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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 11-K
þ | Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 | |
For the fiscal year ended: DECEMBER 31, 2005 |
Or
o | Transition Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 | |
For the transition period from _______ to _______ |
Commission File Number 333-94141
EMPLOYEE STOCK OWNERSHIP PLAN OF
TELECOMUNICACIONES DE PUERTO RICO, INC.
TELECOMUNICACIONES DE PUERTO RICO, INC.
Guaynabo, P.R. 00968
(Name of the issuer of the securities held
pursuant to the plan and the address of
its principal executive office)
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Years Ended December 31, 2005 and 2004
Telecomunicaciones de Puerto Rico, Inc.
1 | ||||||||
Financial Statements | ||||||||
3 | ||||||||
4 | ||||||||
5 | ||||||||
Supplemental Schedule | ||||||||
14 | ||||||||
15 | ||||||||
EX-23.1 Consent of Independent Public Accountants |
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Ownership Plan of Telecomunicaciones de Puerto Rico, Inc.
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June 16, 2006
affixed to
original of
this report.
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Telecomunicaciones de Puerto Rico, Inc.
December 31 | ||||||||||||||||||||||||
2005 | 2004 | |||||||||||||||||||||||
Allocated | Unallocated | Total | Allocated | Unallocated | Total | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||
Equity investment in employer, at estimated fair value | $ | 67,079,654 | $ | 45,725,346 | $ | 112,805,000 | $ | 74,059,008 | $ | 47,460,992 | $ | 121,520,000 | ||||||||||||
Participant loans | 844,747 | — | 844,747 | 817,960 | — | 817,960 | ||||||||||||||||||
Money market funds | 2,297,364 | 691,370 | 2,988,734 | 2,880,971 | 1,310,150 | 4,191,121 | ||||||||||||||||||
Receivables: | ||||||||||||||||||||||||
Employer contribution | 445,653 | — | 445,653 | — | — | — | ||||||||||||||||||
Interest receivable | 8,032 | 3,312 | 11,344 | 2,576 | 898 | 3,474 | ||||||||||||||||||
Total assets | 70,675,450 | 46,420,028 | 117,095,478 | 77,760,515 | 48,772,040 | 126,532,555 | ||||||||||||||||||
Liabilities | ||||||||||||||||||||||||
Interest payable to employer | — | 1,540,954 | 1,540,954 | — | 976,534 | 976,534 | ||||||||||||||||||
Payable to vendors | — | 183,997 | 183,997 | — | 195,000 | 195,000 | ||||||||||||||||||
Loan payable | — | 28,328,383 | 28,328,383 | — | 28,062,000 | 28,062,000 | ||||||||||||||||||
Total liabilities | — | 30,053,334 | 30,053,334 | — | 29,233,534 | 29,233,534 | ||||||||||||||||||
Net assets available for benefits | $ | 70,675,450 | $ | 16,366,694 | $ | 87,042,144 | $ | 77,760,515 | $ | 19,538,506 | $ | 97,299,021 | ||||||||||||
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Telecomunicaciones de Puerto Rico, Inc.
Allocated | Unallocated | Total | ||||||||||
Additions: | ||||||||||||
Dividend income | $ | 2,662,699 | $ | 1,760,981 | $ | 4,423,680 | ||||||
Contributions from employer | — | 445,654 | 445,654 | |||||||||
Contributions from employees | — | 1 ,702,695 | 1,702,695 | |||||||||
Interest income | 108,465 | 36,427 | 144,892 | |||||||||
Loan repayments | 232,832 | — | 232,832 | |||||||||
Forgiveness clause effect | — | 370,117 | 370,117 | |||||||||
Other additions | — | 83,964 | 83,964 | |||||||||
Release of 29,058 collateral shares at $64.46 | 1,873,079 | — | 1,873,079 | |||||||||
Total additions | 4,877,075 | 4,399,838 | 9,276,913 | |||||||||
Deductions: | ||||||||||||
Distributions to participants | 6,433,047 | — | 6,433,047 | |||||||||
Interest expense | — | 1,540,954 | 1,540,954 | |||||||||
Participant loan | 262,743 | — | 262,743 | |||||||||
Other deductions | 83,964 | — | 83, 964 | |||||||||
Release of 29,058 collateral shares at $64.46 | — | 1,873,079 | 1,873,079 | |||||||||
Unrealized depreciation | 5,182,386 | 3,532,614 | 8,715,000 | |||||||||
Administrative expenses | — | 625,003 | 625,003 | |||||||||
Total deductions | 11,962,140 | 7,571,650 | 19,533,790 | |||||||||
Net deductions | (7,085,065 | ) | (3,171,812 | ) | (10,256,877 | ) | ||||||
Net assets available for benefits at beginning of year | 77,760,515 | 19,538,506 | 97,299,021 | |||||||||
Net assets available for benefits at end of year | $ | 70,675,450 | $ | 16,366,694 | $ | 87,042,144 | ||||||
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Telecomunicaciones de Puerto Rico, Inc.
