FORM 11-K
[x] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [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 0-18886
A. HS RESOURCES, INC. 401(k) & PROFIT SHARING PLAN
B. HS RESOURCES, INC.
One Maritime Plaza, 15th Fl.
San Francisco, CA 94111
HS RESOURCES, INC.
401(k) & PROFIT SHARING PLAN
Financial Statements And Schedule
As Of December 31, 1999 And 1998
Together With Report Of Independent Public Accountants
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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INDEX
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PAGE(S)
REPORT OF INDEPENDENT PUBLIC 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 AND SCHEDULE 4-8
SCHEDULE SUPPORTING FINANCIAL STATEMENTS:
Schedule I - Schedule of Assets Held for Investment Purposes
at End of Year 9-12
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of the
HS Resources, Inc. 401(k) & Profit Sharing Plan:
We have audited the accompanying statements of net assets available for benefits
of HS RESOURCES, INC. 401(k) & PROFIT SHARING PLAN (the "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 auditing standards generally accepted
in the United States. 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 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 accounting principles
generally accepted in the United States.
Our audits were performed 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 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. This 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.
/s/ARTHUR ANDERSEN LLP
Denver, Colorado
June 26, 2000
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HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
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AS OF DECEMBER 31, 1999 AND 1998
--------------------------------
1999 1998
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INVESTMENTS (Note 2):
Cash and cash equivalents $ 56,368 $ 88,239
Money market funds 513,020 349,054
Mutual funds 7,292,769 6,081,195
Common/collective trust fund 471,721 176,942
HS Resources common stock 2,692,138 824,721
Common stock 661,622 57,550
Loans to participants 221,458 161,910
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Total investments 11,909,096 7,739,611
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RECEIVABLES:
Employer contributions receivable 1,422,712 1,034,102
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NET ASSETS AVAILABLE FOR BENEFITS $13,331,808 $8,773,713
=========== ==========
The accompanying notes to financial statements and
schedule are an integral part of these statements.
-2-
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
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FOR THE YEAR ENDED DECEMBER 31, 1999
------------------------------------
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income -
Interest, dividends and other income $ 524,134
Net realized and unrealized gain on investments 1,867,926
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Total investment income 2,392,060
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Contributions -
Employer 1,151,555
Employee 1,343,873
Rollover 102,023
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Total contributions 2,597,451
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Total additions 4,989,511
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DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Distributions to participants 410,019
Administrative expenses 21,397
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Total deductions 431,416
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NET INCREASE 4,558,095
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 8,773,713
-----------
End of year $13,331,808
===========
The accompanying notes to financial statements and
schedule are an integral part of this statement.
-3-
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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NOTES TO FINANCIAL STATEMENTS AND SCHEDULE
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DECEMBER 31, 1999 AND 1998
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1. DESCRIPTION OF PLAN:
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Effective July 1, 1990 and June 30, 1989, HS Resources, Inc. (the "Company")
established the HS Resources, Inc. Employee Investment 401(k) Plan (the "401(k)
Plan") and the HS Resources, Inc. Profit Sharing Plan (the "Profit Sharing
Plan"), respectively. The 401(k) Plan was amended and restated effective August
1, 1998. The amendment merged the Profit Sharing Plan into the 401(k) Plan and
changed the name of the 401(k) Plan to the HS Resources, Inc. 401(k) & Profit
Sharing Plan (the "Plan"). At this time the HS Resources, Inc. Master Trust,
which was established for the investment of assets of the 401(k) Plan and the
Profit Sharing Plan, was terminated.
The following description of the Plan provides only general information.
Participants and all others should refer to the Plan Agreement for a more
complete description of the Plan's provisions.
General
- -------
The Plan is a defined contribution plan covering all eligible employees of the
Company, which excludes collective bargaining employees, non-resident aliens who
receive no U.S. source income, leased employees and seasonal part-time employees
or temporary employees. There are no service or age eligibility requirements for
employee deferrals. For employer match contributions, employees must complete
one year of service as defined by the Plan, and be employed on the last day of
the Plan year. The Plan was established under the provisions of Section 401(a)
of the Internal Revenue Code ("IRC"), which includes a qualified deferred
arrangement as described in Section 401(k) of the IRC, for the benefit of
eligible employees of the Company. It is subject to the provisions of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Benefits
under the Plan are not guaranteed by the Pension Benefit Guaranty Corporation.
