-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QnnP4K+041Otu32uETe4jleNzLzXUx4xVzQ9wTLzntFuK/U+f0Ni1W+M2aos5Ofs IljxhOM9oJqbDRmXdHLbnQ== /in/edgar/work/20000628/0000007084-00-000030/0000007084-00-000030.txt : 20000920 0000007084-00-000030.hdr.sgml : 20000920 ACCESSION NUMBER: 0000007084-00-000030 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARCHER DANIELS MIDLAND CO CENTRAL INDEX KEY: 0000007084 STANDARD INDUSTRIAL CLASSIFICATION: [2070 ] IRS NUMBER: 410129150 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-00044 FILM NUMBER: 662359 BUSINESS ADDRESS: STREET 1: 4666 FARIES PKWY CITY: DECATUR STATE: IL ZIP: 62526 BUSINESS PHONE: 2174244798 11-K 1 0001.txt HOURLY 11K MPLS:0006-0066505 Page 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K [X]Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 1999 or [ ]Transition Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the transition period from ___________________ to _________________ Commission file number 1-44 A.Full title of the plan and the address of the plan, if different from that of the issuer named below: ADM EMPLOYEE STOCK OWNERSHIP PLAN FOR HOURLY EMPLOYEES B.Name of the issuer of the securities held pursuant to the Plan and the address of its principal executive office: ARCHER DANIELS MIDLAND COMPANY BOX 1470 DECATUR, IL 62525 1 Page 2 Audited Financial Statements and Schedules ADM Employee Stock Ownership Plan for Hourly Employees Years ended December 31, 1999 and 1998 2 Page 3 ADM Employee Stock Ownership Plan for Hourly Employees Audited Financial Statements and Schedules Years ended December 31, 1999 and 1998 Contents Report of Independent Auditors 1 Audited Financial Statements and Schedules Statements of Net Assets Available for Benefits 2 Statements of Changes in Net Assets Available for Benefits3 Notes to Financial Statements 4 Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes at End of Year 9 Schedule H, Line 4j - Schedule of Reportable Transactions10 Schedule G, Part III - Schedule of Nonexempt Transactions11 3 Page 4 Report of Independent Auditors Administrative Committee ADM Employee Stock Ownership Plan for Hourly Employees We have audited the accompanying statements of net assets available for benefits of the ADM Employee Stock Ownership Plan for Hourly Employees as of December 31, 1999 and 1998, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. 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 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 December 31, 1999 and 1998, and the changes in its net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States. 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 at end of year as of December 31, 1999, reportable transactions and non-exempt transactions for the year then ended, are presented for purposes of additional analysis and are not a required part of the financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan's management. The supplemental schedules 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 the relation to the financial statements taken as a whole. /s/ Ernst & Young LLP Minneapolis, Minnesota June 13, 2000 4 Page 5 ADM Employee Stock Ownership Plan for Hourly Employees Statements of Net Assets Available for Benefits
December 31 1999 1998 Assets Cash $ $ 63 66 Investments, at fair value 53,193,071 54,072,203 Income receivable 38 - Contributions receivable from employer 543,867 884,427 Contributions receivable from employees 780,344 1,441,179 Loan repayments receivable 17,747 19,565 Net assets available for benefits $54,535,13 $56,417,44 0 0 See accompanying notes.
