<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0-13818
GMG RETIREMENT & SAVINGS PLAN
(Full title of the Plan and address of the Plan,
if different from that of the issuer named below)
POPULAR, INC.
209 MUNOZ RIVERA AVENUE
HATO REY, PUERTO RICO 00918
(Name of issuer of the securities held pursuant to the
plan and the address of principal executive office)
<PAGE> 2
GMG RETIREMENT & SAVINGS PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Financial Statements and Schedules:
Independent Auditors' Report................................................................. 1
Statements of Net Assets Available for
Benefits as of December 31, 1999 and 1998.................................................... 2
Statements of Changes in Net Assets Available for
Benefits for the years ended December 31, 1999 and 1998...................................... 3
Notes to Financial Statements................................................................ 4
Schedule of Assets Held For Investment
Purposes as of December 31, 1999 and 1998................................................ 8
Schedule of Reconciliation of Form 5500 as of
December 31, 1999 and 1998............................................................... 9
Signature......................................................................................... 10
Consent of Independent Accountants................................................................ 11
</TABLE>
<PAGE> 3
(LOGO) Hipolito Torres Rivera & Co. CPA'S, P.S.C.
Certified Public Accountants & Consultants
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
GM Group, Inc. CODA Profit Sharing Plan:
We have audited the accompanying statements of net assets available for
benefits of GM Group, Inc. CODA Profit Sharing 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 GM
Group, Inc. CODA Profit Sharing Plan as of December 31, 1999 and 1998, and
the changes in net assets available for benefits for the years then ended
in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules of
assets held for investment purposes and reconciliation of Form 5500 are
presented for the purpose of additional analysis and are not a required
part of the basic financial statements but are supplementary information
required by the Department of Labor's Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974.
The supplemental schedules have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our
opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ Hipolito Torres Rivera & CPA's, P.S.C.
San Juan, Puerto Rico
July 28, 2000
Stamp number 1686711 was
affixed to the original report.
GM Group Plaza Suite 104A-Box 8
1590 Ponce de Leon Ave., San Juan, PR 00926
T (787) 281-0088 F (787) 281-0087 E-Mail [email protected]
1
<PAGE> 4
GM GROUP, INC. CODA PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
ASSETS
INVESTMENTS, at fair value:
Equity fund $ 308,996 $ 226,629
Fixed income 146,101 125,781
Growth fund 729,729 592,661
Money market 275,218 160,281
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Total investments 1,460,044 1,105,352
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CONTRIBUTIONS RECEIVABLE:
Employer -- 20,185
Participants -- 8,800
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Total contributions receivable -- 28,985
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TOTAL NET ASSETS AVAILABLE FOR BENEFITS $1,460,044 $1,134,337
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</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
2
<PAGE> 5
GM GROUP, INC. CODA PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
ADDITIONS TO NET ASSETS ATTRIBUTED TO
INVESTMENT INCOME:
Unrealized gain on trust funds $ 8,018 $ 119,496
Realized gain on distributions 28,329 25,146
Interest 8,172 7,058
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Total investment income 44,519 151,700
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CONTRIBUTIONS:
Participants 447,951 309,828
Employer 22,977 28,080
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Total contributions 470,928 337,908
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Total additions 515,447 489,608
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DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO
BENEFITS PAID DIRECTLY TO PARTICIPANTS 189,740 64,024
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NET INCREASE 325,707 425,584
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 1,134,337 708,753
---------- ----------
End of year $1,460,044 $1,134,337
========== ==========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
3
<PAGE> 6
GM GROUP, INC. CODA PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
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1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION - The GM Group, Inc. CODA Profit Sharing Plan (the "Plan") was
effective on January 1, 1996. The Plan was created for the benefit of the
employees of GM Group, Inc., a corporation organized under the laws of the
Commonwealth of Puerto Rico (the "Sponsor").
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - The most significant accounting
policies followed by the Plan are summarized below:
METHOD OF ACCOUNTING - The financial statements of the Plan have been
prepared following the accrual basis of accounting except for benefit
payments, which are recorded on the cash basis.
INVESTMENTS - The investments are carried at market value. Investments
which do not have a quoted market value are carried at the lower of
cost or net realizable value. Gains and losses on sale of securities
are determined using the average cost method. All investments are held
in a bank administered trust fund.
USE OF ESTIMATES - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
2. DESCRIPTION OF THE PLAN
GENERAL - The Plan is a defined contribution cash or deferred arrangement
profit sharing plan covering substantially all employees of the Sponsor. It
is subject to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA), as amended. The Plan provides for retirement, death and
disability benefits.
