income Fund
The LaSalle Income Plus Fund 34,562,612
Bond Fund
Putnam Income Fund, Class A Shares 27,015,278
S&P 500 Index Fund - State Street S&P 500
Flagship Fund, Series C 133,217,637
Managed Equity Fund
Lazard Equity Portfolio Fund 30,054,896
Growth Equity Fund
Brandywine Fund, Inc. Common Shares 58,963,046
Seagram Stock Fund
The Seagram Company Ltd. Common Shares 15,210,786
Collective Short Term Investment Fund 523,383
The Coca-Cola Company Stock Fund
The Coca-Cola Company Common Stock 3,922,692
Collective Short Term Investment Fund 103,633
Loans to Participants 10,426,983
------------
Total Investments $338,090,165
============
</TABLE>
As of December 31, 1997, the Plan's share of the Master Trust investments
approximated 2.0%.
10
<PAGE> 16
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
JOSEPH E. SEAGRAM & SON, INC. AND AFFILIATES - SPENCER EMPLOYEES
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Year ended
December 31,
Investment Income 1997
- ----------------- ------------
<S> <C>
Bond Fund $ 436,843
S&P 500 Index Fund 35,154,443
Managed Equity Fund 4,172,355
Growth Equity Fund 5,076,157
Seagram Stock Fund (2,917,700)
The Coca-Cola Company Stock
Fund 1,104,840
-----------
Investment gains (net of
investment/expenses losses) 43,026,938
Interest 5,497,996
Dividends 385,589
-----------
Investment Income $48,910,523
===========
</TABLE>
As of December 31, 1996, the net assets of the Plan were invested in the MCA
INC. Employee Savings Plan Single Trust ("MCA Single Trust"). The assets of the
MCA Single Trust as of December 31, 1996 consisted of the following:
<TABLE>
<CAPTION>
December 31,
ASSETS 1996
- ------ ------------
<S> <C>
Short Term Investment Fund $16,817,560
Equity Index Fund 51,757,120
Intermediate Bond Index Fund 12,572,930
-----------
Total Investments $81,147,610
===========
</TABLE>
As of December 31, 1996, the Plan's share of the MCA Single Trust approximated
6.7%.
11
<PAGE> 17
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-19059) of The Seagram Company Ltd., of our report
dated June 26, 1998 relating to the financial statements of the Retirement
Savings and Investment Plan for Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates -- Spencer Employees for the year ended December 31, 1997 included
with this Form 11-K.
/s/ Price Waterhouse LLP
Century City, California
June 26, 1998
<PAGE> 1
EXHIBIT 99(e)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
375 Park Avenue
New York, New York 10152
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Union Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates (the "Union Plan") is
subject to the requirements of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). Attached hereto are the financial
statements of the Union Plan for the fiscal year ended December 31,
1997 prepared in accordance with the financial reporting requirements
of ERISA.
EXHIBITS
1. Financial statements of the Union Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
2. Consent of Gutierrez & Co., independent accountants.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
UNION EMPLOYEES OF JOSEPH E. SEAGRAM & SONS, INC.
AND AFFILIATES
By /s/ John Borgia
----------------------------
John Borgia
Member of Benefits Committee
Date: June 29, 1998
<PAGE> 4
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS,INC.
AND AFFILIATES
FINANCIAL STATEMENTS
DECEMBER 31, 1997
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
INDEX TO FINANCIAL STATEMENTS
Page
----
Independent Auditors' Report 1
Statement of Net Assets Available for
Benefits 2
Statement of Changes in Net Assets
Available for Benefits 3
Notes to Financial Statements 5
<PAGE> 6
INDEPENDENT AUDITORS' REPORT
To the Benefits Committee of the Retirement
Savings and Investment Plan for Union
Employees of Joseph E. Seagram & Sons, Inc.
and Affiliates
We have audited the accompanying statement of net assets available for
benefits of the Retirement Savings and Investment Plan for Union Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates (the "Plan") as of December 31,
1997, and the related statement of changes in net assets available for benefits
for the year then ended. 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 audit.
