<PAGE>
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 [FEE REQUIRED]
For the fiscal year ended December 31, 1998
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: 333-16951
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
Bank of Santa Maria Profit Sharing and Salary Deferral 401(k) Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Bank of Santa Maria
2739 Santa Maria Way
Santa Maria, California 93455
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the Plan) have duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
BANK OF SANTA MARIA PROFIT SHARING AND
SALARY DEFERRAL 401(k) PLAN
By: /s/ Mata Landry
-------------------------------------
Mata Landry, Assistant Vice President
Dated: June 29, 1999
1
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND
SALARY DEFERRAL 401(K) PLAN
DECEMBER 31, 1998
2
<PAGE>
CONTENTS
<TABLE>
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
INDEPENDENT AUDITORS' REPORT
ON THE FINANCIAL STATEMENTS 1
- -----------------------------------------------------------------------------------------------------------------
FINANCIAL STATEMENTS
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS 2
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION 3
NOTES TO FINANCIAL STATEMENTS 4 THROUGH 6
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE>
To the Board of Trustees of
Bank of Santa Maria Profit Sharing and Salary Deferral 401(k) Plan
Santa Maria, California
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying statements of net assets available for plan
benefits of Bank of Santa Maria Profit Sharing and Salary Deferral 401(k) Plan
as of December 31, 1998 and 1997, and the related statement of changes in net
assets available for plan benefits with fund information for the year ended
December 31, 1998. 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 plan benefits of Bank of
Santa Maria Profit Sharing and Salary Deferral 401(k) Plan as of December 31,
1998 and 1997, and the changes in its net assets available for plan benefits for
the year ended December 31, 1998 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 information included in
Schedule G - Financial Schedules (IRS From 5500) 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 information is the responsibility of the
plan's management. The supplemental information 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 the basic
financial statements taken as a whole.
Laguna Hills, California
June 16, 1999
4
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND SALARY DEFERRAL 401(K) PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
December 31,
-----------------------------------
ASSETS 1998 1997
--------------- --------------
<S> <C> <C>
Cash $ - $ 2,794
Investments, at Fair Value:
Interest Bearing Cash - 912,110
Interest in Registered Investment Companies - 4,783,532
BSM Bancorp - 848,965
Loans to Participants - 818,347
--------------- --------------
TOTAL INVESTMENTS - 7,362,954
Receivables:
Employer's Profit Sharing Contributions - 422,787
Employer's Matching Contributions - 55,069
Participant's Contributions - 14,904
Other - ( 2,974)
--------------- --------------
- 489,786
--------------- --------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $ - $ 7,855,534
--------------- --------------
--------------- --------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND SALARY DEFERRAL 401(K) PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Participant Directed
------------------------------------------------------------
Interest in
Interest Registered BSM
Bearing Investment Loans to Bancorp
Cash Companies Participants Stock Other Total
-------------- -------------- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Interest and Dividends $ 34,308 $ 53,986 $ 24,184 $ 11,995 $ - $ 124,473
Net Gain on Sale
of Assets - 160,721 - 213,520 - 374,241
-------------- -------------- ------------ -------------- ------------ --------------
Total Income 34,308 214,707 24,184 225,515 - 498,714
CONTRIBUTIONS
Participants 30,571 117,611 - 19,566 ( 14,904) 152,844
Employer 160,323 525,575 - 84,171 ( 480,069) 290,000
-------------- -------------- ------------ -------------- ------------ --------------
190,894 643,186 - 103,737 ( 494,973) 442,844
-------------- -------------- ------------ -------------- ------------ --------------
Total Additions 225,202 857,893 24,184 329,252 ( 494,973) 941,558
BENEFIT PAYMENTS ( 171,457) ( 243,125) ( 58,114) ( 51,463) - ( 524,159)
-------------- -------------- ------------ -------------- ------------ --------------
NET INCREASE (DECREASE)
PRIOR TO NET INTERFUND
TRANSFERS 53,745 614,768 ( 33,930) 277,789 ( 494,973) 417,399
NET INTERFUND
TRANSFERS 92,521 ( 64,849) ( 85,698) 55,633 2,393 -
TRANSFER TO
MID-STATE BANK PLAN ( 1,058,376) ( 5,333,451) ( 698,719) ( 1,182,387) - ( 8,272,933)
-------------- -------------- ------------ -------------- ------------ --------------
NET DECREASE ( 912,110) ( 4,783,532) ( 818,347) ( 848,965) ( 492,580) ( 7,855,534)
NET ASSETS AVAILABLE
FOR BENEFITS
Beginning of Year 912,110 4,783,532 818,347 848,965 492,580 7,855,534
-------------- -------------- ------------ -------------- ------------ --------------
End of Year $ - $ - $ - $ - $ - $ -
-------------- -------------- ------------ -------------- ------------ --------------
-------------- -------------- ------------ -------------- ------------ --------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND SALARY DEFERRAL 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE A - DESCRIPTION OF PLAN
The following description of the Bank of Santa Maria's Profit Sharing and Salary
Deferral 401(k) Plan provides only general information. Participants should
refer to the Plan Agreement for a more complete description of the Plan's
provisions.
