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As filed with the Securities and Exchange Commission on June 28, 2000
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the 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: 1-11656
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
GENERAL GROWTH MANAGEMENT
SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive offices:
GENERAL GROWTH PROPERTIES, INC.
110 NORTH WACKER DRIVE
CHICAGO, ILLINOIS 60606
(312) 960-5000
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GENERAL GROWTH MANAGEMENT
SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
CONTENTS
REPORT OF INDEPENDENT ACCOUNTANTS 1
FINANCIAL STATEMENTS
Statements of net assets available for benefits as of
December 31, 1999 and 1998 2
Statement of changes in net assets available for benefits
for the year ended December 31, 1999 3
Notes to financial statements 4 - 7
SUPPLEMENTAL SCHEDULE
Item 27a - Schedule of assets held for investment
as of December 31, 1999 8
NOTE: SUPPLEMENTAL SCHEDULES REQUIRED BY THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974 NOT INCLUDED HEREIN ARE NOT APPLICABLE TO THE
GENERAL GROWTH MANAGEMENT SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
The General Growth Management Savings and Employee Stock Ownership Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the General Growth Management Savings and Employee Stock Ownership Plan (the
"Plan") at December 31, 1999 and 1998, and the changes in net assets available
for benefits for the year ended December 31, 1999, in conformity with accounting
principles generally accepted in the United States. 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 of these statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were 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 is presented for the purpose of additional analysis and is not a
required part of the basic financial statements but is 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 schedule is the responsibility of the Plan's management. The
supplemental schedule has been subjected to the auditing procedures applied in
the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
PricewaterhouseCoopers LLP
June 12, 2000
Chicago, Illinois
1
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
DECEMBER 31,
1999 1998
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Assets:
Investments at fair value (Note 4): $ 68,083,354 $ 60,239,224
Receivables:
Employer contribution 2,868,639 2,041,510
Participant contributions 135,271 84,712
Dividends 729,303
Participant loans (Note 3) 1,521,839 1,002,711
Cash - 1,158,147
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Total assets $ 72,609,103 $ 65,255,607
Liabilities:
Other payable - 105,396
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- 105,396
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NET ASSETS AVAILABLE FOR BENEFITS $ 72,609,103 $ 65,150,211
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The accompanying notes are an integral part of these financial statements
2
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1999
Additions:
Investment income:
Net appreciation in fair
value of investments (Note 4) $ 2,891,502
Interest and dividends 1,406,085
-----------
SUBTOTAL 4,297,587
Contributions:
Participants 7,030,887
Employer 2,868,639
Rollover deposits 531,897
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SUBTOTAL 10,431,423
TOTAL ADDITIONS 14,729,010
Deductions:
Benefit payments 7,241,985
Administrative expenses 28,133
-----------
TOTAL DEDUCTIONS 7,270,118
NET INCREASE IN PLAN ASSETS 7,458,892
Net assets available for benefits:
Beginning of year 65,150,211
-----------
End of year $72,609,103
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The accompanying notes are an integral part of these financial statements
3
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1. DESCRIPTION OF PLAN AND SIGNIFICANT PLAN PROVISIONS
The following description of the General Growth Management Savings and Employee
Stock Ownership Plan (the "Plan") provides only general information. For
purposes of federal law, General Growth Management, Inc. (the "Company") is the
Plan Sponsor and Plan Administrator. Participants should refer to the Plan
agreement for a more complete description of the Plan's provisions.
GENERAL: CG Trust Company (the "Trustee") replaced Wells Fargo (the "Former
Trustee") as the trustee of the Plan effective September 1, 1999. The Plan is
designed to encourage and assist eligible employees to adopt a regular program
of savings to provide additional security for their retirement. The Plan is a
defined contribution plan covering all employees of General Growth Management,
Inc. (the "Company"), and other participating employers (GGP Limited
Partnership, GGP Management, Inc., General Growth Management of California,
Inc., General Growth Management of Hawaii, Inc., and GG Management Company,
Inc.), who have completed six months of service (a minimum of 500 hours of
service) and attained age 21. Certain individuals at locations managed by the
Company and participating employers are either (i) employees of companies not
owned or controlled by the Company and/or the participating employers or (ii)
are covered by other qualified plans and therefore are not eligible for this
Plan. The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA).
PLAN MERGER: Effective June 18, 1998, the General Growth Employee Stock
Ownership Plan (the "ESOP") was merged into and become part of the Plan. Each
individual who was a participant in the ESOP on June 17, 1998, became a
participant in this Plan on June 18, 1998 and the participant's account is held
in the ESOP account under this Plan. Three subaccounts were established under
the ESOP account, each containing one third of the total amount transferred to
the Plan. The ESOP accounts have a diversification schedule, which expired on
January 1, 2000, whereby the participant may elect to invest in the other
investment options under the Plan.
