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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2000
OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transmission period from _________________ to _________________
Commission file number 1-07151
THE CLOROX COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 31-0595760
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1221 Broadway, Oakland, CA 94612-1888
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (510) 271-7000
Securities registered pursuant to
Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
- ----------------------------- ---------------------
Common Stock, $1 par value New York Stock Exchange
Pacific Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or
any amendment to this Form 10-K. [ ]
Aggregate market value of voting stock held by non-affiliates
of the registrant at July 31, 2000: $6,951,041,815. Number of
shares of common stock outstanding at July 31, 2000: 235,502,838.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's 2000 Annual Report to Shareholders
("Annual Report") are incorporated by reference into Part I of
this report. Portions of the registrant's definitive Proxy
Statement for the Annual Meeting of Stockholders to be held
on November 15, 2000, which will be filed with the United
States Securities and Exchange Commission within 120 days after
the end of the registrant's fiscal year ended June 30, 2000,
are incorporated by reference into Parts I, II, III and IV of
this report.
PART I
ITEM l. BUSINESS
(a) GENERAL DEVELOPMENT OF BUSINESS.
The Company (the term "Company" as used herein includes the registrant
identified on the facing sheet, The Clorox Company, and its subsidiaries,
unless the context indicates otherwise) was originally founded in
Oakland, California in 1913 as the Electro-Alkaline Company. It was
reincorporated as Clorox Chemical Corporation in 1922, as Clorox
Chemical Co. in 1928, and as The Clorox Company (an Ohio corporation)
in 1957, when the business was acquired by The Procter & Gamble Company.
The Company was fully divested by The Procter & Gamble Company in 1969
and, as an independent company, was reincorporated in 1973 in California
as The Clorox Company. In 1986, the Company was reincorporated in Delaware.
During fiscal year 2000, the Company continued to focus on expanding
its business through internal development of new products and line
extensions of existing products. The Company introduced 114 new products
during fiscal year 2000, including Clorox Disinfecting Wipes, Clorox
Disinfecting Spray, Ultra Clorox liquid bleach, Liquid-Plumr Foaming
Pipe Snake drain cleaner, and Fresh Step Crystals cat litter. The
Company also focused on completing the integration of the product lines
it acquired in its merger with First Brands Corporation in fiscal year
1999.
Internationally, the Company made three acquisitions in fiscal year
2000, consisting of the Bon Bril cleaning utensil business in Colombia,
Venezuela and Peru, the Agrocom S.A. distribution business in Argentina,
and the Astra rubber glove business in Australia. The Company also
increased its equity ownership in Clorox de Colombia S.A.(formerly
"Tecnoclor, S.A.") in Colombia from 72% to 100%. The Company
restructured its operations in Asia, moving to third-party distributors
in many regions.
For other recent business developments, refer to the information set
forth under the caption "Management's Discussion and Analysis," on
pages B-1 through B-9 of Exhibit 99 hereto, and pages B-1 through B-9
of Appendix B of the Company's definitive Proxy Statement for the
2000 Annual Meeting of Stockholders of the Company, which will be
filed with the United States Securities and Exchange Commission
within 120 days after the end of the registrant's fiscal year ended
June 30, 2000 ("Proxy Statement"), incorporated herein by
reference.
(b) FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS.
The Company has three business segments: U.S Household Products and
Canada, U.S. Specialty Products and International. Financial information
for the last three fiscal years, including net sales, earnings before
taxes, and identifiable assets, attributable to each of the Company's
industry segments is set forth in Note 17 - Industry Segment Information
of the Notes to the Consolidated Financial Statements, which appears on
page B-31 of Exhibit 99 hereto, and on page B-31 of Appendix B of the
Proxy Statement, incorporated herein by reference.
(c) NARRATIVE DESCRIPTION OF BUSINESS.
The Company's business operations, represented by the aggregate of its U.S.
Household Products and Canada, U.S. Specialty Products and International
segments, include the production and marketing of non-durable consumer
products sold primarily through grocery and other retail stores. For the
most part, the factors necessary for an understanding of these three
segments are essentially the same.
PRINCIPAL PRODUCTS. The U.S. Household Products and Canada segment
includes the Company's household cleaning, bleach and other home care
products, water filtration products marketed in the United States, and
all products marketed in Canada. The U.S. Specialty Products segment
includes the Company's charcoal, automotive care, cat litter,
insecticide, fire log, dressings, sauces, professional products, and
food storage and disposal categories. Finally, the International segment,
which includes the Company's overseas operations (excluding Canada),
exports and Puerto Rico, primarily focuses on the laundry, household
cleaning, automotive care and food storage and disposal categories.
Principal products, by segment, currently marketed in the United States
and internationally are listed on pages 13 and 14 of the Company's Annual
Report incorporated herein by reference. Each of the Company's segments
accounted for more than 10 percent of the Company's consolidated revenues
during the last three fiscal years, as shown in Note 17 - Industry Segment
Information of the Notes to the Consolidated Financial Statements, which
appears on page B-31 of Exhibit 99 hereto, and on page B-31 of Appendix B
of the Proxy Statement, incorporated herein by reference.
