SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One):
|X| ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED].
For the fiscal year ended December 31, 1996
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED].
For the transition period from __________ to __________
Commission file number 1-724
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below: Phillips-Van Heusen Corporation (Crystal Brands
Division) Associates Investment Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office: Phillips-Van Heusen Corporation, 1290
Avenue of the Americas, New York, New York 10104
Financial Statements
and Supplemental Schedules
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Years ended December 31, 1996 and 1995
with Report of Independent Auditors
[LOGO] Ernst & Young LLP
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Financial Statements
and Supplemental Schedules
Years ended December 31, 1996 and 1995
Contents
Report of Independent Auditors............................................. 1
Financial Statements
Statements of Net Assets Available for Benefits as of
December 31, 1996 and 1995.............................................. 2
Statement of Changes in Net Assets Available for Benefits for
the Year ended December 31, 1996........................................ 4
Notes to Financial Statements ............................................. 5
Supplemental Schedules
Assets Held for Investment Purposes as of December 31, 1996................ 16
Reportable Transactions for the Year ended December 31, 1996............... 17
[Letterhead Of Ernst & Young LLP]
Report of Independent Auditors
Administrative Committee of the Plan
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division)
New York, New York
We were engaged to audit the accompanying financial statements and supplemental
schedules of the Associates Investment Plan of Phillips-Van Heusen Corporation
(Crystal Brands Division), formerly the Voluntary Investment Plan of Crystal
Brands, Inc. (the "Plan"), as of December 31, 1996 and 1995, and for the year
then ended, as listed in the table of contents. These financial statements and
schedules are the responsibility of the Plan's management.
As permitted by 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, the plan administrator instructed us not to perform, and
we did not perform, any auditing procedures with respect to the investment
information summarized in Note D, which was certified by the State Street Bank
and Trust Company, the trustee of the Plan, except for comparing such
information with the related information included in the financial statements
and supplemental schedules. We have been informed by the plan administrator that
the trustee holds the Plan's investment assets and executes investment
transactions. The plan administrator has obtained a certification from the
trustee as of and for the years ended December 31, 1996 and 1995, that the
information provided to the plan administrator by the trustee is complete and
accurate.
Because of the significance of the information that we did not audit, we are
unable to, and do not, express an opinion on the accompanying financial
statements and schedules taken as a whole. The form and content of the
information included in the financial statements and schedules, other than that
derived from the information certified by the trustee, have been audited by us
in accordance with generally accepted auditing standards and, in our opinion,
are presented in compliance with the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974.
As discussed in Note C to the financial statements, the Plan's investments
include interest contracts with insurance companies that have been placed into
conservatorship. Although rehabilitation plans have been approved by the courts,
the ultimate recoverability of these investments is uncertain, and the resulting
loss, if any, cannot presently be determined.
/s/ Ernst & Young LLP
New York, New York
June 13, 1997
1
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Net Assets Available for Benefits
December 31, 1996
Money
Bond Balanced Equity International Market
Fund Fund Fund Fund Fund
- -----------------------------------------------------------------------------------------------------------------------------------
Assets
Investments (Notes B and D)
Shares of registered
investment companies:
Fidelity Intermediate Bond Fund $ 336,943
Fidelity Puritan Fund $ 1,637,087
Fidelity Growth & Income Portfolio $ 2,244,709
Templeton Foreign Fund $ 512,697
Short-term investments $ 2,727,133
Common stock - Employer Company
Interest contracts:
Non-performing (Note C)
Participant loans receivable
--------------------------------------------------------------------------------
Total investments 336,943 1,637,087 2,244,709 512,697 2,727,133
Receivables:
Accrued interest and dividends 12,251
--------------------------------------------------------------------------------
Total assets 336,943 1,637,087 2,244,709 512,697 2,739,384
--------------------------------------------------------------------------------
Net assets available for benefits $ 336,943 $ 1,637,087 $ 2,244,709 $ 512,697 $ 2,739,384
================================================================================
Fixed Income Fund
Phillips-Van ------------------------------
Heusen Corp. Regular Tax
Common Stock Investment Deductible Participant
Fund Fund Fund Loans Total
- ------------------------------------------------------------------------------------------------------------------------------------
Assets
Investments (Notes B and D)
Shares of registered
investment companies:
Fidelity Intermediate Bond Fund $ 336,943
Fidelity Puritan Fund 1,637,087
Fidelity Growth & Income Portfolio 2,244,709
Templeton Foreign Fund 512,697
Short-term investments 2,727,133
Common stock - Employer Company $ 616,299 616,299
Interest contracts:
Non-performing (Note C) $ 4,351,464 $ -- 4,351,464
Participant loans receivable $ 168,917 168,917
-------------------------------------------------------------------------------
Total investments 616,299 4,351,464 -- 168,917 12,595,249
Receivables:
Accrued interest and dividends 12,251
---------------------------------------------------------------------------------
Total assets 616,299 4,351,464 -- 168,917 12,607,500
---------------------------------------------------------------------------------
Net assets available for benefits $ 616,299 $ 4,351,464 $ -- $ 168,917 $ 12,607,500
=================================================================================
See notes to financial statements.
