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EXHIBIT 99
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UNITED STATES 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
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 1-12147
THRIFT PLAN OF DELTIC TIMBER CORPORATION
(Full title of the Plan)
DELTIC TIMBER CORPORATION
(Exact name of issuer of securities held pursuant to Plan)
210 East Elm Street, P.O. Box 7200, El Dorado, Arkansas 71731-7200
(Address of principal executive offices) (Zip Code)
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Ex. 99-0
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INDEPENDENT AUDITORS' REPORT
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The Board of Directors
Deltic Timber Corporation:
We have audited the accompanying statements of net assets available for benefits
of the Thrift Plan of Deltic Timber Corporation as of December 31, 1999 and
1998, and the related statement of changes in net assets available for benefits
for the year ended December 31, 1999. 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, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Thrift Plan
of Deltic Timber Corporation as of December 31, 1999 and 1998, and the changes
in net assets available for benefits for the year ended December 31, 1999 in
conformity with generally accepted accounting principles.
Our audits were performed 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 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 Thrift Plan
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.
/s/ KPMG LLP
KPMG LLP
Shreveport, Louisiana
June 16, 2000
Ex. 99-1
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Statements of Net Assets Available for Benefits
December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
----------- ---------
<S> <C> <C>
Assets
Investments* $9,058,623 7,304,093
Accrued interest and dividends - 23,938
---------- ---------
Total assets 9,058,623 7,328,031
---------- ---------
Liabilities
Forfeitures due to Company 4,936 -
---------- ---------
Total liabilities 4,936 -
---------- ---------
Net assets available for benefits $9,053,687 7,328,031
========== =========
</TABLE>
*For additional information on Plan investments, see Note 3 - Investments.
See accompanying notes to financial statements.
Ex. 99-2
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 1999
<TABLE>
<CAPTION>
<S> <C>
Additions to net assets
Contributions
Employee $ 620,308
Employer 264,212
Rollovers from other plans 82,039
----------
Total contributions 966,559
----------
Investment income
Interest and dividends 352,949
Net appreciation in fair value of investments 866,154
----------
Total investment income 1,219,103
----------
Total additions to net assets 2,185,662
----------
Deductions from net assets
Distributions of benefits 452,259
Administrative expenses 7,747
----------
Total deductions from net assets 460,006
----------
Net increase in net assets available for benefits 1,725,656
Net assets available for benefits
Beginning of year 7,328,031
----------
End of year $9,053,687
==========
</TABLE>
See accompanying notes to financial statements.
Ex. 99-3
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Notes to Financial Statements
December 31, 1999
Note 1 - Description of Plan
General
The Thrift Plan of Deltic Timber Corporation ("the Plan") is a profit sharing,
defined contribution plan covering each employee who is scheduled to work 1,000
or more hours per year. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"). Although it has not expressed
any intent to do so, Deltic Timber Corporation ("Deltic" or the "Company") has
the right under the Plan to amend or terminate the Plan subject to the
provisions of ERISA. For a more complete description of the Plan's provisions,
refer to the Plan document.
Effective July 1, 1999, the Company changed Plan Trustees from Bank One
Corporation ("Bank One") to SunTrust Bank ("SunTrust"), Nashville N.A. As a
result of the change in Trustees, investments in Bank One sponsored investment
funds were converted to similar funds managed by SunTrust.
The Plan is administered by Deltic's Employee Benefits Committee, whose members
are appointed by the Company's Board of Directors.
Contributions
Contributions to the Plan include (a) employee tax-deferred, earnings reduction
contributions, (b) employee after-tax contributions, (c) Company matching
contributions, (d) employee after-tax supplemental contributions, and (e)
rollovers by new participants from other qualified plans.
Each year, a participant may contribute, on a combined tax-deferred and/or
after-tax basis, up to eight percent of their annual base earnings. The Company
has voluntarily agreed to make annual contributions to the Plan based on each
participant's contributions and years of participation. The Company matches 50
percent of employee contributions for the first five years of participation, 75
percent of employee contributions for the second five years of participation,
and 100 percent of employee contributions thereafter. However, Company
contributions cannot exceed five percent of an employee's annual base pay.
Employee's after-tax supplemental contributions, which are not matched by the
Company, may not exceed 10 percent of their annual base salary. Any amounts
contributed by the Company that are forfeited by participants in accordance
with provisions of the Plan are applied to reduce subsequent contributions by
the Company. Participants direct the investment of their contributions and
company contributions into various investment options offered by the Plan. The
Plan currently offers stock in the Company and eight mutual funds as investment
options for participants.
Throughout various Plan mergers and restatements, the Company has allowed
account balances from a former deductible account to remain in the Plan.
