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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 year ended June 30, 1999
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Commission file number: 33-60032
Buckeye Retirement Plan
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Buckeye Technologies Inc.
1001 Tillman Street, Memphis, TN 38112
901-320-8100
Plan Number 002
Internal Revenue Service -- Employer Identification No. 62-1518973
June 30, 1999 and 1998
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<PAGE>
BUCKEYE RETIREMENT PLAN
Financial Statements
and Supplemental Schedules
For the Year Ended June 30, 1999
<PAGE>
BUCKEYE RETIREMENT PLAN
Contents
Page
Independent Auditor's Report 2
Statements of Net Assets Available for Benefits 3
Statements of Changes in Net Assets Available for Benefits 4
Notes to Financial Statements 5-8
Supplemental Schedules
Item 27(a) - Schedule G, Part I - Schedule of Assets Held
for Investment Purposes 9
Item 27(d) - Schedule G, Part V - Schedule of Reportable
Transactions 10
<PAGE>
Independent Auditor's Report
To the Buckeye Investment Committee
Buckeye Retirement Plan
Memphis, Tennessee
We have audited the accompanying statement of net assets available for benefits
of Buckeye Retirement Plan as of June 30, 1999, 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. The financial statements and supplemental schedules as of June 30,
1998 and for the year then ended were reported on by other auditors, whose
report dated December 14, 1998 expressed an unqualified opinion on those
statements.
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 Buckeye
Retirement Plan at June 30, 1999, and the changes in its net assets available
for benefits for the year then ended in conformity with generally accepted
accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The accompanying supplemental schedule of assets
held for investment purposes as of June 30, 1999 and supplemental schedule of
reportable transactions for the year then ended are presented for the purpose 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 basic financial statements. The supplemental
schedules have been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
December 8, 1999
<PAGE>
BUCKEYE RETIREMENT PLAN
Statements of Net Assets Available for Benefits
June 30, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
-------------- --------------
<S> <C> <C>
Assets
Investments (notes 2 and 3)
Fidelity Retirement Money Market Portfolio $ 759,605 $ 692,784
Strong Government Securities Fund 473,560 373,787
Fidelity Puritan Fund 2,373,015 1,916,052
Dodge & Cox Balanced Fund 95,045 21,455
Spartan U.S. Equity Index Fund 5,591,791 3,597,846
MAS Value Adviser Fund 2,907,189 2,902,696
Fidelity Growth & Income Fund 11,177,370 8,023,002
NB Genesis Trust Fund 158,454 113,212
PIMCO Capital Appreciation Fund 348,199 179,415
Fidelity Diversified International Fund 66,558 37,477
Common stock of Buckeye Technologies Inc. 7,127,040 9,399,707
----------- ------------
31,077,826 27,257,433
Employer contributions receivable (note 1) 5,667,023 5,304,143
Cash - 42,223
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Net assets available for benefits $ 36,744,849 $ 32,603,799
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</TABLE>
The accompanying notes are an integral
part of these financial statements.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Statements of Changes in Net Assets Available for Benefits
For the Years Ended June 30, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
-------------- --------------
<S> <C> <C>
Additions to net assets attributed to: Investment income (notes 2 and 3)
Net appreciation (depreciation) in fair value
of investments $ (1,576,026) $ 4,757,194
Interest and dividends 1,423,817 645,722
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(152,209) 5,402,916
Employer contributions (note 1) 5,667,023 5,304,143
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Total additions 5,514,814 10,707,059
Deductions from net assets attributed to:
Benefits paid to participants (notes 1 and 2) 1,344,621 1,074,922
Administrative expenses 29,143 30,131
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Total deductions 1,373,764 1,105,053
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Net increase in net assets 4,141,050 9,602,006
Net assets available for benefits
Beginning of year 32,603,799 23,001,793
----------- -----------
End of year $ 36,744,849 $ 32,603,799
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</TABLE>
The accompanying notes are an integral
part of these financial statements.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Notes to Financial Statements
June 30, 1999 and 1998
Note 1 - Description of Plan
The following description of Buckeye Retirement Plan provides only general
information. Readers should refer to the Plan Agreement for a more complete
description of the Plan's provisions.
General
The Buckeye Retirement Plan (the "Plan") is a noncontributory defined
contribution pension plan covering all eligible salaried and hourly employees of
Buckeye Technologies Inc. and its wholly owned subsidiaries Buckeye Florida,
Limited Partnership; Buckeye Florida Corporation; and Buckeye Lumberton Inc.
