<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------
FORM 11-K
-------------
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the years ended December 31, 1999 and 1998
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 and Security Plan for
Associates of Bell Atlantic South
-------------
Bell Atlantic Corporation
1095 Avenue of the Americas, New York, New York 10036
<PAGE>
BELL ATLANTIC SAVINGS and SECURITY PLAN
for ASSOCIATES OF BELL ATLANTIC SOUTH
As of December 31, 1999 and 1998
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Independent Auditors' Report 1
Financial Statements:
Statements of Net Assets Available for Benefits as of
December 31, 1999 and 1998 2-3
Statements of Changes in Net Assets Available for Benefits
for the years ended December 31, 1999 and 1998 4-5
Notes to Financial Statements 6-22
Signature Page 23
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Corporate Employees' Benefits
Committee of Bell Atlantic Corporation:
We have audited the accompanying Statements of Net Assets Available for Benefits
of the Bell Atlantic Savings and Security Plan for Associates of Bell Atlantic
South (the "Plan") as of December 31, 1999 and 1998, and the related Statements
of Changes in Net Assets Available for Benefits for the years then ended. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Bell
Atlantic Savings and Security Plan for Associates of Bell Atlantic South as of
December 31, 1999 and 1998, and the changes in its net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
/s/ Mitchell & Titus LLP
New York, New York
June 9, 2000
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR ASSOCIATES OF BELL ATLANTIC SOUTH
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
FUND INFORMATION
-------------------------------------------------------------------
BELL GOVERNMENT PASSIVE U.S.
ATLANTIC MONEY EQUITY
SHARES MARKET INDEX INCOME LOAN
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 $ 1,411,534 $ 19,396 178,966 245,685 $ -
Temporary cash investments - - 125 - -
Bell Atlantic Corporation common shares - - - - -
------------- ------------- ------------ ----------- ------------
Total investments 1,411,534 19,396 179,091 245,685 -
Receivables:
Participants' contributions 39 4 8 8 -
Loans to participants - - - - 82,001
Dividends and interest receivable - - 1 - -
------------- ------------- ------------ ----------- ------------
Total receivables 39 4 9 8 82,001
------------- ------------- ------------ ----------- ------------
Total assets 1,411,573 19,400 179,100 245,693 82,001
LIABILITIES:
Commitments (Note 2) - - - - -
Notes payable (see Note 6) - - - - -
------------- ------------- ------------ ----------- ------------
Total liabilities - - - - -
------------- ------------- ------------ ----------- ------------
Net assets available for
benefits (Notes 1 and 2 $ 1,411,573 $ 19,400 179,100 245,693 $ 82,001
============= ============= ============ =========== ============
<CAPTION>
FUND INFORMATION
----------------------------------------------------------------------------------
EMPLOYEE STOCK PASSIVE
OWNERSHIP PLAN INTERNATIONAL ACTIVE U.S. U.S.
-------------------------- PAYSOP EQUITY INDEX EQUITY BALANCED
ALLOCATED UNALLOCATED 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 $ 471,069 $ - $ 157,309 $ 26,436 $ 12,595 $ 8,154
Temporary cash investments - - - - 9 6
Bell Atlantic Corporation common shares - 91,100 - - - -
------------- ------------ ----------- ------------- ------------ -------------
Total investments 471,069 91,100 157,309 26,436 12,604 8,160
Receivables:
Participants' contributions 27 - - 1 3 1
Loans to participants - - - - - -
Dividends and interest receivable - - - - - -
------------- ------------ ----------- ------------- ------------ -------------
Total receivables 27 - - 1 3 1
------------- ------------ ----------- ------------- ------------ -------------
Total assets 471,096 91,100 157,309 26,437 12,607 8,161
LIABILITIES:
Commitments (Note 2) - 11,823 - - - -
Notes payable (see Note 6) - 47,051 - - - -
------------- ------------ ----------- ------------- ------------ -------------
Total liabilities - 58,874 - - - -
------------- ------------ ----------- ------------- ------------ -------------
Net assets available for
benefits (Notes 1 and 2 $ 471,096 $ 32,226 $ 157,309 $ 26,437 $ 12,607 $ 8,161
============= ============ =========== ============= ============ =============
<CAPTION>
FUND INFORMATION
---------------------------------------------------------------------
ACTIVE U.S. BOND
GLOBAL INTERNATIONAL U.S. SMALL MARKET
BALANCED EQUITY CAPITALIZATION INDEX
FUND FUND FUND FUND TOTAL
------------ -------------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated Share of Master Trust net assets $ 2,240 $ 13,055 $ 8,852 $ 9,863 $ 2,565,154
Temporary cash investments 2 9 6 157
Bell Atlantic Corporation common shares - - - - 91,100
------------ -------------- ------------ ------------- -----------
Total investments 2,242 13,064 8,858 9,863 2,656,411
Receivables:
Participants' contributions 1 1 1 1 95
Loans to participants - - - - 82,001
Dividends and interest receivable - - - - 1
------------ -------------- ------------ ------------- -----------
Total receivables 1 1 1 1 82,097
------------ -------------- ------------ ------------- -----------
Total assets 2,243 13,065 8,859 9,864 2,738,508
LIABILITIES:
Commitments (Note 2) - - - - 11,823
Notes payable (see Note 6) - - - - 47,051
------------ -------------- ------------ ------------- -----------
Total liabilities - - - - 58,874
------------ -------------- ------------ ------------- -----------
Net assets available for
benefits (Notes 1 and 2 $ 2,243 $ 13,065 $ 8,859 $ 9,864 $ 2,679,634
============ ============== ============ ============= ===========
</TABLE>
See notes to financial statements.
2
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR ASSOCIATES OF BELL ATLANTIC SOUTH
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
FUND INFORMATION
-------------------------------------------------------------------
BELL GOVERNMENT PASSIVE U.S.