PRINCIPAL MARKETS - METHODS OF DISTRIBUTION. Most non-durable household
consumer products are nationally advertised and sold within the United
States to grocery stores through a network of brokers, and to mass
merchandisers, warehouse clubs, military and other retail stores
primarily through a direct sales force. The Company also sells
within the United States institutional versions of specialty food
and non-food products. Outside the United States, the Company sells
consumer products through subsidiaries, licensees, distributors and
joint-venture arrangements with local partners.
SOURCES AND AVAILABILITY OF RAW MATERIALS. The Company has obtained
ample supplies of all required raw materials and packaging supplies
which, with a few exceptions, were available from a wide variety of
sources during fiscal year 2000. Polyethylene resin raw materials,
which are particularly important for the U.S. Specialty Products
segment, were available from a wide variety of sources during fiscal
year 2000 and the Company has entered into financial instruments with
various maturities partially to stabilize the cost of its polyethylene
resin requirements. Contingency plans have been developed for any
major single-sourced supplier materials.
PATENTS AND TRADEMARKS. Although some products are covered by
patents, the Company does not believe that patents, patent licenses
or similar arrangements are material to its business. Most of the
Company's brand name consumer products are protected by registered
trademarks. Its brand names and trademarks are extremely important
to its business and the Company pursues a course of vigorous action
against apparent infringements.
SEASONALITY. The U.S. Specialty Products segment is the only
portion of the operations of the Company that has any significant
degree of seasonality. Most sales of the Company's charcoal
briquets, insecticides, and automotive appearance product lines
occur in the first six months of each calendar year. Working
capital to carry inventories built up in the off-season and to
extend terms to customers is generally provided by internally
generated funds plus commercial paper lines of credit.
CUSTOMERS AND ORDER BACKLOG. During fiscal years 2000, 1999 and
1998, revenues from the Company's sales of its products to Wal-Mart
Stores, Inc. and its affiliated companies were 18%, 18%, and 15%,
respectively, of the Company's consolidated net sales. Except for
this relationship, the Company is not dependent upon any other single
customer or a small group of customers. Order backlog is not a
significant factor in the Company's business.
RENEGOTIATION. None of the Company's operations is subject to
renegotiation or termination at the election of the feral government.
COMPETITION. The markets for consumer products are highly competitive
and most of the Company's products compete with other nationally
advertised brands within each category, and with "private label" brands
and "generic" non-branded products of grocery chains and wholesale
cooperatives. Competition is encountered from similar and alternative
products, many of which are produced and marketed by major national
concerns having financial resources greater than those of the Company.
Depending on the competitive product, the Company's products compete
on price, quality or other benefits to consumers.
A newly introduced consumer product (whether improved or newly developed)
usually encounters intense competition requiring substantial expenditures
for advertising and sales promotion. If a product gains consumer
acceptance, it normally requires continuing advertising and
promotional support to maintain its relative market position.
RESEARCH AND DEVELOPMENT. The Company incurred expenses of approximately
$63 million, $63 million and $62 million in fiscal years 2000, 1999
and 1998, respectively, on research activities relating to the
development of new products or the maintenance and improvement of
existing products. None of this research activity was customer-sponsored.
ENVIRONMENTAL MATTERS. Historically, the Company has not made
material capital expenditures for environmental control facilities
or to comply with environmental laws and regulations. However, in
general, the Company does anticipate spending increasing amounts
annually for facility upgrades and for environmental programs. The
amount of capital expenditures for environmental compliance was not
material in fiscal year 2000 and is not expected to be material in
the next fiscal year.
The Company is involved in certain other environmental matters,
including Superfund clean-up efforts at various locations. The
potential cost to the Company related to ongoing environmental
matters is uncertain due to such factors as: the unknown magnitude
of possible pollution and clean-up costs; the complexity and
evolving nature of laws and regulations and their interpretations;
and the timing, varying costs and effectiveness of alternative
clean-up technologies. Based on its experience and without offsetting
for expected insurance recoveries or discounting for present
value, the Company does not expect that such costs individually
and in the aggregate will represent a material cost to the Company
or affect its competitive position.
NUMBER OF PERSONS EMPLOYED. At the end of fiscal year 2000,
approximately 11,000 people were employed by the Company.