We conducted our audit 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 audit provides 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
Retirement Savings and Investment Plan for Union Employees of Joseph E. Seagram
& Sons, Inc. and Affiliates at December 31, 1997, and the changes in net assets
available for benefits for the year then ended in conformity with generally
accepted accounting principles.
/s/ Gutierrez & Co.
Flushing, New York
June 26, 1998
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997
<TABLE>
<S> <C>
INVESTMENTS (Note 3)
Money Market Fund:
Dreyfus Cash Management Plus Fund (cost of $41,288) $ 41,288
Cash (49)
Stable Income Fund:
Dreyfus-Certus Stable Value Fund (cost of $25,998) 25,998
Cash 586
Bond Fund:
Dreyfus A Bonds Plus Fund (cost of $35,110) 35,110
Cash 860
S&P 500 Index Fund:
Dreyfus Basic S&P 500 Stock Index Fund (cost of
$231,444) 248,446
Cash 5,076
Managed Equity Fund:
Dreyfus Disciplined Stock Fund (cost of $147,986) 147,257
Cash 2,654
Growth Equity Fund:
Warburg Pincus Emerging Growth Fund (cost of $114,000) 114,399
Cash 2,294
Seagram Stock Fund:
The Seagram Company Ltd. Common Shares (cost of
$64,360) 57,193
TBC Inc. Pooled Employees Fund (cost of $4,155) 4,155
Cash 1,462
Loans to Participants 1,889
---------
Total Investments 688,618
---------
RECEIVABLES
Dividends and Interest 12
Proceeds from Unsettled Sales 49
---------
Total Receivables 61
---------
TOTAL ASSETS 688,679
---------
LIABILITIES
Cost of Unsettled Purchases 15,602
---------
Total Liabilities 15,602
---------
NET ASSETS AVAILABLE FOR BENEFITS $ 673,077
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1997
<TABLE>
<S> <C>
CONTRIBUTIONS
Participating Employees $ 631,470
---------
INVESTMENT ACTIVITIES 631,470
---------
Investment Income
Money Market Fund 784
Stable Income Fund 605
Bond Fund 784
S&P 500 Index Fund 2,040
Managed Equity Fund 409
Seagram Stock Fund 480
Interest on loans to participants 10
---------
Total Investment Income 5,112
---------
Realized Net Gain on Sale of Investments
Bond Fund 476
Stable Income Fund 509
S&P 500 Index Fund 3,411
Managed Equity Fund 13,662
Growth Equity Fund 6,477
Seagram Stock Fund (34)
---------
Total Realized Net Gain on Sale of Investments 24,501
---------
Unrealized Appreciation (Depreciation) on Investments
Bond Fund 510
S&P 500 Index Fund 17,002
Growth Equity Fund 3,003
Managed Equity Fund (729)
Seagram Stock Fund (7,167)
---------
Total Unrealized Appreciation on Investments 12,619
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1997
(Continued)
<TABLE>
<S> <C>
Increase in Plan Equity from Investment
Activities $ 42,232
---------
PARTICIPANT WITHDRAWALS (625)
---------
INCREASE IN PLAN EQUITY 673,077
PLAN EQUITY AT BEGINNING OF YEAR --
---------
PLAN EQUITY AT END OF YEAR $ 673,077
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Retirement Savings and Investment Plan for Union
Employees of Joseph E. Seagram & Sons, Inc. and Affiliates (the "Plan")
conform with generally accepted accounting principles. The more
significant accounting policies are:
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the plan administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those
estimates.
Investment Valuation
Investment securities are recorded and valued as follows:
United States government obligations at fair value based on the current
market yields; temporary investments in short-term investment funds at
cost which in the normal course approximates market value; securities
representing units of other funds at net asset value; The Seagram
Company Ltd. common shares at the closing price reported on the
composite tape of the New York Stock Exchange on the valuation date.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States
Treasury Bonds are reflected as unrealized appreciation.
2. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan established as of January 1,
1997 by Joseph E. Seagram & Sons, Inc. (the "Company").
The Plan covers eligible employees of the Company who are covered by
various collective bargaining agreements between the Company and the
employee representatives, as specified in the Plan.
The Plan provides benefits to participants based upon amounts
voluntarily contributed to a participant's Accounts by the participant
(see Note 4). Under the Plan, a participant is not provided with any
fixed benefit. The ultimate benefit to be received by the participant
depends on the amounts contributed, the investment results and other
adjustments, and the participant's vested interest at termination of
employment (see Note 5).
5
<PAGE> 11
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
2. DESCRIPTION OF THE PLAN (Continued)
With respect to each participant, contributions are allocated among
three Accounts: Pre-Tax Account, After-Tax Account and Rollover
Account. Such contributions are invested as designated by the
participants in one or more of the investment funds referred to in Note
3, and are accumulated and invested in a Trust Fund held by the Dreyfus
Trust Company, as Trustee. The Plan is administered by the Company
through a Benefits Committee appointed by the Board of Directors of the
Company.
3. INVESTMENT PROGRAM
During the year ended December 31, 1997, the Plan was comprised of
seven investment funds: (i) the Money Market Fund investing in the
Dreyfus Cash Management Plus Fund managed by Dreyfus Corporation; (ii)
the Stable Income Fund investing in the Dreyfus-Certus Stable Value
Fund managed by Dreyfus Trust Company; (iii) the Bond Fund investing in
Dreyfus A Bonds Plus Fund managed by Dreyfus Corporation; (iv) the S&P
500 Index Fund investing in Dreyfus Basic S&P 500 Stock Index Fund
(which, prior to August 15, 1997 was named the Dreyfus Institutional
S&P 500 Stock Index Fund) managed by Dreyfus Corporation; (v) the
Managed Equity Fund investing in Dreyfus Disciplined Stock Fund
managed by Dreyfus Corporation; (vi) the Growth Equity Fund investing
in Warburg Pincus Emerging Growth Fund managed by Warburg, Pincus
Counsellors, Inc.; and (vii) the Seagram Stock Fund investing
primarily in The Seagram Company Ltd. common shares. The investments
are administered by the Benefits Committee appointed by the Board of
Directors of the Company.
4. CONTRIBUTIONS
Eligible employees, as defined, may elect to contribute to their
Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions") and/or to
their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 17% (in the
aggregate) of their annual pay, as defined in the Plan, in multiples of
1%, in any combination, provided, the aggregate percentage of the
contributions does not exceed 17% of their annual pay. Pre-tax
Contributions and After-Tax Contributions are subject to limitations
imposed by federal laws for qualified retirement plans.
The Plan does not provide for mandatory matching contributions by the
Company. The Plan will accept into participants' Rollover Accounts cash
received by participants from a qualified plan within the time
prescribed by applicable law ("Rollover Contributions").
5. VESTING
A participant in the Plan always has a fully vested interest in the
value of his or her Pre-Tax, After-Tax and Rollover Accounts.
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of total
and permanent disability, as defined in the Plan, or death, the
participant or his or her beneficiary shall receive the entire value
of his or her Accounts.
6
<PAGE> 12
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
JOSEPH E. SEAGRAM & SONS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
6. DISTRIBUTIONS (Continued)
Prior to termination of employment, the participant may withdraw
amounts from the participant's Accounts in accordance with the
provisions of the Plan.
7. LOANS TO PARTICIPANTS
A participant may apply for loans up to the lesser of $50,000 or 50% of
the value of the participant's Accounts. The minimum loan amount is
$1,000. The maximum repayment terms are 5 years for general purpose
loans and 25 years for principal residence loans. The amounts borrowed
are transferred from the investment funds in which the participant's
Accounts are currently invested. On a weekly basis, repayments and
interest thereon are credited to the participant's current investment
funds. The interest rate for loans is based on the prime rate on the
first business day of the month in which the loan is made plus one
percentage point.
8. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated May 20, 1998
that the Plan is qualified under Section 401(a) of the Internal Revenue
Code. So long as the Plan continues to be so qualified, it is not
subject to federal income taxes.
Participants are not currently subject to income tax on the income
earned by the Plan. Benefits distributed to participants or to their
beneficiaries may be taxable to them. The tax treatment of the value of
such benefits depends on the event giving rise to the distribution and
the method of distribution selected.
9. RELATED PARTY TRANSACTIONS
Certain of the expenses of the Plan are paid by the Company, and
personnel and facilities of the Company are used by the Plan at no
charge.
10. TERMINATION OF THE PLAN
The Board of Directors of the Company may terminate the Plan at any
time. In the case of termination, the rights of participants to their
Accounts shall be vested as of the date of termination.
7
<PAGE> 13
<PAGE> 14
The Seagram Company Ltd.
The Retirement Savings and Investment Plan for Union Employees of Joseph E.
Seagram & Sons, Inc. and Affiliates
We hereby consent to the incorporation by reference in Registration
Statement No. 333-19059 on Form S-8 of our Report dated June 26, 1998 which
appears in your Annual Report on Form 11-K of the Retirement Savings and
Investment Plan for Union Employees of Joseph E. Seagram & Sons, Inc. and
Affiliates for the fiscal year ended December 31, 1997.
/s/ Gutierrez & Co.
Flushing, New York
June 29, 1998
8
<PAGE> 1
EXHIBIT 99(f)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
COMMISSION FILE NUMBER 1-2275
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
1001 13th Avenue East
Bradenton, Florida 34208
(Full title of the plan and the address of the plan)
THE SEAGRAM COMPANY LTD.
1430 Peel Street
Montreal, Quebec, Canada, H3A 1S9
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
<PAGE> 2
REQUIRED INFORMATION
1. Not Applicable.
2. Not Applicable.
3. Not Applicable.
4 The Retirement Savings and Investment Plan for Union Employees of
Joseph E. Seagram & Sons, Inc. and Affiliates (the "Tropicana Plan") is
subject to the requirements of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). Attached hereto are the financial
statements of the Tropicana Plan for the fiscal year ended December 31,
1997 prepared in accordance with the financial reporting requirements
of ERISA.
EXHIBITS
1. Financial statements of the Tropicana Plan for the fiscal year ended
December 31, 1997 prepared in accordance with the financial reporting
requirements of ERISA.
2. Consent of Gutierrez & Co., independent accountants.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on their behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR
UNION EMPLOYEES OF TROPICANA PRODUCTS, INC. AND
AFFILIATES
By /s/ Robert Chiaravalloti
Robert Chiaravalloti
Member of Benefits Committee
Date: June 29, 1998
<PAGE> 4
RETIREMENT SAVINGS AND INVESTMENT PLAN
FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC.
AND AFFILIATES
FINANCIAL STATEMENTS
DECEMBER 31, 1997
<PAGE> 5
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
INDEX TO FINANCIAL STATEMENTS
Page
Independent Auditors' Report 1
Statement of Net Assets Available
for Benefits 2
Statement of Changes in Net Assets
Available for Benefits 3
Notes to Financial Statements 5
<PAGE> 6
INDEPENDENT AUDITORS' REPORT
To the Benefits Committee
of the Retirement Savings and
Investment Plan for Union
Employees of Tropicana
Products, Inc. and Affiliates
We have audited the accompanying statement of net assets available for
benefits of the Retirement Savings and Investment Plan for Union Employees of
Tropicana Products, Inc. and Affiliates (the "Plan") as of December 31, 1997,
and the related statement of changes in net assets available for benefits for
the year then ended. 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 audit.