ATLANTIC MONEY EQUITY
SHARES MARKET INDEX INCOME LOAN
FUND FUND FUND FUND FUND
------------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated Share of Master Trust net assets $ 1,128,290 $ 15,231 $ 157,336 $ 265,239 $ -
Temporary cash investments - - 4,102 - -
Bell Atlantic Corporation common shares - - - - -
------------- ------------ ------------- ----------- -----------
Total investments 1,128,290 15,231 161,438 265,239 -
Receivables:
Participants' contributions 2,748 192 883 1,190 -
Loan repayments 670 23 172 339 (1,283)
Loans to participants - - - - 52,880
Other (1,544) 249 737 (825) -
Dividends and interest receivable - - 51 - -
------------- ------------ ------------- ----------- -----------
Total receivables 1,874 464 1,843 704 51,597
------------- ------------ ------------- ----------- -----------
Total assets 1,130,164 15,695 163,281 265,943 51,597
LIABILITIES:
Notes Payable (see Note 6) - - - - -
------------- ------------ ------------- ----------- -----------
Net assets available for
benefits (Notes 1 and 2) $ 1,130,164 $ 15,695 $ 163,281 $ 265,943 $ 51,597
============= ============ ============= =========== ===========
<CAPTION>
FUND INFORMATION
--------------------------------------------------------------------
EMPLOYEE STOCK PASSIVE
OWNERSHIP PLAN INTERNATIONAL ACTIVE U.S.
-------------------------- PAYSOP EQUITY INDEX EQUITY
ALLOCATED UNALLOCATED 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 $ 542,659 $ - $ 167,011 $ 22,808 $ 11,867
Temporary cash investments - - - - 309
Bell Atlantic Corporation common shares - 119,054 - - -
------------- ------------ ------------- -------------- ------------
Total investments 542,659 119,054 167,011 22,808 12,176
Receivables:
Participants' contributions - - - 166 121
Loan repayments - - - 30 15
Loans to participants - - - - -
Other 547 - (1,416) (39) (147)
Dividends and interest receivable - - - - 4
------------- ------------ ------------- -------------- ------------
Total receivables 547 - (1,416) 157 (7)
------------- ------------ ------------- -------------- ------------
Total assets 543,206 119,054 165,595 22,965 12,169
LIABILITIES:
Notes Payable (see Note 6) - 87,981 - - -
------------- ------------ ------------- -------------- ------------
Net assets available for
benefits (Notes 1 and 2) $ 543,206 $ 31,073 $ 165,595 $ 22,965 $ 12,169
============= ============ ============= ============== ============
<CAPTION>
FUND INFORMATION
----------------------------------------------------------------------------
ACTIVE U.S. BOND
U.S. GLOBAL INTERNATIONAL U.S. SMALL MARKET
BALANCED BALANCED EQUITY CAPITALIZATION INDEX
FUND FUND FUND FUND FUND TOTAL
-------- -------- ------------- -------------- --------- -----
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investments at market (see Notes 2 and 3):
Allocated Share of Master Trust net assets $ 8,994 $ 1,819 $ 1,843 $ 6,321 $ 12,396 $2,341,814
Temporary cash investments 234 47 48 165 - 4,905
Bell Atlantic Corporation common shares - - - - - 119,054
-------- -------- ------------ ----------- -------- ----------
Total investments 9,228 1,866 1,891 6,486 12,396 2,465,773
Receivables:
Participants' contributions 60 20 23 63 94 5,560
Loan repayments 7 2 3 8 14 -
Loans to participants - - - - - 52,880
Other 70 77 53 - 208 (2,030)
Dividends and interest receivable 3 1 1 2 - 62
-------- -------- ------------ ----------- -------- ----------
Total receivables 140 100 80 73 316 56,472
-------- -------- ------------ ----------- -------- ----------
Total assets 9,368 1,966 1,971 6,559 12,712 2,522,245
LIABILITIES:
Notes Payable (see Note 6) - - - - - 87,981
-------- -------- ------------ ----------- -------- ----------
Net assets available for
benefits (Notes 1 and 2) $ 9,368 $ 1,966 $ 1,971 $ 6,559 $ 12,712 $2,434,264
======== ======== ============ =========== ======== ==========
</TABLE>
See notes to financial statements.
3
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR ASSOCIATES OF BELL ATLANTIC SOUTH
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
FUND INFORMATION
---------------------------------------------------------------------
BELL GOVERNMENT PASSIVE U.S.
ATLANTIC MONEY EQUITY
SHARES MARKET INDEX INCOME LOAN
FUND FUND FUND FUND FUND
------------ -------------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ 59,341 $ 3,379 $ 19,527 $ 21,938 $ -
Interfund transfers 167,123 6,634 (9,255) (13,467) -
Plan transfers-in 3,270 19 384 452 -
Rollover contributions (Note 1) 1,528 (301) 537 485 -
Loans to participants (32,953) (995) (6,120) (7,589) 63,031
Employing company contributions (Note 1) - - - - -
Transfer for loan repayments 17,249 535 4,300 6,424 (32,627)
------------ -------------- ------------ ----------- ----------
Total allotments, contributions,
and transfers 215,558 9,271 9,373 8,243 30,404
Investment income:
Dividends/Interest 33,526 - - - -
Interest on ESOP dividends - - - - -
Allocated share of Master Trust investment
activities (Note 3) 186,824 917 32,515 15,433 -
------------ -------------- ------------ ----------- ----------
Total additions (subtractions) 435,908 10,188 41,888 23,676 30,404
------------ -------------- ------------ ----------- ----------
Deductions:
Administrative expenses 2,509 46 348 678 -
Distributions to participants 142,606 6,291 18,585 39,253 -
Plan transfers-out 9,384 146 7,136 3,995 -
------------ ------------ ---------- --------- ----------
Total deductions 154,499 6,483 26,069 43,926 -
------------ -------------- ------------ ----------- ----------
Net increase(decrease) 281,409 3,705 15,819 (20,250) 30,404
Net assets available for benefits:
Beginning of year 1,130,164 15,695 163,281 265,943 51,597
------------ -------------- ------------ ----------- ----------
End of year (Notes 1 and 2) $ 1,411,573 $ 19,400 $ 179,100 $ 245,693 $ 82,001
============ ============= =========== ========== =========
<CAPTION>
FUND INFORMATION
------------------------------------------------------------------
EMPLOYEE STOCK PASSIVE
OWNERSHIP PLAN INTERNATIONAL ACTIVE
