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 period ended June 30, 1998 and the year ended December 31, 1997
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 1-8606
-------------
Bell Atlantic Savings Plan for
Bell Atlantic North Salaried Employees
-------------
Bell Atlantic Corporation
1095 Avenue of the Americas, New York, New York 10036
<PAGE>
Item 1. Financial Statements and Exhibits.
(a) Financial Statements of the Plan* included herein:
Independent Auditor's Report
Financial Statements:
Statements of Net Assets Available for Plan Benefits as of
June 30, 1998 and December 31, 1997
Statements of Changes in Net Assets Available for Plan Benefits
for the period ended June 30, 1998 and the year ended December
31, 1997
Notes to Financial Statements
- -------------------------
*This and certain other capitalized terms used but not defined herein shall have
their respective meanings as defined in the Plan Prospectus.
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Corporate Employees' Benefits
Committee of the Bell Atlantic Corporation:
We have audited the accompanying Statement of Net Assets Available for Plan
Benefits of the Bell Atlantic Savings Plan for Bell Atlantic North Salaried
Employees as of June 30, 1998, and the related Statement of Changes in Net
Assets Available for Plan Benefits for the six months ended June 30, 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 audit. The financial statements of the Plan as of December 31, 1997 were
audited by other auditors, whose report dated April 30, 1998, expressed an
unqualified opinion on those statements.
We conducted our audit 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 audit provides 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 Bell Atlantic
Savings Plan for Bell Atlantic North Salaried Employees as of June 30, 1998, and
the changes in its net assets available for benefits for the six months ended
June 30, 1998, in conformity with generally accepted accounting principles.
/s/ MITCHELL & TITUS, LLP
New York, New York
December 24, 1998
1
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED EMPLOYEES
Statement of Net Assets Available for Plan Benefits
June 30, 1998
(Dollars in Thousands)
<TABLE>
<CAPTION>
Fund Information
-------------------------------------------------------------------------------------
Bell Tele- Government Employee Stock
Atlantic communi- Money Passive U.S. Ownership Plan
Shares cations Market Equity Index Income Loan ---------------------
Fund Fund Fund Fund Fund Fund Allocated Unallocated
-------- --------- ---------- ------------ --------- ------ --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $850,014 $199,638 $8,876 $1,194,382 $736,682 $ $479,898 $
Temporary cash investments 24
Bell Atlantic Corporation common shares 503,605
-------- -------- ------ ---------- --------- -------- -------- --------
Total investments 850,014 199,638 8,876 1,194,406 736,682 0 479,898 503,605
Receivables:
Loan repayments 522 6 722 210 (1,847)
Loans to participants 84,856
Dividends and interest receivable 19
-------- -------- ------ ---------- --------- -------- -------- --------
Total receivables 522 0 6 741 210 83,009 0 0
-------- -------- ------ ---------- --------- -------- -------- --------
Total assets 850,536 199,638 8,882 1,195,147 736,892 83,009 479,898 503,605
-------- -------- ------ ---------- --------- -------- -------- --------
LIABILITIES:
Note payable (Note 7) 369,647
-------- -------- ------ ---------- --------- -------- -------- --------
Total liabilities 0 0 0 0 0 0 0 369,647
-------- -------- ------ ---------- --------- -------- -------- --------
Net assets available for plan
benefits (Notes 1 and 2) $850,536 $199,638 $8,882 $1,195,147 $ 736,892 $ 83,009 $479,898 $133,958
======== ======== ====== ========== ========= ======== ======== ========
<CAPTION>
Passive Active
International Active U.S. U.S. Global International
Equity Index Equity Balanced Balanced Equity
Fund Fund Fund Fund Fund
------------- ------------ -------------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $3,808 $125,031 $67,347 $55,749 $42,849
Temporary cash investments 3 1 1 1
Bell Atlantic Corporation common shares
------ -------- ------- ------- -------
Total investments 3,808 125,034 67,348 55,750 42,850
Receivables:
Loan repayments 7 126 42 42 38
Loans to participants
Dividends and interest receivable 2 1 1 1
------ -------- ------- ------- -------
Total receivables 7 128 43 43 39
------ -------- ------- ------- -------
Total assets 3,815 125,162 67,391 55,793 42,889
------ -------- ------- ------- -------
LIABILITIES:
Note payable (Note 7)
0 0 0 0 0
Total liabilities ------ -------- ------- ------- -------
Net assets available for plan
benefits (Notes 1 and 2) $3,815 $125,162 $67,391 $55,793 $42,889
------ -------- ------- ------- -------
<CAPTION>
U.S. Small U.S. Bond
Capitalization Market Index
Fund Fund Total
-------------- ----------- ----------
<S> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $92,334 $115,748 $3,972,356
Temporary cash investments 2 32
Bell Atlantic Corporation common shares 503,605
------- ------- ---------
Total investments 92,336 115,748 4,475,993
Receivables:
Loan repayments 98 34 0
Loans to participants 84,856
Dividends and interest receivable 2 26
------- -------- ----------
Total receivables 100 34 84,882
------- -------- ----------
Total assets 92,436 115,782 4,560,875
------- -------- ----------
LIABILITIES:
369,647
Note payable (Note 7) ------- -------- ----------
0 0 369,647
Total liabilities ------- -------- ----------
Net assets available for plan
benefits (Notes 1 and 2) $92,436 $115,782 $4,191,228
------- -------- ----------
</TABLE>
See notes to financial statements.
2
<PAGE>
NYNEX CORPORATION SAVINGS PLAN for SALARIED EMPLOYEES
Statement of Net Assets Available for Plan Benefits
December 31, 1997
(Dollars in Thousands)
<TABLE>
<CAPTION>
Fund Information
-------------------------------------------------------------------------------------
Bell
Atlantic Government Diversified Interest
Shares Telecommunications Obligations Equity Income Loan
Fund Fund Fund Portfolio Fund Fund
-------- ------------------ ----------- ----------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $808,784 $186,055 $110,813 $1,048,229 $781,835 $ --
Temporary cash investments ............... -- -- -- 2,400 -- --
Bell Atlantic Corporation common shares .. -- -- -- -- -- --
-------- -------- -------- ---------- -------- --------
Total investments ..................... 808,784 186,055 110,813 1,050,629 781,835 --
Receivables:
Employer's contributions ................. -- -- -- -- -- --
Participants' contributions .............. 173 -- -- 462 114 --
Loan repayments .......................... 73 -- -- 158 37 (341)
Loans to participants .................... -- -- -- -- -- 86,503
Dividends and interest receivable ........ -- -- -- 19 -- --
-------- -------- -------- ---------- -------- --------
Total receivables ..................... 246 0 0 639 151 86,162
-------- -------- -------- ---------- -------- --------
Total assets .......................... 809,030 186,055 110,813 1,051,268 781,986 86,162
-------- -------- -------- ---------- -------- --------
LIABILITIES:
Note payable (Note 7)
-------- -------- -------- ---------- -------- --------
Total liabilities ..................... 0 0 0 0 0 0
-------- -------- -------- ---------- -------- --------
Net assets available for plan
benefits (Notes 1 and 2) ............ $809,030 $186,055 $110,813 $1,051,268 $781,986 $ 86,162
======== ======== ======== ========== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------------------
Employee Stock
Ownership Plan Active U.S. U.S. Global International
------------------------ Equity Balanced Balanced Equity
Allocated Unallocated Fund Fund Fund Fund
--------- ----------- ---------- -------- --------- -------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $460,975 $ -- $100,296 $56,000 $50,094 $40,225
Temporary cash investments ............... -- -- 230 128 115 92
Bell Atlantic Corporation common shares .. -- 527,893 -- -- -- --
-------- -------- -------- ------- ------- -------
Total investments ..................... 460,975 527,893 100,526 56,128 50,209 40,317
Receivables:
Employer's contributions ................. 463 -- -- -- -- --
Participants' contributions .............. -- -- 76 30 33 33
Loan repayments .......................... -- -- 22 7 10 10
Loans to participants .................... -- -- -- -- -- --
Dividends and interest receivable ........ -- -- 1 1 1 1
-------- -------- -------- ------- ------- -------
463 -- 99 38 44 44
Total receivables ..................... -------- -------- -------- ------- ------- -------
Total assets .......................... 461,438 527,893 100,625 56,166 50,253 40,361
-------- -------- -------- ------- ------- -------
LIABILITIES:
Note payable (Note 7) 383,647
-------- -------- -------- ------- ------- -------
Total liabilities ..................... 0 383,647 0 0 0 0
-------- -------- -------- ------- ------- -------
Net assets available for plan
benefits (Notes 1 and 2) .............. $461,438 $144,246 $100,625 $56,166 $50,253 $40,361
======== ======== ======== ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
Fund Information
----------------------------------------------
U.S. Bond
U.S. Small Market
Cap Fund Fund Total
----------- --------- ---------
<S> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated share of Master Trust net assets $ 83,014 $ -- $3,726,320
Temporary cash investments ............... 190 -- 3,155
Bell Atlantic Corporation common shares .. -- -- 527,893
-------- --------- ----------
Total investments .................... 83,204 -- 4,257,368
Receivables:
Employer's contributions ................. -- -- 463
Participants' contributions .............. 66 14 1,001
Loan repayments .......................... 19 5 --
Loans to participants .................... -- -- 86,503
Dividends and interest receivable ........ 2 -- 25
-------- --------- ----------
Total receivables .................... 87 19 87,992
-------- --------- ----------
Total assets ......................... 83,291 19 4,345,360
-------- --------- ----------
LIABILITIES:
Note payable (Note 7) 383,647
-------- --------- ----------
Total liabilities .................... 0 0 383,647
-------- --------- ----------
Net assets available for plan
benefits (Notes 1 and 2) ............. $ 83,291 $ 19 $3,961,713
======== ========= ==========
</TABLE>
See notes to financial statements.