CONTRIBUTIONS: Under the terms of the Plan, subject to certain limitations, each
participant is allowed to make before-tax contributions in 1% increments up to
12% of gross earnings, as defined. The Internal Revenue Code imposes, among
other things, a dollar limitation on the amount of before-tax contributions for
a calendar year. For 1999, a participant's before-tax contribution was limited
to $10,000. The Company will match 100% of the first 4% of earnings contributed
each calendar year, and 50% of the next 2% of the participant's earnings
contributions.
PARTICIPANT ACCOUNTS: Separate accounts are maintained for each participant,
with investment income and losses on contributions credited to that account.
Each participant designates which investment option or combination of options in
which their contributions and the Company's matching contributions are to be
invested. Each participant is credited with employer contributions as defined in
the Plan, allocations of Plan earnings, and is charged with administrative
expenses, if incurred, on a transaction basis. Allocations of Plan earnings and
administrative expenses are based on account balances.
VESTING: Participants are fully vested at all times in all accounts other than
the accounts arising from the Company matching contributions contributed by the
employer prior to January 1, 1998 and the earnings or losses thereon. The
employer matching accounts contributed prior to January 1, 1998 will vest over a
six-year period except that all amounts contributed by the employer after
January 1, 1998 will be 100% vested. Forfeitures are used first for
reinstatements of accounts of re-employed participants. Any remaining forfeiture
amounts are applied as credits against future employer matching contributions.
In 1999, employer contributions were reduced by $144,951 from forfeited
non-vested accounts.
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1. DESCRIPTION OF PLAN AND SIGNIFICANT PLAN PROVISIONS (continued)
TERMINATION: Although it has not expressed any intent to do so, the Company
reserves the right to partially or completely terminate the Plan, subject to
plan provisions. Upon a complete or partial termination of the Plan, all accrued
benefits of affected participants shall immediately become fully vested.
DISTRIBUTIONS: Upon retirement on or after attaining the Plan's normal
retirement age of 60, or upon death or disability, if earlier, or termination of
employment in the case of vested benefits, the balances in the participant's
separate accounts will be paid in lump sum to the participant, or the
participant's beneficiary in event of death. A participant may withdraw
contributions by claiming hardship as defined by the Plan. All distributions
will be made in cash, unless the Participant elects to receive common stock of
General Growth Properties, Inc., a publicly traded real estate investment trust.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING: The financial statements of the Plan are prepared under the
accrual method of accounting.
USE OF ESTIMATES: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities and
changes therein, and disclosure of contingent assets and liabilities. Actual
results could differ from those estimates.
VALUATION OF INVESTMENTS AND PARTICIPANT LOANS: Investments are stated at fair
value based on published market quotations in an active market. Participant
loans and the benefit-responsive investment contract are stated at cost or
contract value, which approximates fair value.
INSURANCE POLICIES: Excluded from the Plan's assets as of December 31, 1999 and
1998, are insurance policies purchased by the Plan for the benefit of certain
participants. Premiums for these policies are deducted from the participant's
balance in whose name the policy is purchased. The insurance company is
responsible for any distribution of benefits.
INVESTMENT TRANSACTIONS: The Plan presents in the statement of changes in net
assets available for benefits the net appreciation (depreciation) in the fair
value of its investments which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments. Investment income
in each fund is allocated daily among the participants' balances in each fund.
ADOPTION OF STATEMENT OF POSITION 99-3: The Accounting Standards Executive
Committee issued Statement of Position 99-3, "Accounting for and Reporting of
Certain Defined Contribution Plan Investments and Other Disclosure Matters" (SOP
99-3), which eliminates the requirement for a defined contribution plan to
disclose participant directed investment programs. The 1999 financial statements
reflect the adoption of SOP 99-3. The 1998 financial statements have been
presented in a manner to conform with this presentation.
ADMINISTRATIVE EXPENSES: All administrative expenses, other than investment
management fees and loan processing and maintenance fees, are paid by the
Company.
PAYMENT OF BENEFITS: Benefit payments to participants are recorded upon
distribution.
5
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 3. PARTICIPANT LOANS
Participants may borrow against their account, subject to those administrative
rules that exist from time to time. The minimum loan that will be made is $1,000
and the total of any individual participant's loan or loans may never exceed 50
percent of the participant's total vested account balance or $50,000 whichever
is less. The rate of interest on existing loans at December 31, 1999, ranged
from 9.75 to 11.19 percent. The term of a loan may not exceed five years, unless
the loan qualifies as a home purchase loan, in which case the term may go up to
20 years. Principal and interest are due each pay period. Participant loans are
due and payable immediately upon termination of employment.
