-----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, D+q5B7MaILpXa0ssxeQIlUcEquOn+dFAGh4BxuvrR63PdQKgNBW3JJgVO7tN+t3X GxprttuhsGoxsPWAGZ8Q9A== /in/edgar/work/20000628/0000893220-00-000799/0000893220-00-000799.txt : 20000920 0000893220-00-000799.hdr.sgml : 20000920 ACCESSION NUMBER: 0000893220-00-000799 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: ADVANTA CORP CENTRAL INDEX KEY: 0000096638 STANDARD INDUSTRIAL CLASSIFICATION: [6141 ] IRS NUMBER: 231462070 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 000-14120 FILM NUMBER: 662918 BUSINESS ADDRESS: STREET 1: P.O. BOX 844 STREET 2: WELSH & MCKEAN ROADS CITY: SPRING HOUSE STATE: PA ZIP: 19477 BUSINESS PHONE: 2154445051 MAIL ADDRESS: STREET 1: C/O WELSH & MCKEAN ROADS STREET 2: P.O. BOX 844 CITY: SPRING HOUSE STATE: PA ZIP: 19477-0844 FORMER COMPANY: FORMER CONFORMED NAME: TSO FINANCIAL CORP DATE OF NAME CHANGE: 19880306 FORMER COMPANY: FORMER CONFORMED NAME: TEACHERS SERVICE ORGANIZATION INC DATE OF NAME CHANGE: 19850812 11-K 1 e11-k.txt ADVANTA CORP. EMPLOYEE SAVINGS PLAN ANNUAL REPORT 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------- FORM 11-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED], FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999 OR [_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] for the transition period from ____________to _____________ COMMISSION FILE NUMBER 0-14120 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: ADVANTA CORP. EMPLOYEE SAVINGS PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: ADVANTA CORP. WELSH AND MCKEAN ROADS P.O. BOX 844 SPRING HOUSE, PA 19477-0844 ================================================================================ 1 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Committee which administers the Plan has duly caused this annual report to be signed by the undersigned thereunto duly authorized. Advanta Corp. Employee Savings Plan Dated: June 28, 2000 By: /s/ Philip M. Browne ------------------------------------- Philip M. Browne Member of the Committee Administering the Plan 2 3 ADVANTA CORP. EMPLOYEE SAVINGS PLAN INDEX TO FINANCIAL STATEMENTS AND SCHEDULES REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS FINANCIAL STATEMENTS: Statements of Assets Available for Benefits as of December 31, 1999 and 1998 Statement of Changes in Assets Available for Benefits for the Year Ended December 31, 1999 Notes to Financial Statements SCHEDULE: I - Schedule of Assets Held for Investment Purposes as of December 31, 1999. 3 4 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Advanta Corp. Employee Savings Plan Compensation Committee: We have audited the accompanying statements of assets available for benefits of Advanta Corp. Employee Savings Plan as of December 31, 1999 and 1998, and the related statement of changes in assets available for benefits for the year ended December 31, 1999. These financial statements and the schedule referred to below are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. 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, the financial statements referred to above present fairly, in all material respects, the assets available for benefits of the Plan as of December 31, 1999 and 1998, and the changes in its assets available for benefits for the year ended December 31, 1999, in conformity with accounting principles generally accepted in the United States. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule listed in the accompanying index 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. 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. /s/ Arthur Andersen LLP Philadelphia, PA June 27, 2000 4 5 ADVANTA CORP. EMPLOYEE SAVINGS PLAN STATEMENTS OF ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, -------------------------------- 1999 1998 ----------- ----------- ASSETS Cash $ 77,738 $ 8,117 Investments (Note 8) 44,695,496 34,452,929 Employer Contribution Receivable 1,394,764 1,268,880 Participant Loans Receivable (Note 4) 1,242,332 1,122,983 ----------- ----------- Total Assets Available for Benefits $47,410,330 $36,852,909 =========== ===========
The accompanying notes are an integral part of these statements. 5 6 ADVANTA CORP. EMPLOYEE SAVINGS PLAN STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1999 INCREASES: Interest and Dividend Income $ 2,653,247 Employee Contributions 6,005,282 Employer Contributions 2,662,163 Net Increase in Fair Market Value of Investments 6,672,400 ----------- 17,993,092 DECREASE: Distributions to Participants 7,435,671 Net Increase 10,557,421 Assets Available for Benefits, Beginning of Year 36,852,909 ----------- Assets Available for Benefits, End of Year $47,410,330 ===========
