<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 3
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED JUNE 30, 1998
COMMISSION FILE NUMBER 1-2275
THE SEAGRAM COMPANY LTD. - LA COMPAGNIE SEAGRAM LTEE
- --------------------------------------------------------------------------------
(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, 1998 (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 Exhibit 99(f) to the Form 10-K the
attached Form 11-K with respect to the PolyGram Holding,
Inc. Deferred Savings and Investment Plan for Employees.
<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: August 18, 1999
<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, 1998
COMMISSION FILE NUMBER 1-2275
POLYGRAM HOLDING, INC. DEFERRED SAVINGS
AND INVESTMENT PLAN FOR EMPLOYEES
800 Third Avenue
New York, New York 10022
(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 PolyGram Holding, Inc. Deferred Savings and Investment Plan for
Employees (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, 1998 prepared in accordance with the financial reporting
requirements of ERISA.
EXHIBITS
1. Financial statements of the Plan for the fiscal year ended December 31,
1998 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.
POLYGRAM HOLDING, INC. DEFERRED SAVINGS
AND INVESTMENT PLAN FOR EMPLOYEES
By /s/ Kelly DeMasi
----------------------------------
Kelly DeMasi
Member of Administrative Committee
By /s/ Eric Scoones
----------------------------------
Eric Scoones
Member of Administrative Committee
By /s/ John R. Toren
----------------------------------
John R. Toren
Member of Administrative Committee
Date: August 18, 1999
<PAGE> 4
4
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 and 1997
<PAGE> 5
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Financial Statements
Independent Auditors' Report 1
Statement of Net Assets Available for Benefits 3
Statement of Changes in Net Assets
Available for Benefits 4
Notes to Financial Statements 5
Supplementary Information
Schedule of Assets Held For Investment Schedule 1 14
Schedule of Reportable Transactions Schedule 2 15
</TABLE>
<PAGE> 6
INDEPENDENT AUDITORS' REPORT
The Plan Administrator
PolyGram Holding, Inc.
Deferred Savings and Investment Plan for Employees
We have audited the accompanying statements of net assets available for
benefits of the PolyGram Holding, Inc. Deferred Savings and Investment Plan for
Employees (the "Plan") as of December 31, 1998 and 1997, and the related
statements of changes in net assets available for benefits for the years then
ended and the supplemental schedules of (1) assets held for investment purposes,
and (2) reportable transactions as of or for the year ended December 31, 1998.
These financial are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. The December 31, 1997 financial statements were reported on by other
auditors whose report dated October 15, 1998 on the financial statements
disclaimed an opinion for the reasons described in the following paragraph.
As permitted by Section 2520.103-8 of the Department of Labor Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, investment assets held by Chase Manhattan Bank, the
trustee of the Plan, and transactions in those assets were excluded from the
scope of our audit of the Plan's 1997 financial statements, except for comparing
the information provided by the trustee, which is summarized in Note 4, with the
related information in the financial statements.
Except as discussed in the above paragraph, 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.
As discussed in Note 7 to the financial statements, the Plan incurred
losses on certain investments during 1996. The Company and the Pension
Committee, which administers the Plan, commenced a lawsuit during 1997 against
the former investment manager to recover all such losses.
1
<PAGE> 7
Because of the significance of the information that we did not audit,
we were unable to, and do not express an opinion on the Plan's financial
statement as of December 31, 1997. The form and content of the information
included in the 1997 financial statements and schedules, other than that derived
from the information certified by the trustee, has been audited by us and, in
our opinion, is presented in compliance with the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974.
In our opinion, the financial statements referred to above, of PolyGram
Holding, Inc. Deferred Savings and Investment Plan for Employees as of December
31, 1998, and for the year then ended present fairly, in all material respects,
the net assets available for benefits of the Plan at December 31, 1998, and the
changes in net assets available for benefits for the year then ended in
conformity with generally accepted accounting principles.