2
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Net Assets Available for Benefits
December 31, 1995
Money
Bond Balanced Equity International Market
Fund Fund Fund Fund Fund
- -----------------------------------------------------------------------------------------------------------------------------------
Assets
Investments (Notes B and D)
Shares of registered
investment companies:
Fidelity Intermediate Bond Fund $ 386,205
Fidelity Puritan Fund $ 1,548,581
Fidelity Growth & Income Portfolio $ 1,907,185
Templeton Foreign Fund $ 541,012
Short-term investments $ 3,998,085
Common stock - Employer Company
Interest contracts:
Non-performing (Note C)
Participant loans receivable
---------------------------------------------------------------------------------
Total investments 386,205 1,548,581 1,907,185 541,012 3,998,085
Receivables:
Accrued interest and dividends 1,906 23,491
---------------------------------------------------------------------------------
Total assets 388,111 1,548,581 1,907,185 541,012 4,021,576
Liabilities
Payable for investments purchased
---------------------------------------------------------------------------------
Net assets available for benefits $ 388,111 $ 1,548,581 $ 1,907,185 $ 541,012 $ 4,021,576
=================================================================================
Fixed Income Fund
Phillips-Van ------------------------------
Heusen Corp. Regular Tax
Common Stock Investment Deductible Participant
Fund Fund Fund Loans Total
- ------------------------------------------------------------------------------------------------------------------------------------
Assets
Investments (Notes B and D)
Shares of registered
investment companies:
Fidelity Intermediate Bond Fund $ 386,205
Fidelity Puritan Fund 1,548,581
Fidelity Growth & Income Portfolio 1,907,185
Templeton Foreign Fund 541,012
Short-term investments $ 143,947 4,142,032
Common stock - Employer Company 190,923 190,923
Interest contracts:
Non-performing (Note C) $ 4,571,600 $ 2,462 4,574,062
Participant loans receivable $ 209,838 209,838
-----------------------------------------------------------------------------
Total investments 334,870 4,571,600 2,462 209,838 13,499,838
Receivables:
Accrued interest and dividends 137 45 25,579
-----------------------------------------------------------------------------
Total assets 335,007 4,571,645 2,462 209,838 13,525,417
Liabilities
Payable for investments purchased 143,448 143,448
-----------------------------------------------------------------------------
Net assets available for benefits $ 191,559 $ 4,571,645 $ 2,462 $ 209,838 $ 13,381,969
=============================================================================
See notes to financial statements.
3
Associates Investments Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Statement of Changes in Net Assets Available for Benefits
Year ended December 31, 1996
Phillips-Van
Money Heusen Corp.
