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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 11-K
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ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 1996
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Commission file number: 33-60032
BUCKEYE RETIREMENT PLAN
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Buckeye Cellulose Corporation
1001 Tillman Street, Memphis, TN 38112
901-320-8100
Plan Number 334/002
Internal Revenue Service -- Employer Identification No. 62-1518973
June 30, 1996 and 1995
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<PAGE>
Buckeye Retirement Plan
Form 5500 - Item 26b
Audited Financial Statements and Supplemental Schedules
Years ended June 30, 1996 and 1995
Contents
Report of Independent Auditors...............................................1
Audited Financial Statements
Statements of Net Assets Available for Benefits,
with Fund Information......................................................2
Statement of Changes in Net Assets Available for Benefits,
with Fund Information......................................................4
Notes to Financial Statements................................................5
Supplemental Schedules
Item 27a - Schedule of Assets Held for Investment Purposes..................10
Item 27d - Schedule of Reportable Transactions..............................11
<PAGE>
Report of Independent Auditors
To the Buckeye Investment Committee
We have audited the accompanying statements of net assets available for benefits
of the Buckeye Retirement Plan (the Plan) as of June 30, 1996 and 1995, and the
related statement of changes in net assets available for benefits for the year
ended June 30, 1996. 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. These 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 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 Plan at June
30, 1996 and 1995 and the changes in net assets available for benefits for the
year ended June 30, 1996 in conformity with generally accepted accounting
principles.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedules of assets
held for investment purposes as of June 30, 1996, and reportable transactions
for the year then ended are presented for purposes of complying with the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974, and are not a required part
of the financial statements. The Fund Information in the statements of net
assets available for benefits as of June 30, 1996 and 1995 and the statement of
changes in net assets available for benefits for the year ended June 30, 1996 is
presented for purposes of additional analysis rather than to present the net
assets available for benefits and changes in net assets available for benefits
of each fund. The supplemental schedules and Fund Information have been
subjected to the auditing procedures applied in our audits of the financial
statements and, in our opinion, are fairly stated in all material respects in
relation to the financial statements taken as a whole.
December 6, 1996
1
<PAGE>
<TABLE>
<CAPTION>
Buckeye Retirement Plan
Statement of Net Assets Available for Benefits,
with Fund Information
June 30, 1996
Money Stock Growth Buckeye
Market Bond Balanced Index Stock Value Stock
Fund Fund Fund Fund Fund Fund Fund Total
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investments at fair value
(Note 3):
Money Market Fund $321,156 $ $ $ $ $ $ $321,156
Bond Fund 205,522 205,522
Balanced Fund 861,790 861,790
Stock Index Fund 1,350,795 1,350,795
Growth Stock Fund 3,999,685 3,999,685
Value Fund 860,360 860,360
Buckeye Stock Fund 816,365 816,365
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Total investments 321,156 205,522 861,790 1,350,795 3,999,685 860,360 816,365 8,415,673
Contributions receivable:
Employer 182,549 108,779 402,004 657,157 1,933,356 597,027 1,063,677 4,944,549
Cash and cash equivalents 1,809,208 1,809,208
Accrued income and other 523 (204) (807) 1,634 (1,426) 23 1,144 887
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Net assets available for $504,228 $314,097 $1,262,987 $2,009,586 $5,931,615 $1,457,410 $3,690,394 $15,170,317
benefits
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</TABLE>
See accompanying notes.
2
<PAGE>
<TABLE>
<CAPTION>
Buckeye Retirement Plan
Statement of Net Assets Available for Benefits,
with Fund Information
June 30, 1995
Money Stock Growth
Market Bond Balanced Index Stock
Fund Fund Fund Fund Fund Total
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<S> <C> <C> <C> <C> <C> <C>
Investments at fair value(Note 3):
Money Market Fund $219,758 $ $ $ $ $219,758
Bond Fund 167,284 167,284
Balanced Fund 590,844 590,844
Stock Index Fund 656,810 656,810
Growth Stock Fund 2,817,482 2,817,482
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Total investments 219,758 167,284 590,844 656,810 2,817,482 4,452,178
Contributions receivable:
Employer 260,472 180,224 679,161 730,816 2,805,062 4,655,735
Cash and cash equivalents 88 2,872 30,765 33,725
Accrued income 9,805 4 30 2,836 48 12,723
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Net assets available for benefits $490,035 $347,600 $1,272,907 $1,421,227 $5,622,592 $9,154,361
=======================================================================================
</TABLE>
See accompanying notes.