FORWARD-LOOKING STATEMENTS AND RISK FACTORS. Except for historical
information, matters discussed in this Form 10-K, including the
Management's Discussion and Analysis and statements about future
growth, are forward-looking statements based on management's estimates,
assumptions and projections. In addition, from time to time, the
Company may make forward-looking statements relating to such matters
as anticipated financial performance, business prospects, new
products, research and development activities, plans for international
expansion, acquisitions, and similar matters. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. In order to comply with the terms of the safe harbor, the
Company notes that a variety of factors could cause the Company's
actual results and experience to differ materially from the anticipated
results or other expectations expressed in the Company's forward-looking
statements. These forward-looking statements are uncertain. The
risks and uncertainties that may affect operations, performance,
product development, and results of the Company's business, some of
which may be beyond the control of the Company, include those discussed
elsewhere in this Form 10-K, marketplace conditions and events, and
the following:
QUARTERLY OPERATING RESULTS MAY FLUCTUATE. The Company cannot be sure
that its operating results will improve from quarter-to-quarter, or
that if any improvement is shown, the degree of improvement will
meet its expectations. The Company's quarterly operating results
will be influenced by a number of factors, including the following:
* the introduction of new products and line extensions by the Company
or its competitors;
* the mix of products sold in a given quarter;
* the Company's ability to control its internal costs and the cost of
raw materials;
* significant increases in energy costs;
* changes in product pricing policies by the Company or its competitors;
* changes in accounting policies; or
* the impact of general economic conditions in the United States and
in other countries in which the Company currently does business.
In addition, sales volume growth, whether due to acquisitions or to
internal growth, can place burdens on the Company's management
resources and financial controls that, in turn, can have a negative
impact on operating results. To some extent, the Company sets its
expense levels in anticipation of future revenues. If actual
revenue falls short of these expectations, operating results are
likely to be adversely affected. Because of all of these factors,
the Company believes that quarter-to-quarter comparisons of its
results of operations should not be relied upon as indications of
future performance.
OPERATIONS OUTSIDE THE UNITED STATES EXPOSE THE COMPANY TO UNCERTAIN
CONDITIONS IN OVERSEAS MARKETS. The Company believes that its sales
outside the United States, which were 19% of net sales in fiscal year
2000, are likely to increase as a percentage of its total sales. As
a result, the Company will increasingly face the risks created by
having foreign operations, including:
* economic or political instability in its overseas markets; and
* fluctuations in foreign currency exchange rates that may make
the Company's products more expensive in its foreign markets or
negatively impact its sales or earnings.
All of these risks could have a significant impact on the Company's
ability to sell its products on a timely and competitive basis in
foreign markets and may have a material adverse effect on the
Company's results of operations or financial position. The Company
seeks to limit its foreign currency exchange risks through the
use of foreign currency forward contracts when practical, but
cannot be sure that this strategy will be successful. In addition,
the Company's operations outside the United States are subject
to the risk of new and different legal and regulatory requirements
in local jurisdictions, potential difficulties in staffing and
managing local operations, credit risk of local customers and
distributors, and potentially adverse tax consequences.
INTEGRATION OF ACQUISITIONS AND MERGERS MAY NOT BE SUCCESSFUL. One
of the Company's strategies is to increase its sales volumes,
earnings and the markets it serves through the acquisition of,
or merger with, other businesses in the United States and
internationally. There can be no assurance that the Company
will be able to identify, acquire, or profitably manage additional
companies or operations or successfully integrate recent or
future acquisitions or mergers into its operations. In addition,
there can be no assurance that companies or operations acquired
will be profitable at the time of their acquisition or will achieve
sales levels and profitability that justify the investment made.
FINANCIAL PERFORMANCE DEPENDS ON CONTINUOUS AND SUCCESSFUL NEW
PRODUCT INTRODUCTIONS. In most categories in which the Company
competes, there are frequent introductions of new products and
line extensions. An important factor in the Company's future
performance will be its ability to identify emerging consumer
and technological trends and to maintain and improve the
competitiveness of its products. The Company cannot be sure
that it will successfully achieve those goals. Continued
product development and marketing efforts have all the risks
inherent in the development of new products and line extensions,
including development delays, the failure of new products and
line extensions to achieve anticipated levels of market acceptance,
and the cost of failed product introductions.
GOVERNMENT REGULATIONS COULD IMPOSE MATERIAL COSTS. The
manufacture, packaging, storage, distribution and labeling of
the Company's products and the Company's business operations
generally all must comply with extensive federal, state, and
foreign laws and regulations. For example, in the United States,
many of the Company's products are regulated by the Environmental
Protection Agency, the Food and Drug Administration, and the
Consumer Product Safety Commission. Most states have agencies
that regulate in parallel to these federal agencies. The failure
to comply with applicable laws and regulations in these or other
areas, including taxes, could subject the Company to civil
remedies, including fines, injunctions, recalls or asset seizures,
as well as potential criminal sanctions, any of which could have
a material adverse effect on the Company. Loss of or failure to
obtain necessary permits and registrations could delay or prevent
the Company from introducing new products, building new facilities
or acquiring new businesses and could adversely affect operating
results.
