<PAGE>
As filed with the Securities and Exchange Commission on June 27, 2000
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UNITED STATES
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 [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 33-41102
----------------------------
A. Full title of the plan and address of the plan, if different from that of the
issuer named below:
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Financial Statements
December 31, 1999 and 1998
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
SILICON VALLEY BANCSHARES
3003 TASMAN DRIVE
SANTA CLARA, CALIFORNIA 95054-1191
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This report contains a total of 15 pages.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
INDEPENDENT AUDITORS' REPORT 3
FINANCIAL STATEMENTS
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS 4
DECEMBER 31, 1999 AND 1998
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS 5
YEAR ENDED DECEMBER 31, 1999
NOTES TO FINANCIAL STATEMENTS 6
SIGNATURES 13
EXHIBITS 14
</TABLE>
2
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Administrative Committee
Silicon Valley Bank 401(k) and Employee Stock Ownership Plan:
We have audited the accompanying statements of net assets available for benefits
of the Silicon Valley Bank 401(k) and Employee Stock Ownership Plan (the "Plan")
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 Plan 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.
/s/ KPMG LLP
------------
San Francisco, California
June 21, 2000
3
<PAGE>
SILICON VALLEY BANK 401(k) AND EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------------- ---------------
<S> <C> <C>
ASSETS:
Investments, at fair value:
Plan interest in Silicon Valley Bank
Retirement Plans Master Trust $58,372,770 $28,877,428
------------- ---------------
Contributions receivable:
Participant - 2,685
Employer 2,782,302 1,301
------------- ---------------
Total contributions receivable 2,782,302 3,986
------------- ---------------
Total assets 61,155,072 28,881,414
------------- ---------------
LIABILITIES:
Excess contributions payable - (9,575)
------------- ---------------
Net assets available for benefits $61,155,072 $28,871,839
============= ===============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
SILICON VALLEY BANK 401(k) AND EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
1999
--------------
<S> <C>
Additions to net assets attributed to:
Plan interest in Master Trust investment income:
Interest $ 87,445
Dividend 427,250
Net appreciation in fair value of investments 29,158,237
--------------
Total investment income 29,672,932
--------------
Contributions:
Participant 2,180,235
Employer 3,346,543
Rollovers 562,505
--------------
Total contributions 6,089,283
--------------
Total additions 35,762,215
--------------
Deductions from net assets attributed to:
Benefits paid to participants 3,469,159
Loan fees and other 9,823
--------------
Total deductions 3,478,982
--------------
Net increase 32,283,233
Net assets available for benefits:
Beginning of year 28,871,839
--------------
End of year $61,155,072
--------------
--------------
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(1) DESCRIPTION OF PLAN
The following description of the Silicon Valley Bank 401(k) and Employee
Stock Ownership Plan (the "Plan") provides only general information.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
(A) GENERAL
The Plan is a defined contribution plan established by Silicon Valley
Bank (the "Company") on January 1, 1985. Effective March 1, 1995, the
Silicon Valley Bancshares Employee Stock Ownership Plan was merged with
the Silicon Valley Bank 401(k) Plan. The merged Plan was restated and
renamed the Silicon Valley Bank 401(k) and Employee Stock Ownership
Plan. The Plan is intended to constitute a qualified profit sharing
plan, as described in Section 401(a) of the Internal Revenue Code
("IRC"), which includes a qualified cash or deferred arrangement as
described in Section 401(k) of the IRC, and which also includes an
employee stock ownership plan as described in Section 4975 (e) (7) of
the IRC. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"), as amended. Assets of
the Plan are included in the Silicon Valley Bank Retirement Plans Master
Trust (the "Master Trust") with the assets of the Silicon Valley Bank
Money Purchase Pension Plan (the "MPP"). The assets of the Master Trust
are held by Merrill Lynch Trust Company ("Merrill Lynch").
(B) ADMINISTRATION OF PLAN
The Company is the sponsor and administrator of the Plan. Management and
administration of the Plan is the responsibility of a committee
appointed by the Company. The Company has contracted with Merrill Lynch
to act as the trustee and custodian, and Merrill Lynch Group Employee
Services to act as recordkeeper of the Plan.
(C) ELIGIBILITY
All eligible employees become Plan participants on the first day of the
calendar quarter after the date the participant attains age 18 and
completes one hour of service as an employee of the Company.
