-----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, LlE1PkOzhezKa6efJe4AqAH57pe+99tAYt8+Gfh7kYLQm26b11WiYhIk5W7TcPkM dJ202AHBDT4AZopADNUXkw== /in/edgar/work/20000628/0000950133-00-002711/0000950133-00-002711.txt : 20000920 0000950133-00-002711.hdr.sgml : 20000920 ACCESSION NUMBER: 0000950133-00-002711 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORBITAL SCIENCES CORP /DE/ CENTRAL INDEX KEY: 0000820736 STANDARD INDUSTRIAL CLASSIFICATION: [3812 ] IRS NUMBER: 061209561 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-14279 FILM NUMBER: 662789 BUSINESS ADDRESS: STREET 1: 21700 ATLANTIC BLVD CITY: DULLES STATE: VA ZIP: 20166 BUSINESS PHONE: 7034065000 MAIL ADDRESS: STREET 1: 21700 ATLANTIC BLVD STREET 2: 21700 ATLANTIC BLVD CITY: DULLES STATE: VA ZIP: 20166 FORMER COMPANY: FORMER CONFORMED NAME: ORBITAL SCIENCES CORP II DATE OF NAME CHANGE: 19900212 11-K 1 e11-k.txt FORM 11-K 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------- ANNUAL REPORT ON FORM 11-K For the fiscal year ended December 31, 1999 COMMISSION FILE NUMBER 0-18287 --------------- ORBITAL SCIENCES CORPORATION (Exact name of registrant as specified in charter) DELAWARE 06-1209561 (State of Incorporation of Registrant) (I.R.S. Employer I.D. No.)
21700 ATLANTIC BOULEVARD DULLES, VIRGINIA 20166 (Address of principal executive offices) (703) 406-5000 (Registrant's telephone number) DEFERRED SALARY AND PROFIT SHARING PLAN FOR EMPLOYEES OF ORBITAL SCIENCES CORPORATION ------------------------------------------------------------------------------ (Full Title of the Plans) ================================================================================ 2 REPORT OF INDEPENDENT ACCOUNTANTS To the Participants and Administrator of the Deferred Salary and Profit Sharing Plan for Employees of Orbital Sciences Corporation In our opinion, the accompanying statements of net assets available for benefits and the related statement of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Deferred Salary and Profit Sharing Plan for Employees of Orbital Sciences Corporation (the "Plan") at December 31, 1999 and 1998, and the changes in net assets available for benefits for the year ended December 31, 1999 in conformity with accounting principles generally accepted in the United States. These financial statements are the responsibility of the Plan's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes at end of year is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. PricewaterhouseCoopers LLP McLean, Virginia June 28, 2000 3 DEFERRED SALARY AND PROFIT SHARING PLAN FOR EMPLOYEES OF ORBITAL SCIENCES CORPORATION STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, ------------ 1999 1998 ---- ---- Assets: Investments (see note 4) $225,479,716 $189,312,085 Contributions receivable: Participant 2,976 491,451 Company 1,836,289 2,050,049 ------------ ------------ Total assets 227,318,981 191,853,585 Liabilities - forfeitures payable - 224,729 ------------ ------------ Net assets available for benefits $227,318,981 $191,628,856 ============ ============
See accompanying notes to financial statements. 2 4 DEFERRED SALARY AND PROFIT SHARING PLAN FOR EMPLOYEES OF ORBITAL SCIENCES CORPORATION STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year Ended December 31, 1999 ---- Additions to net assets attributable to: Investment income: Net appreciation in fair value of investments $ 21,134,905 Interest on participant loans 477,089 ------------ Total investment income 21,611,994 ------------ Contributions: Participant 18,177,769 Company 7,873,429 ------------ Total contributions 26,051,198 ------------ Total additions 47,663,192 ------------ Deductions from net assets attributable to: Benefits paid to participants 11,853,636 Administrative expenses 43,879 ------------ Total deductions 11,897,515 ------------ Net increase prior to transfers 35,765,677 Transfers from the Plan (75,552) ------------ Net increase in net assets available for benefits 35,690,125 Net assets available for benefits, beginning of year 191,628,856 ------------ Net assets available for benefits, end of year $227,318,981 ============
See accompanying notes to financial statements. 3 5 DEFERRED SALARY AND PROFIT SHARING PLAN FOR EMPLOYEES OF ORBITAL SCIENCES CORPORATION NOTES TO FINANCIAL STATEMENTS NOTE 1 - DESCRIPTION OF THE PLAN General The following description of the Deferred Salary and Profit Sharing Plan for Employees of Orbital Sciences Corporation (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. The Plan is a defined contribution plan that is intended to constitute a tax-qualified profit sharing plan under Section 401(a) of the Internal Revenue Code (the "Code"). All U.S domestic employees of Orbital Sciences Corporation (the "Plan Administrator" or the "company") other than employees of Magellan Corporation, a majority-owned subsidiary of the company, who are scheduled to work 1,000 hours during a 12-consecutive month period, or are not so scheduled but in fact complete a year of service for participation (Plan Year), and have attained the age of 21, are eligible to participate in the Plan. The Plan is subject to the provisions of the Employment Retirement