Our audit of the Plan's financial statements as of and for the year
ended December 31, 1998, was conducted for the purpose of forming an opinion on
the financial statements taken as a whole. The supplemental schedules of (1)
assets held for investment purposes, and (2) reportable transactions are
presented for the purpose of additional analysis and are not a required part of
the basic financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement and Income Security Act of 1974. The supplemental
schedules are the responsibility of the Plan's management. The supplemental
schedules have been subjected to the auditing procedures applied in the audit of
the basic financial statements for the year ended December 31, 1998, and, in our
opinion, are fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
Flushing, New York
August 16, 1999
2
<PAGE> 8
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
-----------------------------
1998 1997
----------- -----------
<S> <C> <C>
INVESTMENTS
Money Market Fund:
Dreyfus Cash Management Class A Mutual Fund $ 2,175,212 $ 1,076,313
Intermediate Fixed Income Fund:
PIMCO Low Duration Mutual Fund 10,230,737 10,505,157
Growth & Income Stock Fund:
Vanguard Windsor II Mutual Fund 39,417,944 30,745,565
Balanced Mutual Fund:
Vanguard Wellington Mutual Fund 17,898,732 15,076,515
Aggressive Equity Fund:
Stein Roe Capital Opportunities Fund 4,542,634 3,501,942
Loans to Participants 2,100,341 1,832,410
----------- -----------
Total Investments 76,365,600 62,737,902
----------- -----------
Receivables
Accrued income 185 312
Employee contributions 669,702 337,144
Employer contributions 206,972 81,303
----------- -----------
Total Receivables 876,859 418,759
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $77,242,459 $63,156,661
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 9
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Year Ended December 31,
1998 1997
------------ ------------
<S> <C> <C>
CONTRIBUTIONS
Employee contributions $ 7,863,284 $ 6,651,414
Employer contributions - restorations 2,085,232
Employer contributions 2,716,564 2,059,257
------------ ------------
Total Contributions 12,665,080 8,710,671
------------ ------------
INVESTMENT ACTIVITIES
Investment Income
Money Market Fund 104,161 48,780
Intermediate Fixed Income Fund 703,491 706,397
Growth & Income Stock Fund 1,245,606 2,793,134
Balanced Mutual Fund 640,000 1,281,676
Aggressive Equity Fund 395 142
Participant Loans 182,137 224,910
------------ ------------
Total Investment Income 2,875,790 5,055,039
------------ ------------
Net appreciation in fair value of investments
Intermediate Fixed Income Fund 10,706 154,148
Growth & Income Stock Fund 4,088,359 5,203,475
Balanced Mutual Fund 1,248,214 835,604
Aggressive Equity Fund (86,024) 259,924
------------ ------------
Total Net Appreciation in Fair Value of
Investments 5,261,255 6,453,151
------------ ------------
Increase in Plan Equity from Investment
Activities 8,137,045 11,508,190
------------ ------------
PARTICIPANT WITHDRAWALS (6,716,327) (5,978,996)
------------ ------------
INCREASE IN PLAN EQUITY 14,085,798 14,239,865
PLAN EQUITY AT BEGINNING OF YEAR 63,156,661 48,916,796
------------ ------------
PLAN EQUITY AT END OF YEAR $ 77,242,459 $ 63,156,661
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 10
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
(1) DESCRIPTION OF THE PLAN
The following brief description of PolyGram Holding, Inc. Deferred Savings
and Investment Plan for Employees (the "Plan") is provided for general
information purposes only. Participants should refer to the plan document for
more complete information.
GENERAL
The Plan became effective January 1, 1987, and the Plan was amended from time
to time including amendments subsequent to December 31, 1998 as described in
Note 8. It is a profit sharing, thrift-type defined contribution plan with a
taxsaver 401(k) provision under which certain employees of PolyGram Holding,
Inc. (the "Company") may participate. Leased employees, "freelance" employees
or consultants are not eligible to participate. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974, as amended
(ERISA).
ELIGIBILITY
The Plan is a voluntary defined contribution plan. Under the terms of the
Plan, employees with one year of service are eligible to participate in the
Plan. Employees are eligible to participate in the Plan beginning with the
calendar month following the completion of one year of service.
CONTRIBUTION
Eligible employees may make a combination of taxsaver (pretax dollars) and
thrift (after-tax dollars) contributions, in whole percentage of annual
earnings, through payroll deductions. Participants may contribute up to 16%
of their annual earnings, subject to a 12% maximum in pre-tax contributions
and 10% maximum in after-tax contributions. On the first pretax contribution
of 6% of a participant's annual earnings, the Company will match fifty cents
for each dollar. In addition, the maximum contribution allowed by the
Internal Revenue Service is $10,000 per participant for 1998 and $9,500 per
participant for 1997.
5
<PAGE> 11
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
Participants may elect to have their contributions invested in a variety of
investment funds (see note 2). Investment elections in the funds may be
changed at the beginning of any calendar month and must be made in increments
of 5%.