(D) CONTRIBUTIONS
Participants are allowed to contribute up to 7% of their pre-tax
compensation as defined in the Plan, up to the maximum amount allowable
under federal income tax regulations ($10,000 for 1999 and 1998). Upon
approval by the Plan administrator, participants may also contribute
amounts representing distributions from other qualified defined benefit
or defined contribution plans.
The Company may, at its discretion, make matching 401(k) contributions
as defined in the Plan. The Company may match up to 100% of each
participant's contributions up to a maximum of $1,000 per year.
6
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
Discretionary ESOP contributions made by the Company to the Plan are
allocated among the Plan participants based upon each eligible
participant's cash compensation excluding incentive pay and excluding
IRC Section 401(k) and Section 125 deferrals (collectively "Pay").
Discretionary ESOP contributions, which are based on Company
performance, may range between 0% and 10% of Pay. In 1999, discretionary
ESOP contributions of 10% were made for all participants employed by the
Company on the last day of the year.
(E) PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's
contributions and allocations of (a) the Company's contributions and (b)
Plan earnings. Allocations are based on participant earnings or account
balances, as defined in the Plan. Certain fees may be charged to
participant accounts, as defined in the Plan. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account balance.
(F) VESTING
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting in the Company's 401(k) matching and
discretionary ESOP contributions is based on years of service, as
defined in the Plan, in accordance with the following schedule:
<TABLE>
<CAPTION>
Years of Vested
Service Percentage
------- ----------
<S> <C>
Less than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
</TABLE>
In addition, a participant's account becomes fully vested upon attaining
normal retirement age while employed by the Company, upon termination by
the Company due to a reduction in force, upon death or disability, or
upon a covered termination as defined in the Plan.
(G) FORFEITED ACCOUNTS
Forfeited balances of terminated participants' nonvested accounts are
used first to restore previously forfeited amounts of rehired
participants' accounts and are then used to reduce future Company
contributions to the Plan. Forfeited nonvested accounts which are
included in the money market accounts totaled $403,114 and $445,115 for
the years ended December 31, 1999 and 1998, respectively. During 1999,
Company contributions to the Plan were reduced by $59,861 due to
forfeitures from nonvested accounts.
(H) INVESTMENT OPTIONS
Participants may direct the investment of their Plan assets in any of
the Plan's investment options, except for the ESOP. ESOP contributions
are directed by the Plan administrator. Investment options provide
varying degrees of risk and return.
7
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
Participants may elect to invest in any of the funds in increments of 1%
of their total contribution amounts, except that contributions allocated
to the Silicon Valley Bancshares Common Stock Fund are limited to 25% of
the amount available for each participant to direct. A participant's
investment options and percentage increments for the Plan are the same
as the participant's investment options and percentage increments as
directed by that participant under the MPP Plan. Earnings or losses on
these investments are applied to participants' accounts as of the end of
each day. Effective May 1, 1998, participants may change their
investment elections under the Plan and the MPP Plan at any time.
All ESOP contributions are invested in the Silicon Valley Bancshares
Common Stock Fund. When a participant reaches age 55, they may direct
the investment of the balance in their ESOP account.
(I) PARTICIPANT LOANS
Participants may borrow from the total of their Plan contributions,
including their rollover contributions, plus earnings thereon, an amount
equal to a minimum of $1,000 up to a maximum equal to the lesser of
$50,000 or 50% of the participant's total vested account balance. Loan
transactions are treated as a transfer to (from) the investment funds
from (to) the Participant Loan Account Fund. Loan terms may be up to
five years for personal loans or up to 10 years for the purchase of a
primary residence. The loans are secured by the balance in the
participant's account and bear interest at the trustee's prime rate,
plus 1%. Interest rates for loans outstanding at December 31, 1999 and
1998 range from 8.75% to 10%. Principal and interest are paid ratably
through semi-monthly payroll deductions.
(J) PAYMENT OF BENEFITS
On termination of employment by the Company or termination of service
due to death, disability, retirement, a reduction in force by the
Company, or a covered termination as defined in the Plan, a participant
may elect to receive a lump sum amount equal to the value of the
participant's vested interest in their account. Distributions can be
made in annual installments or in the form of an annuity. Participants
may leave their assets in the Plan until the participant elects a form
of distribution. If the account balance is $5,000 or less, a
distribution payment is made as a single lump sum upon termination.
