United States
Securities and Exchange Commission
Washington, D.C. 20549
Form 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission file number 1-7784
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
CENTURYTEL, INC.
UNION GROUP INCENTIVE PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
CENTURYTEL, INC.
100 CENTURYTEL DRIVE
MONROE, LA 71203
CENTURYTEL, INC. UNION GROUP INCENTIVE PLAN
TABLE OF CONTENTS
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Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED
DECEMBER 31, 2000 AND 1999:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-7
SUPPLEMENTAL SCHEDULE AS OF DECEMBER 31, 2000:
Line 4i - Schedule of Assets Held for Investment
Purposes at Year End 8
Schedules not filed herewith are omitted because of the absence of conditions
under which they are required.
- 8 -
INDEPENDENT AUDITORS' REPORT
Administrative Committee
CenturyTel, Inc. Union Group Incentive Plan:
We have audited the accompanying statements of net assets available for benefits
of the CenturyTel, Inc. Union Group Incentive Plan (the "Plan") as of December
31, 2000 and 1999, and the related statements of changes in net assets available
for benefits for the years then ended. 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 of America. 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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
2000 and 1999, and the changes in net assets available for benefits for the
years then ended in conformity with accounting principles generally accepted in
the United States of America.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents 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 schedule is the responsibility of the Plan's management. The
supplemental schedule has been subjected to the auditing procedures applied in
our audit of the basic 2000 financial statements and, in our opinion, is fairly
stated in all material respects when considered in relation to the basic
financial statements taken as a whole.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
July 6, 2001
CENTURYTEL, INC. UNION GROUP INCENTIVE PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2000 AND 1999
_______________________________________________________________________________
2000 1999
ASSETS:
Investments (Note 3):
At fair value:
Money market funds $ 4,342,133 $ 88,249
Mutual funds 15,784,394 13,993,182
Employer common stock 15,705 -
Common/collective funds - 3,990,165
Participant loans 873,043 419,364
____________ ____________
Total investments 21,015,275 18,490,960
____________ ____________
Receivables:
Accrued employer contributions receivable 135,842
Accrued employee contributions receivable 42,420 -
Accrued interest and dividends - 82
____________ ____________
Total receivables 178,262 82
____________ ____________
NET ASSETS AVAILABLE FOR BENEFITS $ 21,193,537 $ 18,491,042
============ ============
See notes to financial statements.
CENTURYTEL, INC. UNION GROUP INCENTIVE PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 2000 AND 1999
_______________________________________________________________________________
2000 1999
ADDITIONS:
Investment income (Note 3):
Net depreciation in fair value of investments $ (728,914) $ (239,323)
Interest and dividends 1,225,374 590,462
____________ ____________
Total investment income 496,460 351,139
____________ ____________
Contributions:
Employer 786,093 512,655
Participant 2,034,579 1,462,838
Rollovers 110,757 -
____________ ____________
Total contributions 2,931,429 1,975,493
____________ ____________
Total additions 3,427,889 2,326,632
____________ ____________
INCREASES (DECREASES) IN NET ASSETS
ATTRIBUTABLE TO:
Benefits paid (715,043) (1,948,925)
Administrative expenses (10,351) (1,520)
Forfeitures and adjustments - 26,687
____________ ____________
Net decrease (725,394) (1,923,758)
____________ ____________
NET INCREASE 2,702,495 402,874
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 18,491,042 18,088,168
____________ ____________
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 21,193,537 $ 18,491,042
============ ============
See notes to financial statements.
CENTURYTEL, INC. UNION GROUP INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2000 AND 1999
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1. DESCRIPTION OF THE PLAN
The following brief description of the CenturyTel, Inc. Union Group
Incentive Plan, formerly the CenturyTel, Inc. Group Incentive Plan (the
"Plan"), is provided for general information purposes only. Participants
should refer to the plan document for more complete information.
General - The Plan is a defined contribution plan covering eligible
employees of CenturyTel, Inc. and its subsidiaries (the "Company").
Through August 31, 2000, eligible employees are those employees covered by
certain collective bargaining agreements and who have completed 1,000
hours of service as defined by the Plan. Thereafter, eligible employees
are those employees covered by certain collective bargaining agreements.
Participants may enroll during the first available enrollment period
subsequent to their first day of employment. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
("ERISA").