We conducted our audit 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 audit provides 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
Retirement Savings and Investment Plan for Union Employees of Tropicana
Products, Inc. and Affiliates at December 31, 1997, and the changes in net
assets available for benefits for the year then ended in conformity with
generally accepted accounting principles.
/s/ Gutierrez & Co.
Flushing, New York
June 26, 1998
<PAGE> 7
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997
<TABLE>
<S> <C>
INVESTMENTS (Note 3)
Money Market Fund:
Dreyfus Cash Management Plus Fund (cost of $51,766) $ 51,766
Cash 924
Stable Income Fund:
Dreyfus-Certus Stable Value Fund (cost of $40,744) 40,744
Cash 670
Bond Fund:
Dreyfus A Bonds Plus Fund (cost of $31,872) 32,301
Cash 561
S&P 500 Index Fund:
Dreyfus Basic S&P 500 Stock Index Fund (cost of $103,217) 112,682
Cash 1,908
Managed Equity Fund:
Dreyfus Disciplined Stock Fund (cost of $72,426) 73,511
Cash 1,226
Growth Equity Fund:
Warburg Pincus Emerging Growth Fund (cost of $56,379) 58,878
Cash 1,078
Seagram Stock Fund:
The Seagram Company Ltd. Common Shares (cost of $81,346) 70,894
TBC Inc. Pooled Employees Fund (cost of $4,417) 4,417
Cash 1,504
--------
Total Investments 453,064
--------
RECEIVABLES
Dividends and Interest 19
--------
Total Receivables 19
--------
TOTAL ASSETS 453,083
--------
LIABILITIES
Cost of Unsettled Purchases 9,246
--------
Total Liabilities 9,246
--------
NET ASSETS AVAILABLE FOR BENEFITS $443,837
========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 8
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1997
<TABLE>
<S> <C>
CONTRIBUTIONS
Participating Employees $ 396,274
Participating Companies 29,506
---------
425,780
---------
INVESTMENT ACTIVITIES
Investment Income
Money Market Fund 1,085
Stable Income Fund 1,253
Bond Fund 707
S&P 500 Index Fund 1,023
Managed Equity Fund 342
Seagram Stock Fund 732
---------
Total Investment Income 5,142
---------
Realized Net Gain on Sale of Investments
Bond Fund 463
Stable Income Fund 239
S&P 500 Index Fund 1,462
Managed Equity Fund 6,932
Growth Equity Fund 3,865
Seagram Stock Fund (114)
---------
Total Realized Net Gain on Sale of Investments 12,847
---------
Unrealized Appreciation (Depreciation) on Investments
Bond Fund 428
S&P 500 Index Fund 9,465
Growth Equity Fund 2,499
Managed Equity Fund 1,085
Seagram Stock Fund (10,453)
---------
Total Unrealized Appreciation on Investments 3,024
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 9
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1997
(Continued)
<TABLE>
<S> <C>
Increase in Plan Equity from Investment Activities $ 21,013
---------
PARTICIPANT WITHDRAWALS (2,956)
---------
INCREASE IN PLAN EQUITY 443,837
PLAN EQUITY AT BEGINNING OF YEAR --
---------
PLAN EQUITY AT END OF YEAR $ 443,837
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 10
RETIREMENT SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES OF
TROPICANA PRODUCTS, INC. AND AFFILIATES
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed in the preparation of the financial
statements of the Retirement Savings and Investment Plan for Union
Employees of Tropicana Products, Inc. and Affiliates (the "Plan")
conform with generally accepted accounting principles. The more
significant accounting policies are:
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires the plan administrator to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results may differ from those
estimates.
Investment Valuation
Investment securities are recorded and valued as follows:
United States government obligations at fair value based on the current
market yields; temporary investments in short-term investment funds at
cost which in the normal course approximates market value; securities
representing units of other funds at net asset value; The Seagram
Company Ltd. common shares at the closing price reported on the
composite tape of the New York Stock Exchange on the valuation date.
