UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the year ended December 31, 2000
HOMESTAKE MINING COMPANY
SAVINGS PLAN
(Full title of Plan)
HOMESTAKE MINING COMPANY
(Issuer of Securities Held Pursuant to the Plan)
1600 Riviera Avenue, Suite 200
Walnut Creek, CA 94596-3568
(Address of principal executive offices)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Trustees (or other persons who administer the Plan) have duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
HOMESTAKE MINING COMPANY
SAVINGS PLAN
By /s/ T.H. Wong
----------------------------
T.H. Wong
Assistant Treasurer and
Assistant Secretary
June 26, 2001
Item 1. Financial Statements and Exhibits
a. Financial Statements for the two years ended December 31, 2000 and
1999 and Supplemental Schedule as of and for the year ended
December 31, 2000 and Report of Independent Accountants
b. Exhibit No. 23
Consent of Independent Accountants
Homestake Mining Company
Savings Plan
Financial Statements As of December 31, 2000 and 1999
and for the year ended December 31, 2000
Homestake Mining Company Savings Plan
Table of Contents
- --------------------------------------------------------------------------------------------------------------------
Pages
Report of Independent Accountants 1
Financial Statements
Statements of Net Assets Available for Benefits as of December 31, 2000 and 1999 2
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2000 3
Notes to Financial Statements 4 - 10
Supplemental Schedule
Schedule of Assets Held for Investment Purposes as of December 31, 2000 11
Report of Independent Accountants
Homestake Mining Company
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Homestake Mining Company Savings Plan (the "Plan") at December 31, 2000
and 1999, and the changes in net assets available for benefits for the year
ended December 31, 2000, in conformity with accounting principles generally
accepted in the United States of America. 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 of America, 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 our opinion.
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 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/ PricewaterhouseCoopers LLP
- ------------------------------
PRICEWATERHOUSECOOPERS LLP
June 25, 2001
Homestake Mining Company Savings Plan
Statements of Net Assets Available for Benefits
December 31, 2000 and 1999
(in thousands)
- --------------------------------------------------------------------------------
2000 1999
Assets
Investments:
Common/Collective Trusts $ 19,376 $ 26,396
Mutual Funds 30,608 34,891
Personal Choice Retirement Accounts 662 252
---------- ----------
50,646 61,539
---------- ----------
Participant loans 1,283 1,614
---------- ----------
Total assets 51,929 63,153
---------- ----------
Net assets available for benefits $ 51,929 $ 63,153
========== ==========
The accompanying notes are an integral part of these financial statements.
2
Homestake Mining Company Savings Plan
Statement of Changes in Net Assets Available for Benefits
For the year ended December 31, 2000
(in thousands)
- --------------------------------------------------------------------------------
Additions to net assets attributed to:
Interest and dividends $ 1,219
Net depreciation in the fair value of investments (6,598)
----------
(5,379)
----------
Contributions:
Company, in stock 1,255
Participants, in cash 1,940
Other contributions/forfeitures 100
----------
3,295
----------
Total additions (2,084)
----------
Deductions from net assets attributed to:
Benefits paid to participants 9,140
----------
Total deductions 9,140
----------
Net decrease (11,224)
Net assets available for plan benefits:
Beginning of year 63,153
----------
End of year $ 51,929
==========
The accompanying notes are an integral part of these financial statements.
3
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
1. Description of Plan
The following description of the Homestake Mining Company Savings Plan (the
Plan) provides only general information. Participants should refer to the
full Plan document for a more complete description of the Plan's
provisions.
General
The Plan is a multiple-employer defined contribution profit sharing
plan (designed to be qualified under Internal Revenue Code Sections
401(a) and 401(k)) covering the following employees who have completed
three months of service: all full-time salaried employees of Homestake
Mining Company and its subsidiaries (the Company) in the United States
and certain other locations, all hourly employees of the Company in
the United States who are not covered by collective bargaining
agreements, as well as all temporary employees of the Company in the
United States who have completed one year of service, and employees of
the 50% owned Pinson mine operated by Homestake Mining Company. The
Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA), as amended.
The Plan is administered by the Company. Charles Schwab Retirement
Plan Services, Inc. is the Plan's recordkeeper and investment advisor,
and Charles Schwab Trust Company is the Trustee.
Contributions
Participation is voluntary. Participants may make pre-tax or after-tax
contributions of between 1% and 15% (between 1% and 14% pre-tax) of
compensation subject to Internal Revenue Code limitations. Participant
contributions not exceeding 6% of wages or salary are matched 100% by
the Company.