------------------------- PAYSOP EQUITY INDEX U.S. EQUITY
ALLOCATED UNALLOCATED FUND FUND FUND
------------ ----------- ---------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ - $ - $ - $ 3,129 $ 2,549
Interfund transfers (143,474) - (4,375) (3,089) (2,216)
Plan transfers-in 64 - 165 41 52
Rollover contributions (Note 1) - - 1 89 141
Loans to participants (12,824) - - (971) (460)
Employing company contributions (Note 1) 71,814 (35,787) - - -
Transfer for loan repayments 1,973 - - 682 405
------------ ------------ ----------- ------------ -----------
Total allotments, contributions,
and transfers (82,447) (35,787) (4,209) (119) 471
Investment income:
Dividends/Interest 11,765 3,041 4,368 - -
Interest on ESOP dividends - 230 - - -
Allocated share of Master Trust investment
activities (Note 3) 65,935 33,669 25,034 6,338 1,560
------------ ------------ ----------- ------------ -------------
Total additions (subtractions) (4,747) 1,153 25,193 6,219 2,031
------------ ------------ ----------- ------------ -------------
Deductions:
Administrative expenses 1,632 - 339 72 62
Distributions to participants 60,914 - 29,071 1,978 1,013
Plan transfers-out 4,817 - 4,069 697 518
------------ ------------ ----------- ------------ -------------
Total deductions 67,363 - 33,479 2,747 1,593
------------ ------------ ----------- ------------ -------------
Net increase(decrease) (72,110) 1,153 (8,286) 3,472 438
Net assets available for benefits:
Beginning of year 543,206 31,073 165,595 22,965 12,169
------------ ------------ ----------- ------------ -------------
End of year (Notes 1 and 2) $ 471,096 $ 32,226 $ 157,309 $ 26,437 $ 12,607
============ =========== ============ ============= ===========
<CAPTION>
FUND INFORMATION
-------------------------------------------------------------------------
ACTIVE U.S. BOND
U.S. GLOBAL INTERNATIONAL U.S. SMALL MARKET
BALANCED BALANCED EQUITY CAPITALIZATION INDEX
FUND FUND FUND FUND FUND TOTAL
---------- ---------- ----------- --------------- ----------- --------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ 1,342 $ 499 $ 972 $ 1,251 $ 1,742 $ 115,669
Interfund transfers (2,049) (324) 7,714 (256) (2,966) -
Plan transfers-in 6 24 25 12 39 4,553
Rollover contributions (Note 1) 359 45 57 90 49 3,080
Loans to participants (178) (101) (177) (185) (478) -
Employing company contributions (Note 1) - - - - - 36,027
Transfer for loan repayments 227 80 196 216 340 -
---------- ---------- ----------- ------------- ------------- ---------
Total allotments, contributions,
and transfers (293) 223 8,787 1,128 (1,274) 159,329
Investment income:
Dividends/Interest - - - - - 52,700
Interest on ESOP dividends - - - - - 230
Allocated share of Master Trust investment
activities (Note 3) 616 299 2,843 1,989 (123) 373,849
---------- ---------- ----------- ------------- ------------- ---------
Total additions (subtractions) 323 522 11,630 3,117 (1,397) 586,108
---------- ---------- ----------- ------------- ------------- ---------
Deductions:
Administrative expenses 41 12 306 58 31 6,134
Distributions to participants 864 163 457 408 1,181 302,784
Plan transfers-out 625 70 (227) 351 239 31,820
---------- ---------- ----------- ------------- ------------- ---------
Total deductions 1,530 245 536 817 1,451 340,738
---------- ---------- ----------- ------------- ------------- ---------
Net increase(decrease) (1,207) 277 11,094 2,300 (2,848) 245,370
Net assets available for benefits:
Beginning of year 9,368 1,966 1,971 6,559 12,712 2,434,264
---------- ---------- ----------- ------------- ------------- ----------
End of year (Notes 1 and 2) $ 8,161 $ 2,243 $ 13,065 $ 8,859 $ 9,864 $2,679,634
========== ========== =========== ============= ============= ==========
</TABLE>
See notes to financial statements.
4
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR ASSOCIATES OF BELL ATLANTIC SOUTH
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1998
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
FUND INFORMATION
-----------------------------------------------------------------------
BELL GOVERNMENT PASSIVE U.S.
ATLANTIC MONEY EQUITY
SHARES MARKET INDEX INCOME LOAN
FUND FUND FUND FUND FUND
------------- --------------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ 40,454 $ 2,518 $ 17,259 $ 26,484 $ -
Interfund transfers (6,292) 2,568 4,897 (23,046) -
Plan transfers-in 2,116 7 94 90 -
Plan transfer from PAYSOP (Note 1) - - - - -
Rollover contributions (Note 1) 495 71 310 43 -
Employing company contributions (Note 1) 24,447 - - - -
Loans to participants (18,950) (551) (3,801) (9,277) 34,275
Transfer for loan repayments 12,735 421 3,400 6,731 (24,750)
------------- --------------- ------------ ----------- -----------
Total allotments, contributions,
and transfers 55,005 5,034 22,159 1,025 9,525
Investment income:
Dividends/Interest 45,135 - - - -
Allocated share of Master Trust
investments activities (Note 3) 155,891 1,091 34,077 16,729 -
------------- --------------- ------------ ----------- -----------
Total additions 256,031 6,125 56,236 17,754 9,525
------------- --------------- ------------ ----------- -----------
Deductions:
Administrative expenses 2,612 31 176 592 -
Distributions to participants 116,284 2,903 11,471 36,027 -
Plan transfers-out 10,089 62 1,134 1,241 383
------------- --------------- ------------ ----------- -----------
Total deductions 128,985 2,996 12,781 37,860 383
------------- --------------- ------------ ----------- -----------
Net increase(decrease) 127,046 3,129 43,455 (20,106) 9,142
Net assets available for benefits:
Beginning of year 1,003,118 12,566 119,826 286,049 42,455
------------- --------------- ------------ ----------- -----------
End of year (Notes 1 and 2) $ 1,130,164 $ 15,695 $ 163,281 $ 265,943 $ 51,597
============= =============== ============ =========== ===========
<CAPTION>
FUND INFORMATION
--------------------------------------------------------------------------------
EMPLOYEE STOCK PASSIVE
OWNERSHIP PLAN INTERNATIONAL ACTIVE U.S.