The accompanying notes are an integral part of these statements. 6 7 ADVANTA CORP. EMPLOYEE SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 (1) DESCRIPTION OF PLAN: The Advanta Corp. Employee Savings Plan (the "Plan"), as amended, was adopted effective July 1, 1983 and is a defined contribution plan available to all employees of Advanta Corp. ("Advanta") and certain of its subsidiaries and affiliates who have reached age 21 with one year of service. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA). The following description of the Plan provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. Participants may elect to defer a portion of their compensation before certain taxes are deducted. Advanta may elect to limit the maximum percentage a participant may contribute to the extent it determines that such limitation is necessary in order to comply with the rules for plan qualification under Sections 401(a) and (k) of the Internal Revenue Code. An eligible participant may elect to contribute up to 15% of their salary subject to the limits under Section 401 of the Internal Revenue Code. Advanta also makes matching contributions to the Plan, a portion of which is made on a per pay period basis, and the balance of which is made as of the end of the Plan year. Such employer contributions are equal to 50% of each employee's contributions up to 5% of the employee's compensation contributed to the Plan (as defined in the Plan). Advanta may make an additional matching contribution for the benefit of participants who are employed as of the last day of the Plan year. Total employer contributions in 1999 were 100% of the first 5% of employees' compensation contributed to the Plan. The Plan is subject to certain non-discrimination standards under Section 401(k) of the Internal Revenue Code. In order to comply with these standards, certain participants who are "highly compensated employees" (as defined in the Internal Revenue Code) may have a portion of their contributions refunded to them after the end of the Plan Year. Because contributions made under Section 401 can not be included in the income of participants when made, they are fully taxable when distributed unless rolled over into another qualified plan or Individual Retirement Account (IRA). Participants are fully vested as to employer and employee contribution accounts at all times. 7 8 The Plan participants may invest their contributions in the following managed investment funds and in shares of Advanta's Class B common stock. - - T. Rowe Price Stable Value Common Trust Fund: This fund invests primarily in insurance contracts with a portion of the funds' assets in synthetic investment contracts. - - Western Asset Core Portfolio: This fund invests in a portfolio of fixed income securities with a duration of generally 4-6 years. Investments include U.S. Government obligations, mortgage- and other asset-backed securities, and U.S. dollar-denominated obligations of foreign governments and non-governmental domestic or foreign issuers. - - Dodge & Cox Balanced Fund: This fund offers the benefit of asset allocation and invests in a diversified portfolio of common stocks, preferred stocks and bonds. - - Vanguard 500 Index Fund: This fund seeks to match the performance of a benchmark index that measures the investment return of large-capitalization stocks. - - Dodge & Cox Stock Fund: This fund invests primarily in a broadly diversified portfolio of common stocks, investing in companies that appear to be temporarily undervalued by the stock market, but have a favorable outlook for long-term growth. - - Vanguard International Growth Fund: This fund invests primarily in the stocks of seasoned companies located outside the United States with above average growth potential. - - John Hancock Small Cap Growth Fund: This fund invests primarily in stocks of U.S. emerging growth companies with market capitalizations of no more than $1 billion. The John Hancock Special Equities Fund was merged into the John Hancock Small Cap Growth Fund in December 1999. - - Putnam New Opportunities Fund: This fund invests mainly in U.S. common stocks, with a focus on growth stocks in sectors of the economy with high growth potential. The Plan invests funds related to pending trades in a short-term money market fund. While it is Advanta's intention to continue the Plan in operation indefinitely, any termination of the Plan or discontinuance of contributions will not result in the use or diversion of Plan assets for any purposes other than the exclusive benefit of Plan participants and their beneficiaries. (2) BASIS OF ACCOUNTING: The accompanying financial statements have been prepared using the accrual basis of accounting. 