Participants may make a rollover contribution to the Plan of amounts
previously contributed to another qualified plan. Rollover
contributions are not matched by the Company.
Each participant may cause some or all of its current or cumulative
contributions, including any amounts contributed by the Company to
match contributions, to be invested in one or more of the investments
made available through the Plan.
Effective January 1998, Company matching contributions formerly made
in cash can be made in Homestake Mining Company common stock or cash
at the discretion of the Company's Board of Directors. During the 2000
Plan year, all Company matching contributions were made in Homestake
Mining Company common stock.
4
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
Participants' Accounts
A separate account is maintained for each participant. Each
participant's account is directly credited with the participant's
contribution and the Company's matching contribution. Net earnings
from each investment fund, including appreciation (depreciation) in
fair value, are allocated to each participant's account based on the
ratio which the participant's account balance in that investment fund
bears to the total of all participants' account balances in that
investment fund.
Vesting
Participant contributions and any income (loss) thereon are fully
vested at all times. Company matching contributions and any income
(loss) thereon are vested 60% after three years of service, 80% after
four years of service, and 100% after five years of service, on
attainment of age 65, or on the occurrence of death or disability.
Payment of Benefits
The Plan permits withdrawal of after-tax contributions.
The Plan permits withdrawal of pre-tax contributions upon:
(1) Termination of employment;
(2) Attainment of age 59 1/2;
(3) Death (with vested account balance paid to designated
beneficiary);
(4) Hardship.
The Plan permits withdrawal of vested Company matching contributions
made prior to January 1, 1994; however, the right of any participant
who makes such a withdrawal to continue receiving Company matching
contributions is suspended for twelve months.
Distribution of benefits, except for certain participants who are
required to receive annuities, can be made, at the election of the
participant, in the form of a single lump-sum cash payment, partial
payment made in a lump-sum with the remainder paid later, or periodic
installments.
Participant Loans
Participants may borrow from their vested accounts between $1,000 and
$50,000 but not more than 50% of the value of such accounts. The loan
term cannot exceed five years unless the loan is for the purchase of a
principal residence, in which case, it cannot exceed ten years. These
loans bear interest at prime rate plus 1%. Loans are collateralized by
the borrower's vested accounts in the Plan and repayments are made
through payroll deductions on at least a monthly basis.
5
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
Forfeitures
Forfeitures of Company matching contributions made on behalf of former
employees whose employment was terminated before such contributions
were vested, can be utilized to restore participants' accounts, to pay
plan fees and expenses, to offset company matching contributions, or
can be allocated to participants.
For the 2000 and 1999 Plan years, forfeitures were allocated to each
participant in proportion to the Company matching contributions made
to such individual's accounts during the Plan year.
2. Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared under the accrual
basis of accounting in accordance with generally accepted accounting
principles.
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 net assets
available for benefits at the date of the financial statements and the
reported amounts of changes in net assets available for benefits
during the reporting period. Actual results could differ from those
estimates.
Investment Valuation and Income Recognition
Shares and units in investment funds are valued at quoted market
prices, representing the net asset value of the shares or units held
by the Plan at year end.
Participant loans receivable are valued at cost, which approximates
market value.
Purchases and sales of securities are recorded on a trade-date basis,
utilizing the average cost method in determining the basis of
investments sold. Interest income is recorded on the accrual basis.
Dividends are recorded on the ex-dividend date.
Withdrawals
Withdrawals of securities from the Homestake Mining Company Common
Stock Fund may be made in cash, common stock, or both, and are
reported at market value. Withdrawals from all other funds, including
the Personal Choice Retirement Account (PCRA), are made in cash.
Net Appreciation (Depreciation) in Fair Value of Investments
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 consisting of realized gains (losses) and the
unrealized appreciation (depreciation).
6
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
3. Risks and Uncertainties
Plan assets are invested in collective trust and mutual funds, and other
investment securities. Investments are exposed to various risks, such as
interest rate, market and credit. Due to the level of risk associated with
certain investments and the level of uncertainty related to changes in the
value of such investments, it is possible that changes in the value of one
or more of such investments in the near term could materially affect
participants' account balances, the amounts reported in the statements of
net assets available for Plan benefits, and the statement of changes in net
assets available for Plan benefits.
A significant portion of the Plan's assets is invested in the Homestake
Mining Company Common Stock Fund and is, therefore, subject to fluctuations
in the market value of such stock, which is, in turn, impacted by the price
of gold.