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Telecomunicaciones de Puerto Rico, Inc.
(a) | the accounts of employees with vested rights in allocated stock (Allocated) and, | |
(b) | stock not allocated to employees (Unallocated). |
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Telecomunicaciones de Puerto Rico, Inc.
Years of Service | Vested Percentage | |||
1 | 20 | % | ||
2 | 40 | % | ||
3 | 60 | % | ||
4 | 80 | % | ||
5 | 100 | % |
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Telecomunicaciones de Puerto Rico, Inc.
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Telecomunicaciones de Puerto Rico, Inc.
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Telecomunicaciones de Puerto Rico, Inc.
December 31, 2005 | December 31, 2004 | |||||||||||||||
Allocated | Unallocated | Allocated | Unallocated | |||||||||||||
Telecomunicaciones de Puerto Rico, inc. common stock: | ||||||||||||||||
Number of shares | 1,040,640 | 709,360 | 1,066,518 | 683,482 | ||||||||||||
Cost | $ | 37,299,268 | $ | 25,425,323 | $ | 37,520,637 | $ | 25,203,954 | ||||||||
Fair value | $ | 67,079,654 | $ | 45,725,346 | $ | 74,059,008 | $ | 47,460,992 | ||||||||
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Telecomunicaciones de Puerto Rico, Inc.
Year Ending December 31 | Amount | |||
2006 | $ | 1,429,537 | ||
2007 | 1,429,537 | |||
2008 | 1,429,537 | |||
2009 | 1,429,537 | |||
2010 | 1,951,537 | |||
Thereafter | 20,658,698 | |||
Total | $ | 28,328,383 |
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Telecomunicaciones de Puerto Rico, inc.
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Telecomunicaciones de Puerto Rico, Inc.
EIN: 66-0566178
Schedule of Assets (Held at End of Year) (Schedule H — line 4i) | ||
December 31, 2005 |
(c) | (e) | |||||||||||||
(b) | Description | (d) | Current | |||||||||||
(a) | Identity of Issue | of Investment | Cost | Value | ||||||||||
* | Telecomunicaciones de Puerto Rico, | |||||||||||||
Inc. common stock | 1 ,750,000 shares | $ | 62,724,591 | $ | 112,805,000 | |||||||||
* | Participant loans at variable rates | |||||||||||||
(4,75% to 6.75%) | 844,747 | 844,747 | ||||||||||||
Money market funds - U.S. Trust Co. of | 2,988,734 units at | |||||||||||||
California market rate account | $1.00 each | 2,988,734 | 2,988,734 | |||||||||||
Total | $ | 66,558,072 | $ | 116,638,481 | ||||||||||
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan Committee has duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized.
EMPLOYEE STOCK OWNERSHIP PLAN OF
TELECOMUNICACIONES DE PUERTO RICO, INC.
Date | Signature | Capacity | ||
June 29, 2006 | /s/ Cristina M. Lambert Cristina M. Lambert | President and Chief Executive Officer (Principal Executive Officer) | ||
June 29, 2006 | /s/ Hector Houssay Hector Houssay | Vice President Finance and Chief Financial Officer (Principal Financial Officer) | ||
June 29, 2006 | /s/ Maria E. de la Cruz Maria E. de la Cruz | Treasurer |
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EXHIBIT INDEX
EXHIBIT | ||
NUMBER | DESCRIPTION | |
23.1 | Consent of Independent Public Accountants |