Security Transactions
Security transactions are accounted for on a trade date basis with the
average cost basis used for determining the cost of investments sold.
Interest income is recorded on an accrual basis. Income on securities
purchased under agreements to resell is accounted for at the repurchase
rate. Changes in discount on coupons detached from United States
Treasury Bonds are reflected as unrealized appreciation.
2. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan established as of January 1,
1997 by Tropicana Products, Inc. (the "Company").
The Plan covers all employees of Tropicana Products, Inc., Tropicana
Products Sales Division of Joseph E. Seagram & Sons, Inc. and Tropicana
Sales Division of Distillers Products Sales Corporation (collectively,
the "Participating Companies") who are included in a unit of employees
covered by a Collective Bargaining Agreement between Tropicana
Products, Inc.and: (1) Glass, Molders, Pottery, Plastics and Allied
Workers International Union (AFL-CIO, CLC) and its Local Union No. 208;
(2) American Flint Glass Workers Union AFL-CIO and its Local Union No.
46; and (3) District Lodge No. 15 of the International Association of
Machinists and Aerospace Workers AFL-CIO (IAM #15) and who have
completed one month of Eligibility Service.
The Plan provides benefits to participants based upon amounts
voluntarily contributed to a participant's Accounts by the participant
and, amounts contributed, under certain circumstances, by the
Participating Companies (see Note 4). Under the Plan, a participant is
not provided with any fixed benefit. The
<PAGE> 11
2. DESCRIPTION OF THE PLAN (continued)
ultimate benefit to be received by the participant depends on the
amounts contributed, the investment results and other adjustments, and
the participant's vested interest at termination of employment (see
Note 5).
With respect to each participant, contributions are allocated among
four accounts: Pre-Tax Account, Company Match Account, After-Tax
Account and Rollover Account. Such contributions are invested as
designated by the participants in one or more of the investment funds
referred to in Note 3, and are accumulated and invested in a Trust Fund
held by the Dreyfus Trust Company, as Trustee. The Plan is administered
by the Company through a Benefits Committee appointed by the Board of
Directors of the Company.
3. INVESTMENT PROGRAM
During the year ended December 31, 1997, the Plan was comprised of
seven investment funds: (i) the Money Market Fund investing in the
Dreyfus Cash Management Plus Fund, managed by Dreyfus Corporation; (ii)
the Stable Income Fund investing in the Dreyfus-Certus Stable Value
Fund managed by Dreyfus Trsut Company; (iii) the Bond Fund investing in
Dreyfus A Bonds Plus Fund, managed by Dreyfus Corporation; (iv) the S&P
500 Index Fund investing in Dreyfus Basic S&P 500 Stock Index Fund
(which, prior to August 15, 1997 was named Dreyful Institutional S&P
500 Stock Index Fund) managed by Dreyfus Corporation; (v) the Managed
Equity Fund investing in Dreyfus Disciplined Stock Fund managed by
Dreyfus Corporation; (vi) the Growth Equity Fund investing in Warburg
Pincus Emerging Growth Fund managed by Warburg, Pincus Counsellors,
Inc.; and (vii) the Seagram Stock Fund investing primarily in The
Seagram Company Ltd. common shares. The investments are administered
by the Benefits Committee appointed by the Board of Directors of the
Company.
4. CONTRIBUTIONS
Eligible employees, as defined, may elect to contribute to their
Pre-Tax Accounts on a pre-tax basis ("Pre-Tax Contributions") and/or to
their After-Tax Accounts on an after-tax basis ("After-Tax
Contributions") through payroll deductions of 1% to 17% (in the
aggregate) of their annual compensation, as defined in the Plan, in
multiples of 1%, in any combination; provided, the aggregate percentage
of the contributions does not exceed 17% of their annual compensation.
Pre-tax Contributions and After-Tax Contributions are subject to
limitations imposed by federal laws for qualified retirement plans.