4. Plan Termination
Although the Company has not expressed any intent to do so, it has the
right under the Plan and subject to applicable law, to discontinue its
matching contributions at any time and to terminate the Plan. In the event
of Plan termination, all accumulated plan benefits will be fully vested and
will be distributed to participants based on their respective account
balances.
5. Plan Tax Status
The Plan obtained its latest determination letter in April 2001, in which
the Internal Revenue Service stated that the Plan, as then designed, was in
compliance with Sections 401(a) and 401(k) of the Internal Revenue Code.
This determination is subject to the adoption of proposed amendments by the
Plan. Therefore, no provision for income taxes has been included in the
Plan's financial statements.
Participants are not subject to federal income taxes on their pre-tax
contributions, Company matching contributions, or investment earnings
allocated to their accounts until withdrawals are made.
6. Related Party Transactions
Certain Plan investments are units in investment funds managed by the
Trustee. Therefore, these transactions are transactions with
parties-in-interest.
7. Administrative Expenses
Certain costs associated with administering the Plan are paid directly by
the Company.
7
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
8. Investments
Investments at December 31, 2000 and 1999 are comprised of the following:
Number Value Fair
of Per Value
Units Unit (in thousands)
------------- --------- --------------
2000
Common/Collective Trusts at fair value:
* Schwab Stable Value Select Fund 1,025,950 $ 12.87 $ 13,204
* Homestake Mining Company Stock Fund 1,344,354 4.59 6,172
--------------
19,376
--------------
Mutual Funds at fair value:
* Schwab MarketTrack Balanced Fund 184,121 14.70 2,707
Schwab MarketTrack Conservative Fund 88,687 12.83 1,138
Schwab MarketTrack Growth Fund 154,813 16.15 2,500
* Schwab S&P 500 Select Fund 669,735 20.37 13,642
* Invesco Total Return Fund 185,538 26.43 4,903
Safeco Growth Fund 37,970 22.33 848
Scudder Growth & Income Fund 76,446 24.15 1,846
Templeton Institutional Foreign Equity Fund 99,768 16.95 1,691
PIMCO Total Return Institutional Fund 128,256 10.39 1,333
--------------
30,608
--------------
Personal Choice Retirement Accounts 662
--------------
Participant loans, at book value (which
approximates fair value) 1,283
--------------
Total investments $ 51,929
==============
* Represents 5% or more of the net assets available for benefits.
8
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
Number Value Fair
of Per Value
Units Unit (in thousands)
--------- -------- --------------
1999
Common/Collective Trusts at fair value:
* Schwab Stable Value Select Fund 1,379,045 $ 12.16 $ 16,769
* Homestake Mining Company Stock Fund 1,129,936 8.52 9,627
--------
26,396
--------
Mutual Funds at fair value:
Schwab MarketTrack Balanced Fund 193,553 15.46 2,992
Schwab MarketTrack Conservative Fund 99,369 13.12 1,304
Schwab MarketTrack Growth Fund 102,540 17.53 1,798
* Schwab S&P 500 Select Fund 690,795 22.65 15,646
* Invesco Total Return Fund 259,190 28.96 7,506
Safeco Growth Fund 15,843 23.30 369
Scudder Growth & Income Fund 99,465 26.69 2,655
Templeton Institutional Foreign Equity Fund 70,359 21.53 1,515
PIMCO Total Return Institutional Fund 111,753 9.90 1,106
--------
34,891
--------
Personal Choice Retirement Accounts 252
--------
Participant loans, at book value (which approximates fair value) 1,614
--------
Total investments $ 63,153
========
* Represents 5% or more of the net assets available for benefits.
All earnings on the investment funds are credited to each fund daily. These
earnings include interest, dividends, and net appreciation (depreciation)
in fair value.
The Invesco Total Return Fund seeks reasonably consistent total returns
over a variety of market cycles by investing in a combination of equity
securities and fixed income securities.
The Schwab MarketTrack group of funds are hybrid funds that invest in
stocks, bonds and cash. The Schwab MarketTrack Conservative Fund seeks
income and more growth potential than an all bond fund. The Schwab
MarketTrack Balanced Fund seeks to provide maximum total return including
both capital growth and income. The Schwab MarketTrack Growth Fund seeks
high capital growth with less volatility than an all stock portfolio.
The Homestake Mining Company Stock Fund invests in shares of Homestake
Mining Company.
The Safeco Growth Fund seeks long-term capital growth. The fund normally
invests in common stocks of smaller size companies but may also invest in
stocks of companies of all sizes.