Bond Balanced Equity International Market Common Stock
Fund Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Additions
Investment income :
Interest and dividend income $ 24,788 $ 189,867 $ 106,987 $ 25,950 $ 167,210 $ 5,757
Net realized and unrealized appreciation
(depreciation) of investments (Note D) (13,453) 32,514 259,007 69,465 165,007
---------------------------------------------------------------------------------
11,335 222,381 365,994 95,415 167,210 170,764
Contributions:
Participants 41,336 158,763 225,647 75,823 69,992 29,643
Employer 1,290 2,579 430 256,021
---------------------------------------------------------------------------------
41,336 160,053 228,226 76,253 69,992 285,664
---------------------------------------------------------------------------------
Total additions 52,671 382,434 594,220 171,668 237,202 456,428
Deductions
Payments to participants 73,124 335,246 487,930 128,275 1,829,889 73,040
---------------------------------------------------------------------------------
Total deductions 73,124 335,246 487,930 128,275 1,829,889 73,040
---------------------------------------------------------------------------------
Net increase (decrease) prior to loans to
participants and interfund transfers (20,453) 47,188 106,290 43,393 (1,592,687) 383,388
Loans to participants, net of repayments 7,016 13,488 14,045 4,510 (411) 2,273
Interfund transfers (net) (37,731) 27,830 217,189 (76,218) 310,906 39,079
---------------------------------------------------------------------------------
Net increase (decrease) (51,168) 88,506 337,524 (28,315) (1,282,192) 424,740
Net assets available for benefits at beginning of 388,111 1,548,581 1,907,185 541,012 4,021,576 191,559
year
=================================================================================
Net assets available for benefits at end of year $ 336,943 $1,637,087 $2,244,709 $ 512,697 $2,739,384 $ 616,299
=================================================================================
Fixed Income Fund
-----------------------------
Regular Tax
Investment Deductible Participant
Fund Fund Loans Total
----------------------------------------------------------
Additions
Investment income :
Interest and dividend income $ 259,588 $ 780,147
Net realized and unrealized appreciation
(depreciation) of investments (Note D) 512,540
----------------------------------------------------------
259,588 1,292,687
Contributions:
Participants 601,204
Employer 260,320
----------------------------------------------------------
861,524
----------------------------------------------------------
Total additions 259,588 2,154,211
Deductions
Payments to participants 1,176 2,928,680
----------------------------------------------------------
Total deductions 1,176 2,928,680
----------------------------------------------------------
Net increase (decrease) prior to loans to
participants and interfund transfers 258,412 (774,469)
Loans to participants, net of repayments $(40,921) --
Interfund transfers (net) (478,593) $ (2,462) --
----------------------------------------------------------
----------------------------------------------------------
Net increase (decrease) (220,181) (2,462) (40,921) (774,469)
Net assets available for benefits at beginning of 4,571,645 2,462 209,838 13,381,969
year
==========================================================
Net assets available for benefits at end of year $4,351,464 $ -- $168,917 $12,607,500
==========================================================
See notes to financial statements.
4
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
December 31, 1996
A. Description of the Plan
The following description of the Associates Investment Plan of Phillips-Van
Heusen Corporation (Crystal Brands Division) (the "Plan") provides only general
information. Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
Plan Amendments
On February 17, 1995, the net assets of Crystal Brands, Inc. were acquired by
Phillips-Van Heusen Corporation (the "Company"). As a result of the acquisition,
responsibility for administering the Voluntary Investment Plan of Crystal
Brands, Inc. was assumed by the Company.
Prior to February 17, 1995, the Plan was known as the Voluntary Investment Plan
of Crystal Brands, Inc. Prior to July 1, 1995, the Plan was known as the
Voluntary Investment Plan of Phillips-Van Heusen Corporation (Crystal Brands
Division). On July 1, 1995, the Plan changed its name to the Associates
Investment Plan of Phillips-Van Heusen Corporation (Crystal Brands Division).
Effective July 1, 1995, the Plan was restructured to mirror the Phillips-Van
Heusen Corporation Associates Investment Plan. As a result, the investment
options previously offered under the Voluntary Investment Plan of Phillips-Van
Heusen Corporation (Crystal Brands Division) were dissolved, with the exception
of the Fixed Income Fund whose remaining balances represent frozen assets. All
contribution, benefit payment and loan policies have been amended to mirror the
policies of the Phillips-Van Heusen Corporation Associates Investment Plan.