ENVIRONMENTAL MATTERS CREATE POTENTIAL LIABILITY RISKS. The
Company must comply with various environmental laws and regulations
in the jurisdictions in which it operates, including those
relating to air emissions, water discharges, the handling and
disposal of solid and hazardous wastes, and the remediation of
contamination associated with the use and disposal of hazardous
substances. The Company has incurred, and will continue to incur,
capital and operating expenditures and other costs in complying
with those laws and regulations in the United States and
internationally. The Company is currently involved in or has
potential liability with respect to the remediation of past
contamination in the operation of some of its presently and formerly
owned and leased facilities. In addition, some of the Company's
present and former facilities have been or had been in operation
for many years, and over that time, some of these facilities may
have used substances or generated and disposed of wastes that are
or may be considered hazardous. It is possible that those sites,
as well as disposal sites owned by third parties to which the
Company has sent waste, may in the future be identified and become
the subject of remediation. It is possible that the Company could
become subject to additional environmental liabilities in the
future that could result in a material adverse effect on the
Company's results of operations or financial condition.
FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY COULD IMPACT OUR
COMPETITIVENESS. The Company relies on trademark, trade secret,
patent and copyright laws to protect its intellectual property.
The Company cannot be sure that these intellectual property
rights can be successfully asserted in the future or will not
be invalidated, circumvented or challenged. In addition, laws
of some of the foreign countries in which the Company's products
are or may be sold do not protect the Company's intellectual
property rights to the same extent as the laws of the United
States. The failure of the Company to protect its proprietary
information and any successful intellectual property challenges
or infringement proceedings against the Company could make it
less competitive and could have a material adverse effect on the
Company's business, operating results and financial condition.
(d) FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC OPERATIONS.
The following table shows net sales and assets by geographic area
for the last three fiscal years:
Net Sales By Geographic Area:
(Millions) 2000 1999 1998
- ----------- ------ ------ ------
Foreign $ 771 $ 739 $ 758
United States $3,312 $3,264 $3,140
Assets at June 30:
(Millions) 2000 1999 1998
- ----------- ------ ------ ------
Foreign $1,154 $1,043 $1,071
United States $3,199 $3,089 $2,994
ITEM 2. PROPERTIES
PRODUCTION FACILITIES. The Company operates production and
major warehouse facilities for its operations in 30 locations
throughout the United States and in 30 locations internationally.
Most of the space is owned. Warehousing space is leased from public
service warehouses around the United States. The Company also
utilizes six domestic regional distribution centers for many
of the Company's products, which are operated by service providers.
None of the Company's owned facilities were closed during fiscal year
2000. The Company considers its manufacturing and warehousing
facilities to be adequate to support its business.
OFFICES AND R&D FACILITIES. The Company owns its general office
building located in Oakland, California. The Company also owns its
Technical Center and Data Center located in Pleasanton, California.
The Company leases its research and development center and its
engineering research facility for Glad and GladWare products,
which are located in Willowbrook, Illinois, and Kennesauw, Georgia,
respectively. The Company also leases its research and development
center for STP products located in Brookfield, Connecticut. Leased
sales and other office facilities are located at a number of other
locations.
ENCUMBRANCES. None of the Company's owned facilities are encumbered
to secure debt owed by the Company, except that the manufacturing
facility in Belle, Missouri, secures industrial revenue bond
indebtedness incurred in relation to the construction and upgrade
thereof.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
EXECUTIVE OFFICERS OF THE REGISTRANT
The names, ages and current positions of the executive officers of the
Company are set forth below:
Name (Age) and Year Elected to
Current Position Title and Current Position(s)
- -----------------------------------------------------------------------
G. C. Sullivan (60) 1992 Chairman of the Board and Chief
Executive Officer
G. E. Johnston (53) 1999 President and Chief Operating
Officer
R. T. Conti (45) 1999 Group Vice President
L. S. Peiros (45) 1999 Group Vice President
K. M. Rose (52) 1997 Group Vice President - Chief
Financial Officer
P. D. Bewley (54) 1998 Senior Vice President - General
Counsel and Secretary
A. W. Biebl (51) 1999 Senior Vice President - Product
Supply
F. A. Tataseo (46) l999 Senior Vice President - Sales
J. M. Brady (47) 1993 Vice President - Human Resources
C. M. Couric (54) 2000 Vice President - General Manager,
Seasonal, Food and Professional
Products
W. L. Delker (46) 1999 Vice President - Research &
Development
G. S. Frank (40) 1999 Vice President - Controller
S. D. House (39) 1999 Vice President - General Manager,
Latin America
R. C. Klaus (55) 1995 Vice President - Corporate
Administration
D. G. Matz (38) 1999 Vice President - General Manager,
Home Care
G. C. Roeth (39) 2000 Vice President - Marketing
G. R. Savage (43) 1999 Vice President - General Manager,
Glad Products
S. S. Silberblatt (48) 1999 Vice President - Corporate
Communications and Public Affairs
D. G. Simpson (46) 1997 Vice President - Strategy and Planning
K. R. Tandowsky (43) 1998 Vice President - Information Services
S. R. Vogel (39) 1999 Vice President - General Manager,
Laundry Additives
S. A. Weiss (44) 1999 Vice President - General Manager, Brita
There is no family relationship between any of the above named persons, or
between any of such persons and any of the directors of the Company or any
persons nominated for election as a director of the Company. See Item 10
of Part III of this Form 10-K.
