Summary
This 10-K/A filing for the SBC Savings Plan as of December 31, 2001, primarily details the financial health and operations of the employee retirement plan, rather than the parent company, AT&T Inc. (which was SBC Communications Inc. at the time). The Plan experienced significant growth in net assets, increasing from $5.73 billion in 2000 to $6.90 billion in 2001, largely driven by substantial transfers from merged plans and strong participant and employer contributions. A key event was the merger of the Ameritech Savings Plan into the SBC Savings Plan on January 1, 2001, which contributed over $3.2 billion in assets. Despite a net depreciation of $1.08 billion in investment values during 2001, the overall asset base expanded due to these inflows. Investors interested in SBC Communications Inc. (now AT&T) should note the significant exposure of the savings plan to SBC common shares, which constitute a large portion of the plan's investments, particularly through the Employee Stock Ownership Plan (ESOP) and the SBC Shares Fund. The plan also employs long-term debt to finance the ESOP, with significant balances outstanding. While the filing indicates the plan is in compliance with ERISA and generally with the IRS code, it notes an ongoing application for a new tax determination letter. The plan underwent amendments effective January 1, 2002, including changes to vesting schedules and contribution limits, signaling ongoing efforts to enhance employee retirement benefits.
Key Highlights
- 1The SBC Savings Plan saw a substantial increase in Net Assets Available for Benefits, growing to $6.90 billion by December 31, 2001, up from $5.73 billion in 2000.
- 2A major driver of this growth was the merger of the Ameritech Savings Plan into the SBC Savings Plan on January 1, 2001, contributing approximately $3.23 billion in assets.
- 3Despite a significant net depreciation of investments totaling $1.08 billion in 2001, the plan's overall asset base expanded due to strong inflows from contributions and transfers.
- 4The plan's investments have a significant allocation to SBC common shares, held within the Employee Stock Ownership Plan (ESOP) and the SBC Shares Fund, representing substantial exposure to the company's stock.
- 5The plan utilized long-term debt, primarily related to the ESOP, with total outstanding debt of $78.4 million at the end of 2001, showing an increase from $36.0 million in 2000.
- 6Effective January 1, 2002, the plan was amended to include a shorter vesting schedule (3 years vs. 5 years), increased employee contribution limits (30% vs. 16%), and enhanced dividend distribution options.