5
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
A. Description of the Plan (continued)
General
The Plan is a defined contribution plan sponsored by the Company covering
non-union associates of the Company who are employed by the former Crystal
Brands Division and who have at least one year of service (1,000 hours in a
year). The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
Contributions
Each year, participants may contribute up to 15% of pretax annual compensation,
as defined by the Plan. The Company contributes 50% of the first 6% of base
compensation that a participant contributes to the Plan.
Participant Accounts
Each participant's account is credited with the participant's contributions and
allocations of (a) the Company's contributions and (b) Plan earnings. Forfeited
balances of terminated participants' nonvested accounts are used to reduce
future Company contributions. One hundred percent of the Company contributions
are automatically invested in the common stock of the Company and may not
thereafter be transferred until the participant has reached the age of
fifty-five.
Vesting
Amounts attributable to Company contributions become vested on the participant's
sixty-fifth birthday or if the participant's employment by the Company
terminates by reason of the participant's death or permanent disability or the
participant has completed five years of service with the Company.
6
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
A. Description of the Plan (continued)
Investment Options
Upon enrollment in the Plan, a participant may direct employee contributions in
5% increments into any of the six investment options. A participant may
contribute a maximum of 25% of employee contributions into the Phillips-Van
Heusen Corporation Common Stock Fund.
Phillips-Van Heusen Corporation Common Stock Fund--Funds are invested by
the trustee in common shares of the Company. Common shares of the Company
are purchased by the trustee in the open market.
Money Market Fund--Funds are invested by the trustee in short-term
obligations and money market instruments.
Equity Fund--Funds are invested in shares of a registered investment
company that invests primarily in common stock (Fidelity Growth & Income
Portfolio).
Bond Fund--Funds are invested in shares of a registered investment company
that invests in corporate bonds and U.S. government securities (Fidelity
Intermediate Bond Fund).
Balanced Fund--Funds are invested in shares of a registered investment
company that invests in common stocks, preferred stocks, and bond
(Fidelity Puritan Fund).
International Fund--Funds are invested in shares of a registered
investment company that invests in common stocks and bonds of companies
and governments outside the United States (Templeton Foreign Fund).
7
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
A. Description of the Plan (continued)
Fixed Income Fund--The balance in this fund represents investments in
interest contracts issued by Executive Life Insurance Company and Mutual
Benefit Life Insurance Company which, as discussed in Note C, have been
classified as non-performing at December 31, 1996 and 1995. No new
uncommitted investments in interest contracts were made subsequent to June
30, 1991. Effective July 1, 1995, future contributions to this fund were
prohibited. Upon release of frozen assets, funds will be transferred into
the Money Market Fund where participants may elect to withdraw or transfer
the funds to other investment options. Substantially all of the remaining
frozen assets in the interest contracts issued by Executive Life Insurance
Company were released during 1996.
Participant Loans Receivable
Participants may borrow from the Plan, with certain restrictions, using their
vested account balance as collateral. The minimum loan amount is $1,000 and the
maximum loan amount is the lesser of (i) $50,000 reduced by the participant's
highest outstanding loan balance during the previous twelve months or (ii) 50%
of the vested value of the participant's account. Interest is fixed for the term
of the loan at the prime rate as of the first business day of the month of
application as published in the Wall Street Journal, plus 1%. Loan repayments
are made through payroll deductions which may be specified for a term of 1 to 5
years or up to 15 years for the purchase of a primary residence.
Participants maintaining outstanding loans from the Plan as in effect prior to
July 1, 1995 will continue to have their loans governed by the loan provisions
of the Plan as in effect at the time of the loan. However, loan repayment
deductions may be adjusted to comply with their new payroll frequency effective
July 1, 1995.
Payment of Benefits
Participants entitled to final distributions generally will receive payment in
the form of a lump sum amount equal to the value of their vested account.
8
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
A. Description of the Plan (continued)
Plan Termination
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100% vested in their accounts.
B. Significant Accounting Policies
The accounting records of the Plan are maintained on the accrual basis, except
for payments to participants which it accounts for on the cash basis.
Accordingly, the Plan's statements of net assets available for plan benefits do
not reflect amounts payable to terminated, retired or other participants as a
liability.