------------------------ PAYSOP EQUITY INDEX U.S. EQUITY BALANCED
ALLOCATED UNALLOCATED FUND FUND FUND FUND
---------- ------------ --------- ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ - $ - $ - $ 3,646 $ 1,861 $ 896
Interfund transfers - - - (5,426) 9,708 8,303
Plan transfers-in - - 50 17 - -
Plan transfer from PAYSOP (Note 1) - - 157,508 - - -
Rollover contributions (Note 1) - - - 104 65 23
Employing company contributions
(Note 1) 18,803 36,395 - - - -
Loans to participants (160) - - (717) (199) (86)
Transfer for loan repayments 10 - - 601 255 123
---------- ------------ ------------ ------------- ----------- ----------
Total allotments, contributions,
and transfers 18,653 36,395 157,558 (1,775) 11,690 9,259
Investment income:
Dividends/Interest 3,909 4,170 (3,615) - - -
Allocated share of Master Trust
investments activities (Note 3) 85,003 (3,492) 28,452 4,718 1,213 724
---------- ------------ ------------ ------------- ----------- ----------
Total additions 107,565 37,073 182,395 2,943 12,903 9,983
---------- ------------ ------------ ------------- ----------- ----------
Deductions:
Administrative expenses 141 37 36 49 35 20
Distributions to participants 12,360 43,713 16,383 1,612 631 538
Plan transfers-out 2,534 15,270 381 281 68 57
---------- ------------ ------------ ------------- ----------- ----------
Total deductions 15,035 59,020 16,800 1,942 734 615
---------- ------------ ------------ ------------- ----------- ----------
Net increase(decrease) 92,530 (21,947) 165,595 1,001 12,169 9,368
Net assets available for benefits:
Beginning of year 450,676 53,020 - 21,964 - -
---------- ------------ ------------ ------------- ----------- ----------
End of year (Notes 1 and 2) $ 543,206 $ 31,073 $ 165,595 $ 22,965 $ 12,169 $ 9,368
========== ============ ============ ============= =========== ==========
<CAPTION>
FUND INFORMATION
-------------------------------------------------------------------------
Active U.S. Bond
Global International U.S. Small Market
Balanced Equity Capitalization Index
Fund Fund Fund Fund Total
------------ ------------ ---------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Additions:
Allotments, Contributions and Transfers:
Employee allotments $ 304 $ 362 $ 1,049 $ 1,895 $ 96,728
Interfund transfers 1,597 1,607 5,406 678 -
Plan transfers-in 11 18 8 22 2,433
Plan transfer from PAYSOP (Note 1) - - - - 157,508
Rollover contributions (Note 1) 17 25 48 87 1,288
Employing company contributions (Note 1) - - - - 79,645
Loans to participants (23) (43) (81) (387) -
Transfer for loan repayments 35 50 146 243 -
----------- ------------ ---------------- ------------- ------------
Total allotments, contributions,
and transfers 1,941 2,019 6,576 2,538 337,602
Investment income:
Dividends/Interest - - - - 49,599
Allocated share of Master Trust
investments activities (Note 3) 147 69 221 1,179 326,022
----------- ------------ ---------------- ------------- ------------
Total additions 2,088 2,088 6,797 3,717 713,223
----------- ------------ ---------------- ------------- ------------
Deductions:
Administrative expenses 6 8 23 (16) 3,750
Distributions to participants 90 109 185 739 243,045
Plan transfers-out 26 - 30 121 31,677
---------- ------------ ---------------- ------------- -------------
Total deductions 122 117 238 844 278,472
---------- ------------ ---------------- ------------- -------------
Net increase(decrease) 1,966 1,971 6,559 2,873 434,751
Net assets available for benefits:
Beginning of year - - - 9,839 1,999,513
---------- ------------ ---------------- ------------- -------------
End of year (Notes 1 and 2) $ 1,966 $ 1,971 $ 6,559 $ 12,712 $ 2,434,264
========== ============ ================ ============= =============
</TABLE>
See notes to financial statements.
5
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
1. PLAN DESCRIPTION
The following description of the Bell Atlantic Savings and Security
Plan for Associates of Bell Atlantic South (the "BASSP") provides only
general information on the BASSP's provisions as of December 31, 1999
and 1998. Participants should refer to the Benefits Handbook, BASSP
plan document and prospectus for a more complete description of BASSP's
provisions.
The BASSP* was established by Bell Atlantic Corporation on January 1,
1984 to provide a convenient way for non-salaried employees to save on
a regular and long-term basis. In August 1997, Bell Atlantic
Corporation merged with NYNEX Corporation (the "Merger") to form the
new Bell Atlantic Corporation ("Bell Atlantic"). The BASSP is a defined
contribution plan covering all regular non-salaried employees primarily
of the business units of the pre-merger Bell Atlantic and its
participating subsidiaries. Employees are eligible to make tax-deferred
or after-tax contributions to the BASSP upon completion of enrollment
in the BASSP as soon as practicable following the date of hire.
Employees are eligible to make tax-deferred or after-tax contributions
to the BASSP and to receive matching employer contributions, upon
completion of enrollment in the plan as soon as practicable following
the date of hire. The BASSP is also characterized as an employee stock
ownership plan ("ESOP").
ALLOTMENTS AND CONTRIBUTIONS
Eligible employees may authorize basic contributions of 1% to 6% of
salary, as defined, and supplementary contributions up to an additional
10% of salary. For employees of Bell Atlantic and most of its
participating subsidiaries, Bell Atlantic makes employer matching
contributions in an amount equal to 80% of basic contributions. Certain
participating subsidiaries have other employee contribution and
employer matching contribution arrangements. Contributions are subject
to applicable rules set forth in the Internal Revenue Code (the "Code")
and the regulations thereunder. Employer matching contributions are
invested only in the Bell Atlantic Shares Fund until employees reach
age fifty at which point the participant may begin to diversify the
matching contributions.
The BASSP provides for 100% vesting of employer matching contributions
upon attaining three years of service. A terminated employee's unvested
employer matching contributions are forfeited and offset against the
participating companies' obligation to make subsequent contributions to
the BASSP. Forfeitures were $169 and $164 in 1999 and 1998,
respectively.