ELIGIBILITY - Employees become eligible to participate in the Plan upon
attaining the age of twenty-one (21) years old and completing three (3)
months of service.
4
<PAGE> 7
GM GROUP, INC. CODA PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
2. DESCRIPTION OF THE PLAN (CONTINUED)
CONTRIBUTIONS - The annual contributions to the Plan are composed of an
employee contribution and an employer matching contribution. Participants
may contribute the lesser of: (i) $7,500 (or such higher limit as may be in
effect under the Puerto Rico Internal Revenue Code of 1994, as amended), or
(ii) 10% of the participant's qualified compensation, as defined. The
Sponsor contributes to the Plan a matching contribution equal to 25% percent
of each $1 contributed by the participant up to $400 per participant.
Voluntary contributions, on after-tax-basis, by participants directly to the
Plan are also permitted subject to certain amount limit and conditions. A
participant's contributions may be increased, decreased or revoked at any
time by the participant. The Sponsor may increase, decrease or eliminate its
matching contributions to the Plan at any time.
INVESTMENT OPTIONS - The participants can make direct employee contributions
in any of these four investment options:
Fixed income government fund - Funds are invested mainly in obligations
issued or guaranteed by the United States Government or any of its
agencies or instrumentalities.
Equity and income fund - Funds are invested mainly in a diversified
portfolio of equity and fixed income securities with income, growth of
income and capital appreciation potential.
Growth fund - Funds are invested mainly in common stocks and securities
convertible into common stocks.
Money market fund - Funds are invested mainly in bank deposit.
VESTING - Participants are immediately vested in their voluntary
contributions plus actual earnings thereon. Vesting in the Sponsor's
contribution portion plus earnings thereon is based on years of continuous
service. A participant is 100% vested after five (5) years of credited
services.
5
<PAGE> 8
GM GROUP, INC. CODA PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
2. DESCRIPTION OF THE PLAN (CONTINUED)
PAYMENTS OF BENEFITS - Upon termination of services due to death, disability
or retirement, a participant may elect to receive an amount equal to the
value of the participant's vested interest in his or her account in either a
lump-sum amount, or in annual installments over a period not exceeding the
expectancy life of employees or beneficiaries. Upon termination of service
due to other reasons, a participant may receive the value of the vested
interest in his or her account as a lump-sum distribution.
FORFEITURES - All forfeitures shall be used to pay for the Plan expenses and
any remaining part, to reduce employer matching contributions, or distribute
such amounts among the remaining participants matching contributions
accounts in the same proportion as originally allocated.
The above description of the Plan provides only general information.
Participants should refer to the Plan agreement for a complete description
of the Plan's provisions.
3. PLAN ADMINISTRATION
On January 10, 1996, the Sponsor agreed with Oriental Federal Savings Bank
("Oriental") for the record keeping and plan administration. The Plan's
trustee has been designated to hold and invest the Plan assets for the
benefits of all participants. These assets are included in the financial
statements at their market value as reported to the Plan by the trustee. The
Sponsor pays an administration fee without reimbursement by the Plan to
Oriental for these services and other administrative matters.
4. SUBSEQUENT EVENTS
On December 31, 1999, Oriental ended is duty as trustee and record keeper of
the Plan. Effective January 1, 2000, the Sponsor appointed Banco Popular de
Puerto Rico ("BPPR") as successor trustee and record keeper of the Plan. In
addition, the Adoption Agreement of the Plan was amended to change the name
of the Plan to GMG Retirement & Savings Plan and to adopt the Banco Popular
de Puerto Rico Master Defined Contribution Retirement Plan and its Master
Trust. The most significant changes produced by the amendment are as
follows:
Eligibility - Employees become eligible to participate in the Plan upon
attaining the age of eighteen (18) years old and completing one-year of
service.
6
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GM GROUP, INC. CODA PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
4. SUBSEQUENT EVENTS (CONTINUED)
Contributions - The participants may make contributions, pre-tax
contributions and/or after-tax contributions, at the election of the
participant. The pre-tax contributions in a Plan year may not exceed 10% of
compensation or $8,000 (or such higher limit as may be in effect under the
Puerto Rico Internal Revenue Code of 1994, as amended). The after-tax
contributions in a Plan year, if authorized, may not exceed 10% of the
aggregate compensation paid to the employee during all the years he or she
has been a Plan participant. The Sponsor will make a matching contribution
equal to .50 cents for each $1 of a participant's pre-tax contributions.