The Plan's investments are stated at fair value. The shares of registered
investment companies are valued at quoted market prices which represent the net
asset values of shares held by the Plan at year-end. Investments in the Money
Market Fund and participant loans receivable are stated at cost, which
approximates fair value. Interest contracts, except those with Executive Life
Insurance Company, are stated at cost plus accumulated interest. As discussed in
Note C, Executive Life Insurance Company interest contracts are stated at net
realizable value.
Purchases and sales of securities are reflected on a trade date basis.
Substantially all administrative expenses are paid by the Company.
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from these estimates.
9
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
C. Non-Performing Interest Contracts
The investment alternatives of the Plan have included interest contracts with
insurance companies.
On April 11, 1991, the California Department of Insurance placed Executive Life
Insurance Company ("ELIC") into conservatorship and suspended all payments on
interest contracts issued by ELIC. Effective March 31, 1991, allocation of
interest on the Plan's ELIC interest contracts to participant accounts was
suspended, and on May 1, 1991, accrual of interest on the Plan's ELIC interest
contracts was suspended.
On August 13, 1993, the Los Angeles Superior Court approved a plan of
rehabilitation for ELIC that became effective on September 3, 1993. Immediately
prior to the effective date of the rehabilitation plan, ELIC restructured its
obligations, including interest contracts, downward to approximate the value of
the underlying assets. Pursuant to the plan, Aurora National Life Assurance
Company ("Aurora") assumed the restructured obligations, in exchange for which
it received most of ELIC's liquid assets. The remaining assets were placed into
trusts managed by a board of trustees separate from Aurora. These trusts will be
liquidated over a five-year period and the proceeds will be used to fund
payments to investors.
Investors had two alternatives consisting of participating either (1) fully
("opt-in") or (2) partially ("opt-out") in the rehabilitation plan. After
performing an extensive credit review of Aurora and a financial analysis of the
two alternatives available under the plan, the Plan's Trustee made the decision
to opt-out of the rehabilitation plan. The Trustee also considered the
uncertainty of how the Plan's investments would be treated in a liquidation of
Aurora, the ability of Aurora to fund the substantial maturation of contracts
scheduled to occur in 1998, and the limited historical and prospective financial
information available about Aurora.
Substantially all of the remaining frozen assets in the interest contracts
issued by ELIC were released during 1996.
10
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
C. Non-Performing Interest Contracts (continued)
The Plan's investment in ELIC interest contracts was $237 and $276,523 at
December 31, 1996 and 1995, respectively.
On July 16, 1991, on application of the Insurance Commissioner of the State of
New Jersey, the Superior Court of New Jersey placed the Mutual Benefit Life
Insurance Company ("MBLIC") into rehabilitation. Effective June 30, 1991,
allocation of interest on MBLIC interest contracts to participants was
suspended, and on January 1, 1992, the interest accrual rate on all MBLIC
contracts was reduced to 3% in accordance with the recommendation of the Deputy
Rehabilitator of MBLIC.
On November 10, 1993, the court approved a plan of rehabilitation for MBLIC. The
rehabilitation plan provides investors with two alternatives consisting of
either (1) participating ("opt-in") in the plan or (2) not participating
("opt-out") in the plan. Investors electing to opt-in are projected to receive
100% of their July 16, 1991 investment balance over a four-year period from
December 31, 1999 to December 31, 2003. Investors electing to opt-out will
receive approximately 55% of their July 16, 1991 investment balance no later
than mid-1996. The Plan's interest contracts with MBLIC are not covered by state
guaranty associations. For certain investments not covered by state guaranty
associations, including the Plan's interest contracts, the rehabilitation
provides, for those investors electing to opt-in, reinsurance by a consortium of
insurance companies including the Prudential Insurance Company of America and
the Metropolitan Life Insurance Company.
The Plan's Trustee elected to opt-in to the MBLIC rehabilitation plan. The
Trustee made this decision after review and analysis of the rehabilitation plan
and the financial strength of the reinsurers. Based on the MBLIC rehabilitation
plan, including the reinsurance provision, no adjustment to the carrying values
of MBLIC interest contracts has been made.