3
<PAGE>
<TABLE>
<CAPTION>
Buckeye Retirement Plan
Statement of Changes in Net Assets Available for Benefits,
with Fund Information
Year ended June 30, 1996
Money Stock Growth Buckeye
Market Bond Balanced Index Stock Value Stock
Fund Fund Fund Fund Fund Fund Fund Total
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in $ $(6,065) $46,751 $271,978 $607,316 $ 22,928 $162,661 $1,105,569
fair value ofinvestments
Interest and dividends 11,757 16,708 60,678 37,924 255,102 81,124 2,142 465,435
Contributions:
Employer 182,459 108,779 402,004 657,157 1,933,356 597,027 1,063,677 4,944,459
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Total additions 194,216 119,422 509,433 967,059 2,795,774 701,079 1,228,480 6,515,463
Deductions from net assets attributed to:
Benefits paid to participants 29,043 24,710 87,190 43,599 181,020 - - 365,562
Administrative expenses 5,648 4,991 16,494 21,740 71,703 7,546 5,823 133,945
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Total deductions 34,691 29,701 103,684 65,339 252,723 7,546 5,823 499,507
Net increase prior to interfund
transfers 159,525 89,721 405,749 901,720 2,543,051 693,533 1,222,657 6,015,956
Interfund transfers (net) (145,332) (123,224) (415,669) (313,361) (2,234,028) 763,877 2,467,737 -
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Net increase (decrease) 14,193 (33,503) (9,920) 588,359 309,023 1,457,410 3,690,394 6,015,956
Net assets available for benefits 490,035 347,600 1,272,907 1,421,227 5,622,592 - - 9,154,361
beginning of year
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Net assets available for benefits at $504,228 $314,097 $1,262,987 $2,009,586 $5,931,615 $1,457,410 $3,690,394 $15,170,317
end of year
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</TABLE>
See accompanying notes.
4
<PAGE>
Buckeye Retirement Plan
Notes to Financial Statements
June 30, 1996
1. DESCRIPTION OF PLAN
- - ----------------------
The following description of the Buckeye Retirement Plan (the Plan) provides
only general information. Participants should refer to the Plan agreement for a
more complete description of the Plan's provisions.
General
- - -------
The Plan was formed on July 1, 1993 and is a multiple-employer noncontributory
defined contribution plan covering all full-time salaried and hourly employees
of Buckeye Cellulose Corporation and Buckeye Florida Limited Partnership (the
Companies). On the close of business on June 30, 1996, the multiple-employer
plan was converted to a single-employer plan with a single asset pool. Employees
are eligible upon completion of 1,000 hours of service during their first year
of employment or during any plan year (July 1 to June 30).
Contributions
- - -------------
The Companies make an annual contribution to each participant's account based on
the following formula:
Contribution = participant's annual gross income x [1 + .5 (years of service)]%
Contributions are generally funded in the quarter following the Plan's year end.
Participant Accounts
- - --------------------
Each participant's account is credited with the employer contribution and
allocations of Plan earnings and administrative expenses. Forfeited balances of
terminated participants' nonvested accounts are used to reduce future
contributions by the Companies.
Vesting
- - -------
Participants are 100% vested after five years of credited service.
5
<PAGE>
Buckeye Retirement Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF PLAN (CONTINUED)
- - ----------------------------------
Investment Options
- - ------------------
Upon enrollment in the Plan, a participant may direct employer contributions in
10% increments in any of the following five investment options:
Money Market Fund--Funds are invested through a mutual fund in money market
instruments backed by the U.S. government.
Bond Fund--Funds are invested through a mutual fund in a diversified
portfolio of primarily U.S. government securities and high quality corporate
bonds.
Balanced Fund--Funds are invested through a mutual fund in a combination of
common stocks, bonds and cash.
Stock Index Fund--Funds are invested through a mutual fund in stocks of the
Standard & Poor's 500 Index.
Growth Stock Fund--Funds are invested through a mutual fund in common stock
of companies with growth potential.
Value Fund--Funds are invested through a mutual fund in equity securities.
Buckeye Stock Fund--Funds are invested in Buckeye Cellulose Corporation
(BCC) common stock.
Participants may change their investment options quarterly.