Income Security Act of 1974 ("ERISA"). Contributions Participants may elect to make contributions to the Plan, ranging from 1 percent to 15 percent of total eligible compensation, subject to certain annual limitations under the Plan and the Code, by voluntarily reducing their pre-tax salary. Effective January 1, 1999, participants are permitted to make employee contributions to the Plan on an after-tax basis. For the Plan year ended December 31, 1999, the company's Board of Directors (the "Board") determined, in its sole discretion, to match 100 percent of participants' voluntary pre-tax contributions at an amount not to exceed 4 percent of the participants' total annual compensation. The Board approved discretionary profit-sharing contributions, in the amount of 1 percent of the total eligible compensation for the year ended December 31, 1999, which is allocated to all individuals who were eligible to participate in the Plan on the last day of the year, based on their respective total eligible compensation for the year. The Plan also allows participants to make rollover contributions from other tax qualified plans. Rollover contributions are included in the accompanying financial statements as a component of employee contributions. 4 6 Participants' Accounts Each participant's account is credited with the participant's contributions, transfers, and rollovers, as well as applicable company matching contributions, and an allocation of discretionary contributions and investment income earnings. Allocations are based on participants' contributions, earnings or account balances, as applicable as defined in the Plan document. Participants are entitled to a benefit equal to the vested portion of their participant account at the date of separation. Vesting Participants are immediately vested in their voluntary contributions and rollovers plus actual earnings thereon. The company's matching and discretionary contributions, plus earnings thereon, vest over a period of five years at the rate of 20 percent per year of service (1,000 hours) or immediately upon death or long-term disability. Forfeitures Forfeitures by terminated employees of nonvested company contributions are held in a separate account and are used to offset either future company contributions or administrative expenses of the Plan. Used forfeitures are netted against either company contributions or administrative expenses. Payment of Benefits Upon termination of service, death, long-term disability, attainment of age 59 1/2 or qualified financial hardship, a participant may elect to receive either a lump-sum amount equal to the vested value of the participant's account or annual installments over a determined period, as defined in the Plan document. Participants may also withdraw their vested account balances while still in service of the company, as defined in the Plan document. Termination of Plan Although it has not expressed any intent to do so, the company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100 percent vested in their accounts. 5 7 Participant Loans Participants may borrow up to the lesser of $50,000 or 50 percent of their vested balance, minus their highest outstanding loan balance in the past twelve months; from their respective participant accounts. Loan terms generally may not exceed five years. Loans for the purchase of a primary residence may not exceed ten years. The loans are made using an interest-rate commensurate with local prevailing rates as determined by the Plan Administrator. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The accompanying financial statements have been prepared on the accrual basis of accounting. Investments The Plan's investments are carried at fair market value, except for the CIGNA Fixed-Income Fund, which is valued at contract value. Quoted market prices as of December 31, 1999 and 1998 are used to value investments. Participant loans receivable are carried at cost, which approximates fair market value. Purchases and sales of securities are recorded on a trade-date basis. Benefit Payments Benefits are recorded when paid. Administrative Expenses The Plan document provides that administrative expenses may be paid by either the Plan or the company. For the year ended December 31, 1999, certain administrative services, such as audit and legal fees and Plan management costs, were provided by the company at no cost to the Plan. Direct transaction expenses are paid by the Plan and are either netted against investment income or recorded as a deduction from net assets. 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 additions to and deductions from net assets available for benefits during the reporting period. Such estimates include those regarding fair value. Actual results could differ from those estimates. 6 8 NOTE 3 - FEDERAL INCOME TAXES The Plan received tax determination letters from the Internal Revenue Service, dated September 14, 1995, indicating that the Plan and its underlying trust qualify under the applicable provisions of the Code and therefore are exempt from Federal income tax. The Plan has been amended since receiving the September 1995 determination letter. The Plan Administrator believes that the Plan design and operations remain in compliance with the applicable requirements of the Code and, therefore, believes that the Plan remains qualified and the related trust remains tax-exempt. Therefore, no provision for income taxes has been included in the Plan's financial statements. NOTE 4 - INVESTMENTS The following investments represent five percent or more of the Plan's total net assets available for benefits as of December 31, 1999 and 1998:
1999 1998 ---- ---- CIGNA Fixed Income Fund Account $ 56,381,678 $ 54,518,399 Fidelity Equity Income II Fund Account 21,202,644 20,569,599 Vanguard Growth & Income Fund Account 40,681,144 28,654,772 Fidelity Advisor Growth Opportunities Fund Account 42,451,148 43,846,956 Orbital Sciences Corporation Common Stock 9,779,470 10,804,526 Janus Worldwide Fund Account 22,344,029 8,828,006
During 1999, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value by $ 21,134,905 as follows: Pooled separate accounts $ 28,535,280 Common stock (7,400,375) ------------ Total $ 21,134,905 ============
NOTE 5 - DEPOSIT WITH INSURANCE COMPANY The Plan participates in a contract via an investment in the CIGNA Fixed Income Account. For the Plan's investment in the CIGNA Fixed Income Account, the Plan was credited with interest at the rate specified in the contract, which was 6.15% and 6.2% for the years ended December 31, 1999 and 1998, respectively. The guaranteed rate of return is stated semi-annually and is guaranteed against change for a six-month period. The interest rate was 5.9% and 6.2% for the sixth month periods ended June 30, 1999 and 1998, respectively. 7 9 NOTE 6 - RELATED PARTY TRANSACTIONS The Plan's investments are held by CIGNA in pooled separate accounts, which invest in various mutual funds, and in Orbital Sciences Corporation Common Stock. For the year ended December 31, 1999, participants could allocate contributions to various investment alternatives, including Orbital Sciences Corporation Common Stock. Purchases of $8,187,543 and sales of $1,994,882 of Orbital Sciences Corporation Common Stock were made during 1999. In 1998, participants were allowed to invest in all investment options, with the exception of employee contributions in Orbital Sciences Corporation Common Stock. The share price of Orbital Sciences Corporation common stock at December 31, 1999 and 1998 was $18.56 and $44.00, respectively. 8 10 ADDITIONAL INFORMATION SCHEDULE I DEFERRED SALARY AND PROFIT SHARING PLAN FOR EMPLOYEES OF ORBITAL SCIENCES CORPORATION SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR DECEMBER 31, 1999
Current ------- Identity of Issue Asset Description Units Cost Value ----------------- ----------------- ----- ---- ----- Connecticut General Life Insurance Company Retirement & Investment Services* CIGNA Fixed Income Fund Account Investment Contract 1,710,393.22100 $56,381,678 $ 56,381,678 Vanguard Wellington Fund Account Pooled Separate Account 156,070.31228 6,130,053 6,803,811 Fidelity Equity - Income II Fund Account Pooled Separate Account 468,842.39999 15,971,608 21,202,644 Vanguard Growth and Income Fund Account Pooled Separate Account 738,678.78680 28,320,826 40,681,144 Fidelity Advisor Growth Opportunities Fund Account Pooled Separate Account 524,963.93499 30,543,612 42,451,148 PBHG Growth Fund Account Pooled Separate Account 121,148.72277 3,806,021 5,955,123 Warburg Pincus Advisor Emerging Growth Fund Account Pooled Separate Account 90,231.08005 4,065,211 6,176,915 Janus Worldwide Fund Account Pooled Separate Account 249,691.14290 14,027,905 22,344,029 Small Company Stock - Value I Fund Account Pooled Separate Account 119,407.20358 1,248,414 1,351,907 Warburg Pincus Advisor International Equity Fund Account Pooled Separate Account 164,581.61471 4,065,048 6,031,075 Orbital Sciences Corporation* Common Stock 524,534.00858 12,206,687 9,779,470 Various Plan Participants * Participant Loans** - 6,320,772 ------------ $225,479,716 ------------
* Denotes a party-in-interest ** Interest rates ranging from 5.99% to 16.01% and maturity dates ranging from 1/1/2000 to 10/07/2009. 9 11 SIGNATURE Pursuant to the requirement of the Securities Exchange Act of 1934, Orbital Sciences Corporation, the administrator of the employee benefit plan covered by this Report on Form 11-K, has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. ORBITAL SCIENCES CORPORATION, Plan Administrator for the Deferred Salary and Profit Sharing Plan for Employees of Orbital Sciences Corporation Dated: June 28, 2000 By: /s/ JEFFREY V. PIRONE ------------------------------ Jeffrey V. Pirone Executive Vice President and Chief Financial Officer 12 EXHIBIT INDEX Exhibit 23 Consent of PricewaterhouseCoopers LLP (transmitted herewith) EX-23 2 ex23.txt CONSENT OF PRICEWATERHOUSECOOPERS LLP 1 EXHIBIT 23 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-69887) of Orbital Sciences Corporation of our report dated June 28, 2000 relating to the financial statements of the Deferred Salary and Profit Sharing Plan for Employees of Orbital Sciences Corporation, which appears in this Form 11-K. PricewaterhouseCoopers LLP McLean, VA June 28, 2000 -----END PRIVACY-ENHANCED MESSAGE-----