-----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, UGH6CjUjGD77/TXQrZNv2HGQBURFpet18/wQFId1TVTDjN6oUMrkTuHnp47wXJLE CnP77w1KPoRSNGjVjYJ5bA== 0001005150-99-000556.txt : 19990629 0001005150-99-000556.hdr.sgml : 19990629 ACCESSION NUMBER: 0001005150-99-000556 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AES CORPORATION CENTRAL INDEX KEY: 0000874761 STANDARD INDUSTRIAL CLASSIFICATION: COGENERATION SERVICES & SMALL POWER PRODUCERS [4991] IRS NUMBER: 541163725 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-12291 FILM NUMBER: 99653990 BUSINESS ADDRESS: STREET 1: 1001 N 19TH ST STREET 2: STE 2000 CITY: ARLINGTON STATE: VA ZIP: 22209 BUSINESS PHONE: 7035221315 11-K 1 FORM 11-K ================================================================================ SECURITES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 11-K ANNUAL REPORT Pursuant to Section 15(d) of the Securities Exchange Act of 1934 [Fee Waived] For the Fiscal Year Ended December 31, 1998 Commission File Number 0-1928 Full Title of the Plan: THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN Name of Issuer of the Securities Held Pursuant to the Plan and the Address of its Principal Executive Office: THE AES CORPORATION 1001 North 19th Street Arlington, VA 22209 ================================================================================ Page 1 of 20 sequentially numbered pages. The Exhibit Index is on Page 19. THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN TABLE OF CONTENTS - -------------------------------------------------------------------------------- Page ---- INDEPENDENT AUDITORS' REPORT 3 FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997: Statements of Net Assets Available for Participants' Benefits 4 Statements of Changes in Net Assets Available for Participants' Benefits 5 Notes to Financial Statements 6-15 SUPPLEMENTAL SCHEDULES FOR THE YEAR ENDED DECEMBER 31, 1998: Item 27a - Assets Held for Investment Purposes 16 Item 27d - Schedule of Reportable Transactions 17 -2- INDEPENDENT AUDITORS' REPORT The AES Corporation Profit Sharing and Stock Ownership Plan: We have audited the accompanying statements of net assets available for participants' benefits of The AES Corporation Profit Sharing and Stock Ownership Plan (the Plan) as of December 31, 1998 and 1997, and the related statements of changes in net assets available for participants' benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the net assets available for participants' benefits of the Plan as of December 31, 1998 and 1997, and the changes in net assets available for participants' benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules listed in the Table of Contents are presented for the purpose of additional analysis and are not a required part of the basic financial statements, but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The schedules are the responsibility of the Plan's management. Such supplemental schedules have been subjected to the auditing procedures applied in our audit of the basic 1998 financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic 1998 financial statements taken as a whole. /s/ Deloitte & Touche LLP Washington, D.C. June 11, 1999 -3- THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS DECEMBER 31, 1998 AND 1997 - --------------------------------------------------------------------------------
ASSETS 1998 1997 ---- ---- Cash $ 983,904 $ 1,308,815 Investments, at fair value (Notes 2 and 3): Common stock - The AES Corporation 216,603,286 215,485,642 Money market funds 13,843,947 17,562,881 Mutual funds 20,732,481 26,499,187 ------------ ------------ Total investments, at fair value 251,179,714 259,547,710 Participant loans (Note 6) 3,934,613 3,963,190 ------------ ------------ Total cash and investments 256,098,231 264,819,715 ------------ ------------ RECEIVABLES: Employer contributions 1,897,795 2,337,715 Participant contributions 319,919 476,346 ------------ ------------ Total receivables 2,217,714 2,814,061 ------------ ------------ NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS $258,315,945 $267,633,776 ============ ============
See notes to financial statements. -4- THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS YEARS ENDED DECEMBER 31, 1998 AND 1997 - --------------------------------------------------------------------------------
1998 1997 ---- ---- ADDITIONS TO NET ASSETS: Investment income: Net (depreciation) appreciation in fair value of investments (Note 4) $ (2,921,855) $ 109,439,232 Interest and dividends 2,464,037 3,558,652 Contributions: Employer 3,330,620 3,979,515 Participant 2,973,123 4,236,158 ------------- ------------- Total additions 5,845,925 121,213,557 DEDUCTIONS FROM NET ASSETS: Withdrawals and distributions (15,163,756) (23,680,151) ------------- ------------- NET (DECREASE) INCREASE (9,317,831) 97,533,406 NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS: Beginning of year 267,633,776 170,100,370 ------------- ------------- End of year $ 258,315,945 $ 267,633,776 ============= ============= See notes to financial statements.