11
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
C. Non-Performing Interest Contracts (continued)
The Plan's MBLIC interest contracts were credited with interest at 5.25% for
January 1, 1996 through September 30, 1996 and 9.25% for October 1, 1996 through
December 31, 1996 and 3.55% for 1995.
Based on the above, interest contracts issued by ELIC and MBLIC were classified
as non-performing at December 31, 1996 and 1995.
D. Assets of the Plan
Assets of the Plan are held by State Street Bank and are presented in the
following table. Investments that represent 5% or more of the Plan's net assets
are identified by an asterisk.
Assets of the Plan held at December 31, 1996 are as follows:
Shares of Registered Investment Companies:
Fidelity Intermediate Bond Fund, 33,427 shares $ 336,943
Fidelity Puritan Fund, 94,959 shares* 1,637,087
Fidelity Growth & Income Portfolio, 73,046 shares* 2,244,709
Templeton Foreign Fund, 49,488 shares 512,697
State Street Bank and Trust Company:
Short Term Investment Fund, 2,727,133 shares* 2,727,133
Phillips-Van Heusen Corporation Common Stock,
42,873 shares 616,299
Interest Contracts:
Executive Life Insurance Company 237
Mutual Benefit Life Insurance Company* 4,351,227
Promissory Notes (Participant Loans) 168,917
Interest and dividends receivable 12,251
--------------------
$ 12,607,500
====================
12
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
D. Assets of the Plan (continued)
Assets of the Plan held at December 31, 1995 are as follows:
Shares of Registered Investment Company:
Fidelity Intermediate Bond Fund, 37,099 shares $ 386,205
Fidelity Puritan Fund, 91,039 shares* 1,548,581
Fidelity Growth & Income Portfolio, 70,506 shares* 1,907,185
Templeton Foreign Fund, 58,934 shares 541,012
State Street Bank and Trust Company:
Short-Term Investment Fund, 4,142,032 shares* 4,142,032
Phillips-Van Heusen Corporation Common Stock,
19,334,shares 190,923
Interest contracts:
Executive Life Insurance Company 276,523
Mutual Benefit Life Insurance Company* 4,297,539
Promissory Notes (Participant Loans) 209,838
Interest and dividends receivable 25,579
--------------------
$ 13,525,417
=====================
During the years ended December 31, 1996 and 1995, the net appreciation in the
fair value of Plan investments was $512,540 and $754,787, respectively, as
follows:
1996 1995
---------------------------------
Fair Value of Assets Determined by Quoted
Market Price:
Phillips-Van Heusen Corp. Common Stock $ 165,007 $ (27,514)
Fidelity Intermediate Bond Fund (13,453) 7,810
Fidelity Puritan Fund 32,514 30,491
Fidelity Growth & Income Fund 259,007 115,611
Templeton Foreign Fund 69,465 (14,681)
---------------------------------
512,540 111,717
Fair Value Estimated by Trustee:
State Street Bank Index Fund -- 643,070
---------------------------------
$ 512,540 $ 754,787
=================================
13
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
E. Transactions with Parties-in-Interest
During the year ended December 31, 1996, the Plan purchased and sold 26,408 and
2,869 shares of the Company's common stock, respectively, and received $5,587
from the Company as payment of dividends on its common stock. During the year
ended December 31, 1995, the Plan purchased 19,334 shares and received $191 from
the Company as payment of dividends on its common stock.
F. Income Taxes
The Internal Revenue Service has ruled that the Plan qualifies under Section
401(a) of the Internal Revenue Code ("IRC") and therefore its related trust is
tax-exempt under Section 501(a) of the IRC. The Plan's most recent determination
letter is dated September 13, 1995. The Administrative Committee of the Plan is
not aware of any course of action or series of events that have occurred that
might adversely affect the qualified status of the Plan.