3
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED EMPLOYEES
Statement of Changes in Net Assets Available for Plan Benefits
For the period ended June 30, 1998
(Dollars in Thousands)
<TABLE>
<CAPTION>
Fund Information
------------------------------------------------------------------------
Bell Government
Atlantic Telecom- Money Passive U.S. Government
Shares munications Market Equity Index Obligations
Fund Fund Fund Fund Fund
--------- --------- ------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Allocations:
Employee allotments $ 10,998 $ 8 $ 111 $ 24,023 $
Rollover contributions 65 21 59
Employing company contributions (Note 1)
Allocation of shares to participants
Supplemental contributions
Loans to participants (4,483) (513) (47) (5,877)
Transfer for loan repayments 4,830 2 45 8,863
--------- --------- ------- ----------- ---------
Total allotments, contributions
and allocations 11,410 (503) 130 27,068 0
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 13,031 25,090 267 176,651
--------- --------- ------- ----------- ---------
Total additions 24,441 24,587 397 203,719 0
--------- --------- ------- ----------- ---------
Deductions:
Administrative expenses 205 52 4 279
Distributions to participants 27,795 6,304 663 40,023
Interest on note
--------- --------- ------- ----------- ---------
Total deductions 28,000 6,356 667 40,302 0
--------- --------- ------- ----------- ---------
Change in net assets prior to interfund
and plan transfers (3,559) 18,231 (270) 163,417 0
Transfers:
Interfund transfers 41,856 (4,623) 9,144 (22,316) (110,813)
Plan transfers in 4,077 15 3,438
Plan transfers out (868) (25) (7) (660)
--------- --------- ------- ----------- ---------
Total transfers 45,065 (4,648) 9,152 (19,538) (110,813)
--------- --------- ------- ----------- ---------
Net increase (decrease) in net assets 41,506 13,583 8,882 143,879 (110,813)
Net assets available for plan benefits:
Beginning of year - January 1, 1998 809,030 186,055 0 1,051,268 110,813
--------- --------- ------- ----------- ---------
End of period - June 30, 1998 (Notes 1 and 2) $ 850,536 $ 199,638 $ 8,882 $ 1,195,147 $ 0
========= ========= ======= =========== =========
<CAPTION>
Fund Information
------------------------------------------------------------------------------
Employee Stock Passive
Ownership Plan International Active
Income Loan ---------------------- Equity Index U.S. Equity
Fund Fund Allocated Unallocated Fund Fund
--------- -------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Allocations:
Employee allotments $ 6,859 $ $ $ $ 121 $ 4,367
Rollover contributions 1 7 38
Employing company contributions (Note 1) 26,207
Allocation of shares to participants 12,390 (12,390)
Supplemental contributions
Loans to participants (2,157) 15,825 (195) (13) (814)
Transfer for loan repayments 2,690 (18,978) 34 1,370
--------- -------- --------- --------- -------- --------
Total allotments, contributions
and allocations 7,393 (3,153) 12,195 13,817 149 4,961
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 24,871 24,390 (799) 307 13,051
--------- -------- --------- --------- -------- --------
Total additions 32,264 (3,153) 36,585 13,018 456 18,012
--------- -------- --------- --------- -------- --------
Deductions:
Administrative expenses 342 245 2 214
Distributions to participants 36,250 14,009 26 3,749
Interest on note 24,342
--------- -------- --------- --------- -------- --------
Total deductions 36,592 0 14,254 24,342 28 3,963
--------- -------- --------- --------- -------- --------
Change in net assets prior to interfund
and plan transfers
(4,328) (3,153) 22,331 (11,324) 428 14,049
Transfers:
Interfund transfers (41,383) (3,782) 3,344 9,608
Plan transfers in 1,049 69 1,036 43 968
Plan transfers out (432) (158) (88)
--------- -------- --------- --------- -------- --------
Total transfers (40,766) 0 (3,871) 1,036 3,387 10,488
--------- -------- --------- --------- -------- --------
Net increase (decrease) in net assets (45,094) (3,153) 18,460 (10,288) 3,815 24,537
Net assets available for plan benefits:
Beginning of year - January 1, 1998 781,986 86,162 461,438 144,246 0 100,625
--------- -------- --------- --------- -------- --------
End of period - June 30, 1998 (Notes 1 and 2) $ 736,892 $ 83,009 $ 479,898 $ 133,958 $ 3,815 $125,162
========= ======== ========= ========= ======== ========
<CAPTION>
Active U.S. Small
U.S. Global International Capital- U.S. Bond
Balanced Balanced Equity ization Market Index
Fund Fund Fund Fund Fund Total
-------- -------- -------- -------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Allocations:
Employee allotments $ 1,734 $ 1,744 $ 1,696 $ 3,708 $ 1,418 $ 56,787
Rollover contributions 10 11 8 23 2 245
Employing company contributions (Note 1) 26,207
Allocation of shares to participants 0
Supplemental contributions 0
Loans to participants (270) (310) (300) (559) (287) 0
Transfer for loan repayments 488 500 457 1,055 422 1,778
-------- -------- -------- -------- --------- -----------
Total allotments, contributions
and allocations 1,962 1,945 1,861 4,227 1,555 85,017
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 5,656 4,957 3,996 8,249 3,006 302,723
-------- -------- -------- -------- --------- -----------
Total additions 7,618 6,902 5,857 12,476 4,561 387,740
-------- -------- -------- -------- --------- -----------
Deductions:
Administrative expenses 119 114 136 347 32 2,091
Distributions to participants 2,240 1,399 1,235 3,199 4,956 141,848
Interest on note 24,342
-------- -------- -------- -------- --------- -----------
Total deductions 2,359 1,513 1,371 3,546 4,988 168,281
Change in net assets prior to interfund
and plan transfers 5,259 5,389 4,486 8,930 (427) 219,459
Transfers:
Interfund transfers 5,637 (134) (2,155) (410) 116,027 0
Plan transfers in 331 326 206 699 245 12,502
Plan transfers out (2) (41) (9) (74) (82) (2,446)
-------- -------- -------- -------- --------- -----------
Total transfers 5,966 151 (1,958) 215 116,190 10,056
-------- -------- -------- -------- --------- -----------
Net increase (decrease) in net assets 11,225 5,540 2,528 9,145 115,763 229,515
Net assets available for plan benefits:
Beginning of year - January 1, 1998 56,166 50,253 40,361 83,291 19 3,961,713
-------- -------- -------- -------- --------- -----------
End of period - June 30, 1998 (Notes 1 and 2) $ 67,391 $ 55,793 $ 42,889 $ 92,436 $ 115,782 $ 4,191,228
======== ======== ======== ======== ========= ===========
</TABLE>
See notes to financial statements.