Participant and Employer Contributions - Through August 31, 2000,
participants were required to make pre-tax contributions of at least 1% of
their compensation and may elect to make additional pre-tax contributions
up to 15% for a maximum pre-tax contribution of 16% of annual
compensation. The Company made matching contributions for each participant
equal to 55% of the participant's pre-tax contributions up to 6% of
compensation. Subsequent to this date, there is no minimum required
participant contribution amount and participants may make pre-tax
contributions up to 16% of their eligible annual compensation. The Company
makes matching contributions for each participant of either 55% or 66% of
the participant's pre-tax contributions up to 6%, as defined by the
applicable collective bargaining agreement. Contributions are subject to
certain limitations.
Participant Loans - Participants may borrow from their account balance a
minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of
their vested account balance. Loan terms range from one to five years or
up to fifteen years for the purchase of a primary residence. The loans
bear interest at a rate equal to the prime rates published in the Wall
Street Journal on the last day of the previous quarter plus 1% and are
secured by the balance in the participant's account and an assignment of
current pay of the participant sufficient to service the loan.
Investment Options - Participants were allowed to direct contributions to
any of the following investment options through August 31, 2000:
HighMark Income Equity Fund
HighMark Bond Fund
Union Bank Stable Value Fund
Dreyfus Index 500 Fund
As of September 1, 2000, participants may direct contributions to any of
the following investment options:
T. Rowe Price Summit Cash Reserves Fund
PIMCO Total Return Fund
BGI Asset Allocation Fund
T. Rowe Price Equity Index 500 Fund
Janus Fund
T. Rowe Price Equity Income Fund
Janus Overseas Fund
MSDW Institutional Small Company Growth Portfolio Fund
T. Rowe Price Mid-Cap Growth Fund
BGI LifePath Income Fund
BGI LifePath 2010 Fund
BGI LifePath 2020 Fund
BGI LifePath 2030 Fund
BGI LifePath 2040 Fund
CenturyTel Common Stock
Participant Accounts - A separate account is maintained for each
participant, which is credited with the participant's contribution, an
allocation of the employer's contribution, and Plan earnings. Allocations
of the employer contributions are based on the participants' deferrals, as
defined. Plan earnings are allocated based on the investment returns from
the investment options selected by the participant and the participant's
account balance. The benefit to which a participant is entitled is based
on the vested balance of the participant's account.
Vesting - The employer contributions and the accumulated earnings thereon
vest to participants as follows:
Years of Service Percentage Vested
---------------- -----------------
Less than 1 0%
1 20
2 40
3 60
4 80
5 100
In the event of death, disability, or upon reaching age 65, the employer
contributions and the accumulated earnings thereon become fully vested.
Participant contributions and the accumulated earnings thereon are fully
vested at all times.
Benefits Paid - Participants are entitled to receive benefits upon
termination of employment for any reason including death, disability, or
retirement. If the participant's account balance exceeds $5,000, the
participant may defer payment until a later date. Otherwise, distributions
are made in a lump sum as soon as administratively feasible. At
retirement, participants may elect a lump sum payment or periodic
installments over 5, 10, or 15 years. Participants may also withdraw
benefits for financial hardship reasons. Such withdrawals are subject to
the approval of the Administrative Committee.
Forfeitures - The portion of a participant's account that is not vested
shall be forfeited at the earlier of the date of distribution of the
participant's entire vested balance in the plan following the
participant's termination or the date on which the participant completes a
full break in service. The forfeiture shall be valued as of the last
valuation date before the date of the forfeiture. Forfeitures occurring
during a plan year shall be used first to satisfy any restorations for the
year and any remaining forfeitures shall be applied to offset future
employer contributions or pay plan expenses.
Plan Termination - Although it has not expressed any intention to do so,
the Company has the right under the Plan to discontinue its contributions
at any time or to terminate the Plan subject to the provisions of ERISA.
In the event the Company terminates the Plan or discontinues contributions
to the Plan, the accounts of all participants will become fully vested.
2. SIGNIFICANT ACCOUNTING POLICIES
The following are the significant accounting policies followed by the
Plan.
Basis of Accounting - The financial statements of the Plan are prepared
under the accrual method of accounting.
Investments Valuation and Income Recognition - Investments in mutual funds
and employer common stock are stated at fair value based upon quoted
market prices of the underlying securities. The Plan's investment in
common/collective trust investments are stated at contract value which
represents contributions made under the contract, plus earnings, less
withdrawals. Plan management believes that the contract value approximates
fair value for the common/collective trust investments. The average yield
to maturity of the common/collective trust investments was 5.94% as of
December 31, 1999. There were no valuation reserves as of December 31,
2000 and 1999. Temporary cash investments are stated at cost, which
approximates fair value. Purchases and sales of securities are recorded on
a trade-date basis. Interest income is recorded when earned. Dividends are
recorded on the ex-dividend date.