However, after December 31, 1986, participants were not allowed to contribute
to this account.
Ex. 99-4
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Notes to Financial Statements
December 31, 1999
Vesting
A participant is considered to be vested in Company contributions after (1)
completion of five years of service, (2) retirement on or after age 65, (3)
death, (4) total and permanent disability, or (5) discontinuance of the Plan.
In the event of Plan termination, participants will become 100 percent vested
in Company contributions. A nonvested participant forfeits Company
contributions upon termination of employment.
Withdrawals
A participant may withdraw employee after-tax contributions or Company
contributions, if vested, at a minimum of $250, or any higher multiple of 10
percent of the participant's account balance up to 50 percent for a partial
withdrawal, or 100 percent for a total withdrawal. If a partial withdrawal is
taken, Company contributions will be suspended for six months and another
withdrawal cannot be made for 24 months. If a total withdrawal is taken,
Company contributions will be suspended for 12 months. Employee contributions
may continue without interruption after a partial or total withdrawal.
A participant may withdraw employee tax-deferred contributions or rollovers
from other qualified plans under IRS hardship provisions only. "Hardship" is an
immediate and heavy financial need in one of the following areas: (1) large
medical expenses not covered by insurance for the employee or family, (2)
purchase of a principal residence (not regular mortgage payments), (3)
preventing foreclosure or eviction from employee's principal residence, (4)
tuition and related education fees for the next 12 months of post-secondary
education for employee or family, or (5) other events as may be determined by
the IRS. If a hardship withdrawal is taken, participation in all accounts is
suspended for 12 months. Company contributions are forfeited only upon
termination of employment.
An after-tax supplemental withdrawal must be the greater of $250 or 10 percent
of the participant's account balance and may not be made prior to 12 months
from a previous withdrawal.
Withdrawals from the deductible account are subject to the same withdrawal
requirements as after-tax supplemental withdrawals.
Any Company contributions, employee tax-deferred contributions, contributions
to a deductible account, or account earnings withdrawn from the Plan may be
subject to a 10 percent penalty tax under the Tax Reform Act of 1986 if the
participant is not 59 1/2 years old, permanently disabled, or has died.
Upon retirement, disability, or death of a participant, the participant or
his/her spouse, if the designated beneficiary, has the option to receive
settlement in a lump sum or installment payments not to exceed 20 years or
actuarial life if less than 20 years.
Administrative Expenses
Most administrative expenses are paid by the Company.
Ex. 99-5
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Notes to Financial Statements
December 31, 1999
Note 2 - Summary of Significant Accounting Policies
Basis of Accounting
The accompanying financial statements of the Plan have been prepared on the
accrual basis of accounting and present the net assets available for benefits
and changes in those net assets.
The investments and changes in the net assets available for benefits have been
determined by the Trustee and reported to the Plan Administrator based on
contract value for the guaranteed investment contracts ("GIC's") and quoted
market value for all other assets. Purchases and sales of securities are
recorded on a trade-date basis.
The financial statements of the Plan are compiled using information received
from Bank One and SunTrust. The information includes listings of investments
and cash receipts and disbursements of the Plan, together with all other
transactions which affect Plan investments. Such information has been certified
as complete and accurate by the Trustees. The Trustees, for their respective
periods, have been granted discretionary authority concerning the purchase and
sale of investments in the trust fund.
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 net assets available for benefits and
changes therein. Actual results could differ from those estimates.
Note 3 - Investments
In September 1999, the American Institute of Certified Public Accountants
issued Statement of Position 99-3, Accounting for and Reporting of Certain
Defined Contribution Plan Investment and Other Disclosure Matters ("SOP 99-3").
SOP 99-3 simplifies the disclosure for certain investments and is effective for
plan years ending after December 15, 1999. The Plan adopted SOP 99-3 during
the Plan year ending December 31, 1999. Accordingly, information previously
required to be disclosed about participant-directed fund investment programs is
not presented in the Plan's 1999 financial statements. The Plan's 1998
financial statements have been reclassified to conform to the current year's
presentation.