4
<PAGE>
NYNEX CORPORATION SAVINGS PLAN for SALARIED EMPLOYEES
Statement of Changes in Net Assets Available for Plan Benefits
For the year ended December 31, 1997
(Dollars in Thousands)
<TABLE>
<CAPTION>
Fund Information
----------------------------------------------------------------------------
Bell Telecom-
Atlantic munica- Government Diversified Interest
Shares tions Obligations Equity Income Loan
Fund Fund Fund Portfolio Fund Fund
-------- --------- ----------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions, Allocations and Transfers:
Employee allotments $ 18,244 $ 2,655 $ 2,162 $ 39,618 $ 16,077 $ --
Interfund transfers (69,266) (14,128) (6,175) 85,519 2,754 --
Plan transfers-in 8,334 978 1,191 8,654 5,591 --
Rollover contributions 180 53 54 446 56 --
Employing company contributions (Note 1) 1,420 116 192 2,026 1,594 --
Allocation of shares to participants -- -- -- -- -- --
Supplemental contributions -- -- -- -- -- --
Loans to participants (9,333) (910) (743) (12,795) (7,021) 35,251
Transfer for loan repayments 7,586 944 891 13,614 5,919 (34,952)
-------- --------- -------- ---------- -------- ---------
Total allotments, contributions,
allocations and transfers (42,835) (10,292) (2,428) 137,082 24,970 299
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 289,701 54,654 7,250 217,776 50,799 --
-------- --------- -------- ---------- -------- --------
Total additions 246,866 44,362 4,822 354,858 75,769 299
-------- --------- -------- ---------- -------- --------
Deductions:
Administrative expenses 208 59 59 275 300 --
Distributions to participants 59,653 14,067 10,475 70,828 78,700 --
Plan transfers-out 813 100 28 918 788 --
Interest on note -- -- -- -- -- --
-------- -------- ------- --------- ------- --------
Total deductions 60,674 14,226 10,562 72,021 79,788 --
-------- -------- ------- --------- ------- --------
Net (decrease) increase 186,192 30,136 (5,740) 282,837 (4,019) 299
Net assets available for plan benefits:
Beginning of year - January 1, 1997 622,838 155,919 116,553 768,431 786,005 85,863
-------- --------- -------- ---------- -------- --------
End of year - December 31, 1997 (Notes 1 and 2) $809,030 $ 186,055 $110,813 $1,051,268 $781,986 $ 86,162
======== ========= ======== ========== ======== ========
</TABLE>
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------
Employee Stock
Ownership Plan Active U.S. Global
------------------------ U.S. Equity Balanced Balanced
Allocated Unallocated Fund Fund Fund
---------- ----------- ----------- -------- --------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions, Allocations and Transfers:
Employee allotments $ -- $ -- $ 6,250 $ 2,610 $ 3,294
Interfund transfers -- -- (11,288) (1,437) (7,876)
Plan transfers-in -- -- 11,051 749 621
Rollover contributions -- -- 148 56 63
Employing company contributions (Note 1) 15,899 -- 261 131 148
Allocation of shares to participants 22,404 (22,404) -- -- --
Supplemental contributions -- 26,454 -- -- --
Loans to participants (346) -- (1,280) (504) (704)
Transfer for loan repayments -- -- 1,734 673 937
-------- -------- -------- ------- -------
Total allotments, contributions,
allocations and transfers 37,957 4,050 6,876 2,278 (3,517)
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 153,532 188,807 41,130 20,388 22,036
-------- -------- -------- ------- -------
Total additions 191,489 192,857 48,006 22,666 18,519
-------- -------- -------- ------- -------
Deductions:
Administrative expenses 149 -- 276 193 238
Distributions to participants 21,579 4,791 3,558 3,417
Plan transfers-out -- -- 133 59 39
Interest on note -- 38,012 -- -- --
-------- -------- -------- -------
Total deductions 21,728 38,012 5,200 3,810 3,694
-------- --------- -------- -------
Net (decrease) increase 169,761 154,845 42,806 18,856 14,825
Net assets available for plan benefits:
Beginning of year - January 1, 1997 291,677 (10,599) 57,819 37,310 35,428
-------- --------- -------- ------- -------
End of year - December 31, 1997 (Notes 1 and 2) $461,438 $ 144,246 $100,625 $56,166 $50,253
======== ========= ======== ======= =======
</TABLE>
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------
International U.S. Bond
Equity U.S. Small Market
Fund Cap Fund Fund Total
------------- -------------- -------------- ----------
<S> <C> <C> <C> <C>
Additions:
Allotments, Contributions, Allocations and Transfers:
Employee allotments $ 3,373 $ 5,070 $ 14 $ 99,367
Interfund transfers 1,991 19,906 -- 0
Plan transfers-in 572 1,003 -- 38,744
Rollover contributions 51 96 -- 1,203
Employing company contributions (Note 1) 149 245 -- 22,181
Allocation of shares to participants -- -- -- --
Supplemental contributions -- -- -- 26,454
Loans to participants (655) (960) 0
Transfer for loan repayments 983 1,425 5 (241)
------- ------- ------ ----------
Total allotments, contributions,
allocations and transfers 6,464 26,785 19 187,708
Investment income:
Allocated share of Master Trust investment
activities (Note 3) 3,436 16,058 -- 1,065,567
-------- ------- ------ ----------
Total additions 9,900 42,843 19 1,253,275
-------- ------- ------ ----------
Deductions:
Administrative expenses 248 519 -- 2,524
Distributions to participants 2,590 3,398 -- 273,056
Plan transfers-out 48 137 -- 3,063
Interest on note -- -- -- 38,012
-------- ------- ------ ----------
Total deductions 2,886 4,054 -- 316,655
-------- ------- ------ --------
Net (decrease) increase 7,014 38,789 19 936,620
Net assets available for plan benefits:
Beginning of year - January 1, 1997 33,347 44,502 -- 3,025,093
-------- ------- ------ ----------
End of year - December 31, 1997 (Notes 1 and 2) $40,361 $83,291 $ 19 $3,961,713
======== ======= ====== ==========
</TABLE>
See notes to financial statements.
5
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements
(Dollars in Thousands)
1. Plan Description
The Plan* was established by NYNEX Corporation ("NYNEX") on January 1,
1984 to provide a convenient way for salaried employees to save on a
regular and long-term basis. In August 1997, NYNEX merged with Bell
Atlantic Corporation (the "merger") to form the new Bell Atlantic
Corporation ("Bell Atlantic"). The Plan's title changed to the Bell
Atlantic Savings Plan for Bell Atlantic North Salaried Employees
effective January 1, 1998. As of the date of the merger, the Plan's
investments in the NYNEX Shares Fund and the Employee Stock Ownership
Plan ("ESOP") were converted into shares of Bell Atlantic common stock
within the Bell Atlantic Shares Fund and the ESOP Fund. Participants are
able to invest in one or more combinations of the following funds
(referred to herein individually as a "Fund" and collectively as the
"Funds"): Bell Atlantic Shares Fund, Telecommunications Fund, U.S. Bond
Market Index Fund, Passive U.S. Equity Index Fund, Government Money
Market Fund, Income Fund, Passive International Equity Index Fund, U.S.
Balanced Fund, Global Balanced Fund, Active U.S. Equity Fund, Active
International Equity Fund and U.S. Small Capitalization Fund. The ESOP
component of the Plan is described below.
Allotments and Contributions
An Eligible Employee may authorize a basic pre-tax or after-tax
allotment from 1% to 6% of Salary. A pre-tax or after-tax supplementary
allotment of not more than 10% of Salary may be authorized by employees
electing the maximum 6% basic allotment. In 1997, Employing Company
matching contributions were made based upon an amount equal to 66 2/3%
of the authorized Basic After-Tax Allotment and 75% of the authorized
Basic Pre-Tax Allotment of each Participating Employee. Effective
January 1, 1998, the Employing Company matching contributions were
increased to 83 1/3% of both the authorized Basic After-Tax Allotment
and authorized Basic Pre-Tax Allotment. Such matching contributions on
authorized Basic Pre-Tax Allotments are invested currently only in Bell
Atlantic shares and are placed in an ESOP account within the Plan.