Contributions
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Participants can contribute on a pre-tax basis, as permitted by Section 401(k)
of the IRC, an amount from 1% to 15% of their compensation, as defined by the
Plan, limited by the requirements of the IRC. Employees may contribute rollover
contributions from another qualified plan. Participants may also contribute
after-tax amounts from 1% to 5% of compensation to the Plan.
Each Plan year, the Company may, at its sole discretion, contribute a matching
contribution. Participants must be continuously employed from the first day to
the last day of the Plan year to be eligible to receive matching contributions.
For the Plan year ended December 31, 1999, the Company matched the following for
each participant: 100% of the pre-tax contributions for each participant up to
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the first 10% of compensation deferred by the employee. The Company match
totaled $1,056,712 for the Plan year ended December 31, 1999.
Each Plan year, the Company may, at its discretion, contribute an additional
profit sharing contribution and qualified non-elective contribution ("QNEC") to
the Plan. Allocations of profit sharing contributions are based on a uniform
percentage of each participant's pay, adjusted as allowed by law to reflect the
Company's payments to finance the participant's Social Security benefits. In
order to be eligible for a profit sharing contribution, a participant must be
employed on the last day of the Plan year or have completed at least three
months of service during the Plan year. Allocations of QNECs are made in the
proportion that a participant's compensation bears to the compensation of the
eligible non-highly compensated participants for the portion of the Plan year in
which they were participants. The Company did not make a profit sharing
contribution or QNEC for the Plan year ended December 31, 1999.
The annual additions under the Plan and all other plans sponsored by the Company
to each participant are limited to the lesser of 25% of eligible compensation or
$30,000. Annual additions are defined by the IRC.
Participant Accounts
- --------------------
Participant accounts are credited with participant elective contributions,
matching Company contributions, profit sharing contributions, QNEC contributions
and Plan earnings or losses.
Investment Options
- ------------------
Effective August 1, 1998, participants were offered twelve investment options by
Charles Schwab Trust Company ("Schwab") including a personal choice investment
account that allows participants to buy and sell from almost any mutual fund or
other public security available at Schwab. Company stock, however, may not be
traded in the personal choice investment account.
Subsequent to December 31, 1999, two additional mutual funds, Janus Growth and
Income Fund and Vanguard Value Index Fund, were added as investment options.
Participants may invest their accounts in one or more funds in whole percent
increments. Participants may change the investment direction of their funds at
any time by calling the Schwab Voice Response System or through the Schwab
website.
Vesting
- -------
Participants are immediately and fully vested in their elective contributions,
Company matching contributions, and QNECs to the Plan.
Vesting in the Company profit sharing contribution is based on years of service.
This contribution shall be fully vested and non-forfeitable upon and after
attaining the Plan's normal retirement age (age 65), death, or disability, as
defined. If termination occurs for any reason other than these events, the
participant vests as follows:
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Years of Service Vested Percentage
---------------- -----------------
Less than 2 years 0%
2 years 20%
3 years 40%
4 years 66 2/3%
5 years or more 100%
Payments of Benefits
- --------------------
A participant's entire interest in the Plan is payable upon attaining normal
retirement age (age 65), death, or disability, as defined. Upon termination of
service, a participant's vested interest in the Plan is payable. Participant
benefits are payable in a lump sum, installments or a combination thereof. In
addition, hardship distributions are permitted if certain criteria are met.
Benefits for retired and/or terminated employees who had not received their full
payment for their vested benefits, but had requested payment prior to year end,
were immaterial for the years ended December 31, 1999 and 1998.
Participant Loans
- -----------------
In accordance with the Plan Agreement, participants may borrow funds from the
Plan. Borrowings cannot exceed the lesser of $50,000 or 50% of the participant's
vested account and must be a minimum of $1,000. Loans are secured by the
participant's account and bear an interest rate equal to the prime rate of
interest as published in the Wall Street Journal plus 2%. Such loans are
evidenced by promissory notes. Participants may have a maximum of two
outstanding loans at any time.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
-------------------------------------------
Basis of Accounting
- -------------------
The accompanying financial statements have been prepared using the accrual
method of accounting. The preparation of the financial statements in conformity
with accounting principles generally accepted in the United States requires the
Plan's management to use estimates and assumptions that affect the financial
statements and disclosures. Actual results could differ from these estimates.