During 1999, the Plan's investments, including gains and losses on investments
bought and sold, as well as held during the year, appreciated in value by
$866,154, as follows:
Mutual funds $557,135
Equity securities 253,993
GIC investments 55,026
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$866,154
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Ex. 99-6
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Notes to Financial Statements
December 31, 1999
The following table represents the fair value of individual investments that
exceeded 5% of the Plan's net assets at December 31, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
------------ ---------
<S> <C> <C>
Mutual funds
American Century Income and Growth Fund $ 533,666 -
Putnam New Opportunities Fund 1,498,183 -
STI Classic Capital Appreciation Fund 1,817,366 -
SunTrust Stable Asset Fund 2,022,383 -
One Group Disciplined Value Fund - 611,771
One Group Growth Opportunities - 799,556
Fidelity Advisor Growth Opportunity Fund - 1,580,401
Other* 1,130,652 150,188
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7,002,250 3,141,916
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Equity securities
Deltic Timber Corporation common stock 1,358,966 1,032,999
Murphy Oil Corporation common stock 697,407 685,581
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2,056,373 1,718,580
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Other
Federated Capital Preservation Fund - 1,269,424
One Group Government Bond Fund - 632,907
Guaranteed Investment Contracts' Fund - 541,266
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- 2,443,597
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Total investments $9,058,623 7,304,093
========== =========
</TABLE>
*Individually less than 5%.
Note 4 - Income Tax Status
The Plan meets the necessary requirements of the Tax Reform Act of 1986 as
documented in Section 401(a) of the Internal Revenue Code, and accordingly, the
related Trust is exempt from taxation under the provisions of Section 501(a) of
the Internal Revenue Code. A favorable determination letter from the Internal
Revenue Service has not been obtained for the Plan as currently amended and
restated. A request for such is to be filed. Until such time as cash or
shares are withdrawn from the Plan by a participant or a participant's
beneficiary, no income tax is payable by the participant/beneficiary on:
contributions made by the Company on the participant's behalf, allotments made
by the participant pursuant to the Economic Recovery Tax Act of 1981, or any
amounts added to the participant's accounts representing his/her proportional
share of the investment income of the Trust.
Note 5 - Related Party Transactions
Certain Plan investments are invested in funds advised by affiliates of
SunTrust. SunTrust is the Trustee of the Plan; therefore, these transactions
qualify as party-in-interest transactions. In addition, Bank One as
predecessor trustee qualifies as a party-in-interest. The Company is the
sponsor of the Plan, and is considered a party-in-interest.
Ex. 99-7
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THRIFT PLAN OF DELTIC TIMBER CORPORATION
Schedule I
Schedule of Assets Held for Investment Purposes at End of Year*
December 31, 1999
<TABLE>
<CAPTION>
Description of Current
Identity of Issuer Investment Value
--------------------------------------------- ------------------ -----------
<S> <C> <C>
Mutual funds
American Century Income and Growth Fund 15,673.021 shares 533,666
Putnam New Opportunities Fund 16,470.795 shares 1,498,183
STI Classic Balanced Fund 26,425.335 shares 348,550
STI Classic Capital Appreciation Fund 109,678.067 shares 1,817,366
STI Classic Small Cap Growth Stock Fund 13,823.949 shares 240,675
Vanguard 500 Index Fund 1,537.478 shares 208,068
SunTrust Stable Asset Fund 72,990.127 shares 2,022,383
STI Classic U.S. Government Securities
Money Market Fund 33,503.456 shares 333,359
Equity securities
Deltic Timber Corporation common stock 62,902.849 shares $1,358,966
Murphy Oil Corporation common stock 12,155.241 shares 697,407
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365,160.318 shares $9,058,623
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</TABLE>
*The above data is based on information which has been certified as accurate and
complete by the Trustee, SunTrust. SunTrust manages various investment funds
and, accordingly, is a party-in-interest. Additionally, Deltic Timber
Corporation, as sponsor of the Plan, is considered a party-in-interest.
Ex. 99-8
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Employee Benefits Committee has duly caused this Annual Report to be signed on
its behalf by the undersigned hereunto duly authorized.
THRIFT PLAN OF DELTIC
TIMBER CORPORATION
Dated: June 28, 2000 By: /s/ Clefton D. Vaughan
--------------------------- ------------------------------------
Clefton D. Vaughan, Vice President
of Finance and Administration and
Chairman of Employee Benefits
Committee, Deltic Timber Corporation
Ex. 99-9
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INDEPENDENT AUDITORS' CONSENT
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The Board of Directors
Deltic Timber Corporation:
We consent to incorporation by reference in the Registration Statement (No. 333-
34317) on Form S-8 of Deltic Timber Corporation of our report dated June 16,
2000, relating to the statements of net assets available for benefits of the
Thrift Plan of Deltic Timber Corporation as of December 31, 1999 and 1998, and
the related statement of changes in net assets available for benefits for the
year ended December 31, 1999, which report appears in the December 31, 1999
annual report on Form 11-K of the Thrift Plan of Deltic Timber Corporation.
/s/ KPMG LLP
KPMG LLP
Shreveport, Louisiana
June 28, 2000
Ex. 99-10