2. ACCOUNTING POLICIES
- - ----------------------
Investments
- - -----------
Investments are stated at fair market value (based on quoted market prices) with
the change in carrying value reported as the net change in unrealized
appreciation or depreciation in aggregate fair value of investments. Purchases
and sales of investments are recorded on a trade-date basis. Interest income is
recorded on the accrual basis.
6
<PAGE>
Buckeye Retirement Plan
Notes to Financial Statements (continued)
2. ACCOUNTING POLICIES (CONTINUED)
- - ----------------------------------
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 amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
3. INVESTMENTS
- - --------------
Investments that represent 5 percent or more of the Plan's net assets are
separately identified.
June 30
1996 1995
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Investments at fair value as determined by quoted
market price:
Federated Short-Term U.S.Government
Treasury, 321,156 and 219,758
shares, respectively $ 321,156 $ 219,758
Strong Government Securities Fund,
20,070 and 15,977 shares, respectively 205,522 167,284
Dodge & Cox Balanced Fund, 15,274 shares 861,790 -
Fidelity Balanced Fund, 45,415 shares - 590,844
Vanguard Institutional Index Fund,
21,360 shares 1,350,795 -
Vanguard Index Trust 500 Portfolio,
12,841 shares - 656,810
Janus Fund, Inc., 157,220 and 128,770
shares, respectively 3,999,685 2,817,482
MAS Value Fund, 57,053 shares 860,360 -
Buckeye Cellulose Corporation common
stock, 29,686 shares 816,365 -
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$8,415,673 $4,452,178
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7
<PAGE>
Buckeye Retirement Plan
Notes to Financial Statements (continued)
3. INVESTMENTS (CONTINUED)
- - --------------------------
During the year ended June 30, 1996, the Plan's investments (including
investments bought, sold and held during the year) appreciated (depreciated) in
value as follows:
June 30
1996
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MAS Value Fund $ 22,928
Strong Government Securities Fund (6,065)
Dodge & Cox Balanced Fund 46,751
Vanguard Index Trust 500 145,004
Janus Fund, Inc. 607,316
Buckeye Cellulose Corporation common stock 162,661
Vanguard Institutional Index Fund 126,974
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$1,105,569
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4. RELATED PARTY TRANSACTIONS
- - -----------------------------
The Plan purchased 29,686 shares of BCC common stock during the year. The stock
had a market value $816,365 at June 30, 1996. There were no other transactions
with related parties.
5. DIFFERENCES BETWEEN FINANCIAL STATEMENTS AND FORM 5500
- - ---------------------------------------------------------
The following is a reconciliation of net assets available for benefits per the
financial statements to the Form 5500:
June 30, 1996
----------------
Net assets available for benefits per the financial statements $15,170,317
Amounts allocated to withdrawn participants (146,834)
----------------
Net assets available for benefits per the Form 5500 $15,023,483
================
8
<PAGE>
Buckeye Retirement Plan
Notes to Financial Statements (continued)
5. DIFFERENCES BETWEEN FINANCIAL STATEMENTS AND FORM 5500 (CONTINUED)
- - ---------------------------------------------------------------------
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500:
Year ended
June 30, 1996
----------------
Benefits paid to participants per the financial statements $365,562
Amounts allocated on Form 5500 to withdrawn participants
at June 30,1996 146,834
----------------
Benefits paid to participants per the Form 5500 $512,396
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6. PLAN TERMINATION
- - -------------------
Although they have not expressed any intent to do so, the Companies have the
right to discontinue its contributions at any time and to terminate the Plan
subject to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA). In the event of plan termination, participants will become 100 percent
vested in their accounts.
7. INCOME TAX STATUS
- - --------------------
The Internal Revenue Service (IRS) has ruled that the Plan qualifies under the
applicable sections of the Internal Revenue Code (IRC) and is, therefore, not
subject to tax under present income tax law. Once qualified, the Plan is
required to operate in conformity with the IRC to maintain its qualification.
Management is not aware of any course of action or series of events that have
occurred that might adversely affect the Plan's qualified status.
9
<PAGE>
Buckeye Retirement Plan
Item 27a--Schedule of Assets Held for Investment Purposes
June 30, 1996
Description of Investment
Including Maturity Date, Number
Rate of Interest, of Current
Par or Maturity Value Shares Cost Value
- - -------------------------------------------------------------------------------
Federated Short Term U.S. Government
Treasury 321,156 $ 321,156 $ 321,156
Strong Government Securities Fund 20,070 204,894 205,522
Dodge & Cox Balanced Fund 15,274 816,958 861,790
Vanguard Institutional Index Fund 21,360 1,248,396 1,350,795
Janus Fund, Inc. 157,220 3,382,901 3,999,685
MAS Value Fund 57,053 823,530 860,360
Buckeye Cellulose Corporation
common stock* 29,686 653,991 816,365
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$7,451,826 $8,415,673
===========================
* Denotes a party-in-interest of the plan.