Participants are 100% vested in their pre-tax, after-tax and rollover
contributions. A participant's interest in the Company's matching
contribution will become vested according to the following schedule:
<TABLE>
<CAPTION>
COMPLETED YEAR OF SERVICE PERCENTAGE VESTED
------------------------- -----------------
<S> <C>
1 year % 20
2 years % 40
3 years % 60
4 years % 80
5 years or more % 100
</TABLE>
In addition, nonvested employer matching contributions become 100% vested
upon Disability (as defined by the Plan), retirement or death.
Participants as of December 10, 1998 are fully vested in their benefits
accrued through December 31, 1998. Employer matching contributions related to
services performed by employees from January 1, 1999 forward are subject to
the previous regular vesting schedule.
Forfeited balances of terminated participants' nonvested accounts are used to
reduce future Company contributions. For 1998 and 1997, the total forfeited
amounts were $148,018 and $165,032, respectively.
LOANS
Participants may borrow from their vested account balance. The minimum loan
amount is $1,000 and the maximum is the lesser of $50,000 or 50% of the
participant's vested amount balance. Only one loan may be outstanding at any
one time. The interest rate on the loan is Prime Rate plus
6
<PAGE> 12
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
1%. The average interest rate for 1998 and 1997 was 9.5% and 9.5%,
respectively. Repayments are made through payroll deductions over a period of
no more than 5 years although the term may be extended to 15 years if the
loan is for the purchase of the participant's primary residence.
PARTICIPANT DISTRIBUTIONS
The distribution to which a plan participant is entitled is provided by the
vested contributions and income thereon allocated to the participants
account. The election may be made upon retirement, death, Disability or
termination of employment. Distributions are in the form of immediate or
deferred cash lump sum or immediate or deferred installments. Installments
are available only for participants who retire or who are disabled as defined
by the Plan. Normal retirement age is 65; however, a participant may work
past his normal retirement date and continue to participate in the Plan until
70-1/2. If a former participant is rehired and has not received a
distribution of his account balance, any forfeited amounts will be
reinstated. If the former participant has received a distribution, then the
distribution must be repaid within five years from the participant's rehire
date in order to restore the forfeiture amount. There are also certain
inservice withdrawals from the Plan.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
Accounting records of the Plan are maintained on an accrual basis.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported
7
<PAGE> 13
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
amounts of assets, liabilities and disclosures of contingent assets and
liabilities at the date of the financial statements and the reported amounts
of additions and deductions during the reporting period. Actual results could
differ from those estimates.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options. Investment securities are
exposed to various risks such as interest rate, market and credit. Due to the
risk associated with investment securities and the uncertainty related to
changes in the value of such securities, it is at least reasonably possible
that changes in risks, in the near term could materially affect participants'
account balances and the amounts reported in the statements of net assets
available for plan benefits and the statements of changes in net assets
available for plan benefits.
DISTRIBUTIONS DUE TO PARTICIPANTS/RECONCILIATION TO FORM 5500
Distributions due to participants total $1,092,618 and $857,641 at December
31, 1998 and 1997, respectively, which are not included in "Distributions to
participants" on the statements of changes in net assets available for plan
benefits.
BALANCES ALLOCATED TO FORMER EMPLOYEES
Balances related to participants who were former employees of the Company
amounted to $15,982,873 and $11,820,498 at December 31, 1998 and 1997,
respectively.
8
<PAGE> 14
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
INVESTMENTS
The Pension Committee, or its appointed investment advisor(s), periodically
reviews the investment results of current investment options and evaluates
new investments that may be suitable for the Plan.
Market values of the investments held in the Trust are valued by reference to
published market quotations where a quoted market exists. When no published
market quotation exists, the values are determined by the trustee. Purchases
and sales of securities are reflected by the Trustee on a trade-date basis.
Unrealized appreciation and depreciation are recognized on the last business
day of the year and income from debt securities is recognized as earned.
Realized gains and losses are determined on the basis of average cost of
investments sold.
Participants may allocate their investments in the five investment funds as
follows:
- Intermediate Fixed Income Fund invests in the PIMCO Low Duration
Fund with an objective to obtain maximum current income consistent
with preservation of capital and daily liquidity by investing in a
diversified portfolio of securities of varying maturities.
- Growth & Income Stock Fund invests in the Vanguard Windsor II
mutual fund with an objective to provide long-term growth of
capital and income by investing primarily in common stocks. The
fund return attempts to mirror the Standard & Poor's Composite
Price Index.
- Balanced Mutual Fund invests in the Vanguard Wellington Fund with
an objective to provide conservative investors with a prudent
investment program. The fund invests in a combination of common
stocks and bonds. The fund return attempts to mirror a combined
index composed of the Standard & Poor's Composite Stock Price Index
and
9
<PAGE> 15
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
the Lehman Long-Term Corporate AA or Better Bond Index.