(2) SUMMARY OF ACCOUNTING POLICIES
The accounting and reporting policies of the Plan conform with generally
accepted accounting principles.
(A) BASIS OF FINANCIAL STATEMENT PRESENTATION
The financial statements of the Plan are prepared using the accrual
method of accounting.
(B) 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 assets, liabilities, and
changes therein, and disclosure of contingent assets and liabilities at
the date of the financial statements. Actual results could differ from
those estimates.
8
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(C) ADMINISTRATIVE EXPENSES
Plan administrative expenses may be paid by the Company and any such
expenses not paid by the Company shall be paid by the Plan.
Substantially all of the Plan's expenses were paid by the Company.
(D) INVESTMENT VALUATION AND INCOME RECOGNITION
The Plan's investments are stated at fair value. The Plan's interest in
the Master Trust is valued at quoted market prices of the underlying
mutual funds, shares of collective investment funds and money market
funds, which represent the net asset value of shares held in the funds
at year end. The Silicon Valley Bancshares Common Stock Fund is valued
based on its quoted market price. Participant loans are valued at cost,
which approximates fair value.
Purchases and sales of securities are recorded on a trade-date basis.
(E) PAYMENTS OF BENEFITS
Benefits are recorded when paid.
(3) INVESTMENTS
In September 1999, the American Institute of Certified Public
Accountants issued Statement of Position 99-3, ACCOUNTING FOR REPORTING
OF CERTAIN DEFINED CONTRIBUTION PLAN INVESTMENTS 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 with the current year's presentation.
As of December 31, 1999 and 1998, the Plan owned 799,035 and 898,919
equivalent shares of Silicon Valley Bancshares common stock with a cost
basis of $8,623,969 and $9,799,129 and a fair market value of
$39,552,220 and $15,309,493, respectively.
9
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
The following tables provide information on participant-directed and
non-participant-directed activity for the Silicon Valley Bancshares
Common Stock Fund:
<TABLE>
<CAPTION>
Participant Non-Participant
1998 Directed Directed Total
------------ ----------------- -------------
<S> <C> <C> <C>
Silicon Valley Bancshares
common stock fund $ 193,356 $15,116,137 $15,309,493
=========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
Participant Non-Participant
1999 Directed Directed Total
------------ ----------------- -------------
<S> <C> <C> <C>
Silicon Valley Bancshares
common stock fund $2,306,166 $37,246,054 $39,552,220
Employer contribution receivable - 2,782,302 2,782,302
------------ ------------- -------------
Balance at December 31, 1999 $2,306,166 $40,028,356 $42,334,522
============ ============= =============
</TABLE>
<TABLE>
<CAPTION>
Participant Non-Participant
1999 Directed Directed Total
------------ ----------------- -------------
<S> <C> <C> <C>
Balance at January 1, 1999 $ 193,356 $15,116,137 $15,309,493
Net appreciation in
fair value of investments 2,165,542 24,573,322 26,738,864
Employer contributions 73,157 2,782,302 2,855,459
Participant contributions 229,793 - 229,793
Rollovers 35,741 - 35,741
Benefits paid to participants (364,727) (1,897,805) (2,262,532)
Loan fees and other expenses (763) (2,983) (3,746)
Interfund transfers (25,933) (542,617) (568,550)
---------- ----------- -----------
Balance at December 31, 1999 $2,306,166 $40,028,356 $42,334,522
========== =========== ===========
</TABLE>
(4) INTEREST IN MASTER TRUST
The Plan's investments are included in the Master Trust, which was
established for the investment of the assets of both the Plan and the
MPP Plan. Each of the above-mentioned plans has an interest in certain
investment portfolios within the Master Trust. The assets of the Master
Trust are held by Merrill Lynch. At December 31, 1999 and 1998, the
Plan's interest in the assets of the Master Trust constituted
approximately 88% and 86%, respectively, of the total assets. Each
plan's assets, earnings (including realized and unrealized gains and
losses on investments), and disbursements are allocated to the funds
based on each individual plan's total for the above-allocated categories
(e.g., total assets, total earnings and total disbursements) as a
percentage of the Master Trust's total for the above-allocated
categories. This allocation excludes transactions related to the ESOP
and participant loan transactions, which are separately accounted for
under the Plan, and contributions to each plan, which are identifiable
by fund. Effective June 1, 1999, the assets of the Plan and the MPP were
separated by plan in the Master Trust.