G. Differences Between Financial Statements and Form 5500
The following is a reconciliation of net assets available for plan benefits per
the financial statements to the Form 5500:
December 31,
1996
---------------------
Net assets available for plan benefits
per the financial statements $ 12,607,500
Amounts allocated to withdrawn participants
at December 31, 1996 (255,497)
---------------------
Net assets available for plan benefits
per the Form 5500 $ 12,352,003
=====================
14
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Notes to Financial Statements
G. 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
December 31,
1996
-------------------
Benefits paid to participants per the
financial statements $ 2,928,680
Add: Amounts allocated to withdrawn
participants at December 31, 1996 255,497
Less: Amounts allocated to withdrawn
participants at December 31, 1995 (703,948)
-------------------
Benefits paid to participants per the
Form 5500 $ 2,480,229
===================
Amounts allocated to withdrawn participants on the Form 5500 represent benefit
claims that have been processed and approved for payment prior to year-end but
not yet paid.
15
Supplemental Schedules
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Assets Held for Investment Purposes
December 31, 1996
Identity of Issuer Description Cost Market Value
- --------------------------------------------------------------------------------------------------
State Street Bank and Trust Company:
Short Term Investment Fund 2,727,133 shares $ 2,727,133 $ 2,727,133
Fidelity Intermediate Bond Fund 33,427 shares 340,845 336,943
Fidelity Puritan Fund 94,959 shares 1,581,339 1,637,087
Fidelity Growth & Income Portfolio 73,046 shares 1,895,037 2,244,709
Templeton Foreign Fund 49,488 shares 468,779 512,697
Phillips-Van Heusen Corporation
Common Stock 42,873 shares 482,598 616,299
Executive Life Insurance Company Interest Contracts* 237 237
Mutual Benefit Life Insurance Company Interest Contracts* 4,351,227 4,351,227
Promissory Notes Participant loans 168,917 168,917
-----------------------------------
$ 12,016,112 $ 12,595,249
===================================
* Maturity dates and interest rates are subject to statutory conservatorship
rules. See Note C for further information.
16
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Reportable Transactions
Year ended December 31, 1996
Purchase Selling Cost of
Party Involved Description Price Price Asset Sold
- -----------------------------------------------------------------------------------------------------------------------
Category (i)--Individual transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. $ 864,293 $ 864,293
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,072,036 1,072,036
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,203,761 1,203,761
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,157,450 1,157,450
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. $ 864,293
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,072,036
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,157,450
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1,203,761
Net Gain Number of
Party Involved Description or (Loss) Transactions
- ---------------------------------------------------------------------------------------------------------------
Category (i)--Individual transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Co. 1
17
Associates Investment Plan of
Phillips-Van Heusen Corporation
(Crystal Brands Division),
formerly the Voluntary Investment
Plan of Crystal Brands, Inc.
Reportable Transactions (continued)
Year ended December 31, 1996
Purchase Selling Cost of
Party Involved Description Price Price Asset Sold
- -----------------------------------------------------------------------------------------------------------------------
Category (iii)--Series of transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Short-Term Investment Fund $ 852,023 $2,266,922 $2,266,922
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Company 4,580,676 4,526,988 4,526,988
Net Gain Number of
Party Involved Description or (Loss) Transactions
- ---------------------------------------------------------------------------------------------------------------
Category (iii)--Series of transactions in excess of 5% of plan assets:
State Street Bank and Trust Co. Short-Term Investment Fund 54
State Street Bank and Trust Co. Interest contracts with Mutual Benefit Life
Insurance Company 33
There are no category (ii) or (iv) reportable transactions for the year ended
December 31, 1996.
18
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrative Committee has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
PHILLIPS-VAN HEUSEN CORPORATION
(CRYSTAL BRANDS DIVISION)
ASSOCIATES INVESTMENT PLAN
Date: June 24, 1997 By /s/ Pamela N. Hootkin
---------------------------------------
Pamela N. Hootkin, Member of
Administrative Committee
[Letterhead Of Ernst & Young LLP]
Consent of Independent Accountants
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Associates Investment of Phillips-Van Heusen Corporation
(Crystal Brands Division), formerly the Voluntary Investment Plan of Crystal
Brands, Inc., of our report dated June 13, 1997, with respect to the financial
statements and supplemental schedules of the above mentioned plans included in
this Annual Report (Form 11K) for the year ended December 31, 1996.
/s/ Ernst & Young LLP
New York, New York
June 13,1997