- Money Market Fund invests in the Dreyfus Cash Management Class A
Mutual Fund with an objective to provide a high level of current
income with the preservation of capital and the maintenance of
liquidity. This is achieved by investing in short-term money market
obligations, including securities issued by the U.S. Government,
certificates of deposit and other short-term obligations.
- Aggressive Equity Fund invests in the Stein Roe Capital
Opportunities Mutual Fund with an objective to provide long-term
capital appreciation by investing in selected companies that in the
opinion of Stein Roe & Farnham Inc., the advisor, offer
opportunities for capital appreciation.
(3) PRIORITIES UPON TERMINATION OF THE PLAN
The Plan may be terminated at the discretion of the Board of Directors
of the Company. The employer contributions on behalf of the participants
shall then become fully vested. The total value of the employer and
employee vested accounts shall be distributed to the participants in a
lump-sum cash payment.
(4) TRUST ASSETS CERTIFIED BY PLAN TRUSTEE
For the plan year ended December 31, 1997, the plan administrator has
elected the method of compliance permitted by 29 CFR 2520.103-8 of the
Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974. Accordingly,
as permitted under such election, the plan administrator instructed the
Plan's independent auditors not to perform any auditing procedures with
respect to the information and details thereof certified by the trustee,
except for comparing such information included in the financial
statements and supplemental schedule of assets held for investment
purposes.
10
<PAGE> 16
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
At December 31, 1998 and 1997, the Plan's trustee, Chase Manhattan Bank,
has certified the completeness and accuracy of the information
pertaining to the following:
Statements of net assets available for plan benefits:
Investments, at fair value
Statements of changes in net assets available for plan benefits:
Interest, excluding interest on participants' loans
Dividends
Net appreciation (depreciation) in fair value of
investments
The following 5% investments reported at fair value in the accompanying
statements of net assets available for plan benefits were reported by
Chase Manhattan Bank as of December 31, 1998 and 1997.
<TABLE>
<CAPTION>
1998 1997
----------------------------- -----------------------------
FAIR FAIR
COST VALUE COST VALUE
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Investments:
PIMCO Low Duration Mutual Fund $10,147,118 $10,230,737 $10,387,113 $10,505,157
Vanguard Windsor II Mutual Fund 29,576,435 39,417,944 22,025,288 30,745,565
Vanguard Wellington Mutual Fund 14,808,677 17,898,732 11,790,278 15,076,515
Stein Roe Capital Opportunities Fund 4,421,064 4,542,634 3,291,544 3,501,942
----------- ----------- ----------- -----------
$58,953,294 $72,090,047 $47,494,223 $59,829,179
=========== =========== =========== ===========
</TABLE>
(5) ADMINISTRATIVE EXPENSES
All costs associated with the maintenance of accounting records and
certain investment fees of the Plan are borne by the Company.
Administrative expenses paid to investment brokers are deducted from
plan earnings.
11
<PAGE> 17
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
(6) TAX STATUS
The Plan is approved as qualified under Section 401(a) of the Internal
Revenue Code (the "Code") of 1986, as amended, and, therefore, is exempt
from Federal income taxes under Section 501(a) of such Code, pursuant to
a determination letter dated December 10, 1997 from the Internal Revenue
Service (the "IRS"). In the opinion of the plan administrator, the Plan
and its underlying trust have operated within the terms of the Plan and
the compliance requirements to remain qualified under the applicable
provisions of the Code.
(7) LITIGATION
As a result of losses incurred in the Intermediate Fixed Income Fund
during 1996, the Company and the Pension Committee, which administers
the Plan, commenced a lawsuit in the United States District Court for
the Southern District of New York on behalf of the Plan, against the
former investment manager, Barclay. The lawsuit alleges, among other
things, that Barclay breached its fiduciary duty in the management of
the assets and seeks to recover from Barclay all losses incurred by the
Plan as a result of such breach. As of June 1998, the Pension Committee
determined to keep the litigation off the court's active calendar with
the understanding that it can be reactivated in response to further
developments.