(collectively the "Company"). 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). The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
Contributions
Contributions made annually by the Company are computed based upon the following
formula:
Contribution = (A+B)C A=1% B=.5% X number of years service not
to exceed twenty (20) years. C=Plan year compensation. The
minimum is 1 1/2% of eligible compensation and the maximum is
11% of compensation.
Contributions are generally funded in the quarter following the Plan's year end.
Participant accounts
Each participant's account is credited with the allocation of the employer's
contribution. The value of a participant's account is the contributions made on
their behalf plus a proportionate interest in the investment earnings of the
funds in which the contributions are invested. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's account.
Vesting
Participants are 100% vested in their accounts after completion of five years of
credited service. In the event of death, disability, normal retirement (age 65)
or if the Plan is discontinued, participants become 100% vested in their account
balances.
Payment of benefits
Participants may choose to receive account distributions either in the form of a
lump sum payment or installments over a period of time as defined in the Plan
Agreement. However, if the participant's vested balance does not exceed $5,000,
the Plan may distribute funds in the form of a lump sum payment without the
consent of the participant.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Notes to Financial Statements (Continued)
June 30, 1999 and 1998
Note 1 - Description of Plan (continued)
Forfeitures
If an employee terminates before his or her account has become fully vested,
such portion of the account is forfeited. Forfeitures are used to reduce future
contributions by the Company.
Plan termination
Although it has not expressed any intent to do so, the Company has the right to
modify or terminate the Plan at any time subject to the provisions of ERISA and
the Plan Agreement.
Note 2 - Summary of significant accounting policies
Investments
Investments are stated at fair value and represent the Plan's share of the
market value of fund holdings or are based upon quoted market prices. Purchases
and sales of securities are recorded on a trade-date basis. Interest income is
recorded on the accrual basis and dividends are recorded on the ex-dividend
date.
Benefit payments
Benefit payments to participants are recorded upon distribution.
Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires the plan administrator to make estimates and
assumptions which affect certain reported amounts and disclosures. Accordingly,
actual results may differ from those estimates.
Note 3 - Investments
The Plan allows participants to invest varying portions of their account
balances in eleven different investment options which include the common stock
of Buckeye Technologies Inc. and ten different investment programs offered by
Fidelity Investments. The ten programs offered by Fidelity Investments include
the Fidelity Retirement Money Market Portfolio, Strong Government Securities
Fund, Fidelity Puritan Fund, Dodge & Cox Balanced Fund, Spartan U.S. Equity
Index Fund, MAS Value Adviser Fund, Fidelity Growth & Income Fund, NB Genesis
Trust Fund, PIMCO Capital Appreciation Fund and the Fidelity Diversified
International Fund. All Plan assets are held by Fidelity Management Trust
Company.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Notes to Financial Statements (Continued)
June 30, 1999 and 1998
Note 3 - Investments (continued)
The fair value of individual investments which represent five percent or more of
the Plan's net assets as of June 30, 1999 and 1998 is as follows:
<TABLE>
<CAPTION>
1999 1998
--------------- ---------------
<S> <C> <C>
Fidelity Puritan Fund $ 2,373,015 $ 1,916,052
Spartan U.S. Equity Index Fund 5,591,791 3,597,846
MAS Value Adviser Fund 2,907,189 2,902,696
Fidelity Growth & Income Fund 11,177,370 8,023,002
Common stock of Buckeye Technologies Inc. 7,127,040 9,399,707
During 1999 and 1998, the Plan's investments (including investments bought, sold
and held during the year) appreciated (depreciated) in value as follows:
1999 1998
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Fidelity Puritan Fund $ 39,978 $ 118,445
Dodge & Cox Balanced Fund 4,946 84,628
Spartan U.S. Equity Index Fund 1,019,966 456,185
MAS Value Adviser Fund (314,803) (53,517)
Fidelity Growth & Income Fund 1,376,447 1,088,389
Common stock of Buckeye Technologies Inc. (3,702,169) 2,322,361
Vanguard Institutional Index Fund - 233,795
Janus Fund, Inc. - 458,993
Other (391) 47,915
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$ (1,576,026) $ 4,757,194
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</TABLE>
Note 4 - Related party transactions
The Plan purchased $2,276,160 and sold $846,658 of the Plan Sponsor's common
stock during the year ended June 30, 1999. The stock held by the Plan at June
30, 1999 and 1998 had a market value of $7,127,040 and $9,399,707, respectively.
Plan investments include interests in investment accounts managed by Fidelity
Investments Institutional Operations Company, Inc. as of June 30, 1999 and 1998.
An affiliate of Fidelity Investments Institutional Operations Company, Inc. is
the trustee as defined by the Plan and therefore, these investments and
investment transactions qualify as party-in-interest. Fees paid to Fidelity
totaled $29,143 and $30,131 for the years ended June 30, 1999 and 1998,
respectively.