GENERAL
The Plan is a defined contribution Plan covering all employees of the Company
who have one year of service, work one thousand hours during the Plan year, and
are age eighteen or older. It is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
CONTRIBUTIONS
For each year, employer contributions are determined by the Board of Directors.
Participants may contribute up to fifteen percent of their annual compensation
before commissions and noncash taxable fringe benefits not to exceed $10,000.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contribution and
an allocation of (a) the Company's contribution, (b) Plan earnings, and (c)
forfeitures of terminated participants' nonvested accounts. Allocations are
based on participant earnings or account balances, as defined. The benefit to
which a participant is entitled is the benefit that can be provided from the
participant's account.
VESTING
Participants are immediately vested in their voluntary contributions plus actual
earnings thereon. Vesting in the remainder of their accounts is based on years
of continuous service. A participant is 100 percent vested after seven years of
credited service.
PAYMENT OF BENEFITS
On termination of service, a participant may elect to receive either a lump-sum
amount equal to the value of his or her account, or monthly, quarterly, or
annual installments over the life expectancy of the participant and the
participant's designated beneficiary.
7
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND SALARY DEFERRAL 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The financial statements of the Plan are prepared on the accrual basis of
accounting.
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires the plan administrator to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results may differ from those estimates.
INVESTMENT VALUATION
The plan's investments are stated at fair value. Shares of registered investment
companies are valued at quoted market prices which represent the net asset value
of shares held by the plan at year end. The Bancorp stock is valued at its
quoted market price. Participants notes receivable are valued at cost which
approximates fair value.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
NOTE C - MERGER
The plan sponsor, Bank of Santa Maria, entered into an "Agreement to Merge and
Plan of Reorganization" dated January 29, 1998 and amended on March 27, 1998 by
and among Mid-State Bank, BSM Bancorp and Bank of Santa Maria. On July 10, 1998
Bank of Santa Maria Merged into Mid-State Bank and all of the assets of the Bank
of Santa Maria Profit Sharing and Salary Deferral 401(k) Plan were transferred
to Mid-State Bank Profit Sharing and Salary Deferral 401 (k) Plan effective
August 7, 1998.
NOTE D - 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 of Plan termination,
participants will become 100 percent vested in their accounts.
8
<PAGE>
BANK OF SANTA MARIA
PROFIT SHARING AND SALARY DEFERRAL 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE E - TAX STATUS
The Internal Revenue Service has determined and informed the Company by a letter
dated June 2, 1993, that the Plan and related Trust are designed in accordance
with applicable sections of the Internal Revenue Code (IRC). The Plan has been
amended since receiving the determination letter. However, the Plan
Administrator believes that the Plan is designed and is currently being operated
in compliance with applicable requirements of the IRC.
NOTE F - LOANS TO PARTICIPANTS
Participants may borrow from their fund accounts a minimum of $1,000 up to a
maximum equal to the lesser of $50,000 or 50% of their account balance. Loan
transactions are treated as a transfer to (from) the investment fund from (to)
the Loans to Participants fund. Loan terms range from one to five years. The
loans are secured by the balance in the participant's account and bear interest
at a rate commensurate with local prevailing rates as determined quarterly by
the Plan Administrator. Interest rates range from 5.40% to 8.50%. Principal and
interest is paid ratably through monthly payroll deductions.
9