5 Page 6 ADM Employee Stock Ownership Plan for Hourly Employees Statements of Changes in Net Assets Available for Benefits
Year ended December 31 1999 1998 Additions: Contributions from Archer Daniels Midland $ $ Company 5,558,187 5,454,619 Contributions from participating 7,835,466 8,125,492 employees Transfer of assets from another plan 2,404,315 1,767,654 Dividend and interest income 2,688,374 2,369,170 18,486,342 17,716,935 Deductions: Benefit payments: Common stock 1,407,219 2,382,966 Cash 2,002,770 3,514,220 3,409,989 5,897,186 15,076,353 11,819,749 Net transfers out Net realized and unrealized depreciation in fair value (16,958,66 (5,694,111 of investments 3) ) Net (decrease)/increase (1,882,310 6,125,638 ) Net assets available for benefits at 56,417,440 50,291,802 beginning of year Net assets available for benefits at end $54,535,13 $56,417,44 of year 0 0 See accompanying notes. 6
Page 7 1. Significant Accounting Policies Basis of Accounting The accounting records of the ADM Employee Stock Ownership Plan for Hourly Employees (the "Plan") are maintained on the accrual basis. Investments Investments are carried at fair value. Common stocks are valued at the quoted market price on the last business day of the Plan year. Investments in mutual funds are stated at the reported net asset value on the last day of the Plan year. Unallocated funds are invested in a short-term money market account as deemed appropriate by the trustee. The participant loans are valued at cost which approximates fair value. Plan Expenses Brokerage commissions, transfer taxes and other charges and expenses in connection with the purchase or sale of securities are charged against the trust fund and added to the cost of such securities, or deducted from the sale proceeds, as the case may be. Any remaining costs of administering the Plan are currently paid by the Plan Sponsor, Archer Daniels Midland Company ("ADM" or the "Company") and its affiliates. While it is anticipated ADM and its affiliates will continue to pay these costs, the Plan does permit the reasonable expenses of administering the Plan to be paid from the trust fund. There are no charges or deductions, other than taxes, that may be made against the trust fund other than those described in this summary. 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. 2. Description of the Plan General The Plan is a defined contribution plan available to all hourly employees of the Company who have completed one year of service. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. The Company converted the Plan, formerly called the ADM Savings and Investment Plan for Hourly Employees, to an employee stock ownership plan ("ESOP"), effective April 1, 1998. Most features of the Plan, including employee and employer contributions, loans and withdrawals, and distribution options remained unchanged. In accordance with Internal Revenue Service regulations for ESOPs, the Plan offers investment options to employees age 55 and older with ten or more years of service. 7 Page 8 2. Description of the Plan (continued) All Plan assets are held and managed by Hickory Point Bank & Trust, FSB (trustee of the Plan as of October 1, 1998). The former trustee was National City Bank of Minneapolis. The trust will continue for an indefinite period of time as provided by the Plan. Hickory Point Bank & Trust, FSB is a subsidiary of ADM. Contributions Under the terms of the Plan, employees electing to participate can generally contribute from 1% up to as much as 10% of their compensation as defined by the Plan document to the Plan, the maximum determined by the participant's participating location. The Company match varies by location. Substantially all contributions are received from the Company in the form of Archer Daniels Midland Company common stock as determined by location and all contributions are immediately vested to the participant. Employees should refer to the appendix to the Plan applicable to their participating location for more complete information regarding employee contributions and employer match limitations. The investment option that allows participants age 55 and older with ten years of service to reallocate their ESOP accounts into the various investment funds maintained under the Plan became available January 1, 1999. Shares of ADM stock added to the participants' accounts after April 1, 1998 may be reallocated. Participant Loans Participants may borrow from their fund accounts a minimum of $1,000 up to the lesser of $50,000 or 50% of their account balance. Loan