NOTE 4. INVESTMENTS
Participants can choose to invest in increments of 1% in any of the eleven
investment options. The following presents investments that represent 5 percent
or more of the Plan's net assets available for benefits in either 1999, 1998, or
in both years:
FAIR VALUE
DECEMBER 31,
1999 1998
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Charter Guaranteed Income Fund $ 4,275,582
Charter Large Company Stock
Growth - Putnam 5,923,219
Charter Small Company Stock Value I
Fund - Berger 7,040,524
Invesco Dynamics 17,307,216
Janus Worldwide Account 5,133,927
General Growth Properties, Inc.
Common Stock 22,980,863 $ 24,128,193
Norwest Stable Return Fund 3,205,159
Putnam Income Fund 2,737,619
Mutual Shares Fund 10,740,789
Acorn Fund 8,640,044
Norwest Short-Term Investment Fund 2,817,424
Vanguard Wellington Fund 2,309,951
Fidelity Contrafund Fund 3,753,028
During 1999, the Plan's investments (net gains and losses on investments bought
and sold as well as held during the year) appreciated in value by $2,891,502 as
follows:
Mutual Funds, investment in
collective trusts, registered
investment companies, net $ 11,221,369
Common Stock, net (8,329,867)
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$ 2,891,502
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 4. INVESTMENTS (continued)
The Plan has a benefit-responsive investment contract with the Trustee's
Connecticut General Life Insurance Company ("Connecticut General"). Connecticut
General maintains the contributions in the Charter Guaranteed Income Fund
account. The account is credited with earnings on the underlying investments
and charged for participant withdrawals and administrative expenses.
Participants may ordinarily direct the withdrawal or transfer of all or a
portion of their investment at contract value.
The are no reserves against contract value for credit risk of the contract
issuer or otherwise. The average yield and crediting interest rates were
approximately 4.850% for 1999.
NOTE 5. INCOME TAX STATUS
The Plan received its latest determination letter on October 14, 1999,
applicable for Plan amendments adopted on June 12, 1998, in which the Internal
Revenue Service (IRS) stated the Plan, as then designed, was in compliance with
the applicable requirements of the Internal Revenue Code, as amended. The Plan
was subsequently amended; however, the Plan administrators believe that the Plan
is designed and is currently being operated in compliance with the applicable
requirements of the IRS. Therefore, no provision for income taxes has been
included in the Plan's financial statements.
NOTE 6. RISKS AND UNCERTAINTIES
The Plan provides for various investment options in any combination of mutual
finds, investments in collective trusts, interest in registered investment
companies and shares of common stock. The investments of the Plan are exposed to
various risks, such as interest rate, market and credit. Due to the level of
risk associated with certain investment securities and the level of uncertainty
related to changes in the value of investment securities, it is at least
reasonably possible that changes in risks in the near term would materially
affect participants' account balances and the amounts reported in the statements
of net assets available for benefits and the statement of changes in net assets
available for benefits.
7
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
ITEM 27a -- SCHEDULE OF ASSETS HELD FOR INVESTMENT
<TABLE>
<CAPTION>
DECEMBER 31, 1999
FAIR
DESCRIPTION DESCRIPTION OF INVESTMENT VALUE
-------------------------------------------------------------------------------------------------------
<S> <C> <C>
Connecticut General Life Insurance Charter Guaranteed Income Fund $ 4,275,582
Connecticut General Life Insurance Charter Corporate Bond - CIGNA 2,113,170
Connecticut General Life Insurance CIGNA Lifetime 20 21,919
Connecticut General Life Insurance CIGNA Lifetime 30 28,922
Connecticut General Life Insurance CIGNA Lifetime 40 2,233,908
Connecticut General Life Insurance CIGNA Lifetime 50 71,554
Connecticut General Life Insurance CIGNA Lifetime 60 92,517
Connecticut General Life Insurance Charter Large Company Stock Index - CIGNA 251,686
Connecticut General Life Insurance Charter Large Company Stock Growth - Putnam 5,923,219
Connecticut General Life Insurance Charter Large Company Stock Value - Levin 349,599
Connecticut General Life Insurance Charter Large Company Stock Value I Fund - Berger 7,040,524
Connecticut General Life Insurance Invesco Dynamics 17,307,216
Connecticut General Life Insurance Janus Worldwide Account 5,133,927
National Financial Services General Growth Properties, Inc. - Common Stock 22,980,863
National Financial Services Short Term Money Market Account 200
Vanguard Fixed Income Securities Value of Interest in Registered
Fund GUNMA Portfolio Investment Company 258,548
Outstanding Participant Loans 1,521,839
------------
$ 69,605,193
============
</TABLE>
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized on this 28th day of June, 2000.
GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
By: General Growth Management, Inc.,
as Administrator
By: /s/ ROBERT A. MICHAELS
------------------------------
Robert A. Michaels
Its: President
9
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GENERAL GROWTH MANAGEMENT SAVINGS
AND EMPLOYEE STOCK OWNERSHIP PLAN
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
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23.1 Consent of PricewaterhouseCoopers LLP
10