G. C. Sullivan and J. M. Brady have been employed by the Company for at l
east the past five years in the same respective positions as listed above.
The other executive officers have held the respective positions described
below for at least the past five years:
G. E. Johnston joined the Company in July 1981 as Regional Sales Manager -
Special Markets. Prior to his election as President and Chief Operating
Officer effective January 20, 1999, he was Group Vice President from July 1,
1996 through January 19, 1999, Vice President - Kingsford Products from
November 17, 1993 through June 1996, and Vice President - Corporate
Development from June 1992 through November 16, 1993.
R. T. Conti joined the Company in 1982 as Associate Region Sales Manager,
Household Products. Prior to his election as Group Vice President
effective September 1, 1999, he was Vice President - General Manager
from July 1999 through August 1999, Vice President - Kingsford Products
from July 1996 through June 1999, and Vice President - International
from June 1992 through June 1996.
L. S. Peiros joined the Company in 1982. He was elected Group Vice
President effective January 20, 1999. Prior to that, he served as
Vice President - Household Products from June 1, 1998 through January 19,
1999, Vice President - Food Products from July 1995 through June 1998, and
Vice President - Corporate Marketing Services from September 1993 until
July 1995.
K. M. Rose joined the Company in 1978 as a Financial Analyst. Prior to her
election as Group Vice President - Finance and Chief Financial Officer
effective December 1, 1997, she was Vice President - Treasurer from July
1992 through November 1997.
P. D. Bewley joined the Company in February 1998 as Senior Vice President -
General Counsel and Secretary. From 1994 through January 1998, he was
employed by Nova Care, Inc., as Senior Vice President - General Counsel
and Secretary, and prior to that was employed by Johnson & Johnson as
Associate General Counsel.
A.W. Biebl joined the Company in January 1981 as Director of Manufacturing
for the Food Service Products Division. Prior to his election as Senior
Vice President - Product Supply effective September 1, 1999, he was
Vice President - Product Supply from May 1992 through August 1999.
F. A. Tataseo joined the Company in October 1994 as Vice President - Sales
and was elected as Senior Vice President - Sales effective September 1, 1999.
C. M. Couric joined the Company in 1973 as a brand assistant in the
Household Products marketing organization. Prior to his election in
March 2000 as Vice President - General Manager, Seasonal, Food and
Professional Products, he was Vice President - General Manager, Brita
Products from July 1995 through March 2000, and had served as Director,
Brita Operations since 1988.
W. L. Delker joined the Company as Vice President - Research &
Development in August 1999. Prior to that, he was General Manager
of Six Sigma Quality for GE Silicones, a division of GE Plastic,
from February 1998 through July 1999, and General Manager of
Technology for GE Silicones from January 1994 through January 1998.
G. S. Frank joined the Company in 1982 as a staff accountant. Prior
to his election as Vice President - Controller effective October 1,
1999, he was General Manager - Korea from September 1998 through
September 1999, Director of Finance - Kingsford Products from 1997
through August 1998, Director of Finance - Armor All Products from
1996 to 1997, Director of Finance - Food Products from 1995 to 1996,
and Director of Corporate Financial Planning from 1994 to 1995.
S. D. House joined the Company in 1983 as a staff accountant. Prior
to his election as Vice President - General Manager, Latin America
effective July 1, 1999, he was Vice President - Treasurer from December 1,
1997 through June 1999, and prior to that he had served as a Director
of Finance for the international business and also had held various
positions in auditing, financial analysis and forecasting.
R. C. Klaus joined the Company in 1977 as Regional Sales Manager
(Baltimore) for Household Products. Prior to his election as Vice
President - Corporate Administration in November 1995, he was Vice
President - Clorox Professional Products from March 1994 through
October 1995, and Vice President - Food Service Products from May
1990 through March 1994.
D. G. Matz joined the Company in 1986 as a brand assistant in the
Company's Household Products marketing organization. Prior to his
election as Vice President - General Manager, Home Care effective
September 1, 1999, he was Category General Manager - Home Care from
February 1999 through August 1999, Director of Marketing - Home Care
from December 1997 through January 1999, Director of Marketing -
Food Products and Auto Care from August 1995 through November 1997,
and Group Marketing Manager - Laundry Care Additives from January
1994 through July 1995.
G. C. Roeth joined the company in 1987 as a brand assistant in the
marketing organization. Prior to his election as Vice President -
Marketing effective April 1, 2000, he was Vice President - Brand
Marketing from October 1999 through March 2000; Marketing Director -
Brita from February 1998 through September 1999; Group Marketing
Manager for Brita from October 1996 through January 1998, and for
Home Cleaning from January 1994 through September 1996.
G. R. Savage joined the Company in 1983 as an Associate Marketing
Manager. He was elected Vice President - General Manager, Glad
Products effective January 20, 1999. Prior to that, he served as
Vice President - Food Products from December 1, 1997 through January 19,
1999, and Director of Marketing for the Household Products business
from 1993.