transactions are treated as a transfer from (to) the investment fund. A maximum of one loan may be outstanding to a participant at any time. Loans are allowed only for purposes of educational and medical expenses and for purchases of a primary residence. Educational or medical expense loans are available for up to five years, and a home purchase loan is available for up to ten years. The loans are secured by the balance in the participant's account and bear interest at a rate equal to the prime rate plus 1% at time of issuance. Principal and interest are repaid ratably through payroll deductions, with payments taken from each paycheck. Withdrawal The full value of an employee's account is payable following termination of employment. Withdrawals by active employees are permitted for two reasons: upon reaching age 59 1/2 and for specific hardship circumstances, and only after receiving a loan available to the participant under the loan program. Withdrawal of shares acquired under 401(k) provisions is subject to hardship restrictions. 8 Page 9 2. Description of the Plan (continued) Plan Mergers During the years ended December 31, 1999 and 1998, the assets and liabilities of certain savings plans covering the hourly employees of recently acquired ADM subsidiaries were merged into the Plan, as is the policy of ADM. 3. Investments The Plan's investments are held by a bank-administered trust fund. During 1999 and 1998, the Plan's investments (including investments bought, sold, as well as held during the year) appreciated (depreciated) in fair value as follows:
Net Appreciation (Depreciation ) in Fair Fair Value Value During at Year End of Year Year ended December 31, 1999: Cash equivalents $ $ - 53,807 Archer Daniels Midland Company common (14,578,622) 41,782,995 stock Pfizer Incorporated common stock (2,138,994) 5,222,762 Vanguard Wellington Fund (125,057) 676,549 Equity mutual funds (3,758) 2,867,843 Invesco Stable Value Fund - 1,919,508 Participant loans - 669,607 $(16,846,431) $53,193,07 1 Year ended December 31, 1998: Cash equivalents $ $ - 30,298 Archer Daniels Midland Company common (9,066,049) 43,094,771 stock Pfizer Incorporated common stock 3,303,180 7,479,625 Balanced Fund 4,315 255,424 Equity mutual funds 57,199 990,520 Stable Value Fund 7,244 1,779,667 Participant loans - 441,898 $ $54,072,20 (5,694,111) 3
At December 31, 1999 and 1998, the fair value of the Archer Daniels Midland Company common stock and the Pfizer Incorporated common stock each represented 5% or more of the Plan's net assets. 9 Page 10 4. Nonparticipant-Directed Investments Information about the net assets and the significant components of the changes in net assets relating to the nonparticipant-directed investments is as follows:
December 31 1999 1998 Net assets: Archer Daniels Midland Company common $41,782,99 $43,094,77 stock 5 1 Total $41,782,99 $43,094,77 5 1
Year ended December 31, 1999 Changes in net assets: Contributions: Employer` $ 5,558,187 Employee 7,835,466 Dividend income 2,424,635 Net realized and unrealized depreciation in fair (14,177,257 value of investments ) Distributions to participants (2,892,642) Transfers to participant-directed investments (60,165) $ (1,311,776)
5. Transactions with Parties-in-Interest During the years ended December 31, 1999 and 1998, the Plan had the following transactions related to Archer Daniels Midland Company common stock:
1999 1998 Number of common shares contributed 862,061 632,764 Number of common shares purchased 1,345,453 23,931 Cost of common shares purchased $16,856,25 $447,271 7 Cash dividends received $600,173 $425,950 Shares received through stock dividends 141,808 110,973 Number of common shares sold 415,916 122,546 Market value of common shares sold $3,487,060 $2,366,977 Cost of common shares sold $6,577,319 $1,575,291
10 Page 11 6. Plan Terminations Although it has not expressed any intent to do so, the Company has the right to terminate the Plan at any time. Upon termination, all amounts in participants' accounts are 100% vested. 7. Income Tax Status The Plan has received a determination letter from the Internal Revenue Service, dated April 5, 1996, stating that the Plan is qualified under Section 401(a) of the Internal Revenue Code (the "Code") and, therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan is qualified and the related trust is tax-exempt. Subsequent amendments have been structured to, and are intended to, maintain the Plan's qualified status. Distributions of benefits to participants, their estates or beneficiaries, generally are subject to federal income tax as either ordinary income or capital gain depending on the event giving rise to the distribution and the method used. 11 Page 12 ADM Employee Stock Ownership Plan for Hourly Employees EIN: 41-0129150 Plan #027 Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes at End of Year December 31, 1999