-5- THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1998 AND 1997 - -------------------------------------------------------------------------------- 1. PLAN DESCRIPTION The AES Corporation Profit Sharing and Stock Ownership Plan (the Plan) was established on April 1, 1989, as the successor plan to the Applied Energy Services, Inc. Employee Profit Sharing Plan, the Applied Energy Services, Inc. Employee Stock Ownership Plan, the AES Deepwater Division Employee Profit Sharing Plan, the AES Beaver Valley Division Employee Profit Sharing Plan, and the BV Partners Employee Profit Sharing Plan. The following description of the Plan provides only general information. Participants should refer to the Summary Plan Description for a more complete description of the Plan's provisions. General - The Plan is a defined contribution plan. All regularly scheduled full-time and part-time employees are eligible to participate in the Plan on the entry date following employment. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). As of December 31, 1998 the majority of the Plan's assets, approximately 84%, was common stock of The AES Corporation. Contributions - Participants may make pre-tax contributions to the Plan up to an annual maximum determined by the Internal Revenue Service. During 1998 and 1997, The AES Corporation (the Company) matched participant pre-tax contributions up to 5.0% of compensation, as defined by the Plan Agreement, on a dollar for dollar basis. Matching contributions made by the Company are paid in common stock of The AES Corporation. Participants may also make after-tax contributions of up to 10% of compensation. In addition, the Company may make profit sharing contributions to the Plan that are allocated to the participants accounts on the basis of each participant's base compensation, as defined by the Plan Agreement. Profit-sharing contributions are made in the Company's common stock. During 1998 and 1997, the Company contributed 5.0% and 6.5% of base compensation as profit sharing allocations. Participant Accounts - Each participant's account is credited with the participant's and the employer's contributions and an allocation of the Plan's earnings. Allocations are based on the balance of each investment type in the participant's account. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. Participants can choose to invest their contributions in common stock of The AES Corporation and various mutual funds including Alliance Quasar Fund and Pimco Total Return Fund and in the following eight Merrill Lynch funds: Growth Fund, Global Allocation Fund, Federal Securities Trust Fund, Capital Fund, Basic Value Fund, Retirement Preservation Trust Fund, Equity Index Trust I Fund, Hotchkis & Wiley International Fund, or in any combination thereof in increments of 10% at their discretion. Participants can allocate their investment among the common stock of The AES Corporation or any of the funds at their discretion. Investment options are selected by the administrative committee of the Plan. -6- Vesting - Participants are immediately vested in their pre-tax and post-tax contributions and Company matching contributions plus actual earnings thereon. Vesting in profit sharing contributions is based on years of continuous service. A participant vests 20% per year and is fully vested after five years of credited service. Withdrawals and Distributions - The value of participants' contributions plus the value of all vested Company contributions is payable to participants upon retirement or upon termination of employment with the Company. At each participant's election, the entire distribution may be made as a single lump sum payable in common stock of The AES Corporation, cash, or a combination of both. The participants also have the option of receiving the value of their Plan account in substantially equal cash installments. Forfeitures - Participants who leave the Company who have not completed five years of credited service forfeit the value of the Company's profit sharing contributions in which they are not then vested. Forfeitures are applied to reduce the Company's contributions in subsequent years. Administration - The Plan is administered by an Administrative Committee appointed by the Board of Directors of the Company. Merrill Lynch Trust Company is the Plan Trustee. Administrative, legal, and all other expenses of the Plan are paid by the Company. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES General - The Plan's financial statements are prepared on the accrual basis of accounting. Participant benefits are recorded when paid. Valuation of Investments - All money market and other mutual funds are stated at their quoted market prices at December 31, 1998 and 1997. All participant loans are valued at cost, which approximates fair value. The Company's stock is traded on the New York Stock Exchange (NYSE). The Plan's investment in the Company's stock is stated at quoted market value. At December 31, 1998 and 1997, the quoted market value of the Company's common stock was $47.38 and $46.63 per share, respectively. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires the Plan to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of additions and deductions during the reporting period. Actual results could differ from those estimates. 3. INVESTMENTS The participants' and the Company's contributions to the Plan and Plan earnings are invested in various money market, mutual funds or Company stock at the direction of the participants. The following tables present the fair values of investments as of December 31, 1998 and 1997. -7-
December 31, December 31, 1998 1997 ---- ---- Cash $ 983,904 $ 1,308,815 Investments at quoted market value: The AES Corporation common stock 216,603,286* 215,485,642* Money market funds: Merrill Lynch Retirement Preservation Fund 12,737,215 17,508,574* Other 1,106,732 54,307 Mutual funds: Merrill Lynch Growth Fund 8,124,546 13,762,550* Merrill Lynch Basic Value Fund 5,782,622 5,867,330 Other 6,825,313 6,869,307 Participant loans 3,934,613 3,963,190 ------------ ------------ Total cash and investments $256,098,231 $264,819,715 ============ ============
The above investments indicated with an "*" represent 5% or more of the Plan's net assets as of December 31, 1998 and 1997, respectively. 4. NET (DEPRECIATION) APPRECIATION IN FAIR VALUE OF INVESTMENTS During the years ended December 31, 1998 and 1997, the Plan's investments (including investments bought, sold, as well as held during the period) (depreciated) appreciated in value by $(2,921,855) and $109,439,232, respectively, as follows:
Year Ended Year Ended December 31, 1998 December 31, 1997 ----------------- ----------------- The AES Corporation common stock $ 600,668 $107,491,971 Mutual funds (3,522,523) 1,947,261 ------------ ------------ Net (depreciation) appreciation in fair value $ (2,921,855) $109,439,232 ============ ============
-8- 5. INFORMATION REGARDING NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS BY FUND For the year ended December 31, 1998
MERRILL LYNCH FUNDS ----------------------------------------------------------- AES GLOBAL FEDERAL COMMON GROWTH ALLOCATION SECURITIES CAPITAL STOCK FUND FUND TRUST FUND FUND ----- ---- ---- ---------- ---- ADDITIONS TO NET ASSETS: Investment Income: Interest and dividends $ 137,266 $ 238,891 $ 258,885 $ 139,204 $ 173,801 Net appreciation (depreciation)in fair value of investments 600,668 (3,255,462) (256,179) 6,433 (60,936) ------------- ------------- ------------- ------------- ------------- Total investment income (loss) 737,934 (3,016,571) 2,706 145,637 112,865 ------------- ------------- ------------- ------------- ------------- Contributions: Employer 3,330,620 -- -- -- -- Participants 1,277,000 735,072 176,642 146,021 179,337 ------------- ------------- ------------- ------------- ------------- Total contributions 4,607,620 735,072 176,642 146,021 179,337 ------------- ------------- ------------- ------------- ------------- TOTAL ADDITIONS 5,345,554 (2,281,499) 179,348 291,658 292,202 DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in (1,345,971) (2,957,838) (518,285) (61,007) (379,232) Withdrawals and distributions (3,321,859) (398,667) (103,065) (105,046) (140,914) ------------- ------------- ------------- ------------- ------------- TOTAL DEDUCTIONS (4,667,830) (3,356,505) (621,350) (166,053) (520,146) ------------- ------------- ------------- ------------- ------------- NET INCREASE (DECREASE) 677,724 (5,638,004) (442,002) 125,605 (227,944) NET ASSETS AVAILABLE FORPARTICIPANTS' BENEFITS,BEGINNING OF YEAR 217,823,357 13,762,550 2,448,229 1,845,471 2,296,236 ------------- ------------- ------------- ------------- ------------- NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 218,501,081 $ 8,124,546 $ 2,006,227 $ 1,971,076 $ 2,068,292 ============= ============= ============= ============= =============
-9-