S. S. Silberblatt joined the Company in 1980 in the marketing department
for Kingsford products. Prior to his election as Vice President -
Corporate Communications and Public Affairs in February 1999, he was
Director of Business Development.
D. G. Simpson joined the Company in 1979 in the brand management
function. He was elected Vice President - Strategy and Planning
effective December 1, 1997. Prior to that, he had served as head of
corporate strategic planning.
K. R. Tandowsky joined the Company in 1981 as a staff accountant. He
was elected Vice President - Information Services effective February 7,
1998. Prior to that, he had served as Director of Finance for the
Kingsford products business from 1994 and Director of Corporate Finance,
Treasury from 1992.
S. R. Vogel joined the Company in 1988 as a brand assistant in the
marketing organization. Prior to his election as Vice President -
General Manager, Laundry Additives effective September 1, 1999, he
was Category General Manager - Laundry Cleaning Additives from
February 1999 through August 1999, Marketing Director - Laundry
Cleaning Additives from 1997 through January 1999, Group Marketing
Manager - Laundry Cleaning Additives from 1995 through 1996, and
Group Marketing Manager - Home Cleaning from 1994 to 1995.
S. A. Weiss joined the Company in 1994 as an area general manager f
or the Pacific Rim business. He was elected Vice President - General
Manager, Brita Products in March 2000. Prior to that, he was Vice
President - General Manager, Food & Professional Products from February
1999 to March 2000, Vice President - Asia Middle East from June 1998
through January 1999 and he held the position of Area General Manager
Asia-Middle East from 1994 until his election as an officer.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
(a) MARKET INFORMATION.
The principal markets for Clorox Common Stock are the New York
Stock Exchange and the Pacific Exchange. The high and low sales
prices quoted for New York Stock Exchange-Composite Transactions
Report for each quarterly period during the past two fiscal years
appears under "Quarterly Data," on page B-35 of Exhibit 99 hereto,
and on page B-35 of Appendix B of the Proxy Statement, incorporated
herein by reference, and on July 31, 2000, the closing price for
the Company's stock was $41.31 per share.
(b) HOLDERS.
The approximate number of record holders of Clorox Common Stock as
of July 31, 2000 was 15,554 based on information provided by the
Company's transfer agent.
(c) DIVIDENDS.
The amount of quarterly dividends paid with respect to Clorox Common
Stock during the past two fiscal years appears under "Quarterly Data,"
on page B-35 of Exhibit 99 hereto, and on page B-35 of Appendix B of
the Proxy Statement, incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
This information appears under "Five-Year Financial Summary," on
page B-36 of Exhibit 99 hereto, and on page B-36 of Appendix B of the
Proxy Statement, incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
This information appears under "Management's Discussion and Analysis,"
on pages B-1 through B-9 of Exhibit 99 hereto, and on pages B-1 through
B-9 of Appendix B of the Proxy Statement, incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
This information appears under "Market-Sensitive Derivatives and
Financial Instruments" in the "Management's Discussion and Analysis,"
on pages B-6 and B-7 of Exhibit 99 hereto, and on pages B-6 and B-7 of
Appendix B of the Proxy Statement, incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
These statements and data appear on pages B-10 through B-35 of Exhibit 99
hereto, and on pages B-10 through B-35 of Appendix B of the Proxy
Statement, incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None.
PART III
ITEM l0. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information regarding each nominee for election as a director,
including those who are executive officers of the Company, appears
under "Nominees for Election as Directors" of the Proxy Statement,
incorporated herein by reference.
Pursuant to Instruction 3 to Item 401(b) of Regulation S-K, information
regarding the executive officers of the registrant is reported in
Part I of this Report.
The information required by Item 405 of Regulation S-K appears under
"Section 16(a) Beneficial Ownership Reporting Compliance" of the Proxy
Statement, incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information required by Item 402 of Regulation S-K appears under
"Organization of the Board of Directors," "Summary Compensation
Table," "Options and Stock Appreciation Rights," "Comparative Stock
Performance," "Compensation Interlocks and Insider Participation,"
and "Pension Benefits" of the Proxy Statement, all incorporated herein
by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
(a) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS.
Information concerning the only entity or person known to the
Company to be the beneficial owner of more than 5% of its Common
Stock appears under "Beneficial Ownership of Voting Securities" of
the Proxy Statement, incorporated herein by reference.
(b) SECURITY OWNERSHIP OF MANAGEMENT.