--------
* Certain other capitalized terms used but not defined herein shall have their
respective meanings as defined in the BASSP Prospectus.
6
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
LOANS
The BASSP includes an employee loan provision authorizing participants
to borrow an amount from their vested account balances in the BASSP.
Loans are generally repaid by payroll deductions. The term of repayment
for loans generally will not be less than six months nor more than
fifteen years. Each new loan will bear interest at a rate based upon
the prime rate for loans up to sixty months and the prime plus one for
loans from sixty-one months to one hundred eighty months as published
in The Wall Street Journal.
TERMINATION PRIORITIES
Although it has not expressed any intent to do so, Bell Atlantic has
the right under the BASSP to discontinue all employer matching
contributions at any time and to terminate the BASSP subject to the
provisions of the Employee Retirement Income Security Act of 1974, as
amended, ("ERISA"). In the event of plan termination, participants
would become 100% vested in their accounts.
FUND OPTIONS
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, 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 BASSP is described below.
The Bell Atlantic Shares Fund invests primarily in the common stock of
Bell Atlantic.
The U.S. Bond Market Index Fund includes all U.S. Treasury,
government-sponsored, mortgaged-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.
On January 1, 1998, a new Fund, the Passive U.S. Equity Index Fund,
became the successor fund to the BASSP's U.S. Equity Index Fund. Any
assets in the U.S. Equity Index Fund not designated for transfer to
another fund by BASSP participants by December 31, 1997 were
automatically transferred to the Passive U.S. Equity Index Fund.
Effective January 1, 1998 the U.S. Equity Index Fund ceased to exist.
The Passive U.S Equity Index Fund invests in an equity index fund which
is managed by Bell Atlantic Asset Management Company ("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.
7
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
The Government Money Market Fund invests in securities of the U.S.
government or its 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 thirty to sixty days, but may vary from one to ninety
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 Deutsche Asset Management.
Effective January 1, 1998 the Short-Term Fixed Income Fund ceased to
exist. Any assets in the BASSP's Short-Term Fixed Income Fund not
designated for transfer to another fund by BASSP participants by
December 31, 1997 were automatically transferred to the new Income
Fund. The Income Fund invests primarily in a diversified portfolio of
guaranteed investment 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 U.S.
government and its agencies ("Synthetic Investment Contract"). As an
integral part of the purchase of each pool of these investments, a
financial institution, via a wrapper contract, agrees to pay at book
value for qualified distributions (e.g. participant withdrawals) and at
maturity of the contract, based upon the agreed upon interest rate for
the relevant time period, but not in the event of a default of any
security in the pool. The BASSP is exposed to credit risk in the event
of nonperformance by the entities for which the contracts are placed.
The BASSP 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 an indefinite period of time. 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).
On January 1, 1998 the BASSP's International Equity Index Fund was
renamed the Passive International Equity Index Fund. The Passive
International Equity Index Fund has investments that mirror the
MSCI-EAFE-GDP, which is an index established by Morgan Stanley Dean
Witter, comprised of approximately 1,000 companies from twenty 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 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: U.S. Balanced Fund, Global Balanced Fund,
Active U.S. Equity Fund, Active International Equity Fund, and the U.S.
Small Capitalization Fund.
8
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
On January 1, 1998 the U.S. Balanced Fund became available to
participants in the BASSP. 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
December 31, 1999, 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.,
Fidelity Management Trust Company, Franklin Portfolio Associates, LLC,
Gardner Lewis Asset Management, L.P., Goldman Sachs Asset Management
Co., Independence Investment Associates, Inc., Miller Anderson &
Sherrerd, LLP, Palisade Capital Management, LLC, Provident Investment
Counsel, Inc., State Street Research and Management Company,
Transamerica Investment Management, LLC, and Wilshire Associates, Inc.
On January 1, 1998 the Global Balanced Fund became available to
participants in the BASSP. 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 states (generally
referred to as emerging market 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 December 31, 1999, BAAMCO had selected the following Master Trust
pooled accounts for the Fund: Barrow, Hanley, Mewhinney & Strauss,
Inc., Capital Guardian Trust Company, Fidelity Management Trust
Company, Franklin Portfolio Associates, LLC, Gardner Lewis Asset
Management, L.P., Goldman Sachs Asset Management Co., Independence
Investment Associates, Inc., Miller Anderson & Sherrerd, LLP, Morgan
Stanley Dean Witter Investment Management, Inc., Northern Cross
Investments, Ltd., Palisade Capital Management, LLC, Provident
Investment Counsel, Inc., Rogge Global Partners, PLC, State Street
Global Advisors, State Street Research and Management Company,
Transamerica Investment Management, LLC, and Wilshire Associates, Inc.
On January 1, 1998 the Active U.S. Equity Fund became available to
participants in the BASSP. The Active U.S. Equity Fund invests
primarily in domestic common stocks. As of December 31, 1999, BAAMCO
had selected the following Master Trust pooled accounts for the Fund:
Barrow, Hanley, Mewhinney & Strauss, Inc., Fidelity Management Trust
Company, Franklin Portfolio Associates, LLC, Gardner Lewis Asset
Management, L.P., Goldman Sachs Asset Management Co., Independence
Investment Associates, Inc., Miller Anderson & Sherrerd, LLP,
Palisade Capital Management, LLC, Provident Investment Counsel, Inc.,
Transamerica Investment Management, LLC, and Wilshire Associates, Inc.
9
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
On January 1, 1998 the Active International Equity Fund became
available to participants in the BASSP. The Active International Equity
Fund invests in international equity markets throughout the world,
generally excluding the United States. It is 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 December 31, 1999, BAAMCO had selected Capital Guardian
Trust Company, Morgan Stanley Dean Witter Investment Management, Inc.,
Northern Cross Investments, Ltd., and State Street Global Advisors as
the Master Trust pooled accounts for the Fund.
On January 1, 1998 the U.S. Small Capitalization Fund became available
to participants in the BASSP. 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 December 31, 1999, 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, Inc., and Wilshire
Associates, Inc.