9
Homestake Mining Company Savings Plan
Notes to Financial Statements
- --------------------------------------------------------------------------------
The Scudder Growth & Income Fund seeks long-term capital growth and current
income. The fund invests primarily in dividend-paying common stocks,
preferred stocks, and convertible securities with growth potential.
The Templeton Institutional Foreign Equity Fund seeks long-term capital
growth through a flexible policy of investing in stocks and debt
obligations of companies and governments outside the United States.
The Schwab S&P 500 Select Fund invests in substantially the same stocks in
the same percentage weightings as the Standard & Poor's 500 Composite Stock
Price Index seeking to approximate as closely as practicable the rate of
return of that index.
The PIMCO Total Return Institutional Fund is a broad market bond fund which
invests in a diversified portfolio of fixed income securities with varying
maturities.
The Schwab Stable Value Select Fund invests primarily in guaranteed
investment contracts, synthetic guaranteed investment contracts and U.S.
Treasury and agency securities.
The Personal Choice Retirement Account ("PCRA") is a Schwab individual
brokerage account available under the Plan. This account allows
participants to select a broad range of stocks, bonds or mutual funds.
However, certain investments and securities are not permitted in the PCRA.
Plan participants could allocate up to 25% of their total account balance
to the PCRA. Effective January 1, 2001, this percentage was increased to
50%.
9. Acceleration of Vesting Percentages
Pinson Mine
On February 1, 1999, the Pinson mine discontinued mining operations and
the employment of a number of Plan participants was terminated. In
accordance with the Plan, the vesting percentages of all such Pinson
mine participants whose employment was terminated and whose vesting
percentages were less than 100% were accelerated to 100% upon
termination.
Ruby Hill Mine
Effective August 1, 2000, any Ruby Hill mine participant whose
employment was terminated after May 1, 2000, and whose vesting
percentage was less than 100% was accelerated to 100% upon termination.
Other
Effective July 23, 1999, any participant whose service with any
affiliated companies is terminated after June 4, 1999, but prior to
December 31, 1999, will be fully vested in his or her entire account as
of the date of such termination if that participant is notified by an
affiliated company that his or her termination of service occurred as a
result of an organizational restructuring.
10. Subsequent Event
On June 25, 2001, Barrick Gold Corporation ("Barrick") and Homestake
Mining Company announced that they have agreed to merge. Under the
merger agreement, Barrick will exchange 0.53 of a Barrick share for
each of Homestake Mining Company's 263.3 million outstanding shares.
The transaction is subject to regulatory and Homestake Mining Company
shareholders' approval. If approved, the transaction is expected to be
completed by the end of 2001 or early 2002.
10
Homestake Mining Company Savings Plan
Schedule of Assets Held for Investment Purposes
At December 31, 2000
- --------------------------------------------------------------------------------
(b) Identity of (c) Description of Investment
Issuer, Borrower, including Maturity Date, (d) Current
Lessor, or Rate of Interest, Collateral, Value
(a) Similar Party Par or Maturity Value (in thousands)
- ---- -------------------------------------------- ------------------------------------------- --------------
* Charles Schwab Investment Management Schwab Stable Value Select Fund
(1,025,950 units) $ 13,204
* Charles Schwab Investment Management Schwab MarketTrack Balanced Fund
(184,121 units) 2,707
* Charles Schwab Investment Management Schwab MarketTrack Conservative Fund
(88,687 units) 1,138
* Charles Schwab Investment Management Schwab MarketTrack Growth Fund
(154,813 units) 2,500
* Charles Schwab Investment Management Schwab S&P 500 Select Fund (669,735 units) 13,642
* Charles Schwab Retirement Plan Services, Inc. Homestake Mining Company Stock Fund
(1,344,354 units) 6,172
Invesco Invesco Total Return Fund (185,538 units) 4,903
Safeco Asset Management Safeco Growth Fund (37,970 units) 848
Scudder Kemper Investments Scudder Growth & Income Fund
(76,446 units) 1,846