8 9 (3) USE OF ESTIMATES: The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets available for benefits and changes therein. Actual results could differ from those estimates. (4) PARTICIPANT LOANS: As provided for in the Plan document, loans are available to participants under certain specified conditions. The principal amount of a Plan loan to a participant may not exceed the lesser of $50,000 (reduced by the maximum amount of any Plan loans outstanding anytime during the preceding year) or 50% of a participant's accrued equity in the Plan. Plan loans are generally limited to a term of five years (or, in the case of a loan used to finance the acquisition of a principal residence, fifteen years) and bear an interest rate charged by commercial lenders for a comparable loan on the date the loan request is approved. Plan loans are collateralized by the participant's accrued benefit in the Plan. (5) PARTICIPANT ACCOUNTS: Effective July 1, 1997, the Plan was amended. Pursuant to the amendments to the Plan, the investment options that existed at December 31, 1996 were replaced with new investment options. Plan participants may invest their contributions and employer contributions in one or more of the investment options described in Note 1. In addition, in July 1997, Wilmington Trust Company replaced PW Trust Company as Trustee of the Plan. Separate accounts are maintained for each participant in each investment fund. Investment gains and losses in each of the funds described above are allocated to the participants in the ratio of each participant's account balance (including employee contributions and employer matching contributions) to the total account balance in each fund. (6) ADMINISTRATIVE EXPENSES: All administrative expenses of the Plan and other fees incident to the management of the Plan are paid for by Advanta, except for brokerage commissions, investment advisory fees and transfer taxes, if any. (7) DISTRIBUTIONS TO PARTICIPANTS: There were no distributions payable as of year-end 1999 or 1998. 9 10 (8) INVESTMENTS: The carrying values of individual investments that represent more than 5% of the Plan's net assets were as follows:
1999 1998 ---- ---- T. Rowe Price Stable Value Fund $ 5,101,869 $ 5,365,337 Dodge & Cox Balanced Fund 3,650,567 3,693,383 Vanguard 500 Index Fund 13,170,520 10,211,235 Dodge & Cox Stock Fund 4,596,327 4,180,879 Vanguard International Growth Fund 2,728,201 2,169,424 John Hancock Small Cap Growth Fund 2,818,382 1,937,267 Putnam New Opportunities Fund 7,555,145 3,977,650 Advanta Corp. Common Stock, Class A & B 4,345,721 2,240,713
All investments are stated at market value on the statement of net assets. Market value for the investments is based on quoted market prices. The net increase (decrease) in fair market value of investments, including gains and losses on investments bought and sold, as well as held during the year, was as follows for the year ended December 31, 1999: Western Asset Core Portfolio $ (55,038) Dodge & Cox Balanced Fund 64,549 Vanguard 500 Index Fund 2,070,981 Dodge & Cox Stock Fund 506,022 Vanguard International Growth Fund 449,230 John Hancock Small Cap Growth Fund 372,179 Putnam New Opportunities Fund 2,454,390 Advanta Corp. Common Stock, Class A & B 810,087 --------- Total $ 6,672,400 =========
(9) FEDERAL INCOME TAXES: The Internal Revenue Service issued a determination letter dated December 30, 1994 stating that the Plan was designed in accordance with applicable Internal Revenue Code requirements as of that date. The Plan has been amended since receiving the determination letter. However, the Plan administrator and management believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code. Therefore, they believe that the Plan was qualified and the related trust was tax-exempt for the year ended December 31, 1999. 10 11 SCHEDULE I ADVANTA CORP. EMPLOYEE SAVINGS PLAN EIN 23-1462070 ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1999
MARKET COST VALUE ----------- ----------- Cash $ 77,738 $ 77,738 T. Rowe Price Stable Value Fund: Market value per share $1.00 5,101,869 5,101,869 Western Asset Core Portfolio: Market value per share $10.28 788,883 728,764 Dodge & Cox Balanced Fund: Market value per share $65.71 3,792,833 3,650,567 Vanguard 500 Index Fund: Market value per share $135.33 9,842,013 13,170,520 Dodge & Cox Stock Fund: Market value per share $100.52 4,505,770 4,596,327 Vanguard International Growth Fund: Market value per share $22.49 2,289,697 2,728,201 John Hancock Small Cap Growth Fund: Market value per share $15.21 2,460,588 2,818,382 Putnam New Opportunities Fund: Market value per share $90.96 4,693,889 7,555,145 Advanta Corp. Common Stock* 4,837,978 4,345,721 Class A: market value $18.25 per share Class B: market value $14.06 per share Participant Loans Receivable, bearing interest from 7.5% to 11.5% 1,242,332 1,242,332 ----------- ----------- $39,633,590 $46,015,566 =========== ===========
*Party-in-interest to the Plan 11 12 EXHIBIT INDEX EXHIBIT NO. DOCUMENT 1 Consent of Independent Public Accountants 12 EX-1 2 ex1.txt CONSENT OF ARTHUR ANDERSEN LLP 1 EXHIBIT 1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report included in this Form 11-K, into Advanta Corp.'s previously filed Form S-8 Registration Statements File Nos. 33-10790, 33-47308, 33-50209, 333-01681 and 333-04471. /s/ Arthur Andersen LLP Philadelphia, PA June 28, 2000 13 -----END PRIVACY-ENHANCED MESSAGE-----