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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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, 1998
OR
( ) Transition report pursuant to Section 15(d) of the Securities Exchange
Act of 1934 from the transition period from _____to_____
Commission file number: 0-22163
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AMERITRADE HOLDING CORPORATION ASSOCIATES
PROFIT SHARING PLAN AND TRUST
(Full title of the plan)
AMERITRADE HOLDING CORPORATION
4211 SOUTH 102ND STREET, OMAHA, NEBRASKA 68127
(Name of Issuer of Securities and Address Principal Executive Office)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
Date: April 13, 1999 Name of Plan: Ameritrade Holding Corporation
Associates Profit Sharing Plan
and Trust
Signature: /s/ Robert T. Slezak
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Robert T. Slezak
Plan Administrator
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
TABLE OF CONTENTS
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PAGES
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED
DECEMBER 31, 1998 AND 1997:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-6
SUPPLEMENTAL SCHEDULES:
Item 27a - Schedule of Assets Held for Investment Purposes,
December 31, 1998 7
Item 27d - Schedule of Reportable Transactions for the Year Ended
December 31, 1998 8
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[DELOITTE & TOUCHE LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
To the Trustees and Participants of
Ameritrade Holding Corporation
Associates Profit Sharing Plan
Omaha, Nebraska
We have audited the accompanying statements of net assets available for
benefits of the Ameritrade Holding Corporation Associates Profit Sharing Plan
(the Plan) as of December 31, 1998 and 1997, and the related statements of
changes in net assets available for 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 benefits of the Plan at December 31,
1998 and 1997, and the changes in net assets available for 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. These schedules are the responsibility of the Plan's management. Such
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 financial
statements taken as a whole.
/s/ Deloitte & Touche LLP
February 3, 1999
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998 AND 1997
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<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
ASSETS:
Investments, at fair value (Note D):
Ameritrade Holding Corporation Class A common stock $87,774,624 $40,752,504
Mutual funds -- 722,617
Commercial Paper 108,000 299,000
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87,882,624 41,774,121
Receivables:
Accrued interest 378 1,490
Accrued employer contribution 1,032,103 659,859
Cash 4 --
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Total Assets 88,915,109 $42,435,470
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LIABILITIES:
Note payable (Note E) 600,000 --
Accrued interest payable 3,867 --
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Total Liabilities 603,867 --
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NET ASSETS AVAILABLE FOR BENEFITS $88,311,242 $42,435,470
=========== ===========
</TABLE>
See notes to financial statements.
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
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<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Net appreciation of fair value of investments $47,111,023 $29,034,684
Employer contribution 1,032,103 659,859
Mutual fund dividend income 10,566 37,809
Interest income 17,660 19,793
Mutual fund capital gains -- 18,300
Distributions repaid -- 15,639
Other income 530 930
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Total Additions 48,171,882 29,787,014
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Distributions to plan participants 2,266,602 278,285
Interest expense 29,508 --
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Total Deductions 2,296,110 278,285
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NET INCREASE 45,875,772 29,508,729
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 42,435,470 12,926,741
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End of year $88,311,242 $42,435,470
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</TABLE>
See notes to financial statements.
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
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A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Ameritrade Holding Corporation Associates
Profit Sharing Plan (the Plan) are prepared on the accrual basis of
accounting.
The Employer (Ameritrade Holding Corporation) has appointed John Joe
Ricketts and Marlene M. Ricketts as Trustees of the Plan. The Trustees
have been granted discretionary authority concerning purchases and sales
of investments in the Plan. The investments and changes therein of this
Plan have been reported to the Plan by the Trustees as having been
determined through the use of fair value for all assets of the Plan.
Realized gains or losses and unrealized appreciation or depreciation in
the fair value of investments are determined using beginning of year fair
value or purchase price if acquired during the year. Investments are
valued as follows:
- COMMERCIAL PAPER - Commercial paper is valued at face value, which is
considered a reasonable estimate of fair value.
- AMERITRADE HOLDING CORPORATION CLASS A COMMON STOCK - The Class A
common stock is stated at fair value as determined by quoted market
prices.
On August 18, 1998, Ameritrade Holding Corporation effected a stock
split of its Class A common stock in the form of a two-for-one stock
dividend. This increased the number of shares in the Plan from
1,393,248 to 2,786,496. All per share amounts presented have been
adjusted for this split. On January 25, 1999, the Employer announced
another two-for-one split of its Class A common stock effective on or
about February 22, 1999. The impact of this split is not reflected in
the Plan's financial statements.
- MUTUAL FUNDS - Mutual funds are stated at fair value as determined by
quoted market prices.
Benefits are recorded by the Plan when paid.
The Company pays all administrative costs for the Plan. Such costs are not
reflected in the Plan's financial statements.
USE OF ESTIMATES - In preparing financial statements in conformity with
generally accepted accounting principles, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the
date of the financial statements and changes in net assets available for
benefits during the reporting period. Actual results could differ from
those estimates.