Templeton Investment Counsel, Inc. Templeton Institutional Foreign
Equity Fund (99,768 units) 1,691
Pacific Investment Management Company PIMCO Total Return
Institutional Fund (128,256 units) 1,333
* Participant notes (Repayable over five years unless it is
for purchase of a principal residence which
is repayable over ten years. Rate during
2000 ranged from 7.87% to 10.5%.) 1,283
--------
51,267
--------
* Charles Schwab Retirement Plan Services, Inc. Personal Choice Retirement Account
Cash Equivalents (64,968 units) 65
AT&T Corp (100 units) 2
Agilent Technologies Inc. (250 units) 14
Amazon Com. Inc. (125 units) 2
Amgen Inc. (100 units) 6
Applera Celera Genomics (100 units) 4
11
Homestake Mining Company Savings Plan
Schedule of Assets Held for Investment Purposes
At December 31, 2000
- --------------------------------------------------------------------------------
(b) Identity of (c) Description of Investment
Issuer, Borrower, including Maturity Date, (d) Current
Lessor, or Rate of Interest, Collateral, Value
(a) Similar Party Par or Maturity Value (in thousands)
- ---- -------------------------------------------- ------------------------------------------- ---------------
Applied Materials Inc. (200 units) $ 8
Archer Daniels Midland Co. (1,050 units) 16
At Home Corp. (322 units) 2
Avaya Inc. (32 units) 1
Bank One Corp. (100 units) 4
Bell Microproducts Inc. (100 units) 2
Berkshire Hathaway (5 units) 12
BP Amoco PLC ADR (328 units) 16
CMGI Inc. (118 units) 1
Cisco Systems Inc. (100 units) 4
Commerce One Inc. (11 units) -
Corning Inc. (100 units) 5
E-Trade Group Inc. (200 units) 1
Ebay Inc. (36 units) 1
First Union Corp. (100 units) 3
Firstar Corp. (1,000 units) 23
Freeport-McMoran Cooper & Gold
(1,000 units) 9
Gap Inc. (100 units) 3
Genentech Inc. (60 units) 5
General Electric Co. (105 units) 5
General Motors Corp. (600 units) 14
Gillette Co. (200 units) 7
Hewlett-Packard Co. (600 units) 19
Intel Corp. (100 units) 3
JDS Uniphase Corp. (100 units) 4
12
Homestake Mining Company Savings Plan
Schedule of Assets Held for Investment Purposes
At December 31, 2000
- --------------------------------------------------------------------------------
(b) Identity of (c) Description of Investment
Issuer, Borrower, including Maturity Date, (d) Current
Lessor, or Rate of Interest, Collateral, Value
(a) Similar Party Par or Maturity Value (in thousands)
- ---- -------------------------------------------- ------------------------------------------- ---------------
Johnson & Johnson (50 units) $ 5
Keyspan Corp. (800 units) 34
LSI Logic Corp. (150 units) 3
Lucent Technologies Inc. (400 units) 5
Macromedia (500 units) 30
McDonalds Corp. (100 units) 3
McKesson HBOC Inc. (100 units) 4
Merck & Co. Inc. (50 units) 5
Micron Technologies (200 units) 7
Microsoft Corp. (100 units) 4
Microstrategy Inc Class A (300 units) 3
MIPS Technologies Inc. (27 units) 1
Motorola Inc. (600 units) 12
Nokia Corp. (700 units) 30
Openwave Systems Inc. (100 units) 5
Palm, Inc. (700 units) 20
Parametric Technology Corp.
(1,200 units) 16
Peoplesoft Inc. (200 units) 7
Qualcomm Inc. (100 units) 8
Rite Aid Corp. (12,000 units) 29
SBC Communication Inc. (300 units) 14
Silicon Graphics (200 units) 1
Sun Microsystems Inc. (300 units) 8
Texas Instruments Inc. (75 units) 4
The Charles Schwab Corp. (675 units) 19
13
Homestake Mining Company Savings Plan
Schedule of Assets Held for Investment Purposes
At December 31, 2000
- --------------------------------------------------------------------------------
(b) Identity of (c) Description of Investment
Issuer, Borrower, including Maturity Date, (d) Current
Lessor, or Rate of Interest, Collateral, Value
(a) Similar Party Par or Maturity Value (in thousands)
- ---- -------------------------------------------- ------------------------------------------- ---------------
Verticalnet Inc. (200 units) $ 1
Vodafone Group PLC. (300 units) 11
Wal-Mart Stores Inc. (200 units) 11
Walt Disney Holding Company
(300 units) 9
WorldCom Inc. (100 units) 1
Xircom (100 units) 2
Chase Manhattan 10.84% PFD (700 units) 19
Utilicorp United 9.75% (600 units) 20
Federated International Small Co. Fund
(189 units) 5
Plum Creek Timber Co. (900 units) 23
RS Diversified Growth Fund (195 units) 4
NASDAQ 100 Shares (305 units) 18
---------
662
---------
$ 51,929
---------
* Represents party-in-interest to Plan
14