Eligible Employees of certain Bell Atlantic companies that participate
in the Plan, and are immaterial to the Plan, are subject to different
rules concerning allotments, company matching contributions and
participation in the ESOP. For a detailed discussion of these
differences, participants should refer to the Plan Document.
Contributions are subject to applicable rules set forth in the Internal
Revenue Code (the "Code") and the regulations thereunder.
*This and certain other capitalized terms used but not defined herein shall have
their respective meanings as defined in the Plan Prospectus.
6
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Participating Employees are immediately vested in their contributions
plus actual earnings thereon. A Participating Employee shall be vested
in his/her accrued benefit derived from Employing Company contributions
and Employing Company ESOP contributions after completing three years of
service. Non-vested Employing Company contributions which are forfeited
are applied as a credit to reduce subsequent contributions of the
Employing Company. At June 30, 1998 and December 31, 1997, forfeited
non-vested accounts were $119 and $279, respectively.
Termination Priorities
Although it has not expressed intent to do so, in the event that the
Plan is terminated by Bell Atlantic, subject to conditions set forth in
the Employee Retirement Income Security Act of 1974, as amended, the
Plan provides that the net assets shall be distributed to Participating
Employees in an amount equal to their respective vested interests in
such assets.
Fund Options
Beginning in 1998, three new fund options were offered to participants:
o Government Money Market Fund
o U.S. Bond Market Index Fund
o Passive International Equity Index Fund
The Bell Atlantic Shares Fund invests primarily in the common stock of
Bell Atlantic.
The Telecommunications Fund's portfolio is comprised of investments in
twenty-eight North American telephone utility and telecommunications
companies each with a minimum market value of approximately $1 billion
at June 30, 1998. Effective January 1, 1998, the Telecommunications Fund
was no longer open to new investments. Participants who did not elect a
new investment direction had their contributions automatically directed
to the Passive U.S. Equity Index Fund. Also effective January 1, 1998,
transfers of participant existing balances into the Telecommunications
Fund were prohibited. Dividends, including stock dividends of the
Telecommunications Fund, will be reinvested in the Fund. Participants
will be allowed to move money out of the Fund at any time. The Fund is a
market weighted index fund and is managed by Bell Atlantic Asset
Management Company ("BAAMCO").
Effective January 1, 1998, the Government Obligations Fund was no longer
offered as a fund selection. Any balances in the Fund were automatically
transferred to the U.S. Bond
7
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Market Index Fund along with any investment directions designated to the
Government Obligations Fund. To accomplish this automatic transfer, some
of the Government Obligations Fund's assets were held in shorter
maturity government instruments beginning in December 1997. The U.S.
Bond Market Index Fund includes all U.S. Treasury, government-sponsored,
mortgage-backed, asset-backed and investment-grade corporate bonds, with
at least one year maturity and at least $100 million outstanding. The
Fund may use interest rate futures and various other kinds of
derivatives to adjust portfolio duration or as interest rate hedges. The
Fund is managed by Barclays Global Investors, N.A.
The Passive U.S. Equity Index Fund invests in an equity index fund which
is managed by BAAMCO. This Fund is principally a portfolio of common
stocks and is structured and maintained with the objective of providing
investment results which approximate the overall performance of the
common stocks included in the Standard and Poors Composite Index of 500
stocks.
The Government Money Market Fund invests in securities of the U.S.
government or it's agencies, obligations guaranteed or insured by the
U.S. government and repurchase agreements that use these securities as
collateral. The average maturity of the securities in the Fund generally
will be 30 to 60 days, but may vary from one to 90 days. The Fund may
use interest rate futures for cash management purposes or to adjust the
average duration of the portfolio. The Fund is managed by Bankers Trust
Company.
The Income Fund, invests primarily in a diversified portfolio of
guaranteed insurance contracts ("GICs") issued by insurance companies.
Some of the assets of the Fund are also invested in pools of
asset-backed securities, corporate bonds, and obligations of the United
States Government and its agencies ("Synthetic Guaranteed Investment
Contract"). As an integral part of the purchase of each pool of these
investments, a financial institution agrees to protect the pool, via a
wrapper contract, to the extent its market value and/or interest return
fluctuates but not in the event of a default of any security in the
pool. The Plan is exposed to credit risk in the event of nonperformance
by the entities with whom the contracts are placed. The Plan seeks to
minimize credit risk by diversifying among a group of GIC issuers and
other financial institutions which meet certain investment criteria
established by BAAMCO. These contracts guarantee (i) a fixed rate of
interest for a fixed period of time or (ii) a fixed rate of interest for
a fixed or indefinite period of time combined with the right to
participate in income earned above such fixed rate. Such interest is not
guaranteed by any of the Employing Companies. The Fund is managed by
BAAMCO. (For further discussion of this Fund see Note 2.)
8
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
The Passive International Equity Index Fund has investments that mirror
the MSCI-EAFE-GDP, which is an index established by Morgan Stanley,
comprised of approximately 1,000 companies from 20 of the largest
countries outside of the United States, including Japan, Germany and the
United Kingdom. The weighting of each country in the index is based upon
its GDP, which is a measure of domestic economic output. The Fund holds
stocks represented in the index. The Fund is managed by Barclays Global
Investors, N.A.
In addition to the Passive U.S. Equity Index Fund, each of the following
five Funds invest in the assets of unitized investment advisor
account(s) of the Bell Atlantic Master Trust ("Master Trust"), as
designated by BAAMCO.
The U.S. Balanced Fund invests primarily in domestic stocks and bonds.
The fixed income portion of the Fund may invest a small portion of its
assets in issues of international agencies, foreign governments, their
agencies and foreign corporations. The Fund targets approximately 60% in
stocks and 40% in bonds. As of June 30, 1998, BAAMCO had selected the
following unitized investment advisor account(s) of the Master Trust
("Master Trust pooled accounts") for the Fund: Barrow, Hanley, Mewhinney
& Strauss, Inc., Equinox Capital Management, LLC, Fidelity Management
Trust Company, Franklin Portfolio Associates, Inc., Gardner Lewis Asset
Management, L.P., Goldman Sachs, Independence Investment Associates,
Inc., Miller Anderson & Sherrerd, LLP, Palisade Capital Management,
L.L.C., Provident Investment Counsel, State Street Research and
Management Company, Transamerica, Trinity Investment Management
Corporation, and Wilshire Associates Incorporated.
The Global Balanced Fund invests in the world's capital markets,
primarily in equity and fixed income instruments. The Fund is
diversified and has representation in a variety of countries, from those
of the most mature and developed nations to those still in their
developmental stages (generally referred to as emerging markets
countries). The Fund may invest in large or small capitalization stocks.
The Global Balanced Fund typically targets 75% of its investments for
the domestic market and 25% for the foreign market, and approximately
70% in stocks and 30% in bonds. Emerging markets investments are
targeted at 4% of the total Fund. As of June 30, 1998, BAAMCO had
selected the following Master Trust pooled accounts for the Fund:
Barrow, Hanley, Mewhinney & Strauss, Inc., Capital Guardian
International Small Cap, Capital Guardian Trust Company, Equinox Capital
Management, LLC, Fidelity Management Trust Company, Franklin Portfolio
Associates, Inc., Gardner Lewis Asset Management, L.P., Goldman Sachs,
Independence Investment Associates, Inc., Miller Anderson & Sherrerd,
LLP, Morgan Stanley Asset Management, Morgan Stanley International,
Northern Cross Investments, Ltd., Palisade Capital Management, L.L.C.,
9
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Provident Investment Counsel, Rogge Global Partners, PLC, State Street
Global Advisors, State Street Research and Management Company,
Transamerica, Trinity Investment Management Corporation, and Wilshire
Associates Incorporated.
The Active U.S. Equity Fund invests primarily in domestic common stocks.