MERRILL LYNCH FUNDS ----------------------------------------------------------------- PIMCO BASIC RETIREMENT EQUITY HOTCHKIS TOTAL VALUE PRESERVATION INDEX & WILEY RETURN FUND TRUST TRUST I INT'L FUND FUND ---- ----- ------- ---------- ---- ADDITIONS TO NET ASSETS: Investment Income: Interest and dividends $ 539,305 $ 914,929 $ 2,961 $ 5,072 $ 25,766 Net appreciation (depreciation)in fair value of investments 53,912 -- 86,802 (13,505) (3,763) ------------ ------------ ------------ ------------ ------------ Total investment income (loss) 593,217 914,929 89,763 (8,433) 22,003 ------------ ------------ ------------ ------------ ------------ Contributions: Employer -- -- -- -- -- Participants 428,016 504,834 41,141 6,391 10,438 ------------ ------------ ------------ ------------ ------------ Total contributions 428,016 504,834 41,141 6,391 10,438 ------------ ------------ ------------ ------------ ------------ TOTAL ADDITIONS 1,021,233 1,419,763 130,904 (2,042) 32,441 DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in (771,167) 4,014,641 922,916 110,156 278,734 Withdrawals and distributions (334,774) (10,205,763) (1,395) -- -- ------------ ------------ ------------ ------------ ------------ TOTAL DEDUCTIONS (1,105,941) (6,191,122) 921,521 110,156 278,734 ------------ ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) (84,708) (4,771,359) 1,052,425 108,114 311,175 NET ASSETS AVAILABLE FORPARTICIPANTS' BENEFITS,BEGINNING OF YEAR 5,867,330 17,508,574 54,307 4,902 10,102 ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 5,782,622 $ 12,737,215 $ 1,106,732 $ 113,016 $ 321,277 ============ ============ ============ ============ ============
-10-
ALLIANCE QUASAR PARTICIPANT FUND LOANS OTHER TOTAL ---- ----- ----- ----- ADDITIONS TO NET ASSETS: Investment Income: Interest and dividends $ 13,575 $ -- $ 14,382 $ 2,464,037 Net appreciation (depreciation)in fair value of investments (79,825) -- -- (2,921,855) ------------- ------------- ------------- ------------- Total investment income (loss) (66,250) -- 14,382 (457,818) ------------- ------------- ------------- ------------- Contributions: Employer -- -- -- 3,330,620 Participants 17,936 -- (549,705) 2,973,123 ------------- ------------- ------------- ------------- Total contributions 17,936 -- (549,705) 6,303,743 ------------- ------------- ------------- ------------- TOTAL ADDITIONS (48,314) -- (535,323) 5,845,925 DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in 129,680 (1,088,502) 1,665,875 -- Withdrawals and distributions (308) 1,059,925 (1,611,890) (15,163,756) ------------- ------------- ------------- ------------- TOTAL DEDUCTIONS 129,372 (28,577) 53,985 (15,163,756) ------------- ------------- ------------- ------------- NET INCREASE (DECREASE) 81,058 (28,577) (481,338) (9,317,831) NET ASSETS AVAILABLE FORPARTICIPANTS' BENEFITS,BEGINNING OF YEAR 264,367 3,963,190 1,785,161 267,633,776 ------------- ------------- ------------- ------------- NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 345,425 $ 3,934,613 $ 1,303,823 $ 258,315,945 ============= ============= ============= =============
-11- - -------------------------------------------------------------------------------- For the year ended December 31, 1997
MERRILL LYNCH FUNDS -------------------------------------------------------------------------- AES GLOBAL FEDERAL COMMON GROWTH ALLOCATION SECURITIES CAPITAL STOCK FUND FUND TRUST FUND FUND ----- ---- ---- ---------- ---- ADDITIONS TO NET ASSETS: Investment Income: Interest and dividends $ 99,376 $ 1,172,837 $ 322,520 $ 160,528 $ 175,852 Net appreciation (depreciation) in fair value of investments 107,491,971 1,055,922 (78,188) 31,359 157,024 ------------- ------------- ------------- ------------- ------------- Total investment income (loss) 107,591,347 2,228,759 244,332 191,887 332,876 ------------- ------------- ------------- ------------- ------------- Contributions: Employer 3,979,515 -- -- -- -- Participants 1,281,086 781,677 258,187 125,414 220,064 ------------- ------------- ------------- ------------- ------------- Total contributions 5,260,601 781,677 258,187 125,414 220,064 ------------- ------------- ------------- ------------- ------------- TOTAL ADDITIONS 112,851,948 3,010,436 502,519 317,301 552,940 DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in (22,728,190) (1,286,305) (66,681) 409,847 262,352 Withdrawals and distributions (2,689,301) (828,672) (91,110) (1,029,416) (77,311) ------------- ------------- ------------- ------------- ------------- TOTAL DEDUCTIONS (25,417,491) (2,114,977) (157,791) (619,569) 185,041 ------------- ------------- ------------- ------------- ------------- NET INCREASE (DECREASE) 87,434,457 895,459 344,728 (302,268) 737,981 NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS,BEGINNING OF YEAR 130,388,900 12,867,091 2,103,501 2,147,739 1,558,255 ------------- ------------- ------------- ------------- ------------- NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 217,823,357 $ 13,762,550 $ 2,448,229 $ 1,845,471 $ 2,296,236 ============= ============= ============= ============= =============
