SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT OF EMPLOYEE STOCK
PURCHASE, SAVINGS AND SIMILAR PLANS
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to .
Commission File Number: 001-14473
SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(K) PLAN
(Full title of the plan)
SKY FINANCIAL GROUP, INC.
221 South Church Street
Bowling Green, Ohio 43402
(419) 327-6300
(Name of issuer of the securities held pursuant to the
plan and address of its principal executive office)
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
FINANCIAL STATEMENTS
December 31, 1999 and 1998
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
Bowling Green, Ohio
FINANCIAL STATEMENTS
December 31, 1999 and 1998
CONTENTS
REPORT OF INDEPENDENT AUDITORS .................................. 4
FINANCIAL STATEMENTS
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS .............. 5
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS .... 6
NOTES TO FINANCIAL STATEMENTS ................................ 7
SUPPLEMENTAL SCHEDULES
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR 12
SIGNATURES ...................................................... 13
EXHIBIT 23 ...................................................... 14
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REPORT OF INDEPENDENT AUDITORS
Plan Administrator
Sky Financial Group, Inc.
Profit Sharing and 401(k) Plan
Bowling Green, Ohio
We have audited the accompanying statements of net assets available for
benefits of the Sky Financial Group, Inc. Profit Sharing and 401(k) Plan as
of December 31, 1999 and 1998 and the related statement of changes in net
assets available for benefits for the year ended December 31, 1999. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. These standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as
of December 31, 1999 and 1998, and the changes in net assets available for
benefits for the year ended December 31, 1999, in conformity with generally
accepted accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets
held for investment purposes at end of year is presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974, and
is not a required part of the financial statements. The supplemental
schedule has been subjected to the auditing procedures applied in our audit
of the financial statements and, in our opinion, is fairly stated in all
material respects in relation to the financial statements taken as a whole.
/s/ Crowe, Chizek and Company LLP
Crowe, Chizek and Company LLP
Columbus, Ohio
May 19, 2000
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, 1999 and 1998
1999 1998
ASSETS
Investments at fair value (Note 5) $23,710,133 $46,431,529
Cash and cash equivalents 1,632,452 1,501,325
Receivables
Employer contributions 3,178,653 1,406,908
Employee contributions 12,249 71,230
Interest and dividends 68,334 201,623
Total assets 28,601,821 49,612,615
LIABILITIES
Security purchases payable 22,247 -
Net assets available for benefits $28,579,574 $49,612,615
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Year Ended December 31, 1999
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value of investments (Note 5) $ 345,740
Interest and dividend 532,703
878,443
Contributions:
Employer 4,344,293
Participants 2,349,420
6,693,713
Total additions 7,572,156
Deductions from net assets attributed to:
Benefits paid to participants 5,585,201
Administrative expenses 284,388
Transfer to Sky Financial Group, Inc. Employee Stock
Ownership Pension Plan (Note 4) 22,735,608
28,605,197
Net increase (decrease) (21,033,041)
Net assets available for benefits
Beginning of year 49,612,615
End of year $28,579,574
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE 1 - DESCRIPTION OF PLAN
The following description of the Sky Financial Group, Inc. Profit Sharing and
401(k) Plan (the Plan) provides only general information. The Plan includes
a frozen profit sharing component, an employee stock-ownership component and
a 401(k) component. Participants should refer to the Plan agreement for a
more complete description of the Plan's provisions.
General: The Plan was originally effective July 1, 1989 and was restated on
January 1, 1995 and January 1, 1999. The Plan is a defined contribution plan
covering substantially all employees of Sky Financial Group, Inc. (the
Company), and its wholly-owned subsidiaries who have worked 1,000 hours in
their first year of service and have attained age 21. The Plan is subject to
the provisions of the Employee Retirement Income Security Act of 1974
(ERISA).
Contributions: Each year, participants may contribute up to the maximum
amount allowed by the Internal Revenue Code ($10,000) to the Plan. The
Company makes a matching contribution equal to 100% of the participant's
contribution up to 3% percent of that participant's compensation.
Additionally, the Company, at the option of its board of directors, may
contribute additional amounts each year that are allocated among participants
based on each participant's compensation.