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B. DESCRIPTION OF THE PLAN
The following description of the 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 qualified defined contribution profit-sharing plan
covering all associates of Ameritrade Holding Corporation and its
subsidiary companies who are at least 21 years of age and have completed
one or more years of service. It is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
CONTRIBUTIONS - Contributions to provide benefits under the Plan are made
by the employer, as determined at the sole discretion of the Board of
Directors. Employer contributions and forfeitures are allocated to the
participants as of the last day of the Plan year based on the percentage
of the participant's compensation to the total of all participants'
compensation. Allocations of earnings are pro rata based on the
participant's account balance. Voluntary participant contributions are not
permitted.
VESTING - Vesting for Employer contributions is as follows:
Less than two years 0%
Two years, but less than three years 20%
Three years, but less than four years 40%
Four years, but less than five years 60%
Five years, but less than six years 80%
Six years 100%
PAYMENT OF BENEFITS - Upon termination of service, a participant may
elect to receive either a lump sum amount equal to the value of the
participant's vested account or a series of periodic payments. At December
31, 1998 and 1997, distributions payable to terminated associates were
$17,143,137 and $3,991,112, respectively.
PLAN TERMINATION - Although it has not expressed any intent to do so, the
Employer 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 become 100% vested.
C. TAX STATUS
The trust established under the Plan to hold the Plan's assets is
qualified pursuant to the appropriate section of the Internal Revenue Code
and, accordingly, the Plan's net investment income is exempt from income
taxes. The Internal Revenue Service has determined and informed the Plan
by a letter dated September 1, 1998, that the Plan as last amended
November 11, 1997, is designed in accordance with the applicable sections
of the Internal Revenue Code. The Plan sponsor believes that the Plan
continues to qualify and to operate as designed. As such, no provision for
federal income taxes is reflected in the Plan's financial statements.
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D. PLAN INVESTMENTS
Plan investments consist of the following at December 31:
<TABLE>
<CAPTION>
1998 1997
INVESTMENTS AT FAIR VALUE AS DETERMINED BY
QUOTED MARKET PRICE:
<S> <C> <C>
Ameritrade Holding Corporation Class A common stock* $87,774,624 $40,752,504
Janus Worldwide Fund -- 375,409
Oppenheimer Champion Income Fund A -- 347,208
General Electric Capital Corporation commercial paper -- 299,000
First Credit Corporation commercial paper 108,000 --
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$87,882,624 $41,774,121
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</TABLE>
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Net Change in Fair Value:
Investment at fair value as determined by quoted market price:
Ameritrade Holding Corporation Class A common stock $47,022,120 $28,996,974
Mutual funds 88,903 37,710
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Net Appreciation in Fair Value $47,111,023 $29,034,684
=========== ===========
</TABLE>
* Exceeds 5% of net assets available for benefits.
E. NOTE PAYABLE
At December 31, 1998, the Plan has a $600,000 note payable to a bank, due
April 30, 1999, with interest paid monthly at a variable rate (7.25% at
December 31, 1998). The note is collateralized by 100,000 shares of
Ameritrade Holding Corporation Class A common stock.
F. PARTIES-IN-INTEREST
The Plan holds shares of Ameritrade Holding Corporation Class A common
stock. Ameritrade Holding Corporation is a party-in-interest.
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
SUPPLEMENTAL SCHEDULE
Item 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1998
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<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
<S> <C> <C> <C>
DESCRIPTION OF INVESTMENT
INCLUDING COLLATERAL,
IDENTITY OF ISSUE, BORROWER, RATE OF INTEREST, MATURITY CURRENT
LESSOR OR SIMILAR PARTY DATE, PAR OR MATURITY VALUE COST VALUE
Ameritrade Holding Corporation* Class A common stock,
2,786,496 shares, $0.01
par value per share $ 246,227 $87,774,624
First Credit Corporation Commercial paper, 4.50%,
due January 5, 1999 108,000 108,000
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$ 354,227 $87,882,624
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</TABLE>
*Represents a party-in-interest
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AMERITRADE HOLDING CORPORATION
ASSOCIATES PROFIT SHARING PLAN
SUPPLEMENTAL SCHEDULE
Item 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
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SERIES OF TRANSACTIONS, WHEN AGGREGATED, INVOLVING AN AMOUNT
IN EXCESS OF 5% OF THE CURRENT VALUE OF PLAN ASSETS
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F COLUMN G
<S> <C> <C> <C> <C> <C> <C>
TOTAL TOTAL
DOLLAR DOLLAR
IDENTITY OF DESCRIPTION NUMBER OF NUMBER VALUE OF VALUE NET GAIN
PARTY INVOLVED OF ASSET PURCHASES OF SALES PURCHASES OF SALES OR (LOSS)
First Credit Corporation Commercial Paper 32 31 $6,722,000 $6,614,000 $ --
</TABLE>
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