10
<PAGE>
<TABLE>
<CAPTION>
Buckeye Retirement Plan
Item 27d - Schedule of Reportable Transactions
Year ended June 30, 1996
Current Value
Identity Description Number of Asset on Net
of of of Purchase Selling Cost of Transaction Gain or
Party Involved Investment Transactions Price Price Asset Date (Loss)
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Category (i)--single transaction in excess of 5 percent
of plan assets
Purchases of assets:
First Tennessee Bank* Dodge & Cox Balanced Fund 1 $501,240 $ $501,240 $501,240 $
Janus Fund 1 830,719 830,719 830,719
Vanguard Institutional Index Fund 1 624,890 624,890 624,890
Fidelity Institutional Cash US Govt. 1 693,532 693,532 693,532
Dodge & Cox Balanced Fund 1 762,674 762,674 762,674
Fidelity Institutional Cash US Govt. 1 1,115,658 1,115,658 1,115,658
Fidelity Institutional Cash US Govt. 1 727,403 727,403 727,403
Janus Fund 1 1,973,065 1,973,065 1,973,065
MAS Value Fund 1 526,475 526,475 526,475
Vanguard Institutional Index Fund 1 923,733 923,733 923,733
Sales of assets:
First Tennessee Bank* Vanguard Index Trust 500 1 624,890 537,735 571,003 53,887
Fidelity Institutional Cash U.S.Govt. 1 714,208 714,208 714,208
Janus Fund 1 727,403 614,560 650,306 77,097
Janus Fund 1 488,491 446,641 474,302 14,189
Vanguard Index Trust 500 1 923,733 792,519 841,494 82,239
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
Buckeye Retirement Plan
Item 27d - Schedule of Reportable Transactions (continued)
Current Value
Identity Description Number of Asset on Net
of of of Purchase Selling Cost of Transaction Gain or
Party Involved Investment Transactions Price Price Asset Date (Loss)
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Category (iii)--series of transactions in excess of
5 percent of plan assets
Purchases of assets:
First Tennessee Bank* Buckeye Cellulose Corp. 30 $ 659,625 $ $ 659,625 $ 659,625 $
Dodge & Cox Balanced Fund 21 1,357,890 1,357,890 1,357,890
Janus Fund 17 3,157,448 3,157,448 3,157,448
MAS Value Fund 20 1,036,455 1,036,455 1,036,455
Vanguard Institutional Index Fund 13 1,581,403 1,581,403 1,581,403
Vanguard Index Trust 500 17 882,579 882,579 882,579
Fidelity Institutional Cash U.S. Govt. 230 5,195,157 5,195,157 5,195,157
Sales of assets:
First Tennessee Bank* Dodge & Cox Balanced Fund 28 550,436 540,934 540,934 9,502
Janus Fund 34 2,582,560 2,255,265 2,394,640 187,920
Vanguard Index Trust 500 15 1,690,403 1,454,232 1,545,399 145,004
Fidelity Institutional Cash U.S. Govt. 214 3,394,049 3,394,049 3,394,049
</TABLE>
There were no category (ii) or (iv) reportable transactions during 1996.
* Denotes a party-in-interest of the plan.
12
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Retirement Plan Committee of the Employee Retirement Plans for Buckeye Cellulose
Corporation has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BUCKEYE RETIREMENT PLAN
By: /s/ DAVID H. WHITCOMB
------------------------------
David H. Whitcomb,
Vice President and Comptroller
Date: December 20, 1996
13
BUCKEYE RETIREMENT PLAN
Exhibit Index
Exhibit No. Description
23 Consent of Independent Auditors
23-1
<PAGE>
Exhibit 23
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8, Number 33-80867) pertaining to the Buckeye Retirement Plan of our report
dated December 6, 1996 with respect to the financial statements and schedules of
the Buckeye Retirement Plan included in this Annual Report (Form 11-K) for the
year ended June 30, 1996.
Ernst & Young LLP
Memphis, Tennessee
December 17, 1996
23-2