-12-
MERRILL LYNCH FUNDS BASIC RETIREMENT EQUITY HOTCHKIS VALUE PRESERVATION INDEX & WILEY FUND TRUST TRUST I INT'L FUND ---- ----- ------- ---------- ADDITIONS TO NET ASSETS: Investment Income: Interest and dividends $ 491,537 $ 1,121,813 $ -- $ 87 Net appreciation (depreciation) in fair value of investments 775,641 -- 2,131 (185) ------------ ------------ ------------ ------------ Total investment income (loss) 1,267,178 1,121,813 2,131 (98) ------------ ------------ ------------ ------------ Contributions: Employer -- -- -- -- Participants 412,059 330,456 -- -- ------------ ------------ ------------ ------------ Total contributions 412,059 330,456 -- -- ------------ ------------ ------------ ------------ TOTAL ADDITIONS 1,679,237 1,452,269 2,131 (98) DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in 805,114 22,252,801 -- 5,000 Withdrawals and distributions (209,260) (19,579,544) 52,176 -- ------------ ------------ ------------ ------------ TOTAL DEDUCTIONS 595,854 2,673,257 52,176 5,000 ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 2,275,091 4,125,526 54,307 4,902 NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS,BEGINNING OF YEAR 3,592,239 13,383,048 -- -- ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 5,867,330 $ 17,508,574 $ 54,307 $ 4,902 ============ ============ ============ ============
-13-
MERRILL LYNCH FUNDS PIMCO TOTAL ALLIANCE RETURN QUASAR PARTICIPANT FUND FUND LOANS OTHER TOTAL ---- ---- ----- ----- ----- ADDITIONS TO NET ASSETS: Investment Income: $ 296 $ 425 $ -- $ 13,381 $ 3,558,652 Interest and dividends Net appreciation (depreciation) in fair value of investments (194) 3,751 -- -- 109,439,232 ------------- ------------- ------------- ------------- ------------- Total investment income (loss) 102 4,176 -- 13,381 112,997,884 ------------- ------------- ------------- ------------- ------------- Contributions: Employer Participants -- -- -- -- 3,979,515 -- 146 -- 827,069 4,236,158 ------------- ------------- ------------- ------------- ------------- Total contributions -- 146 -- 827,069 8,215,673 ------------- ------------- ------------- ------------- ------------- TOTAL ADDITIONS 102 4,322 -- 840,450 121,213,557 DEDUCTIONS FROM NET ASSETS: (Transfers out) transfers in 10,000 260,045 (727,705) 803,722 -- Withdrawals and distributions -- -- 772,287 -- (23,680,151) ------------- ------------- ------------- ------------- ------------- TOTAL DEDUCTIONS 10,000 260,045 44,582 803,722 (23,680,151) ------------- ------------- ------------- ------------- ------------- NET INCREASE (DECREASE) 10,102 264,367 44,582 1,644,172 97,533,406 NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS,BEGINNING OF YEAR -- -- 3,918,608 140,989 170,100,370 ------------- ------------- ------------- ------------- ------------- NET ASSETS AVAILABLE FOR PARTICIPANTS' BENEFITS, END OF YEAR $ 10,102 $ 264,367 $3,963,190 $1,785,161 $257,633,776 ============== ============= ============= ============= ==============
-14- 6. PARTICIPANT LOANS Participants may obtain loans from the Plan in aggregate amounts up to the lesser of (a) $50,000 or (b) 50% of the participant's vested account balance. Loans are repayable over periods up to five years (ten years for loans to purchase a principal residence). The loans are secured by the balance in the participant's account and bear a fixed interest rate, based on the federal prime lending rate plus 1/2%, determined at the commencement of the loan. Interest on all loans is allocated to the participant's account from which the loan was funded. Principal and interest are paid ratably through monthly payroll deductions. 7. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right to terminate the Plan subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). In the event of a termination, the assets of the Plan will first be used to pay the liabilities (if any) of the Plan. The remaining assets will then be distributed to the participants in proportion to their respective interest in the Funds. 8. INCOME TAXES The Plan obtained its most recent determination letter on January 31, 1996, pursuant to which the Internal Revenue Service (the IRS) determined that the terms of the Plan, as submitted, were in compliance with the applicable requirements of the Internal Revenue Code of 1986, as amended (the Code). The Plan has subsequently been amended since receiving this determination letter and the Company anticipates obtaining a determination letter from the IRS that the Plan, as amended, continues to comply with all applicable requirements of the Code. The Company also believes that the Plan is being operated in compliance with all applicable requirements of the Code. Therefore, no provision for income taxes has been included in the Plan's financial statements. 