As of June 30, 1998, BAAMCO had selected the following Master Trust
pooled accounts for the Fund: Barrow, Hanley, Mewhinney & Strauss, Inc.,
Equinox Capital Management, LLC, Fidelity Management Trust Company,
Franklin Portfolio Associates, Inc., Gardner Lewis Asset Management,
Goldman Sachs, Independence Investment Associates, Inc., L.P., Miller,
Anderson & Sherrerd, LLP, Palisade Capital Management, L.L.C., Provident
Investment Counsel, Transamerica, Trinity Investment Management
Corporation and Wilshire Associates Incorporated.
The Active International Equity Fund invests in international equity
markets throughout the world, generally excluding the United States. It
is well-diversified and has representation in a variety of economies,
from those of the most mature and developed nations to those still in
their developmental stages (generally referred to as emerging market
countries). The Fund may invest in large or small capitalization stocks.
It targets 80% of its investments for developed countries such as Japan,
Germany and the United Kingdom and 20% for emerging markets such as
Brazil, Mexico and Taiwan. As of June 30, 1998, BAAMCO had selected
Capital Guardian International Small Cap, Capital Guardian Trust
Company, Morgan Stanley Asset Management, Morgan Stanley International,
Northern Cross and State Street Global Advisors as the Master Trust
pooled accounts for the Fund.
The U.S. Small Capitalization Fund invests primarily in the stocks of
smaller-sized domestic companies, generally with a market capitalization
that is in the smallest 15% of publicly traded stocks. As of June 30,
1998, BAAMCO had selected the following as the Master Trust pooled
accounts for the Fund: Columbus Circle Investors, Gardner Lewis Asset
Management, L.P., Investment Counselors of Maryland, Inc., the Boston
Company Asset Management, Inc., Provident Investment Counsel and
Wilshire Associates Inc. Small Value.
The ESOP is a leveraged Fund that invests primarily in Bell Atlantic
shares. The ESOP component of the Plan is a stock bonus plan intended to
qualify under Sections 401(a)(4) and 4975(e)(7) of the Code. An
employee's Employing Company ESOP Contribution Account reflects all
amounts released from the ESOP Suspense Account and any additional
Employing Company contributions that were made on and after July 1, 1990
to match the employee's Employee Basic Pre-Tax Allotments. Since
January 1, 1998, it also represents Employee Basic Post-Tax Allotments
as well, together with the earnings thereon. The employee may
10
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
not withdraw or transfer funds out of the ESOP Fund except for hardship
withdrawals and during certain election periods commencing with the Plan
year in which occurs the latest of the (a) employee's attainment of age
55 or (b) completion of 10 years of participation in the Plan. The
amounts allowed to be transferred during any election period are subject
to certain limitations under the terms of the Plan.
The ESOP Suspense Account (the "Unallocated Fund") which is part of the
ESOP Fund consists of Bell Atlantic Shares that were acquired with the
proceeds of an acquisition loan which have not yet been released and
allocated to Participating Employees.
Participating Employees may request loans against their savings plan
balances. The amount that a Participating Employee may borrow is limited
by certain factors, including the Employee's vested interest in the
respective Employee's pre-tax account. Generally, the amount can be no
less than one thousand dollars and no greater than fifty thousand
dollars less the highest outstanding principal over the last twelve
months. An employee may not have more than two loans outstanding. Except
under certain circumstances, the loans provide for periodic repayments
over a period not to exceed five years, at an interest rate determined
under the Plan. Effective September 1, 1993, Participating Employees
also may prepay the entire loan at any time, after the first of the
month following the loan's effective date. Loans are collateralized by
the Participating Employee's vested account and are recorded in the Loan
Fund. In the event of a default, all of the Participating Employee's
contributions to the Plan shall be suspended. In addition, the Corporate
Employees' Benefit Committee (the "Committee") shall cause the amount of
unpaid debt to be deducted from any interest in, or payment or
distribution from, the employee's account, subject to certain
limitations. If the amount of such interest, payment or distribution is
not sufficient to repay the unpaid balance of said debt, the Committee
may exercise the Plan's right, if any, to any non-Plan assets and to the
extent a loan balance remains, take whatever collection action,
including suit, the Committee determines necessary.
All the assets of the Plan are included in the Master Trust (See Note 2)
for which Mellon Bank, N.A., is the trustee.
Wellspring Resources, LLC was the recordkeeper for the Plan through June
30, 1998. As of July 1, 1998, PriceWaterhouseCoopers Kwasha HR Solutions
became the recordkeeper for the merged plan.
For a complete description of the Plan, participants should refer to the
Plan Document.
11
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
2. Accounting Policies
Investments
The NYNEX Master Trust was established on January 1, 1984, and through
December 31, 1994, it served as the vehicle for the investment of the
assets of two defined benefit pension plans of NYNEX, the NYNEX Pension
Plan and the NYNEX Management Pension Plan. During the period of January
1, 1995 through December 31, 1997, all of the assets of NYNEX's defined
contribution plans were transferred into the NYNEX Master Trust.
Effective January 1, 1998, the NYNEX Master Trust was renamed the Bell
Atlantic Master Trust. Also as of January 1, 1998, the assets of Bell
Atlantic's defined benefit plans and defined contribution plans were
transferred to the trust.
Value of Investments Held In the Master Trust (See Note 3)
The Trustee values the investments in the Master Trust as follows:
Investments in securities traded on national and foreign securities
exchanges are valued by the Trustee at the last reported sale prices on
the last business day of the year or, if no sales were reported on that
date, at the last reported bid prices. Over-the-counter securities and
government obligations are valued at the bid prices or the average of
the bid and asked prices on the last business day of the year from
published sources where available or, if not available, from other
sources considered reliable, generally broker quotes.
The value of each contract with an insurance company or other financial
institution included in the Income Fund is reported at contract value in
the Statements of Net Assets Available for Plan Benefits based upon the
principal then invested in by the Fund plus the interest then accrued on
such principal, which approximates the fair value. In accordance with
Statement of Position 94-4 "Reporting of Investment Contracts held by
Health and Welfare Benefit Plans and Defined Contribution Pension Plans"
and in connection with the fully benefit-responsive investment
contracts, the following information is presented:
(i) The asset weighted crediting interest rate yielded a return of
6.2% and 6.5% for the periods ended June 30, 1998 and December
31, 1997, respectively.
(ii) The crediting interest rates ranged from 4.2% to 9.3% at June
30, 1998 and December 31, 1997.
(iii) The fair value, as determined by discounting future cash flows
of the underlying investments, at June 30, 1998 and December 31,
1997, respectively was approximately $1,137,717 and $709,466.
12
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Forward currency contracts are accounted for as contractual commitments
on a trade date basis and are carried at fair value derived by the
Trustee at the exchange rate prevailing on the last business day of the
year. Index futures contracts are recorded as contractual commitments on
a trade-date basis and are carried at fair value based on the closing
index futures price prevailing on the last business day of the year.
Both exchange rates and index futures prices are readily available from
published sources.
Temporary cash investments are stated at redemption value which
approximates fair value.
Purchases and Sales of Investments
Purchases and sales of investments are reflected as of the trade date.
Realized gains and losses on sales of investments are determined on the
basis of average cost.
Investment Income
Dividend income is recorded on the ex-dividend date. Interest earned on
investments is recorded on the accrual basis.
Net Appreciation (Depreciation) of Investments
The Statements of Changes in Net Assets Available for Plan Benefits
reflects the net appreciation (depreciation) in the fair value of the
Plan's investments, which consists of the realized gains or losses and
the unrealized appreciation (depreciation) on those investments.
Distributions
Distributions elected to be withdrawn from the Plan by participants are
recorded when paid.
Plan Expenses
The Plan pays certain administrative fees out of Fund assets held in the
Master Trust and out of interest income earned from the Plan's
disbursement account, as held by the Trustee, in accordance with Plan
provisions and to the extent permitted by law. Any fees not paid by the
Plan are paid by Bell Atlantic.
Bell Atlantic's Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires Bell Atlantic, as Plan
administrator, to make significant estimates and assumptions that affect
the reported amounts of net assets available for plan benefits at the
date of the financial statements and the changes in net assets available
for benefits during the reporting period and, when applicable,
disclosures of contingent assets and liabilities at the date of the
financial statements. Actual results could differ from those estimates.