New Accounting Pronouncement
- ----------------------------
In 1999, the Accounting Standards Executive Committee of the American Institute
of Public Accountants 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. SOP 99-3
was adopted for the accompanying financial statements, and as such, the 1998
financial statements have been appropriately reclassified to eliminate the
participant directed fund investment program disclosures.
Investment Valuation
- --------------------
The Plan's investments are stated at fair value which is determined by the
trustee based on current market prices. The Schwab Stable Value Fund, which is a
common/collective trust fund consisting of insurance company guaranteed
investment contracts and synthetic investment contracts, is determined to be
fully
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benefit-responsive and is carried in the accompanying financial statements at
cost plus accrued income, which approximates fair market value. The crediting
interest rate changes daily. The Schwab Stable Value Fund's average yield for
the year ending December 31, 1999 was 6.2%. The crediting interest rate as of
December 31, 1999 and 1998 was approximately 6.1% and 5.6%. Participant loans
are valued at cost, which approximates fair value.
Purchases and sales of securities are recorded on a trade date basis.
Investments
- -----------
The following presents investments which exceed 5% of net assets available for
plan benefits as of December 31, 1999 and 1998:
1999
-----------------------
Face Value
or Number
of Units Fair Value
---------- ----------
T. Rowe Price Small-Cap Stock 45,281 $1,032,399
Vanguard Index 500 12,989 1,757,809
Vanguard Wellington 25,328 708,160
Vanguard Windsor II 82,690 2,064,756
HS Resources Common Stock 156,066 2,692,138
1998
-----------------------
Face Value
or Number
of Units Fair Value
---------- ----------
T. Rowe Price Small-Cap Stock 45,795 $ 952,079
Vanguard Index 500 8,851 1,008,574
Vanguard Wellington 26,467 776,800
Vanguard Windsor II 86,166 2,572,042
HS Resources Common Stock 109,054 824,721
During 1999, the Plan's investments (including gains and losses on investments
bought and sold, as well as held during the year) appreciated in value by
$1,867,926 as follows:
Mutual funds $ 138,121
Common/collective trust fund 12,438
HS Resources Common Stock 1,528,852
Common stock 188,515
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$1,867,926
===========
-7-
Payment of Benefits
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Benefits are recorded when paid.
Plan Expenses
- -------------
The Plan pays all trustee and custodial fees as shown in the accompanying
financial statements. The Company pays all other costs and expenses of
maintaining the Plan.
3. INCOME TAXES:
-------------
The Internal Revenue Service ("IRS") has determined and informed the Company by
a letter dated March 28, 1991, that the Plan and related trust are designed in
accordance with the applicable sections of the IRC. The Plan has been amended
and restated since receiving the determination letter. However, the Plan
Administrator believes that the Plan is currently designed and being operated in
compliance with the applicable requirements of the IRC. Therefore, the Plan
Administrator believes that the Plan was qualified and the related trust was
tax-exempt as of the financial statement dates.
4. PLAN TERMINATION:
-----------------
Although it has not expressed any intent to do so, the Company has the right to
terminate the Plan and dispose of the net assets in accordance with the
provisions of ERISA.
5. RELATED PARTY TRANSACTIONS:
---------------------------
Certain Plan investments are shares and/or units of mutual funds,
common/collective trust funds, money market funds and common stock managed by
Schwab. Therefore, these transactions qualify as party-in-interest transactions.
Certain Plan investments are also shares of the Company common stock.
6. RISKS AND UNCERTAINTIES:
------------------------
The Plan provides for various investments in mutual funds, common/collective
trust funds, money market funds, common stock, and Company common stock.
Investments in general, are subject to various risks, such as interest rate,
credit, and overall market volatility risk. Due to the level of risk associated
with certain investments, including the Company's common stock, it is reasonably
possible that changes in the value of investments 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 benefits.