Description of Identity of Issue, Investment Including Current Borrower, Maturity Date, Rate Cost Value Lessor or Similar Party of Interest, Par or Maturity Value Cash equivalents: Vista Premier U.S. Government Money Market 25,925 units $ $ Fund 25,925 25,925 SEI Liquid Asset Prime Obligations Fund #12 27,882 units 27,882 27,882 53,807 53,807 Archer Daniels Midland 3,446,020 shares of 50,878,544 41,782,99 Company* common stock 5 Pfizer Incorporated 161,010 shares of 725,945 5,222,762 common stock Invesco Stable Value Fund 1,919,508 units 1,919,508 1,919,508 Vanguard Wellington Fund 24,197 units 599,898 676,549 Equity mutual funds: Vangaurd S & P 500 Index 14,278 units 1,540,641 1,932,183 Fund Hotchkis & Wiley 2,171 units 57,638 57,312 International Fund T. Rowe Mid-Cap Growth Fund 13,858 units 502,238 556,101 Janus Fund 1,320 units 60,229 58,127 Templeton Foreign Fund CLI 3,310 units 34,616 37,140 Vista Balanced Fund A 1,852 units 30,680 28,611 Vista Capital Growth Fund 1,637 units 74,066 68,623 CLA Vista Growth & Income Fund 1,508 units 67,552 59,403 CLA Vista U.S. Treasury Income 1,006 units 10,728 10,547 Fund A Dreyfus A BDS Plus Fund 969 units 13,077 12,981 Dreyfus Appreciation Fund 381 units 17,417 17,402 Dreyfus New Leader Fund 580 units 30,578 29,413 2,439,460 2,867,843 Participant loans Various notes bearing interest at 8.75% to 0 669,607 9.50% Total assets held for investment purposes $56,617,16 $53,193,1 2 07
*Indicates a party-in-interest to the Plan. 12 Page 13 ADM Employee Stock Ownership Plan for Hourly Employees EIN: 41-0129150 Plan #027 Schedule H, Line 4j - Schedule of Reportable Transactions Year ended December 31, 1999
Current Value of Asset Purchase Selling Cost on Net Identity of Party Description of Price Price of Asset Transacti Gain/ Involved Asset/Transaction on (Loss) Date Category (iii)--Series of Transactions in Excess of 5% of Net Assets Hickory Point Bank SEI Liquid Asset Prime Obligations Fund #12: Purchased 3,974,833 shares in $ $ $ 185 transactions 3,974,833 3,974,833 3,974,833 Sold 3,946,951 shares in $3,946,95 3,946,951 3,946,951 $ 192 transactions 1 - Archer Daniels Midland Archer Daniels Midland Company Company common stock: Sold 415,916 shares in 353 3,487,060 6,577,319 3,487,060 (3,090,2 transactions 59) Purchased 1,345,453 shares in 16,856,25 16,856,25 16,856,25 68 transactions 7 7 7
There were no category (i), (ii) or (iv) transactions for the year ended December 31, 1999. 13 Page 14 ADM Employee Stock Ownership Plan for Hourly Employees EIN: 41-0129150 Plan #027 Schedule G, Part III - Schedule of Nonexempt Transactions Year ended December 31, 1999
(b) Relationship (a) Identity of to Plan, Employer (c) Description of Transactions Including Maturity Party Involved or Other Date, Party-in-Interest Rate of Interest, Collateral, Par or Maturity Value Archer Daniels Midland Employer/Plan The Plan Sponsor failed to timely remit participant Company Sponsor 401(k) contributions in February 1999, due to administrative error. The amount totaled $604,882 and has been subsequently deposited. There was no earnings impact to the participants as a result of the delay. The subsequent deposit of treasury stock shares of the Plan Sponsor was made at the appropriate cost, as if the deposit had been made timely.
Columns (d) through (j) are not applicable. *Indicates a party-in-interest to the Plan. 14 Page 15 Signature Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Administrator has duly caused this annual report to be signed by the undersigned thereunto duly authorized. ARCHER DANIELS MIDLAND COMPANY /s/Douglas J. Schmalz Douglas J. Schmalz Vice President and Chief Financial Officer Dated: June 28, 2000 15 EX-23 2 0002.txt E&Y CONSENT Page 1 Exhibit 23 Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-58387 dated April 3, 1995) pertaining to the ADM Employee Stock Ownership Plan for Hourly Employees of our report dated June 13, 2000 with respect to the financial statements and schedules of the ADM Employee Stock Ownership Plan for Hourly Employees included in this Annual Report (Form 11-K) for the year ended December 31, 1999. /s/ Ernst & Young LLP Minneapolis, Minnesota June 22, 2000 1 -----END PRIVACY-ENHANCED MESSAGE-----