Funding Policy - Participant pre-tax contributions to the Plan are made
through payroll deductions and are forwarded to the Plan trustee biweekly
along with the employer contributions.
Administration Expenses - The Plan provides that the Company may pay
administrative costs of the Plan. Those costs not paid by the Company are
paid from Plan assets.
Use of Estimates - The preparation of the financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect reported amounts of net assets and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of additions and withdrawals during the reporting period.
Actual results could differ from those estimates.
Benefits Paid - Benefits are recorded when paid.
3. INVESTMENTS GREATER THAN 5% OF NET ASSETS
The following represents individual investments that are greater than 5%
of the net assets at December 31:
2000 1999
PIMCO Total Return Fund $ 2,850,197 $ -
T. Rowe Price Equity Income Fund 7,179,352 -
T. Rowe Price Equity Index 500 Fund 4,259,037 -
T. Rowe Price Summit Cash Reserves Fund 4,342,133 -
HighMark Income Equity Fund - 10,607,561
HighMark Bond Fund - 3,385,621
Stable Value Fund - 3,990,165
Net appreciation (depreciation) by investment type for the years ended
December 31 is as follows:
2000 1999
Mutual funds $ (729,035) $ (239,323)
Employer common stock 121 -
----------- -----------
Total $ (728,914) $ (239,323)
=========== ===========
4. PLAN ADMINISTRATION
Effective September 1, 2000, the Plan changed the trustee and recordkeeper
from Union Bank of California and Merrill Lynch/Howard Johnson to T. Rowe
Price.
5. TAX STATUS
The Plan obtained its latest determination letter dated March 20, 1996 in
which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue
Code. The Plan has been amended 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 Internal Revenue Code. Accordingly, no provision for income taxes
has been included in the Plan's financial statements.
6. PARTY-IN-INTEREST TRANSACTIONS
Plan assets are invested in mutual funds managed by T. Rowe Price which is
the trustee of the Plan. These funds are charged administrative expenses
which are paid by the Company. In addition, the Plan invests in shares of
Company common stock at the direction of the participants.
7. CONCENTRATION OF RISK
The Plan's assets consist of financial instruments including money market
funds, mutual funds, common/collective funds, and Company common stock.
These financial instruments may subject the Plan to concentrations of risk
as, from time to time, cash balances exceed amounts insured by the Federal
Deposit Insurance Corporation, and investments in mutual funds,
common/collective funds, and Company stock are subject to changes in
market values of such investments.
* * * * * *
CENTURYTEL, INC. UNION GROUP INCENTIVE PLAN
LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT YEAR END
DECEMBER 31,2000
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Identity of Issue/Description of Investment Cost** Current Value
MUTUAL FUNDS:
PIMCO Total Return Fund $ 2,850,197
BGI Asset Allocation Fund 72,093
* T. Rowe Price Equity Index 500 Fund 4,259,037
Janus Fund 515,551
* T. Rowe Price Equity Income Fund 7,179,352
Janus Overseas Fund 145,246
MSDW Institutional Small Company Growth Portfolio Fund 337,041
* T. Rowe Price Mid-Cap Growth Fund 314,582
BGI LifePath Income Fund 1,251
BGI LifePath 2010 Fund 90,215
BGI LifePath 2020 Fund 13,999
BGI LifePath 2030 Fund 587
BGI LifePath 2040 Fund 5,243
-------------
Total mutual funds 15,784,394
EMPLOYER COMMON STOCK:
* CenturyTel Common Stock 15,705
MONEY MARKET FUNDS:
* T. Rowe Price Summit Cash Reserves Fund 4,342,133
PARTICIPANT LOANS:
Participant loans, interest rates ranging
from 10.5% to 11.5% 873,043
-------------
TOTAL INVESTMENTS $ 21,015,275
=============
* Denotes a party-in-interest with respect to the Plan
**Note: Historical cost is not required for plans with participant-directed
accounts.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Retirement Committee has duly caused this annual report to be signed on its
behalf by the undersigned thereunto duly authorized.
CenturyTel, Inc.
Dollars and Sense Plan
July 12, 2001 /s/ R. Stewart Ewing, Jr.
----------------------------
R. Stewart Ewing, Jr.
Retirement Committee Member
and Executive Officer of
Issuer of Plan Securities