-8-
SCHEDULE I
PAGE 1 OF 4
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
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AT END OF YEAR
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EIN NUMBER 36-0732690
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FORM 5500 - SCHEDULE H - ITEM 4i
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Identity of Issue, Number of
Borrower, Lessor or Shares or Current
Similar Party Description of Investments Principal Value Value
- --------------------- -------------------------------- ----------------- ----------
The Charles Schwab
Trust Company Cash and Cash Equivalents 56,368 $ 56,368
----------
Money Market Funds:
Stock Liquidity 1,099 1,099
*Schwab Value Advantage Fund 329,512 329,512
*Schwab Money Market Fund 132,049 132,049
*Schwab Value Advantage Money Fund 50,360 50,360
----------
Total money market funds 513,020
----------
Common/Collective Trust Fund:
*Schwab Stable Value Fund 38,850 471,721
----------
Mutual Funds:
American Aadvantage International Equity 19,770 387,500
DFA US Small Cap 6-10 Value 13,503 250,744
Oakmark International Fund 16,497 242,498
PIMCO Total Return Fund 23,047 228,169
T. Rowe Price Small-Cap Stock 45,281 1,032,399
Vanguard Index 500 12,989 1,757,809
Vanguard Wellington 25,328 708,160
Vanguard Windsor II Fund 82,690 2,064,756
Amcent 20th Centy Intl. Discovery Fund 5,768 98,978
Dresdner RCM Global SM C 65 1,510
Dreyfus Technology Growth Fund 103 5,483
Excelsior Energy & Nat Res Fund 43 539
Excelsior Latin America Fund 305 1,980
Firsthand Medical Specialists Fund 261 3,702
Firsthand Tech Innovators Fund 70 3,471
Firsthand Technology Value Fund 58 5,229
Gabelli Global Interactive Couch Fund 200 7,021
Indymac Mortgage Holdings, Inc. 244 3,107
* Represents a party-in-interest (Note 5).
The accompanying notes to financial statements and
schedule are an integral part of this schedule.
-9-
SCHEDULE I
PAGE 2 OF 4
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
AT END OF YEAR
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EIN NUMBER 36-0732690
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FORM 5500 - SCHEDULE H - ITEM 4i
--------------------------------
Identity of Issue, Number of
Borrower, Lessor or Shares or Current
Similar Party Description of Investments Principal Value Value
- --------------------- -------------------------------- ----------------- ----------
The Charles Schwab
Trust Company Mutual Funds-
Janus Fund 283 12,430
Janus Global Technology Fund 2,031 62,817
Janus Mercury Fund 268 11,741
Janus Special Situations Fund 909 20,958
Janus Twenty Fund 553 46,133
Janus Worldwide Fund 202 15,463
Marsico Focus Fund 1,620 37,992
Marsico Growth & Income Fund 654 14,299
N&B Millennium Fund 31 1,015
PBHG Technology & Communications Fund 123 8,397
Smith Breden Equity Plus Fund 10,163 164,938
Torray Fund 396 17,549
Vanguard Growth Index Fund 523 20,639
Warburg Pincus Global 14 1,015
Warburg Pincus Japan Small Company 267 7,363
Weitz Hickory Portfolio 453 17,970
Weitz Value Portfolio 534 17,679
White Oak Growth Stock Fund 185 11,316
----------
Total mutual funds 7,292,769
----------
* HS Resources Common Stock 156,066 2,692,138
----------
* Represents a party-in-interest (Note 5).
The accompanying notes to financial statements and
schedule are an integral part of this schedule.