The Leveraged ESOP ("LESOP") is a leveraged Fund that invests primarily
in Bell Atlantic shares. The LESOP component of the BASSP, initially
funded in 1989, is a stock bonus plan intended to qualify under
Sections 401(a)(4) and 4975(e)(7) of the Code. It is used to match the
employee's Basic Pre-Tax Allotments and Post-Tax Allotments. Depending
on the value of Bell Atlantic shares from time to time, the LESOP may
fund more or less than all of the required employer matching
contributions in a given calendar year. As a result of a continuing
series of additional LESOP refinancings (See Note 7), the LESOP is
likely to continue to generate most of the shares required for employer
matching contributions but not more than the amount required for those
contributions. In the event of a shortfall, Bell Atlantic and its
participating subsidiaries make additional employer matching
contributions to the BASSP. Any surplus is allocated in equal amounts
to the BASSP accounts of participants who, as of the last day of the
year, are active employees of Bell Atlantic and its participating
subsidiaries, and have account balances under the BASSP. The employee
may not withdraw or transfer funds out of the LESOP Fund except for
hardship withdrawals and except for those participants over age 50 with
more than one year of participation in the BASSP. The amounts allowed
to be transferred during any election period are subject to certain
limitations under the terms of the BASSP.
10
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
The Bell Atlantic Employee Stock Ownership Plan (the "PAYSOP") was
established by Bell Atlantic on January 1, 1984 as an ERISA plan. The
assets in the PAYSOP consisted of Employing Company contributions of
Bell Atlantic Corporation common shares and earnings thereon. As a
result of PAYSOP amendments necessitated by the Tax Reform Act of 1986,
there have been no Employing Company contributions to the PAYSOP since
the 1986 plan year. Effective January 1, 1998, the PAYSOP was merged
into the BASSP and the Bell Atlantic Savings Plan for Salaried
Employees (the "BASP"). The assets of the PAYSOP were transferred to
the Bell Atlantic Master Trust on January 1, 1998 and accordingly
allocated to the BASSP based on the participating employees' balances
in PAYSOP as of December 31, 1997.
All the assets of the BASSP are included in the Bell Atlantic Master
Trust (See Note 2) for which Mellon Bank, N.A., is the trustee.
Metropolitan Life Insurance Company (previously operating as Bankers
Trust Company) was the recordkeeper for the BASSP through June 30,
1998. As of July 1, 1998, the Kwasha Group of PricewaterhouseCoopers,
LLP, became the recordkeeper for the BASSP.
2. ACCOUNTING POLICIES
INVESTMENTS
As of January 1, 1998, the assets of Bell Atlantic's defined benefit
plans and defined contribution plans were transferred to the NYNEX
Master Trust. Effective January 1, 1998, the NYNEX Master Trust was
renamed the Bell Atlantic Master Trust (the "Master Trust").
VALUE OF INVESTMENTS
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 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
11
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
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 6.0% and 6.3% for the years ended December 31,
1999 and 1998, respectively.
ii. The crediting interest rates ranged from 5.06% to 8.15%
at December 31, 1999 and 4.2% to 8.3% at December 31,
1998.
iii. The fair value, as determined by discounting future cash
flows of the underlying BASSP investments, at December
31, 1999 and 1998, was approximately $216,898 and
$229,921, respectively.
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.
COMMITMENTS
Commitments represents the value of the ESOP shares to be allocated to
participants accounts once the scheduled corresponding loan payments is
made.
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 Benefits reflects
the net appreciation (depreciation) in the fair value of the BASSP's
investments, which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
12
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
DISTRIBUTIONS
Distributions elected to be withdrawn from the BASSP by participants
are recorded when paid.
PLAN EXPENSES
The BASSP pays certain administrative expenses out of assets held in
the Master Trust and out of interest income earned from the BASSP's
disbursement account, as held by the Trustee, in accordance with BASSP
provisions and to the extent permitted by law. Any expenses not paid by
the BASSP are paid by Bell Atlantic.
BELL ATLANTIC'S USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires the BASSP's trust asset
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.
RISKS AND UNCERTAINTIES
The BASSP 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
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 December 31, 1999
and 1998, was approximately $56.6 billion (of which net assets totaling
approximately $21.4 billion are specific to the defined benefit plans,
item (b) above, for which separate financial statements are prepared)
and approximately $51.2 billion, respectively.
13
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
INVESTMENTS HELD IN POOLED ACCOUNTS
The pooled investments are unitized, aggregated and reported by the
Master Trust with a carrying value of $22.7 billion at December 31,
1999 and 1998, and with investment earnings of $3.9 billion and $2.2
billion for the years ended December 31, 1999 and 1998, 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.
The total investments held in the Master Trust pooled accounts at
December 31, were as follows:
<TABLE>
<CAPTION>
FAIR VALUE (NOTE 2)
----------------------------------------
DESCRIPTION 1999 1998
----------- ---------------- ----------------
<S> <C> <C>
Cash - non interest bearing $ - $ 7,587
Receivables 691,568 1,300,045
Common Stock 21,107,790 18,625,854
Bell Atlantic Corporation common shares 91,530 70,998
Preferred Stock 76,783 115,874
U.S. Government Securities 99,119 1,097,450
Corporate Debt - preferred and other 228,401 1,489,671
Real estate - 166
Temporary cash investments 586,308 619,688
Other investments* 485,553 708,470
---------------- ----------------
23,367,052 24,035,803
Liabilities 650,607 1,307,975
---------------- ----------------
Total pooled net assets in the Master Trust $ 22,716,445 $ 22,727,828
================ ================
</TABLE>
*Other investments include foreign investments, principally foreign
government debt.
The BASSP'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 the Statements of Net Assets Available for
Benefits and "Allocated share of Master Trust investment activities" in
the Statements of Changes in Net Assets Available for Benefits.
14
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
Investments in the Master Trust are allocated to the BASSP's Fund
options in accordance with their respective percentages of interest.