Participant Accounts: Each participant's account is credited with the
participant's own contribution and an allocation of the Company's
contribution and Plan earnings. Company contributions are allocated to
participant accounts based on each participant's proportional
compensation. Investment income or loss is allocated to participant accounts
based on proportional account balances. The benefit to which a participant
is entitled is the benefit that can be provided from the participant's
account.
Retirement, Death and Disability: A participant is entitled to 100% of his
or her account balance upon retirement, death or disability.
Vesting: Participants are immediately vested in their voluntary, employer
matching and rollover contributions plus actual earnings thereon. Vesting in
the remainder of their account plus earnings thereon is based on years of
credited service as follows:
Years of Service Vested Percentage
Less than 2 0%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE 1 - DESCRIPTION OF PLAN (Continued)
The portion of a participant's account balance that is not fully vested will
be forfeited if the participant separates from service. These forfeited
amounts will be used to reduce future employer contributions to the Plan.
Payment of Benefits: On termination of service, a participant may elect to
receive either a lump-sum amount equal to the value of his or her vested
interest in the account, or the vested portion of a participant's balance may
be distributed in installments or partial distributions.
Loans: The Plan provides that participants can borrow funds against their
account balances. These loans are limited to the lesser of $50,000 or 50% of
the participant's vested account balance. Loan issuances are treated as a
transfer between a participant's investment fund(s) and the loans receivable
from participant's fund. The loans are secured by the balance in the
participant's account. Loan principal and interest payments are made in
accordance with the note's amortization schedule, and are made via payroll
withholding.
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES
Basis of Accounting: The financial statements of the Plan are prepared under
the accrual method of accounting in accordance with generally accepted
accounting principles.
New Accounting Standard: The Plan has adopted the American Institute of
Certified Public Accountants Statement of Position 99-3, Accounting and
Reporting of Certain Defined Contribution Plan Investments and Other
Disclosure Matters. The adoption of the standard did not materially impact
the Plan's financial statements.
Estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires the plan administrator to
make estimates and assumptions that affect certain reported amounts and
disclosures, and actual results may differ from these estimates. It is at
least reasonably possible that a significant change will occur in the near
term for the estimates of investment valuation.
Valuation of Investments: The Plan invests in common/collective investment
funds offered by Sky Trust, N.A. (formerly known as Mid Am Private Trust,
N.A., a wholly-owned subsidiary of the Company), shares of mutual funds,
Company common stock, corporate notes, and other common stocks. The Plan's
investment in the common/collective investment funds is valued based upon the
Plan's proportional share of the common/collective fund's underlying assets.
The underlying assets of the common/collective fund are valued at fair market
value. Other investments are valued at fair market value as determined by
the Plan Trustee using quoted market prices except participant notes
receivable, which are valued at cost which approximates fair value.
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES (Continued)
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on an accrual basis.
Payment of Benefits: Benefits are recorded when paid.
NOTE 3 - PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate
the Plan subject to the provisions of ERISA and its related regulations. In
the event of plan termination, participants will become 100% vested in their
accounts.
NOTE 4 - CUSTODIANSHIP OF PLAN ASSETS AND SPIN-OFF OF ASSETS
Prior to April 1, 1999, Mid Am Bank served as the Plan Trustee for all
components of the Plan. Effective April 1, 1999, Sky Trust, N.A. assumed
trusteeship of the 401(k) component of the Plan. Mid Am Bank (a wholly-owned
subsidiary of the Company) retained trusteeship of the frozen profit sharing
and employee stock ownership components of the Plan.
During 1999, the Plan assets were either paid to former participants in the
frozen profit sharing plan or they were spun off from the Plan and
transferred to the Sky Financial Group, Inc. Employee Stock Ownership Pension
Plan (Sky Financial ESOP Pension). This spin-off was accomplished in
accordance with certain resolutions adopted by the Plan Sponsor. The
transfer to the Sky Financial ESOP Pension is reflected on the statement of
changes in net assets available for benefits as a decrease of $22,735,608 in
the Plan's assets.
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE 5 - INVESTMENTS
The following presents, at fair value, investments that represent 5% or more
of the Plan's net assets.
