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)