The proportionate interests of the BASSP's Fund options in the carrying
value of the Master Trust pooled accounts at December 31, were as
follows:
<TABLE>
<CAPTION>
CARRYING CARRYING
VALUE VALUE
1999 1999 1998 1998
------------ ---------- ------------ -----------
<S> <C> <C> <C> <C>
Active U.S. Equity Fund $ 12,607 0.0555% $ 12,169 0.0535%
U.S. Balanced Fund 8,161 0.0359% 9,368 0.0412%
Global Balanced Fund 2,243 0.0099% 1,966 0.0087%
Active International Equity Fund 13,065 0.0575% 1,971 0.0087%
U.S. Small Capitalization Fund 8,859 0.0390% 6,559 0.0289%
Passive U.S. Equity Index Fund 179,100 0.7884% 163,281 0.7184%
------------ ------------
Total $ 224,035 $ 195,314
============ ============
</TABLE>
INVESTMENTS HELD IN SPECIFIC ACCOUNTS
Effective January 1, 1998, the assets of all Bell Atlantic's defined
contribution plans were included in the Master Trust. The net assets
specific to these plans are the Bell Atlantic Shares Fund, PAYSOP 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 December 31, were as follows:
<TABLE>
<CAPTION>
DESCRIPTION FAIR VALUE (NOTE 2)
----------- ---------------------------------------
1999 1998
---------------- ----------------
<S> <C> <C>
Receivables $ 401,820 $ 410,006
Common Stock 741,499 609,620
Bell Atlantic Corporation common shares 9,787,824 8,324,047
Temporary cash investments 174,224 139,788
Fixed income obligations - insurance contracts 1,826,236 1,973,019
Fixed income corporate obligations 168,522 239,031
---------------- ----------------
13,100,125 11,695,511
Liabilities 578,356 642,498
---------------- ----------------
Total net assets in the specific
accounts in the Master Trust $ 12,521,769 $ 11,053,013
================ ================
</TABLE>
15
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
Investments in the Master Trust are allocated to the BASSP's Fund
options in accordance with their respective percentages of interest.
The proportionate interest of the BASSP, the Bell Atlantic Savings Plan
for Salaried Employees (the "BASP") and the Bell Atlantic Savings and
Security Plan for Associates of Bell Atlantic North (the "NSSP") in the
carrying value of the Master Trust specific accounts at December 31,
1999 was as follows:
<TABLE>
<CAPTION>
CARRYING CARRYING CARRYING
VALUE VALUE VALUE
BASSP PLAN % BASP PLAN % NSSP PLAN %
------------- ----------- ------------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Bell Atlantic Shares Fund $ 1,411,573 21% $ 2,755,661 40% $ 2,670,119 39%
Telecommunications Fund - - 297,567 53% 264,650 47%
Government Money Market Fund 19,400 11% 147,899 85% 6,955 4%
Passive International Equity Index Fund 26,437 15% 138,330 77% 14,556 8%
Income Fund 245,693 13% 1,180,551 65% 400,046 22%
Loan Fund 82,001 22% 161,631 40% 153,844 38%
ESOP 503,322 24% 1,632,176 76% - -
U.S. Bond Market Index Fund 9,864 6% 148,611 88% 10,072 6%
PAYSOP 157,309 65% 83,502 35% - -
------------- ------------- -------------
Total $ 2,455,599 $ 6,545,928 $ 3,520,242
============= ============= =============
</TABLE>
The following table reflects the investments that represent 5% or more
of the net assets in the Master Trust as of December 31, 1999:
<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <C> <C>
Bell Atlantic Corporation common shares $9,787,824 $8,324,047
</TABLE>
INVESTMENT INCOME
Investment income and expenses are allocated to the BASSP'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.
16
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
The allocated net investment income to the BASSP's Fund options for the
years ended December 31, were as follows:
<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>
DECEMBER 31, 1999:
------------------
Bell Atlantic Shares Fund $ 563 $ - $ - $ 186,261 $ - $ 186,824
Government Money Market Fund 917 - - - - 917
Passive U.S. Equity Index Fund 419 - 1,991 30,107 (2) 32,515
Passive International Equity
Index Fund 20 - - 6,318 - 6,338
Income Fund 15,433 - - - - 15,433
Employee Stock Ownership Plan:
Allocated - - - 65,935 1 65,936
Unallocated - - - 33,669 - 33,669
U.S. Bond Market Index Fund 5 - - (128) - (123)
Active U.S. Equity Fund 7 - 159 1,394 - 1,560
U.S. Balanced Fund 196 - 72 348 - 616
Global Balanced Fund 32 - 21 247 (1) 299
Active International Equity Fund 5 - 60 2,784 (6) 2,843
U.S. Small Capitalization Fund 13 - 51 1,925 - 1,989
PAYSOP 43 - - 24,991 - 25,034
--------- -------------- ----------- -------------- ----------- ---------------
Total $ 17,653 $ - $ 2,354 $ 353,851 $ (8) $ 373,850
========= ============== =========== ============== =========== ===============
</TABLE>
<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>
DECEMBER 31, 1998:
------------------
Bell Atlantic Shares Fund $ 560 $ 44,575 $ - $ 110,756 $ - $ 155,891
Government Money Market Fund 1,091 - - - - 1,091
Passive U.S. Equity Index Fund 261 - 1,940 31,873 3 34,077
Passive International Equity
Index Fund 25 - - 4,693 - 4,718
Income Fund 16,708 - - 21 - 16,729
Employee Stock Ownership Plan:
Allocated 30 - 4,879 80,094 - 85,003
Unallocated (6) - 4,170 (7,656) - (3,492)
U.S. Bond Market Index Fund 7 - - 1,172 - 1,179
Active U.S. Equity Fund 8 - 139 1,066 - 1,213
U.S. Balanced Fund 135 - 61 528 - 724
Global Balanced Fund 22 - 16 109 - 147
Active International Equity Fund 3 - 31 38 (3) 69
U.S. Small Capitalization Fund 12 - 35 174 - 221
PAYSOP 95 - 5,054 23,303 - 28,452
--------- -------------- ----------- -------------- ----------- ---------------
Total $ 18,951 $ 44,575 $ 16,325 $ 246,171 $ - $ 326,022
========= ============== =========== ============== =========== ===============
</TABLE>
17
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(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 BASSP's assets and speculation are prohibited as
stated in the BASSP plan documents. Offsetting currency positions are
not permitted to exceed the level of exposure in the BASSP'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 BASSP's forward
contracts is equal to any gains which have not been settled as of the
BASSP's year end. The credit risk of the BASSP'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 BASSP.
All derivative activity relating to the BASSP is within the Master
Trust pooled accounts. The Master Trust pooled accounts' derivative
activity is allocated to the BASSP in accordance with the BASSP'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 BASSP.