13
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Risks and Uncertainties
The Plan provides for various participant investment options in any
combination of funds which can invest in any combination of stocks,
bonds, fixed income securities, mutual funds, and other investment
securities. Investment securities are exposed to various risks, such as
interest rate, market, and credit risks. Due to the level of risk
associated with certain investment securities, it is at least reasonably
possible that changes in the values of investment securities will occur
in the near term and that such changes could materially affect
participants' account balances and the amounts reported in the
Statements of Net Assets Available for Plan Benefits.
3. Investments
The following table reflects the investments that represent 5% or more
of the net assets in the Master Trust as of June 30, 1998 and December
31, 1997:
<TABLE>
<CAPTION>
1998 1997
------------ -------------
<S> <C> <C>
Bell Atlantic Corporation common shares $ 2,886,659 $ 2,761,266
</TABLE>
Investment in Master Trust
All of the investment assets in the Master Trust are managed by BAAMCO
or external investment advisors. The assets in the Master Trust are
either (a) pooled between the defined benefit plans and the defined
contribution plans or (b) net assets that are specific to the defined
benefit plans, or (c) net assets specific to the defined contribution
plans. The total fair value of the Master Trust at June 30, 1998 and
December 31, 1997 was approximately $51 billion (of which net assets
totalling approximately $37 billion are specific to the defined benefit
pension plans, item (b) above, for which separate financial statements
are prepared) and approximately $26 billion respectively.
Investments held in Pooled Accounts
The pooled investments are unitized, aggregated and reported by the
Master Trust with a carrying value of $22,938,702 and $11,845,864 at
June 30, 1998 and December 31, 1997, respectively, and with investment
earnings of $1,607,953 and $2,070,271 for the period or year ended June
30, 1998 and December 31, 1997, respectively. Given that the pooled
accounts include interests of the defined contribution plans and the
defined benefit plans, the totals in each respective statement do not
equal the carrying value or net investment income of/from the Master
Trust pooled accounts in this footnote.
14
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
The total investments held in the Master Trust pooled accounts at June
30, 1998 and December 31, 1997 were as follows:
<TABLE>
<CAPTION>
Fair Value (Note 2)
------------------------------
Description 1998 1997
----------- ------------- --------------
<S> <C> <C>
Receivables $ 1,044,775 $ 721,643
Common Stock 18,588,770 9,313,917
Bell Atlantic Corporation common shares 123,735 101,036
Preferred Stock 155,817 79,863
U.S. Government Securities 1,526,981 892,987
Corporate Debt - preferred and other 1,577,778 832,741
Real estate 204 278
Temporary cash investments 523,508 391,265
Other investments* 636,877 277,734
------------- --------------
24,178,445 12,611,464
Liabilities 1,239,743 765,600
------------- --------------
Total pooled net assets in the Master Trust $ 22,938,702 $ 11,845,864
============= ==============
</TABLE>
*Other investments include foreign investments, principally foreign
government debt.
The Plan's interests in the Master Trust pooled accounts carrying value
and investment income of the Master Trust pooled accounts are reported
in each respective Fund Option as the "Allocated share of Master Trust
net assets" in 1998 and 1997, respectively, in the Statement of Net
Assets Available for Plan Benefits and "Allocated share of Master Trust
investment activities" in the Statements of Changes in Net Assets
Available for Plan Benefits for the period or year ended June 30, 1998
and December 31, 1997.
Investments in the Master Trust are allocated to the Plan's Fund Options
in accordance with their respective percentages of interest. The
proportionate interests of the Plan's Fund Options in the carrying value
of the Master Trust pooled accounts at June 30, 1998 and December 31,
1997 were as follows:
15
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
<TABLE>
<CAPTION>
Carrying Carrying
Value Value
1998 1998 1997 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Active U.S. Equity Fund $ 125,162 0.5436% $ 100,625 0.8495%
U.S. Balanced Fund 67,391 0.2938% 56,166 0.4741%
Global Balanced Fund 55,793 0.2432% 50,253 0.4242%
Active International Equity Fund 42,889 0.1870% 40,361 0.3407%
U.S. Small Capitalization Fund 92,436 0.4030% 83,291 0.7031%
Passive U.S. Equity Index Fund 1,195,147 5.2102% 1,051,268 8.8746%
------------- -------------
Total $ 1,578,818 $ 1,381,964
============= =============
</TABLE>
Investments Held in Specific Accounts
Effective January 1, 1998, the assets of all Bell Alantic's defined
contribution plans were included in the Master Trust. The net assets
specific to these plans are the Bell Atlantic Shares Fund,
Telecommunications Fund, Government Money Market Fund, Income Fund, Loan
Fund, the ESOP allocated account, Passive International Equity Index
Fund, and the U.S. Bond Market Index Fund.
The investments held in the Master Trust specific accounts for the
defined contribution plans at June 30, 1998 and December 31, 1997 were
as follows:
<TABLE>
<CAPTION>
Fair Value (Note 2)
---------------------------
Description 1998 1997
----------- ------------ -------------
<S> <C> <C>
Receivables $ 345,985 $ 231,946
Common Stock 338,372 307,288
Bell Atlantic Corporation common shares 2,762,924 2,660,230
Temporary cash investments 722,695 599,054
Fixed income obligations - insurance contract 1,751,261 1,105,670
Fixed income corporate obligations - 118,112
Other investments 293,426 -
------------ -------------
Total net assets in the specific accounts in the
Master Trust $ 6,214,663 $ 5,022,300
============ =============
</TABLE>
16
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
Investments in the Master Trust are allocated to the Plan's Fund Options
in accordance with their respective percentages of interest. The
proportionate interest of the Plan in the carrying value of the Master
Trust specific accounts at June 30, 1998 were as follows:
<TABLE>
<CAPTION>
Carrying
Value Plan %
---------------------------
<S> <C> <C>
Bell Atlantic Shares Fund $ 850,536 13.69
Telecommunications Fund 199,638 3.21
Government Money Market Fund 8,882 .14
Passive International Equity Index
Fund 3.815 .06
Income Fund 736,892 11.86
Loan Fund 83,009 1.34
Employee Stock Ownership Plan 613,856 9.88
U.S. Bond Market Index Fund 115,782 1.86
------------
Total $ 2,612,410
============
</TABLE>
Investment Income
Investment income and expenses are allocated to the Plan's Fund Options
daily in accordance with their respective daily percentages of interest
in the Master Trust's pooled accounts. Percentages of interest are based
on the daily ratio of units owned by each Plan's Fund Options to the
total units in the Master Trust pooled accounts. Investment income
related to investments held in specific accounts for the defined
contribution plans is allocated to each plan's Fund Options daily in
accordance with each plan's respective percentage of interest. The
allocated net investment income to the Plan's Fund Options for the
period or year ended June 30, 1998 and December 31, 1997 was as follows:
17
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
<TABLE>
<CAPTION>
Dividends
on Bell
Atlantic Other
Corporation Net income/ Net
common Other Appreciation expenses- Investment
Interest shares Dividends (depreciation) net Income
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
June 30, 1998:
--------------
Bell Atlantic Shares Fund $ 226 $ 13,562 $ (757) $ 13,031
Telecommunications Fund 37 $ 2,073 22,980 25,090
Government Money Market Fund 184 83 267
Passive U.S. Equity Index Fund 40 492 176,119 176,651
Passive International Equity Index Fund 1 306 307
Income Fund 22,881 1,990 24,871
Loan Fund
Employee Stock Ownership Plan:
Allocated 7,904 16,486 24,390
Unallocated 8,820 (9,619) (799)
U.S. Bond Market Index Fund 45 2,961 3,006
Active U.S. Equity Fund 50 867 12,135 $ (1) 13,051
U.S. Balanced Fund 618 291 4,747 5,656
Global Balanced Fund 425 335 4,210 (13) 4,957
Active International Equity Fund 54 584 3,415 (57) 3,996
U.S. Small Capitalization Fund 118 237 7,894 8,249
--------- ---------- -------- --------- ----- ----------
Total $ 24,679 $ 30,286 $ 4,879 $ 242,950 $ (71) $ 302,723
========= ========== ======== ========= ===== ==========
December 31, 1997:
------------------
Bell Atlantic Shares Fund $ 1,773 $ 28,804 $ $ 259,124 $ $ 289,701
Telecommunications Fund 4,535 50,119 54,654
Government Obligations Fund 217 7,033 7,250
Diversified Equity Portfolio 3,469 16,128 198,167 12 217,776
Interest Income Fund 50,302 497 50,799
Loan Fund
Employee Stock Ownership Plan:
Allocated 153,532 153,532
Unallocated* 6 188,801 188,807
Active U.S. Equity Fund 398 2,862 37,847 23 41,130
U.S. Balanced Fund 1,287 1,623 17,454 24 20,388
Global Balanced Fund 1,050 1,614 19,359 13 22,036
International Equity Fund 231 802 2,436 (33) 3,436
U.S. Small Cap Fund 484 392 15,182 16,058
--------- ---------- -------- --------- ----- ----------
Total $ 59,217 $ 28,804 $ 27,956 $ 949,551 $ 39 $1,065,567
========= ========== ======== ========= ===== ==========
</TABLE>
*Held in a separate Trust (see Note 1)
18
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
4. Derivative Financial Instruments
Derivative financial instruments are used in the Master Trust's pooled
accounts primarily to rebalance fixed income/equity allocations, to
efficiently gain exposure to a specific underlying market, and to offset
the currency risk associated with foreign investments. Leveraging of the
Plan's assets and speculation are prohibited as stated in the Plan
documents. Offsetting currency positions are not permitted to exceed the
level of exposure in the Plan's foreign asset base. The derivatives most
commonly used by investment managers are highly-liquid, exchange-traded
equity and fixed income futures and over-the-counter foreign exchange
forward contracts.