-10-
SCHEDULE I
PAGE 3 OF 4
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
----------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
AT END OF YEAR
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EIN NUMBER 36-0732690
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FORM 5500 - SCHEDULE H - ITEM 4i
--------------------------------
Identity of Issue, Number of
Borrower, Lessor or Shares or Current
Similar Party Description of Investments Principal Value Value
- --------------------- -------------------------------- ----------------- ----------
The Charles Schwab
Trust Company Common Stock:
American Online Delaware 110 8,346
Anadarko Petroleum Corporation 70 2,389
Backweb Technologies, Ltd. 900 37,913
Barnesandnoble.com INCCL A 200 2,837
Bel Fuse, Inc. 100 2,787
Carematrix Corp. 450 1,125
Cendant Corporation 355 9,430
Cisco Sys, Inc. 1,000 107,125
Closure Med Corp. 100 1,287
Coulter Pharmaceutical, Inc. 100 2,269
Cypress Semiconductor Corp. 200 6,475
Digital Armor, Inc. 1,000 1
E.M.C. Corp. Massachusetts 50 5,462
Eagle Geophysical, Inc. 2,200 88
Ericsson Tel Adr New CL B 110 7,226
Euro99.Com A/S Spn Adr 2,200 60,500
Frontier Airlines 600 6,825
Hilton Hotels Corp. 101 963
Infonow Corp. New 400 6,600
International Business Machines 48 5,187
Interspeed, Inc. 100 1,769
JDS Uniphase Corp. 40 6,453
Labranche & Company, Inc. 200 2,550
Legato System 100 6,881
Level 3 Communications, Inc. 50 4,094
Material Sciences Corp. 100 1,019
Mathsoft, Inc. 900 4,106
Merck & Company 100 6,719
Meridian Resource Corp. 200 612
Microsoft Corporation 150 17,513
Miller Bldg Sys, Inc. 200 975
Mortgage.Com, Inc. 200 1,162
Network Appliance, Inc. 1,000 83,063
* Represents a party-in-interest (Note 5).
The accompanying notes to financial statements and
schedule are an integral part of this schedule.
-11-
SCHEDULE I
PAGE 4 OF 4
HS RESOURCES, INC.
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401(k) & PROFIT SHARING PLAN
----------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
-----------------------------------------------
AT END OF YEAR
--------------
EIN NUMBER 36-0732690
---------------------
FORM 5500 - SCHEDULE H - ITEM 4i
--------------------------------
Identity of Issue, Number of
Borrower, Lessor or Shares or Current
Similar Party Description of Investments Principal Value Value
- --------------------- -------------------------------- ----------------- --------
The Charles Schwab
Trust Company Common Stock-
Nortel Networks Corp. 50 5,050
Novamed Eyecare, Inc. 150 1,012
Novellus Sys, Inc. 50 6,127
Object Design, Inc. 1,000 14,500
Park Pl Entmt Cp 500 6,250
Performance Tech, Inc. 200 3,475
Philip Morris Companies 200 4,600
Pier 1 Imports, Inc. 300 1,912
PMC-Sierra, Inc. 20 3,206
Pulte Corp. 100 2,258
PYR Energy Corp. 1,225 5,513
Qualcomm 60 10,568
Research Frontiers, Inc. 2,450 36,291
RF Micro Devices, Inc. 50 3,422
Scansoft, Inc. 1,000 4,000
Somera Communications 500 6,219
Sprint PCS Group 45 4,612
Summa Inds. 100 1,156
Sun Microsystems 1,100 85,181
Texas Instruments 50 4,831
Titan Corp. 200 9,463
Tri Valley Corp. 1,250 1,875
Tyco Intl Ltd. New 300 11,700
Vicon Inds, Inc. 400 2,400
Vitessee Semiconductor Corp. 200 10,488
Winstar Communications, Inc. 50 3,762
-----------
Total common stock 661,622
-----------
Participant loans - interest rates
ranging from 9.00% - 11.85% 221,458 221,458
-----------
Total investments $11,909,096
===========
* Represents a party-in-interest (Note 5).
The accompanying notes to financial statements and
schedule are an integral part of this schedule.
-12-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, HS
Resources, Inc. (as Plan Administrator) has duly caused this annual report to be
signed on its behalf by the undersigned thereunto duly authorized.
HS RESOURCES, INC. 401(k) & PROFIT SHARING PLAN
By: HS RESOURCES, INC.,
Plan Administrator
By: /s/ANNETTE M. MONTOYA
-------------------------------
Name: Annette M. Montoya
Title: Vice President-Human Resources,
Accounting & Administration
DATED: June 28, 2000
EXHIBIT INDEX
Exhibit
Number Description of Exhibits
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23.1 Consent of Independent Public Accountants