The Company provides the Plan with certain management and administrative
services for which no fees are charged.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Notes to Financial Statements (Continued)
June 30, 1999 and 1998
Note 5 - Tax status
The Plan has received a determination letter from the Internal Revenue Service
stating that the Plan qualifies under the appropriate sections of the Internal
Revenue Code (IRC), and is, therefore, not subject to tax under present income
tax law. The Plan has been amended since receiving the determination letter.
However, the plan administrator believes that the Plan is currently designed and
is being operated in compliance with the applicable requirements of the Internal
Revenue Code. Therefore, they believe that the Plan was qualified and the
related trust was tax-exempt as of the financial statement date.
Note 6 - Concentration of market risk
The Plan has invested a significant portion of its assets in Buckeye
Technologies Inc. common stock. This investment in Buckeye Technologies Inc.
common stock approximates 19% of the Plan's net assets available for benefits as
of June 30, 1999. As a result of this concentration, any significant reduction
in the market value of this stock could adversely affect individual participant
accounts and the net assets of the Plan.
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<PAGE>
SUPPLEMENTAL SCHEDULES
<PAGE>
BUCKEYE RETIREMENT PLAN
Item 27(a) - Schedule G, Part I - Schedule of Assets
Held for Investment Purposes
EIN: 62-1518973 / Plan Number: 002
June 30, 1999
<TABLE>
<CAPTION>
Current
(a) (b)(c) Identity of Issue/Description (d) Cost (e) Value
- ------- ------------------------------------------------ ----------- -----------
<S> <C> <C> <C>
* Fidelity Retirement Money Market Portfolio $ 759,605 $ 759,605
Strong Government Securities Fund 481,359 473,560
* Fidelity Puritan Fund 2,228,610 2,373,015
Dodge & Cox Balanced Fund 89,749 95,045
* Spartan U.S. Equity Index Fund 4,196,078 5,591,791
MAS Value Adviser Fund 2,906,703 2,907,189
* Fidelity Growth & Income Fund 8,874,704 11,177,370
NB Genesis Trust Fund 153,670 158,454
PIMCO Capital Appreciation Fund 317,747 348,199
* Fidelity Diversified International Fund 60,227 66,558
* Buckeye Technologies Inc. common stock 7,626,672 7,127,040
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Total assets held for investment purposes $ 27,695,124 $ 31,077,826
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</TABLE>
* Represents a party-in-interest.
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<PAGE>
BUCKEYE RETIREMENT PLAN
Item 27(d) - Schedule G, Part V - Schedule of Reportable Transactions
EIN: 62-1518973 / Plan Number: 002
For the Year Ended June 30, 1999
<TABLE>
<CAPTION>
Current
Value on
Identity of Purchase Selling Cost of Transaction Net Gain
(a) Party Involved Description of Asset (c) Price (d) Price (g) Asset (h) Date (i) (Loss)
- -------------------------- --------------------- ----------- ---------- ---------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
MAS Value Adviser Fund Mutual fund
(88 purchases) $ 1,268,282 $ - $ 1,268,282 $ 1,268,282 $ -
MAS Value Adviser Fund Mutual fund
(76 sales) - 948,986 1,001,904 948,986 (52,918)
Buckeye Technologies Inc. Common stock
(54 purchases) 2,276,160 - 2,276,160 2,276,160 -
Buckeye Technologies Inc. Common stock
(51 sales) - 846,658 861,208 846,658 (14,550)
Fidelity Growth and Income Fund Mutual fund
(105 purchases) 2,723,148 - 2,723,148 2,723,148 -
Fidelity Growth and Income Fund Mutual fund
(69 sales) - 945,225 818,542 945,225 126,683
Spartan U.S. Equity Index Fund Mutual fund
(100 purchases) 1,390,889 - 1,390,889 1,390,889 -
Spartan U.S. Equity Index Fund Mutual fund
(44 sales) - 416,911 354,210 416,911 62,701
</TABLE>
-10-
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Retirement Plan Committee of the Employee Retirement Plans for Buckeye
Technologies Inc. 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
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David H. Whitcomb, Senior Vice President, Finance and Accounting
Date: December 17, 1999
<PAGE>
BUCKEYE RETIREMENT PLAN
Exhibit Index
Exhibit No. Description
23 Consent of Independent Auditors
<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 15, 1999 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, 1999.
/S/ THOMPSON DUNAVANT PLC
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Thompson Dunavant PLC
Memphis, Tennessee
December 17, 1999