Bell Atlantic's use of financial instruments for risk management
purposes is represented by notional amounts. These notional values
represent solely contractual amounts that serve as the basis or
reference amounts upon which contractually stipulated calculations are
based. Therefore, these amounts are intended to serve as general volume
indicators only and do not represent the potential gain or loss from
market or credit risks.
Market risk arises from the potential for changes in the value of
financial instruments resulting from fluctuations in interest rates,
foreign exchange rates and prices of equity securities. Market risk is
also affected by changes in volatility and liquidity in the markets in
which these instruments are traded.
Equity price risk arises from the possibility that equity prices will
fluctuate, affecting the value of equity securities and derivative
financial instruments that derive their value from a stock index, a
particular stock or a defined basket of stocks.
The credit risk and amount of accounting loss of the Plan's forward
contracts is equal to any gains which have not been settled as of the
Plan's year end. The credit risk of the Plan's futures contracts is
equal to the posted margin plus any unsettled positive variation margin.
The amount of accounting loss at year end is equal to any variation
margin owed to the Plan.
All derivative activity relating to the Plan is within the Master Trust
pooled accounts. The Master Trust pooled accounts' derivative activity
is allocated to the Plan in accordance with the Plan's Fund Options'
respective percentages of interest (see Note 3). The following
disclosures regarding the notional values, fair values, average fair
values and net trading gains are reported for the Plan.
19
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
The notional values and fair values of the derivative activity used for
trading purposes held by the Plan at June 30, 1998 and December 31, 1997
were as follows:
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Domestic Equity Futures Contracts:
Notional Values $ 2,581 $ 3,017
Fair Values 2,680 3,041
Fixed Income Futures Contracts:
Notional Values 404 69
Fair Values 403 70
Forward Foreign Currency Payable Contracts:
Notional Values 153 477
Fair Values 151 457
Forward Foreign Currency Receivable Contracts:
Notional Values 153 477
Fair Values 152 474
</TABLE>
The average fair values of the derivative activity used for trading
purposes held by the Plan during the period or year ended June 30, 1998
and December 31, 1997 were as follows:
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Average Fair Values:
Domestic Equity Futures Contracts $ 3,382 $ 2,163
Fixed Income Futures Contracts 273 92
Forward Foreign Currency Payable Contracts 207 377
Forward Foreign Currency Receivable Contracts 211 391
</TABLE>
The Plan was allocated $230 in 1998 and $3,478 in 1997 of net trading
losses from futures contracts. Net trading losses allocated to the Plan
from foreign exchange contracts totalled $14 in 1998 net trading gains
allocated to the Plan totaled $42 from foreign exchange contracts in
1997 .
5. Number and Value of Units
The interest of an employee in each Fund of the Plan, with the exception
of the Loan Fund, is represented by units as described in Section 8 of
the Plan. A Participant's unit value is determined daily by dividing
each Fund's adjusted net assets, as defined in the Plan, by the number
of outstanding units.
20
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
The number and value of units at June 30, 1998 and December 31, 1997,
carried to the fourth decimal place, were as follows:
<TABLE>
<CAPTION>
1998 1997
--------------------------- --------------------------
Number Value Number Value
of Units per Unit of Units per Unit
------------ ------------ ------------ -----------
<S> <C> <C> <C> <C>
Bell Atlantic Shares Fund 85,613,063 9.9347 82,972,114 $ 9.7506
Government Money Market Fund 89,293,697 .0995 -- --
Telecommunications Fund 8,197,243 24.3543 8,677,950 21.4400
Government Obligations Fund -- -- 10,935,086 10.1337
Passive International Equity Index Fund 3,290,596 1.1594 -- --
Passive U.S. Equity Index Fund 43,051,078 27.7611 44,537,743 23.6040
U.S. Bond Market Index Fund 11,109,303 10.4221 -- --
Income Fund 133,317,869 5.5273 146,219,557 5.3480
Employee Stock Ownership Plan 175,848,820 2.7290 172,928,068 2.6684
Active U.S. Equity Fund 50,626,837 2.4722 45,877,892 2.1933
U.S. Balanced Fund 33,230,187 2.0280 30,340,465 1.8512
Global Balanced Fund 28,356,432 1.9676 28,040,604 1.7922
Active International Equity Fund 29,138,564 1.4719 30,313,910 1.3314
U.S. Small Capitalization Fund 44,084,483 2.0968 43,679,669 1.9069
</TABLE>
The number and value of units at each month end, which are unaudited,
carried to the fourth decimal place, were as follows:
21
<PAGE>
BELL ATLANTIC SAVINGS PLAN
for BELL ATLANTIC NORTH SALARIED EMPLOYEES
NOTES to FINANCIAL STATEMENTS, Continued
(Dollars in Thousands)
<TABLE>
<CAPTION>
Government Money Market Passive U.S. Equity Index
Bell Atlantic Shares Fund Telecommunications Fund Fund Fund
------------------------- ----------------------- ----------------------- -------------------------
Number of Value per Number of Value per Number of Value per Number of Value per
1998 Units Unit Units Unit Units Unit Units Unit
- ---------- ---------- --------- --------- --------- --------- --------- ---------- ---------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
January 82,336,292 $ 9.9602 8,572,940 $22.6202 4,434,161 $1.0089 44,169,865 $23.7136
February 83,346,895 9.6597 8,493,963 22.8594 5,539,377 1.0134 44,192,985 25.4250
March 82,642,057 11.0209 8,405,686 25.3809 6,201,724 1.0183 44,079,695 26.7080
April 84,301,767 10.1501 8,341,844 24.2761 6,838,023 1.0227 43,883,008 26.9792
May 85,852,464 9.9374 8,239,137 24.0559 8,147,591 1.0270 43,507,933 26.5137
June 85,613,063 9.9347 8,197,243 24.3543 89,293,697 .0995 43,251,078 27.7611
</TABLE>
<TABLE>
<CAPTION>
U.S. Bond Market Index Employee Stock Ownership Passive International
Fund Income Fund Fund Equity Index Fund
------------------------- ----------------------- ----------------------- -------------------------
Number of Value per Number of Value per Number of Value per Number of Value per
Units Unit Units Unit Units Unit Units Unit
---------- --------- --------- --------- --------- --------- ---------- ---------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
January 11,044,985 $ 10.1716 145,017,134 $ 5.3841 173,361,087 $ 2.7303 863,875 $ 1.0330
February 10,959,971 10.1388 140,502,828 5.4114 174,065,949 2.6475 1,954,959 1.0997
March 11,050,210 10.1737 139,413,973 5.4389 176,324,915 3.0237 2,772,643 1.1440
April 11,063,260 10.2227 135,743,365 5.4658 176,939,136 2.7810 2,881,353 1.1600
May 10,915,448 10.3160 134,083,046 5.4938 177,665,707 2.7230 3,010,109 1.1788
June 11,109,303 10.4221 133,317,869 5.5273 175,848,820 2.7290 3,290,595 1.1594
</TABLE>
<TABLE>
<CAPTION>
Active International
Active U.S. Equity Fund U.S. Balanced Fund Global Balanced Fund Equity Fund
------------------------- ----------------------- ----------------------- -------------------------
Number of Value per Number of Value per Number of Value per Number of Value per
Units Unit Units Unit Units Unit Units Unit
---------- --------- --------- --------- --------- --------- ---------- ---------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