10
<PAGE>
SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
The Master Trust had the following investments at December 31, 1999 and
1998:
<TABLE>
<CAPTION>
Investments, at fair value: 12/31/99 12/31/98
----------- -------------
<S> <C> <C>
Interest-bearing cash $ 1,522,804 $ 339,977
Common / Collective trusts 15,213,189 12,421,526
Mutual funds 7,719,329 4,453,688
Silicon Valley Bancshares common stock fund 40,678,202 15,599,414
Participant loan account 920,811 761,707
----------- -------------
Total investment $66,054,335 $ 33,576,312
=========== =============
</TABLE>
Investment income for the Master Trust for the year ended December 31,
1999 is as follows:
<TABLE>
<CAPTION>
Net appreciation
in fair value of Interest and
Investments Dividends
----------- ---------
<S> <C> <C>
Interest-bearing cash $ - $ 42,325
Common / Collective trusts 1,998,501 11,803
Mutual funds 1,689,896 544,842
Silicon Valley Bancshares common stock fund 27,138,393 -
Participant loan account - 73,651
----------- ---------
Total investment income $30,826,790 $ 672,621
=========== =========
</TABLE>
(5) RELATED PARTY TRANSACTIONS
The Company is the Plan administrator, as defined in the Plan, and
therefore, all Silicon Valley Bancshares common stock transactions
involving the Plan qualify as exempt party-in-interest transactions.
Investments are managed by Merrill Lynch. Merrill Lynch is the current
Plan trustee and custodian, as defined in the Plan, and therefore, these
transactions also qualify as exempt party-in-interest transactions.
(6) PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right to terminate the Plan or discontinue contributions, in accordance
with the Plan document and under the provisions of ERISA, at any time
and for any reason. In the event of Plan termination, participants will
become fully vested in their Company 401(k) match and ESOP accounts.
(7) TAX STATUS
The Internal Revenue Service has determined and informed the Company, by
a letter dated March 5, 1997, that the Plan, as amended, and related
trust are designed in accordance with applicable sections of the IRC.
The Plan has been further amended since receiving the determination
letter to allow for a participant's account to become fully vested upon
a covered termination, as defined in the Plan. The Plan administrator,
based upon the advice of legal counsel, believes that the Plan is
designed and is currently being operated in compliance with the
applicable requirements of the IRC. Accordingly, no provision for income
taxes is reflected in the accompanying financial statements.
11
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SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(8) CONCENTRATION OF INVESTMENTS
The Plan's investment in shares of the Silicon Valley Bancshares common
stock represents 68% and 53% of total assets as of December 31, 1999 and
1998, respectively. Silicon Valley Bancshares is a bank holding company
whose principal subsidiary is Silicon Valley Bank (the "Bank"), a
California-chartered bank with headquarters in Santa Clara, California.
The Bank maintains regional banking offices in California, and
additionally has loan offices in Arizona, Colorado, Georgia, Illinois,
Massachusetts, Minnesota, North Carolina, Oregon, Pennsylvania, Texas,
Virginia, and Washington.
(9) SUBSEQUENT EVENTS
In March 2000, the Board of Directors of Silicon Valley Bancshares
approved a two-for-one stock split, in the form of a stock dividend
of its common stock. Holders of the Silicon Valley Bancshares' $0.001
par value common stock as of the record date, April 21, 2000 received
one additional share of $0.001 par value for every one share of
common stock they owned as of the record date. The settlement date
for this stock dividend was May 15, 2000, therefore, all common share
and per share amounts included in the accompanying financial
statements do not reflect this stock split.
Effective September 1, 2000, the Company has contracted with Fidelity
Management Trust Company to act as the trustee and custodian, and
Fidelity Institutional Retirement Servies Company to act as the
recordkeeper of the Plan.
12
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SILICON VALLEY BANK 401(k) AND
EMPLOYEE STOCK OWNERSHIP PLAN
SIGNATURES
THE PLAN. 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.
SILICON VALLEY BANCSHARES
Date: June 27, 2000 /s/ Christopher T. Lutes
-----------------------------------------
Christopher T. Lutes
Executive Vice President and
Chief Financial Officer
13
<PAGE>
EXHIBIT INDEX
23.1 Consent of Independent Auditors
14