12
<PAGE> 18
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1998 and 1997
The Company, as a result of these losses, determined to make a one-time
special contribution to the Plan to restore losses incurred in the
period July 1, 1996 to November 30, 1996. The Company obtained a
favorable ruling from the IRS in November 1997 to make the restoration
payment. The payment, which was made on March 2, 1998, was $2,085,232
and included interest through February 1998. The payment was allocated
to the investment funds in accordance with the participant current
investment elections. The following table shows the distribution of the
restorative payment:
<TABLE>
<CAPTION>
STEIN ROE VANGUARD VANGUARD
DREYFUS CAPITAL PIMCO WELLINGTON WINDSOR II TOTAL
---------- --------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net loss $ 989,389 $165,109 $ 94,977 $223,630 $ 432,380 $1,905,485
Interest 93,331 15,575 8,959 21,095 40,787 179,747
---------- -------- -------- -------- ---------- ----------
$1,082,720 $180,684 $103,936 $244,725 $ 473,167 $2,085,232
========== ======== ======== ======== ========== ==========
</TABLE>
The Plan changed its investment manager from Barclay to Pacific Asset
Management, Inc. in December 1996.
(8) SUBSEQUENT EVENTS
The Plan was amended as of August 1, 1999 to comply with the benefit
covenants set forth in the acquisition agreement with respect to the
acquisition of Polygram N.V. Further, the provisions of the Plan have
been amended as of August 23, 1999 to become substantially similar to
the provisions of the other 401(k) plans sponsored by affiliates of the
Company in order to simplify and streamline administration of the Plan
and the 401(k) plans of its affiliates and to restate the Plan for
recent federal legislation. Further, the Pension Committee (now the
Investment Committee) removed the Stein Roe Capital Opportunity Fund
from the Plan, effective May 31, 1999. Other changes to the Plan
included the change of trustee and recordkeeper as well the investment
funds that participants could allocate their investments.
13
<PAGE> 19
SCHEDULE 1
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
December 31, 1998
Line 27(a) - Schedule of Assets Held for Investment Purposes
<TABLE>
<CAPTION>
CURRENT
SHARES COST VALUE
<S> <C> <C> <C>
Dreyfus Money Market Fund 2,175,212 $ 2,175,212 $ 2,175,212
PIMCO Low Duration Fund 1,005,972 10,147,118 10,230,737
Stein Roe Capital Opportunities Fund 154,722 4,421,064 4,542,634
Vanguard Wellington Mutual Fund 609,838 14,808,677 17,898,732
Vanguard Windsor II Mutual Fund 1,320,534 29,576,435 39,417,944
Loan Fund -- 2,100,341 2,100,341
----------- -----------
Total $63,228,847 $76,365,600
=========== ===========
</TABLE>
The above information has been certified as complete and accurate by Chase
Manhattan Bank, the Plan's trustee as of December 31, 1998.
See accompanying independent auditors' report.
14
<PAGE> 20
SCHEDULE 2
POLYGRAM HOLDING, INC.
DEFERRED SAVINGS AND INVESTMENT
PLAN FOR EMPLOYEES
Year ended December 31, 1998
Line 27(d) - Schedule of Reportable Transactions
<TABLE>
<CAPTION>
UNIT UNIT
PURCHASE SELLING COST OF PROCEEDS NET GAIN
DESCRIPTION PRICE PRICE ASSETS FROM SALE (LOSS)
----------- -------- ------- ----------- --------- --------
<S> <C> <C> <C> <C> <C>
SINGLE TRANSACTION
Vanguard Windsor II Mutual Fund 28.58 -- 393,708,379 -- --
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF NUMBER OF
PURCHASE SALE COST OF PROCEEDS NET GAIN
DESCRIPTION TRANSACTIONS TRANSACTIONS ASSETS FROM SALE (LOSS)
----------- ------------ ------------ ----------- ---------- --------
<S> <C> <C> <C> <C> <C>
SERIES OF TRANSACTIONS
Chase Enhanced Cash Investment
Fund 137 111 $13,477,991 13,477,991 --
Vanguard Wellington Mutual Fund 42 9 3,382,833 1,808,830 1,444,395
Vanguard Windsor II Mutual Fund 51 8 8,089,134 3,505,115 2,967,127
</TABLE>
The above information has been certified as complete and accurate by Chase
Manhattan Bank, the Plan's trustee as of December 31, 1998.
See accompanying independent auditors' report.
15
<PAGE> 21
20
The Seagram Company Ltd.
PolyGram Holding, Inc. Deferred Savings and Investment Plan for Employees
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 filed by The Seagram Company Ltd. on August 18, 1999 of
our Report dated August 16, 1999 which appears in the Annual Report on Form 11-K
of the PolyGram Holding, Inc. Deferred Savings and Investment Plan for Employees
for the fiscal year ended December 31, 1998.
/s/ Gutierrez & Co.
Gutierrez & Co.
Flushing, New York
August 18, 1999