January 47,118,945 $ 2.1772 31,761,521 $ 1.8473 27,610,298 $ 1.7954 29,587,943 $ 1.3540
February 48,731,330 2.3384 32,778,936 1.9319 28,002,930 1.8871 29,585,480 1.4383
March 50,287,287 2.4593 33,814,952 1.9971 28,313,002 1.9565 30,379,133 1.5097
April 50,556,028 2.4674 33,997,891 2.0041 28,663,951 1.9703 30,113,602 1.5386
May 50,490,118 2.4082 33,397,102 1.9861 28,428,541 1.9436 29,543,260 1.4933
June 50,626,837 2.4722 33,230,187 2.0280 28,356,432 1.9676 29,138,564 1.4719
U.S. Small Capitalization
Fund
-------------------------
Number of Value per
Units Unit
---------- ---------
(Unaudited)
<S> <C>
January 43,392,642 $ 1.9037
February 43,878,802 2.0598
March 44,241,879 2.1406
April 44,491,882 2.1876
May 44,069,010 2.0738
June 44,084,483 2.0968
</TABLE>
22
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
6. Federal Income Taxes
The Internal Revenue Service has determined and informed Bell Atlantic
(formerly NYNEX) by a letter dated October 12, 1995, that the Plan, as
submitted, is qualified and the Master Trust established under the Plan
is tax-exempt, under the appropriate sections of the Code. The Plan has
been amended since receiving the determination letter. However, the
Plan's administrator and the Plan's tax counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the Code. Therefore, they believe that the Plan is
qualified and the related Master Trust is tax-exempt as of the date of
the financial statements.
7. Indebtedness
During 1990, pursuant to the NYNEX Employee Stock Ownership Trust, the
ESOP Trust issued a Secured Promissory Note of $449,297 to Bell Atlantic
for the purpose of purchasing shares of common stock of Bell Atlantic.
The Secured Promissory Note is collateralized by all shares of common
stock of Bell Atlantic acquired by the ESOP Trust. The borrowings bear
interest at 9.778% and have maturities from February 1, 1996 through
February 1, 2015. Principal amounts of $15,807, $16,912, $17,949,
$18,926 and $19,854 will be payable from 1998 to 2002, respectively.
Employing Company supplemental contributions to the ESOP Fund and
dividends earned on unallocated and allocated shares for 1998 of
$26,207, $8,820, and $3,520, respectively, and for 1997 of $26,454,
$18,535, and $6,425, respectively, were used to pay principal and
interest on the debt. Interest credits earned from principal prepayments
were used to pay interest on the debt of $2,062 and $2,405 in 1998 and
1997, respectively. The fair value of the Note, $304,314 at June 30,
1998, is determined based on discounted future cash flows.
8. Related Party Transactions
BAAMCO, a wholly owned subsidiary of Bell Atlantic, is the investment
advisor for the Telecommunications Fund, Passive U.S. Equity Index Fund
and Income Fund and therefore qualifies as a party-in-interest. BAAMCO
received no compensation from the Plan for the investment advisory
services rendered to the Plan.
23
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
9. Concentrations of Credit Risk
Financial instruments that potentially subject the Plan to
concentrations of credit risk consist principally of investment
contracts with insurance companies and other financial institutions.
The Plan places its investment contracts with high-credit quality
insurance companies and financial institutions in order to limit credit
exposure. The Plan regularly monitors the financial stability of the
financial institutions and insurance companies.
10. Plan Amendments
On October 22, 1997 the Plan was amended to offer the following
investment funds and to close the Telecommunications Fund to new
investments.
* Government Money Market Fund
* Income Fund
* U.S. Bond Market Index Fund
* Passive U.S. Equity Index Fund
* Active U.S. Equity Fund
* Telecommunications Fund
* U.S. Small Capitalization Fund
* Passive International Equity Index Fund
* Active International Equity Fund
* U.S. Balanced Fund
* Global Balanced Fund
* Bell Atlantic Shares Fund
On September 3, 1997, the Corporate Employees' Benefit Committee
approved an increase in the Employing Company matching contributions to
83 1/3% on both the authorized After-Tax Allotment and authorized Basic
Pre-Tax Allotment. This increase became effective January 1, 1998.
On April 1, 1997, the Plan was amended to provide that certain
employees who are plan participants and who are involuntarily terminated
in connection with the merger of NYNEX Corporation and Bell Atlantic
Corporation would be fully vested in their accrued benefit derived from
Employing Company Contributions and Employing Company ESOP
Contributions.
11. Reconciliation of Financial Statements in Form 11-K to Form 5500
The Department of Labor requires that amounts allocated to accounts of
persons who have elected to withdraw from the Plan but have not yet been
paid be reported as liabilities on the Plan's Form 5500. In accordance
with generally accepted accounting principles, benefit amounts should
not be accrued as liabilities of the Plan. The following is a
reconciliation of distributions to participants and net assets available
for Plan benefits in the financial statements to the amounts to be
reported in Form 5500.
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Aggregate distributions to participants as presented in the
Statement of Changes in Net Assets Available for Plan $ 141,848 $ 273,056
Benefits
Add: Current year benefits claims payable presented in the
Statement of Net Assets Available for Plan Benefits in Form
5500 (see Note 2) -- 4,442
Less: Prior year benefits claims payable presented in the
Statement of Net Assets Available for Plan Benefits in Form
5500 (see Note 2) 4,442 2,343
----------- ----------
Benefit payments and payments to provide benefits directly to
Participants and beneficiaries presented in the
Statement of Changes in Net Assets Available for
Plan Benefits in $ 137,406 $ 275,155
=========== ==========
</TABLE>
24
<PAGE>
BELL ATLANTIC SAVINGS PLAN for BELL ATLANTIC NORTH SALARIED
EMPLOYEES
Notes to Financial Statements, Continued
(Dollars in Thousands)
<TABLE>
<CAPTION>
1998 1997
------------- ------------
<S> <C> <C>
Net assets available for Plan benefits presented in the
Statement of Net Assets Available for Plan Benefits $ 4,191,228 $ 3,961,713
Less: Benefits claims payable presented in the Statement
of Net Assets Available for Plan Benefits in Form
5500 (see Note 2) -- 4,442
Less: Transfer of Net Assets Available for Plan Benefits 4,191,228 --
------------- -----------
Net assets available for Plan benefits presented in the
Statement of Net Assets Available for Plan Benefits
in Form 5500 $ -- $ 3,957,271
============= ===========
</TABLE>
12. Merger of the Plan
On July 1, 1998, the Plan was merged into the Bell Atlantic Savings Plan
for Salaried Employees. A new unit value was assigned to some of the new
plan's investment funds. The new unit value does not change the value of
the participant's contribution in each fund or the value of the
participant's total savings plan account.
25
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Savings Plan Committee of Bell Atlantic Corporation has duly caused this
annual report to be signed by the undersigned thereunto duly authorized.
BELL ATLANTIC SAVINGS PLAN FOR
BELL ATLANTIC NORTH SALARIED EMPLOYEES
By /s/Lea Davies
-------------
for (D. J. Sacco, Chairman, Employees' Benefit Committee)
Date: December 28, 1998