Information concerning the beneficial ownership of the Company's
Common Stock by each nominee for election as a director and by all
directors and executive officers as a group appears under
"Beneficial Ownership of Voting Securities" of the Proxy Statement,
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information concerning transactions with directors, nominees for
election as directors, management and the beneficial owner of more
than 5% of the Company's Common Stock appears under "Certain
Relationships and Transactions" of the Proxy Statement, incorporated
herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a)(1) Financial Statements:
Consolidated Financial Statements and Independent Auditors'
Report included in Exhibit 99 hereto, and in Appendix B
of the Proxy Statement, incorporated herein by reference:
Financial Highlights
Consolidated Statements of Earnings for the years
ended June 30, 2000, 1999 and, l998
Consolidated Balance Sheets for the years ended June 30,
2000 and 1999
Consolidated Statements of Stockholders' Equity for
the years ended June 30, 2000, 1999 and l998
Consolidated Statements of Cash Flows for the years
ended June 30, 2000, 1999 and l998
Notes to Consolidated Financial Statements
Independent Auditors' Report
Quarterly Data
Five-Year Financial Summary
(2) Financial Statement Schedules have been omitted because of the
absence of conditions under which they are required, or because
the information is shown elsewhere in this Form 10-K.
(3) Executive Compensation Plans and Arrangements:
Long-Term Compensation Program dated October 21, 1987,
amended 11/17/93 (Exhibit 10(ii) to the Annual Report on
Form 10-K for the year ended June 30, 1994)
Officer Employment Agreement (form) (Exhibit 10(xi) to the
Annual Report on Form 10-K for the year ended June 30, 1996)
Officer Change of Control Employment Agreement (form)
(Exhibit 10(xii) to the Annual Report on Form 10-K for the
year ended June 30, 1996)
Supplemental Executive Retirement Plan (July 17, 1991, amended
May 18, 1994, January 17, 1996 and January 19, 2000),
(Exhibit 10(viii) to the Quarterly Report on Form 10-Q for the
quarter ended March 31, 2000)
Non-Qualified Deferred Compensation Plan (Exhibit 10(xiii)
to the Annual Report on Form 10-K for the year ended
June 30, 1996)
The Clorox Company 1995 Performance Unit Plan (Exhibit
10(xiv) to the Annual Report on Form 10-K for the year
ended June 30, 1996)
The Clorox Company 1996 Stock Incentive Plan (Exhibit 10(xv)
to the Annual Report on Form 10-K for the year ended
June 30, 1996)
The Clorox Company 1996 Executive Incentive Compensation
Plan (Exhibit 10(xvi) to the Annual Report on Form 10-K for
the year ended June 30, 1996)
1993 Directors' Stock Option Plan dated November 17, 1993
(filed as Exhibit 10(xi) to the Annual Report on Form 10-K
for the year ended June 30, 1994, incorporated herein
by reference)
The Clorox Company Independent Directors' Stock-Based
Compensation Plan (Exhibit 10 (xix) to the Annual Report
on Form 10-K for the year ended June 30, 1997)
(b) Current Reports on Form 8-K during the fourth quarter of fiscal
year 2000:
None.
(c) Exhibits:
Index to Exhibits follows.
(d) (Not applicable)
Index to Exhibits
-----------------
(3)(i) Restated Certificate of Incorporation (filed as Exhibit 3(iii)
to the Quarterly Report on Form 10-Q for the quarter ended
December 31, 1999, incorporated herein by reference)
(ii) Bylaws (restated) of the Company (filed as Exhibit 3(ii) to
the Annual Report on Form 10-K for the year ended June 30, 1998)
(4)(i) Form of Indenture between the Company and Wachovia Bank & Trust
Company, N.A. as Trustee, regarding $200,000,000 in 8.8%
Notes due 2001 (filed as Exhibit 4 to the Company's Registration
Statement on Form S-3 No. 33-4083 dated May 24, 1991,
incorporated herein by reference)
(ii) Prospectus Supplement (to Prospectus dated July 9, 1991) giving
terms of the Indenture referenced in Exhibit 4 (i) above
(filed on July 18, 1991, supplementing the Registration
Statement on Form S-3 No. 33-4083 dated May 24, 1991, and
incorporated herein by reference)
(iii) Form of Indenture between First Brands and Bank of New York,
as Trustee, regarding $150,000,000 in 7.25% Senior Notes due
2007 (filed as Exhibit 4.1 to First Brands' Registration
Statement on Form S-4 dated April 24, 1997, incorporated
herein by reference)
(10) Material contracts:
(i) Long-Term Compensation Program dated October 21, 1987
(Amended 11/17/93) (filed as Exhibit 10(ii) to the Annual
Report on Form 10-K for the year ended June 30, 1994,
incorporated herein by reference)
(ii) Agreement between Henkel KGaA and the Company dated
June l8, l981 (filed as Exhibit (l0)(v) to Form 8 dated
August 11, l983, incorporated herein by reference)
(iii) Agreement between Henkel GmbH (now Henkel KGaA) and
the Company dated July 3l, l974 (filed as Exhibit (l0)(vi)
to Form 8 dated August 11, l983, incorporated herein by
reference)
(iv) Agreement between Henkel KGaA and the Company dated