The Plan provides for mandatory matching contributions by the
Participating Companies payable to the participants' Company Match
Account. The Participating Companies, except as herein noted,
contribute on behalf of the participants 25% of the participants'
aggregate Pre-Tax and After-Tax Contributions not exceeding 2% of their
compensation, except for the IAM #15 Group which will receive mandatory
matching contributions beginning January 1, 1999 under the terms of its
collective bargaining agreement. The Participating Companies' matching
contributions are subject to limitations imposed by federal laws for
qualified retirement plans.
The Plan will accept into participants' Rollover Accounts cash received
by participants from a qualified plan within the time prescribed by
applicable law ("Rollover Contributions").
5. VESTING
A participant in the Plan always has a fully vested interest in the
value of his or her Pre-Tax, After-Tax and Rollover Accounts. He or she
has a non-forfeitable right to the value of his or her Company Match
Account upon retirement, total and permanent disability or death. Upon
termination of employment for any other reason, a participant vests in
his or her Company Match Account in accordance with the following
vesting schedule:
<PAGE> 12
5. VESTING (continued)
<TABLE>
<CAPTION>
Years of Service Vested Percentage
---------------- -----------------
<S> <C>
Less than 1 0%
At least 1, but less than 2 20%
At least 2, but less than 3 40%
At least 3, but less than 4 60%
At least 4, but less than 5 80%
5 or more 100%
</TABLE>
Upon termination of employment for reasons other than retirement, total
and permanent disability or death of a participant who was not fully
vested in his or her Company Match Account, the nonvested portion of
the participant's Company Match Account shall be forfeited. Any amount
forfeited shall be applied to reduce the Participating Companies'
contributions. Any amount forfeited shall be restored if the
participant is re-employed by a Participating Company before incurring
a five year break in service and if the participant repays to the Plan
(within five years after his or her reemployment commencement date) an
amount in cash equal to the full amount distributed to him or her from
the Plan on account of termination of employment, excluding amounts
from the After-Tax and Rollover Accounts at the participant's election.
6. DISTRIBUTIONS
Upon termination of employment, after retirement or for reason of total
and permanent disability or death, the participant or his or her
beneficiary shall receive the value of his or her Accounts. However, if
the termination of employment is for reasons other than retirement,
total and permanent disability or death, the participant shall receive
only the value of the vested portion of his or her Accounts (See Note
5).
Prior to termination of employment, the participant may withdraw
amounts from the Participant's Accounts in accordance with the
provisions of the Plan.
7. TAX STATUS OF PLAN
The Internal Revenue Service has ruled by a letter dated May 20, 1998
that the Plan is qualified under Section 401(a) of the Internal Revenue
Code. So long as the Plan continues to be so qualified, it is not
subject to federal income taxes.
Participants are not currently subject to income tax on the
Participating Companies' contributions to the Plan or on income earned
by the Plan. Benefits distributed to participants or to their
beneficiaries may be taxable to them. The tax treatment of the value of
such benefits depends on the event giving rise to the distribution and
the method of distribution selected.
8. RELATED PARTY TRANSACTIONS
Certain expenses of the Plan are paid by the Company, and personnel and
facilities of the Company are used by the Plan at no charge.
9. TERMINATION OF THE PLAN
The Board of Directors of the Company may terminate the Plan at any
time. In the case of termination, the rights of participants to their
Accounts shall be vested as of the date of termination.
<PAGE> 13
<PAGE> 14
The Seagram Company Ltd.
The Retirement Savings and Investment Plan for Union Employees of Tropicana
Products, Inc. and Affiliates
We hereby consent to the incorporation by reference in Registration
Statement No. 333-19059 on Form S-8 of our Report dated June 26, 1998 which
appears in your Annual Report on Form 11-K of the Retirement Savings and
Investment Plan for Union Employees of Tropicana Products, Inc. and Affiliates
for the fiscal year ended December 31, 1997.
/s/ Gutierrez & Co.
Flushing, New York
June 29, 1998
