-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GwvljEgud8g0mevH1jzvD0iigHXuXRUcWXec1vjKMadzHd8g/Obf2SxPJzOUIcPt djqKWo/wMx0DSlIDduNdLQ== /in/edgar/work/20000627/0000950144-00-008209/0000950144-00-008209.txt : 20000920 0000950144-00-008209.hdr.sgml : 20000920 ACCESSION NUMBER: 0000950144-00-008209 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000627 FILER: COMPANY DATA: COMPANY CONFORMED NAME: POPULAR INC CENTRAL INDEX KEY: 0000763901 STANDARD INDUSTRIAL CLASSIFICATION: [6022 ] IRS NUMBER: 660416582 STATE OF INCORPORATION: PR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 002-96018 FILM NUMBER: 661664 BUSINESS ADDRESS: STREET 1: 209 MUNOZ RIVERA AVE STREET 2: POPULAR CENTER BUILDING CITY: HATO REY STATE: PR ZIP: 00918 BUSINESS PHONE: 7877659800 MAIL ADDRESS: STREET 1: P.O. BOX 362708 CITY: SAN JUAN STATE: PR ZIP: 00936-2708 FORMER COMPANY: FORMER CONFORMED NAME: BANPONCE CORP DATE OF NAME CHANGE: 19920703 11-K 1 e11-k.txt POPULAR SECURITIES, INC. RETAIL - 1165(E) PLAN 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 11-K [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999 or [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 0-13818 POPULAR SECURITIES, INC. RETAIL - 1165(e) Plan (Full title of the Plan and address of the Plan, if different from that of the issuer named below) POPULAR, INC. 209 MUNOZ RIVERA AVENUE HATO REY, PUERTO RICO 00918 (Name of issuer of the securities held pursuant to the plan and the address of principal executive office) 2 POPULAR SECURITIES, INC. - RETAIL 1165(E) PLAN TABLE OF CONTENTS
PAGE Unaudited Financial Statements: Statement of Assets Available for Benefits as of December 31, 1999 and 1998 ....................... 2 Statement of Changes in Assets Available for Benefits for the years ended December 31, 1999 and December 31, 1998 ............................ 3 Notes to Unaudited Financial Statements .......... 4-8 Signature .............................................. 9
1 3 POPULAR SECURITIES, INC. RETAIL - 1165(E) UNAUDITED STATEMENT OF ASSETS AVAILABLE FOR BENEFITS AS OF DECEMBER 31, 1999 AND DECEMBER 31, 1998
1999 1998 Assets: Investments, at fair value $325,083 $248,417 Dividends and Interest Receivable 987 1,558 -------- -------- Total Assets Available for Benefits $326,070 $249,975 ======== ========
The accompanying notes are an integral part of these unaudited financial statements. 2 4 POPULAR SECURITIES, INC. RETAIL - 1165(E) UNAUDITED STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEARS ENDED ON DECEMBER 31, 1999 AND DECEMBER 31, 1998
1999 1998 Additions to net assets: Investment income - Net (depreciation) appreciation in fair value of investments $(25,734) $ 38,439 (Loss)/Gain (16,061) 1,890 Interest 224 3,045 Dividends 10,711 1,601 -------- -------- Total investment (loss) income (30,860) 44,975 -------- -------- Contributions: Employer 114,367 60,962 Participants 110,894 89,028 -------- -------- Total contributions 225,261 149,990 -------- -------- Total additions 194,401 194,965 -------- -------- Deductions from net assets - Benefits paid to participants 118,306 9,879 -------- -------- Net increase 76,095 185,086 Assets available for benefits: Beginning of year 249,975 64,889 -------- -------- End of year $326,070 $249,975 ======== ========
The accompanying notes are an integral part of these unaudited financial statements. 3 5 POPULAR SECURITIES, INC. RETAIL - 1165(E) NOTES TO UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 1. DESCRIPTION OF PLAN The following description of Popular Securities, Inc. Retail - 1165(e) Plan (the "Plan"), provides only general information. Participants should refer to the Plan agreement for a more complete description of its provisions. General The Plan is a defined contribution plan, which became effective on June 30, 1997. The Plan covers substantially all employees of the retail division of Popular Securities, Inc. (the "Company") (a subsidiary of Popular, Inc.), who have one year of service (work at least 365 days), are age eighteen or older, and are residents of the Commonwealth of Puerto Rico. The Plan was created for the purpose of providing retirement benefits to employees and to encourage and assist employees in adopting a regular savings program by means of payroll deductions, through a plan that qualifies under the applicable laws of the Commonwealth of Puerto Rico. The Plan is subject to the provisions of the Employee Retirement Security Act of 1974 ("ERISA"). Contributions Plan participants may authorize the Company to make payroll deductions under the Plan ranging from 1% to 10% of their monthly compensation before performance bonuses. At no time participant contributions may exceed the lesser of 10% of the participant's compensation, as defined, or $8,000. With the approval of the Plan Administrator, participants may also contribute amounts representing distributions from other qualified defined benefit or contribution plans. The Company matches participant's savings contributions at the rate of 50 cents for each dollar saved, on the first 10% of the participant's compensation ("Matching Contribution"). Additionally, the Company may make contributions out of its net profits in such amounts as the Company may determine, if any, but not exceeding the lesser of employer's net profits or 15% of a participant's compensation in any plan year ("Profit Sharing contribution"). Participant Accounts Each participant account is credited with the participant's contribution and allocations of (a) the Company's matching and profit sharing contribution, (b) plan earnings, and (c) forfeitures of terminated participants' non-vested accounts with at least five periods of consecutive breaks in service. For purposes of the above, break in service with respect to an employee means an eligibility computation period (one year) during which such employee does not complete more than 365 days of continuous service. During the break in period, if the terminated participant is re-employed by the Company, the current value of such forfeited amounts shall be restored to the participant's account. As of December 31, 1999, no forfeitures have occurred since the Plan is less than five years old. Allocations are based on the proportion that each participant's compensation during the Plan year bears to the total compensation during such Plan year or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the particular account of each participant. The net change in value of the Plan assets is posted to the participants' accounts on a monthly basis. 4 6 POPULAR SECURITIES, INC. RETAIL - 1165(E) NOTES TO UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 Vesting Participants are immediately vested in their contributions plus actual earnings thereon. Vesting in the Company's contributions plus actual earnings thereon is based on years of service. The contributions vest in accordance with the following schedule:
YEARS OF SERVICE VESTING % Less than 1 0 At least 1 20 At least 2 40 At least 3 60 At least 4 80 At least 5 100
Investment Options Upon enrollment in the Plan, participants may elect to have their contributions invested in one or more of the following investment funds:
FUND DESCRIPTION Vanguard Index Seeks investment results that correspond with the price and yield performance of the S&P 500 500 Fund Index. Fidelity Income Seeks long-term growth, current income, and growth of income, consistent with reasonable & Growth Fund investment risk. The fund invests primarily in dividend-paying common stocks with growth potential. Generally, the fund sells securities with dividends that fall below the yield of the S&P 500 index. Some common-stock selections, however, may be made in securities not paying dividends, but offering prospects for capital growth. The fund's fixed-income investments generally consist of corporate bonds. American 20th Seeks capital growth. The fund typically invests at least 90% of assets in equities selected Century Fund for their appreciation potential. The majority of these securities are common stocks issued by companies that meet management's standards for earnings and revenue growth. The fund may only purchase securities of companies that have operated continuously for three or more years. Federated Trust Is an open-end money market mutual fund whose investment objective seeks to provide US Fund shareholders For with current income as is consistent with stability of principal and maintenance of liquidity. Vanguard Fixed Seeks current income consistent with maintenance of principal and liquidity. The fund normally Income Fund invests al least 85% of assets in long-term U.S. Treasury bonds and other guaranteed U.S. government obligations. It may invest the balance of assets in other U.S. government securities, including repurchase agreements on such securities. The fund typically maintains an average weighted maturity of between 15 and 30 years. Popular, Inc. Investment in Popular, Inc.'s common stock. Common Stock
5 7 POPULAR SECURITIES, INC. RETAIL - 1165(E) NOTES TO UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 Popular, Inc. is the Company's parent company. Banco Santander de Puerto Rico is the trustee for the investment in Popular, Inc. stock. Payments of Benefits Plan participants are permitted to make withdrawals from the Plan, subject to provisions in the Plan agreement and only from after-tax contributions. If a participant suffers financial hardship, as defined in the Plan agreement, the participant may request a withdrawal from his or her contributions. On termination of service due to disability, retirement or other reasons, a participant may elect to receive either a lump sum amount equal to the value of the participant's vested interest in his or her account or installment payments. In the case of a participant termination because of death, the entire vested amount is paid to the person or persons legally entitled thereto. Effective on June 1, 1997, an amendment was made to the Puerto Rico Internal Revenue Code Section 1165(b) which requires that a 20% tax be withheld from termination payments in excess of after tax participant contributions Plan Expenses and Administration The Company is responsible for the general administration of the Plan and for carrying out the provisions thereof. Company contributions are held and managed by a trustee appointed by the Board of Directors of the Company, which invests cash received, interest and dividend income and makes distributions to participants. Banco Popular de Puerto Rico is the trustee and record keeper of the Plan. All expenses of the Plan are paid by the Company. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Under the Department of Labor Rules and Regulations for Reporting and Disclosure under ERISA, the Plan files Form 5500-C/R, which is required for employee benefit plans with fewer than 100 participants. Employee benefit plans with 100 or more participants are required to file Form 5500. Those plans filing Form 5500 are required to prepare audited financial statements as well as all applicable schedules required by Section 2520.103-10 of Department of Labor's Rules and Regulations for Reporting and Disclosure under ERISA. Such requirements are not mandated for those plans filing Form 5500-C/R. Accordingly, the attached financial statements are unaudited and the above mentioned schedules are not presented. Basis of Accounting The financial statements of the Plan are prepared on the accrual method of accounting. Use of Estimates The preparation of financial statements, in conformity with generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 6 8 POPULAR SECURITIES, INC. RETAIL - 1165(E) NOTES TO UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 Investment Valuation and Income Recognition The Plan's investments are stated at fair value. Shares of registered investment companies are valued at quoted market prices, which represent their net asset value at year end. Popular, Inc. common stock is valued at its quoted market price. The plan presents in the statement of changes in assets available for benefits the net (depreciation) appreciation in the fair value of its investments which consists of the realized gains or losses and the unrealized appreciation (depreciation) on them. Purchases and sales of securities are recorded on a trade-date basis. Dividends and interest earned are recorded on the accrual basis and credited to each participant's account, as appropriate, based on proportional shares held at the date of record. Contributions Employee and Company matching contributions are recorded in the year in which the Company makes the payroll deductions from the participants earnings. These contributions are temporarily placed in a non-participant directed time deposit open account. Transfer of Assets to Other Plans Company employees or retirees may elect to transfer their savings to other plans qualified by the Puerto Rico Department of the Treasury. Payment of Benefits Benefits are recorded when paid. 3. INVESTMENTS The following table presents the Plan's investments that represent five percent or more of the Plan's assets at December 31:
1999 1998 -------------------------- --------------------------- # of shares Value # of shares Value Mutual funds: Vanguard Index 500 Fund 251 $ 34,031 180 $ 20,461 Fidelity Income & Growth Fund 833 39,277 715 32,760 American 20th Century Fund 539 24,678 300 10,025 Common stock - Popular, Inc. 7,914 221,105 5,171 177,598
7 9 POPULAR SECURITIES, INC. RETAIL - 1165(E) NOTES TO UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 During 1999, the Plan's investments (including gains and losses on investments bought and sold) appreciated (depreciated) in value as follows: Mutual Funds $ 11,783 Common Stock (53,578)
4. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event the Plan terminates, the interest of each participant in the Plan shall be fully vested and such termination shall not reduce the interest of any participating employee or their beneficiaries accrued under the Plan up to the date of such termination. 5. TAX STATUS The Puerto Rico Department of Treasury has determined and informed the Company that the Master Plan and the related trust are designed in accordance with the applicable Puerto Rico income tax law and, therefore, exempt from income taxes. The Plan and the income tax law have been amended since receiving the determination letter. However, the Plan Administrator and the Plan's tax counsel believe that the Plan is designed and is currently being operated in compliance with the applicable requirements of the income tax law. Therefore, no provision for income taxes has been included in the Plan's financial statements. 8 10 Signature Pursuant to the requirement of the Securities Exchange Act of 1934, the persons who administer the employee benefit plan have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. POPULAR SECURITIES, INC. RETAIL - 1165(e) Plan (Name of Plan) By: /s/ Maria Isabel Burckhart ------------------------------------- Maria Isabel Burckhart Authorized Representative By: /s/ Jorge A. Junquera ------------------------------------- Jorge A. Junquera Authorized Representative in the United States Dated: June 27, 2000 9 -----END PRIVACY-ENHANCED MESSAGE-----