1999 1998
Sky Financial Group, Inc. common stock,
-0- and 896,892 shares, respectively $ - $23,711,582*
Sky Financial Group, Inc. common stock,
302,722 and 233,322 shares, respectively 6,092,274 6,168,703
Sky Trust, N.A. Collective Core Equity Fund,
390,761 and 354,045 shares, respectively 7,754,023 6,043,527
Sky Trust, N.A. Collective Aggressive Equity Fund,
339,795 and 306,753 shares, respectively 4,389,558 3,614,853
Sky Trust, N.A. Collective International Fund,
118,847 and -0- shares, respectively 1,509,191 -
Sky Trust, N.A. Collective Core Fixed Fund,
207,456 and -0- shares, respectively 2,405,047 -
* Nonparticipant directed
During 1999, the Plan's investments (including investments bought, sold, and
held during the year) appreciated by $345,740 as follows:
Net Change in Fair Value
Year Ended
December 31, 1999
Investments at fair value
Company common stock $(307,427)
Common collective accounts 857,369
Other common stock (90,145)
Corporate bonds (18,552)
Mutual funds (61,654)
Government securities (33,851)
$345,740
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE 5 - INVESTMENTS (Continued)
The investments of the ESOP and frozen profit sharing components of the Plan
during 1998 were directed by the plan administrator and as such represented
nonparticipant-directed investments. Information about the net assets
relating to the nonparticipant-directed investments, is as follows:
December 31, 1998
Net Assets:
Common stock $24,343,576
Mutual funds 483,560
Corporate bonds 122,160
U.S. Government Securities 200,289
Cash and cash equivalents 1,386,619
$26,536,204
NOTE 6 - INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by
letter dated July 11, 1998, that the Plan is qualified under the applicable
sections of the Internal Revenue Code. The Plan has been amended since
receipt of this determination letter. The plan administrator believes that
the Plan continues to qualify as a tax-exempt plan.
NOTE 7 - RELATED PARTY TRANSACTIONS
Parties-in-interest are defined under DOL regulations as any fiduciary of the
plan, any party rendering service to the plan, the employer, and certain
others. Certain Plan investments are shares of common/collective investment
funds managed by Sky Trust, N.A. Additionally, certain other plan
investments are shares of Sky Financial Group, Inc. common stock. Sky Trust,
N.A. was a fiduciary of the Plan, and Sky Financial Group, Inc. is the
sponsor of the Plan. Therefore, all transactions in these investments are
party-in-interest transactions. Fees paid by the Plan for administrative and
investment services amounted to $284,388 for the year ended December 31,
1999.
NOTE 8 - PLAN AMENDMENTS
Effective January 1, 1999, the Plan was amended and restated. As a part of
the amendment and restatement, the Plan name was changed from the "Mid Am,
Inc. Profit Sharing and 401(k) Plan" to the "Sky Financial Group, Inc. Profit
Sharing and 401(k) Plan".
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SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(k) PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
December 31, 1999
Attachment to Form 5500, Schedule H, Part IV, Line 4i
Name of plan sponsor: Sky Financial Group, Inc.
Employer identification number: 34-1372535
Three-digit plan number: 001
(c)
(b) Description of Investment
Identity Including Maturity Date, (e)
of Issue Rate of Interest, Collateral, (d) Current
(a) or Borrower Par or Maturity Value Cost Value
* Sky Financial Common Stock
Group, Inc. 302,722 shares @ $ 6,092,274
* Sky Trust, N.A. Core Equity Fund
Investment in 390,761
shares of common/
collective fund @ 7,754,023
* Sky Trust, N.A. Aggressive Equity Fund
Investment in 339,795
shares of common/
collective fund @ 4,389,558
* Sky Trust, N.A. International Fund
Investment in 118,847
shares of common/
collective fund @ 1,509,191
* Sky Trust, N.A. Core Fixed Fund
Investment in 207,456
shares of common/
collective fund @ 2,405,047
* Sky Trust, N.A. Short-Term Fixed Fund
Investment in 92,897
shares of common/
collective fund @ 1,070,100
* Participant Notes Debt obligations of Plan
participants with interest
rates ranging from
7.0% to 9.75% @ 489,940
$ 23,710,133
* Denotes party-in-interest
@ Participant directed investments. Pursuant to Department of Labor
regulations, cost basis not presented.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have
duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
SKY FINANCIAL GROUP, INC.
PROFIT SHARING AND 401(K) PLAN
Date: June 28, 2000 By: /s/ W. Granger Souder, Jr.
W. Granger Souder, Jr., Chairman
Benefits Plan Committee (Plan Administrator)
Sky Financial Group, Inc.