However, the Sponsor will not make matching contributions above 6% of the
participant's basic compensation nor in excess of 30% of the participant's
maximum allowable pre-tax contribution.
Vesting - Vesting in the Sponsor's contribution portion plus earnings is as
follow:
<TABLE>
<CAPTION>
Completed Vested
Years of Service Percentage
---------------- --------------
<S> <C>
Less than 1 0
At least 1 20
At least 2 40
At least 3 60
At least 4 80
At least 5 100
</TABLE>
Early Retirement Age - A participant will be fully vested and may retire
prior to normal retirement age (reaching age 65 or the fifth anniversary of
the first day of the Plan year in which he/she commenced in the Plan) upon
reaching age 55 and completing 10 years of service.
5. RELATED PARTY TRANSACTION
Effective July 1, 1999, Popular, Inc. acquired 100% of the outstanding
common stock of the Sponsor. BPPR is also a wholly-owned subsidiary of
Popular, Inc. As stated in Note 4, BPPR was appointed successor trustee and
record keeper of the Plan effective January 1, 2000.
6. INCOME TAX STATUS
This plan is not a qualified plan under the U.S. Internal Revenue Code. This
is a Non-Domiciled U.S. Plan which is qualified under Section 1165(e) of the
Puerto Rico Income Tax Act of 1954, as amended. Therefore, it is not subject
to income taxes provided continuance compliance with all the terms and
eligibility requirements of the Plan.
7
<PAGE> 10
Supplemental Schedule
GM GROUP, INC. CODA PROFIT SHARING PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998
------------------------- -----------------------
Current Current
Identity of Issuer Description of Investment Cost Value Cost Value
--------------------------- -------------------------------------------- ----------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C>
Fidelity Investments Fund Fidelity Advisor Balanced Fund $ 251,474 $ 308,996 $ 176,151 $ 226,629
Fidelity Investments Fund Fidelity Advisor Government Investment Fund 135,079 146,101 110,949 125,781
Fidelity Investments Fund Fidelity Advisor Growth Opportunities Fund 575,073 729,729 443,002 592,661
Oriental Bank & Trust Money Market Fund 275,218 275,218 160,281 160,281
----------- ----------- --------- -----------
$ 1,236,844 $ 1,460,044 $ 890,383 $ 1,105,352
=========== =========== ========= ===========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THIS SCHEDULE.
8
<PAGE> 11
SUPPLEMENTAL SCHEDULE
GM GROUP, INC. CODA PROFIT SHARING PLAN
SCHEDULE OF RECONCILIATION OF FORM 5500
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
This schedule summarizes differences between the financial statements of GM
Group, Inc. CODA Profit Sharing Plan as of December 31, 1999 and 1998, and the
financial information presented as part of Form 5500 for those years. The net
effect of the $28,985 difference for 1998, which is set forth below, was
recognized as contributions during 1999 for Form 5500 purposes.
<TABLE>
<CAPTION>
A - STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS 1999 1998
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<S> <C> <C>
Total Assets and Net Assets Available for Plan Benefits per
financial statements $ 1,460,044 $ 1,134,337
Less - Net effect of contributions receivable that were recorded for
financial statement purposes in the current audit year period, but not
recorded for Form 5500 purposes
28,985 (28,985)
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Total Assets and Net Assets and Net Assets Available for Plan
Benefits per Form 5500 $ 1,489,029 $ 1,105,352
=========== ===========
<CAPTION>
B - STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
1999 1998
----------- -----------
<S> <C> <C>
Net Increase in Plan Assets per financial statements $ 325,707 $ 425,584
Less - Net effect of contributions receivable that were recorded for
financial statement purposes in the current audit year period, but not
recorded for Form 5500 purposes
28,985 (28,985)
----------- -----------
Net Increase in Plan Assets per Form 5500 $ 354,692 $ 395,599
=========== ===========
</TABLE>
9
<PAGE> 12
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the persons who administer the employee benefit plan have duly caused this
annual report to be signed on its behalf by the undersigned hereunto duly
authorized.
GMG RETIREMENT & SAVINGS PLAN
(Name of Plan)
By: /S/ Maria Isabel Burckhart
------------------------------------
Maria Isabel Burckhart
Authorized Representative
By: /S/ Jorge A. Junquera
-----------------------------------
Jorge A. Junquera
Authorized Representative
in the United States
Date: October 10, 2000
10