18
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
The notional values and fair values of the derivative activity used for
trading purposes held by the BASSP at December 31, were as follows:
<TABLE>
<CAPTION>
1999 1998
------------- -----------
<S> <C> <C>
Domestic Equity Futures Contracts:
Notional values $ 1,490 $ 1,187
Fair values 1,534 1,253
Forward Foreign Currency Payable Contracts:
Notional values 29 14
Fair values 30 15
Forward Foreign Currency Receivable Contracts:
Notional values 29 14
Fair values 28 15
</TABLE>
The average fair values of the derivative activity used for trading
purposes held by the BASSP during the years ended December 31, were as
follows:
<TABLE>
<CAPTION>
1999 1998
------------ ----------
<S> <C> <C>
Average Fair Values:
Domestic Equity Futures Contracts $ 3,988 $ 871
Forward Foreign Currency Payable Contracts 32 20
Forward Foreign Currency Receivable Contracts 31 20
</TABLE>
The BASSP was allocated $293 and $339 in 1999 and 1998, respectively,
of net trading losses from futures contracts. Net trading losses
allocated to the BASSP from foreign exchange contracts totaled $3,034
and $16,521 in 1999 and 1998, respectively.
5. TAX DETERMINATION
On November 13, 1997, the Internal Revenue Service issued a ruling that
the BASSP meets the requirements of Section 401(a) of the Code and is
exempt from Federal income taxes under Section 501(a) of the Code and
that the ESOP portion of the BASSP qualifies as an employee stock
ownership plan within the meaning of Section 4975(e)(7) of the Code.
The BASSP has been amended since receiving the determination letter.
However, the BASSP's administrator and the BASSP's tax counsel believe
that the BASSP is designed and is currently being operated in
compliance with the applicable requirements of the Code.
19
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
6. INDEBTEDNESS
BASSP LEVERAGED ESOP NOTES PAYABLE
The LESOP notes payable originally bore an 8.17% interest rate subject
to adjustment due to changes in the Federal income tax rate or changes
in the Federal law regarding the alternative minimum tax. Portions of
the LESOP notes were refinanced on two separate occasions. In 1998,
$11M was refinanced at 5.5%, and in 1999, $11M at 4.64%. Interest and
principal payments are guaranteed by Bell Atlantic and are due on
January 1 and July 1 of each year; principal payments began July 1,
1990.
The following table displays the principal maturities under the notes
with the final payment due July 1, 2005.
<TABLE>
<S> <C>
2000 $ 30,036
2001 3,072
2002 3,229
2003 3,395
2004 3,568
Thereafter 3,751
-------------
$ 47,051
=============
</TABLE>
The fair value of the LESOP notes payable is based on quoted market
prices for the same or similar instruments. As of December 31, 1999 and
1998, respectively, the note payable carrying amount was $47,051 and
$87,981 and the estimated fair value was $40,943 and $80,525.
7. 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 BASSP for the investment
advisory services rendered to the BASSP.
20
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
8. CONCENTRATIONS OF CREDIT RISK
Financial instruments that potentially subject the BASSP to
concentrations of credit risk consist principally of investment
contracts with insurance companies and other financial institutions.
The BASSP places its investment contracts with high-credit quality
insurance companies and financial institutions in order to limit credit
exposure. The BASSP regularly monitors the financial stability of the
financial institutions and insurance companies.
9. PLAN AMENDMENTS
Effective July 1, 1998, the BASSP was amended for conforming changes in
certain administrative rules.
Effective January 1, 1998, the portion of the PAYSOP which contains
accounts for BASSP associate employees was merged into the BASSP.
Effective January 1, 1998, the BASSP was amended to offer new
investment funds (See Note 1).
10. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The Department of Labor requires that amounts allocated to accounts of
persons who have elected to withdraw from the BASSP but have not yet
been paid be reported as liabilities on the plan's 5500. In accordance
with the relevant American Institute of Certified Public Accountants
audit and accounting guide, benefits should not be accrued as
liabilities of the plan. The following is a reconciliation of net
assets available for benefits per the financial statements to the
amounts reported in Form 5500:
21
<PAGE>
BELL ATLANTIC SAVINGS AND SECURITY PLAN FOR
ASSOCIATES OF BELL ATLANTIC SOUTH
NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(DOLLARS IN THOUSANDS)
The following is a reconciliation of net assets available for plan
benefits per the financial statements to the amounts reported in Form
5500:
<TABLE>
<CAPTION>
1999 1998
--------------- ---------------
<S> <C> <C>
Net assets available for benefits presented in the
Statement of Net Assets Available for Benefits $ 2,679,634 $ 2,434,264
Less: Benefit claims payable presented in the Statement
of Net Assets Available for Benefits in Form 5500 672 10,330
--------------- ---------------
Net assets available for benefits presented in the Statement
of Net Assets Available for Benefits in Form 5500 $ 2,678,962 $ 2,423,934
=============== ===============
</TABLE>
The following is a reconciliation of benefits paid to participants per
the financial statements to the amounts reported in Form 5500:
<TABLE>
<CAPTION>
1999 1998
--------------- --------------
<S> <C> <C>
Aggregate distribution to participants as presented in the
Statement of Changes in Net Assets Available for Benefits $ 302,784 $ 243,045
Add: Current year benefit claims payable presented in
the Statement of Net Assets Available for Benefits in
Form 5500 672 10,330
Less: Prior year benefits claims payable presented in
the Statement of Net Assets Available for Benefits in
Form 5500 10,330 13,461
-------------- -------------
Benefit payments and payments to provide benefits directly to
participants and beneficiaries presented in the Statement of
Changes in Net Assets Available for Benefits in Form 5500 $ 293,126 $ 239,914
============== =============
</TABLE>
22
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Bell
Atlantic Corporate Employees' Benefits Committee has duly caused this annual
report to be signed by the undersigned thereunto duly authorized.
Bell Atlantic Savings and Security Plan
for Associates of Bell Atlantic South
By: /s/ Thomas J. Edwards
---------------------------------------
Thomas J. Edwards
(Acting Chairman, Bell Atlantic Corporate
Employees' Benefit Committee)
Date: June 19, 2000
23