9. PLAN AMENDMENTS In accordance with the terms of the Plan, the Company is authorized to amend the Plan. Since the adoption of the Plan, the Company has periodically amended the Plan to comply with the requirements of the Internal Revenue Code of 1986, as amended, as well as to implement design changes. During 1997, the Company amended the Plan, effective May 1, 1997, to allow for the immediate distribution of benefits to an alternate payee under a Qualified Domestic Relations Order. No amendments were made to the Plan during 1998. 10. SUBSEQUENT EVENTS In May 1999, a subsidiary of the Company acquired six power plants from NGE Generation, Inc., an affiliate of New York State Electric and Gas Corporation (NYSEG). In connection with this acquisition, approximately 350 additional employees became eligible to participate in the Plan, including certain employees covered by the collective bargaining agreement (NY Union Participants). The benefits provided by the Plan to the NY Union Participants are limited with respect to matching, profit-sharing, and after-tax contributions. A more complete description of the Plan's provisions can be obtained by referring to the Summary Plan Description. * * * * * * -15- THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN ITEM 27a - SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1998 - --------------------------------------------------------------------------------
NUMBER FAIR OF SHARES COST VALUE --------- ---- ----- Cash -- $ 983,904 $ 983,904 The AES Corporation common stock - at $47.38 per share (1) 4,572,101 46,414,485 216,603,286 Merrill Lynch Retirement Preservation Trust Fund (1) 12,737,215 12,737,199 12,737,215 Merrill Lynch Growth Fund (1) 377,710 8,245,839 8,124,546 Merrill Lynch Global Allocation Fund (1) 159,098 2,240,498 2,006,227 Merrill Lynch Federal Securities Trust Fund (1) 201,336 1,956,599 1,971,076 Merrill Lynch Capital Fund (1) 60,107 1,929,380 2,068,292 Merrill Lynch Basic Value Fund (1) 152,094 4,803,983 5,782,622 Merrill Lynch Equity Index Trust I (1) 13,188 976,583 1,106,732 Hotchkis & Wiley International Fund (1) 4,855 122,804 113,016 Pimco Total Return Fund 30,482 325,235 321,277 Alliance Quasar Fund 13,817 403,579 345,425 Participant loans (Interest 6.5 % - 12%) (1) -- 3,934,613 3,934,613 ------------ ------------ TOTAL $ 85,074,701 $256,098,231 ============ ============
- --------- (1) Transactions in these investments are considered to be party-in-interest transactions under Department of Labor regulations. -16- THE AES CORPORATION PROFIT SHARING AND STOCK OWNERSHIP PLAN ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS DECEMBER 31, 1998 - --------------------------------------------------------------------------------
TOTAL NUMBER OF - ------------------------------ COST/BOOK PROCEEDS OF REALIZED PURCHASES SALES DESCRIPTION VALUE SALE GAIN/(LOSS) --------- ----- ----------- ----- ---- ----------- 202 -- The AES Corporation Common Stock $19,221,926 $ -- $ -- 228 -- Merrill Lynch Retirement Preservation Trust 15,152,739 -- -- -- 152 The AES Corporation Common Stock 7,149,845 18,700,738 11,550,893 -- 139 Merrill Lynch Retirement Preservation Trust 19,924,098 19,924,098 --
NOTES: (1) The items listed above represent all transactions or series of transactions that are reportable under Section 2520.103-6, as amended, of the Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. All purchases are stated at cost. (2) There were no single transactions in excess of 5% of Plan assets for the year ended December 31, 1998. -17- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized. THE AES CORPORATION BY: /s/ Barry J. Sharp ---------------------- Barry J. Sharp Senior Vice President and Chief Financial Officer Date: June 28, 1999 -18- EXHIBIT INDEX EXHIBIT 23.1 PAGE ---- Independent Auditors' Consent 20 -19- EX-23.1 2 EXHIBIT 23.1 EXHIBIT 23.1 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in the Registration Statement No. 33-49262 of The AES Corporation on Form S-8 of our report dated June 11, 1999, appearing in this Annual Report on Form 11-K of The AES Corporation Profit Sharing and Stock Ownership Plan for the year ended December 31, 1998. /s/ Deloitte & Touche LLP Washington, DC June 28, 1999 -20- -----END PRIVACY-ENHANCED MESSAGE-----