July 16, 1986 (filed as Exhibit B to Current Report on
Form 8-K for March 19, 1987, incorporated herein by reference)
(v) Agreement between Henkel KGaA and the Company dated
March 18, 1987 (filed as Exhibit A to Current Report on
Form 8-K for March 19, 1987, incorporated herein by reference)
(vi) Supplemental Executive Retirement Plan Restated
(July 17, 1991, amended May 18, 1994, January 17, 1996
and January 19, 2000), (filed as Exhibit 10(viii) to the
Quarterly Report on Form 10-Q for the quarter ended
March 31, 2000, incorporated herein by reference)
(vii) 1993 Directors' Stock Option Plan dated November 17,
1993 (filed as Exhibit 10(xi) to the Annual Report on
Form 10-K for the year ended June 30, 1994, incorporated
herein by reference)
(viii) Officer Employment Agreement (form) (filed as
Exhibit 10(xi) to the Annual Report on Form 10-K for the year
ended June 30, 1996, incorporated herein by reference)
(ix) Officer Change of Control Employment Agreement
(form) (filed as Exhibit 10(xii) to the Annual Report
on Form 10-K for the year ended June 30, 1996, incorporated
herein by reference)
(x) Non-Qualified Deferred Compensation Plan (filed as
Exhibit 10(xiii) to the Annual Report on Form 10-K for the
year ended June 30, 1996, incorporated herein by reference)
(xi) The Clorox Company 1995 Performance Unit Plan
(filed as Exhibit 10(xiv) to the Annual Report on Form 10-K
for the year ended June 30, 1996, incorporated herein by
reference)
(xii) The Clorox Company 1996 Stock Incentive Plan (filed as
Exhibit 10(xv) to the Annual Report on Form 10-K for the
year ended June 30, 1996, incorporated herein by this
reference)
(xiii) The Clorox Company 1996 Executive Incentive
Compensation Plan (filed as Exhibit 10(xvi) to the Annual
Report on Form 10-K for the year ended June 30, 1996,
incorporated herein by reference)
(xiv) The Clorox Company Employee Retirement Investment
Plan, formerly The Clorox Company Value Sharing Plan
(Exhibit 4.3 to Amendment No. 2 dated July 12, 1996 to
Registration Statement on Form S-8 No. 33-41131 dated
June 10, 1991, incorporated herein by reference)
(xv) The Clorox Company Independent Directors' Stock-Based
Compensation Plan (filed as Exhibit 10 (xix) to the Annual
Report on Form 10-K for the year ended June 30, 1997,
incorporated herein by reference)
(xvi) Agreement and Plan of Reorganization and Merger by
and among The Clorox Company, Pennant, Inc. and First Brands
Corporation (Appendix A to Registration Statement on Form S-4
No. 333-69455 dated December 22, 1998, incorporated herein
by reference)
(xvii) Agreement between Henkel KGaA and the Company
dated November 2, 1999 (filed as Exhibit 10 (xix) to the
Quarterly Report on Form 10-Q for the quarter ended
December 31, 1999, incorporated herein by reference)
(13) Excerpts of 2000 Annual Report to Stockholders
(21) Subsidiaries of the Company
(23) Independent Auditors' Consents
(i) Deloitte & Touche LLP Independent Auditors' Consent
(ii) KPMG LLP Independent Auditors' Consent
(24) Power of Attorney (see page 17)
(27) Financial Data Schedule
(99) Financial Statements
SIGNATURES
Pursuant to the requirements of Section l3 or l5(d) of the Securities
Exchange Act of l934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto
duly authorized.
THE CLOROX COMPANY
Date: September 20, 2000 By: /s/G.C. Sullivan
G. C. Sullivan, Chairman of
the Board and Chief Executive
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Peter D. Bewley, Karen M.
Rose, and Gregory S. Frank, jointly and severally, attorneys-in-fact
and agents, with full power of substitution, for her or him in any
and all capacities to sign any and all amendments to this Form 10-K,
and to file the same and all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission,
hereby ratifying and confirming all that each of said attorneys-in-fact
and agents, and his or their substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of l934,
this report has been signed below by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.
Signature Title Date
/s/G. C. Sullivan Chairman of the Board & September 20, 2000
G. C. Sullivan Director (Chief Executive
Officer)
/s/D. Boggan, Jr. Director September 20, 2000
D. Boggan, Jr.
/s/ E. L. Chao Director September 20, 2000
E. L. Chao
/s/J. W. Collins Director September 20, 2000
J. W. Collins
/s/U. Fairchild Director September 20, 2000
U. Fairchild
/s/T. M. Friedman Director September 20, 2000
T. M. Friedman
/s/J. Manchot Director September 20, 2000
J. Machot
/s/R. W. Matschullat Director September 20, 2000
R. W. Matschullat
/s/ D. O. Morton Director September 20, 2000
D. O. Morton
/s/K. Morwind Director September 20, 2000
K. Morwind
/s/E. L. Scarff Director September 20, 2000
E. L. Scarff
/s/L. R. Scott Director September 20, 2000
L. R. Scott
/s/ C. A. Wolfe Director September 20, 2000
C. A. Wolfe
/s/K. M. Rose Group Vice President - September 20, 2000
Chief Financial Officer
(Principal Financial
Officer)
/s/G. S. Frank Vice President-Controller September 20, 2000
(Principal Accounting
Officer)