SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 __________________________________________________

 FORM 11-K

  __________________________________________________

 

(Mark One)

 

ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 30, 2019

OR

TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from              to

Commission File Number 1-8519

  __________________________________________________

CINCINNATI BELL

RETIREMENT SAVINGS PLAN

  __________________________________________________

 CINCINNATI BELL INC.

221 East Fourth Street

Cincinnati, Ohio 45202

 

 

 

 


 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

TABLE OF CONTENTS

 

 

Page

 

 

Reports of Independent Registered Public Accounting Firms

1

 

 

Financial Statements:

 

 

 

Statements of Net Assets Available for Benefits as of December 30, 2019 and 2018

3

 

 

Statement of Changes in Net Assets Available for Benefits for the Year Ended December 30, 2019

4

 

 

Notes to Financial Statements

5

 

 

Schedule H, line 4(i) – Schedule of Assets (Held as of December 30, 2019)

12

 

 

Signature

13

 

 

Exhibit Index

14

 

 

Exhibit 23.1 – Consent of Independent Registered Public Accounting Firm – Clark, Schaefer, Hackett & Co.

 

 

 

Exhibit 23.2 – Consent of Independent Registered Public Accounting Firm – Barnes, Dennig & Co., LTD

 

 

 

 


Table of Contents

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Participants, Plan Administrator and the Employees’ Benefit Committee

Cincinnati Bell Retirement Savings Plan

 

Opinion on the Financial Statements
We have audited the accompanying statement of net assets available for benefits of the Cincinnati Bell Retirement Savings Plan (the Plan) as of December 30, 2019, and the related statement of changes in net assets available for benefits for the year ended December 30, 2019, and the related notes and schedule (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of December 30, 2019, and the change in net assets available for benefits for the year ended December 30, 2019, in conformity with accounting principles generally accepted in the United States of America.

 

Basis for Opinion
These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on the Plan’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Plan in accordance with the U.S. federal securities laws and applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

 

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. 

 

Supplemental Information
The supplemental schedule of assets held at end of year has been subjected to audit procedures performed in conjunction with the audit of the Plan’s financial statements. The supplemental information is the responsibility of the Plan’s management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole.

 

/s/ Clark, Schaefer, Hackett & Co.

 

We have served as the Plan’s auditor since 2019.

 

Cincinnati, Ohio

June 24, 2020

 

 

 


1


Table of Contents

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

To the Participants and Administrator of the

Cincinnati Bell Retirement Savings Plan

 

 

Opinion on the Financial Statements

 

We have audited the accompanying statement of net assets available for benefits of the Cincinnati Bell Retirement Savings Plan (the “Plan”) as of December 30, 2018. In our opinion, the financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of December 30, 2018, in conformity with accounting principles generally accepted in the United States of America.

 

Basis for Opinion

 

These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on the Plan’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Plan in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 

We began serving as the Plan’s auditor in 2012. In 2019 we became the predecessor auditor.

 

/s/ Barnes, Dennig & Co., LTD

 

Cincinnati, Ohio

June 24, 2019

 

2


Table of Contents

CINCINNATI BELL RETIREMENT SAVINGS PLAN

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS

(DOLLARS IN THOUSANDS)

 

December 30,

 

 

2019

 

 

2018

 

Investments

 

 

 

 

 

 

 

Investment in Master Trust

$

367,220

 

 

$

297,951

 

Notes Receivable

 

 

 

 

 

 

 

Participant loans

 

5,396

 

 

 

5,347

 

Net assets available for benefits

$

372,616

 

 

$

303,298

 

 

See Notes to Financial Statements.

 

 

3


Table of Contents

CINCINNATI BELL RETIREMENT SAVINGS PLAN

STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS

FOR THE YEAR ENDED DECEMBER 30, 2019

(DOLLARS IN THOUSANDS)

 

Net assets available for benefits as of December 30, 2018

 

$

303,298

 

Contributions:

 

 

 

 

Employee (non-rollover)

 

 

16,569

 

Employee (rollover)

 

 

1,158

 

Employer

 

 

7,455

 

Total contributions

 

 

25,182

 

 

 

 

 

 

Investment gain from Master Trust

 

 

74,609

 

 

 

 

 

 

Interest on participant loans

 

 

298

 

 

 

 

 

 

Transfers from other Company-sponsored plans, net

 

 

162

 

Distributions:

 

 

 

 

Benefits paid to participants

 

 

(30,890

)

Administrative expense paid by the Plan

 

 

(43

)

Total distributions

 

 

(30,933

)

Net increase in assets available for benefits

 

 

69,318

 

Net assets available for benefits as of December 30, 2019

 

$

372,616

 

 

 

 

 

See Notes to Financial Statements.

 

 

4


 

Table of Contents

 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

(1)

Plan Description and Accounting Policies

 

a.

General: The Cincinnati Bell Retirement Savings Plan (the “Plan”) is sponsored by Cincinnati Bell Inc. (together with its subsidiaries, the “Company” or “Cincinnati Bell”) and administered generally through the Company Employees’ Benefit Committee.

The Plan is, subject to certain exceptions, currently available to employees of the Company who are not hourly employees. Hourly employees are generally defined as employees either (i) who are represented by a collective bargaining unit (unless the applicable collective bargaining agreement requires their participation in the Plan) or (ii) whose position is an hourly-paid position that is or at any prior time had been otherwise subject to automatic wage progression or covered under the Cincinnati Bell Inc. Savings and Security Plan (an additional plan sponsored by the Company). However, an hourly employee hired on or after February 1, 2008 and in a position described in clause (ii) above, is generally eligible for the Plan.

In addition, certain other classes of employees (including but not limited to co-op students, interns, temporary employees and contingency employees) are ineligible to participate in the Plan.

These Notes to Financial Statements provide a brief description of certain provisions of the Plan, but do not constitute a document under which the Plan is operated. In the event of any conflict between these Notes to Financial Statements and the Plan documents, the Plan documents shall control. Participants must refer to the Plan documents and to the summary plan description for further details of the Plan.

The Plan is subject to the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

The financial statements of the Plan are prepared under the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Until December 30, 2019, the Plan’s fiscal year (the “plan year”) began each December 31 and ended the following December 30. Effective as of December 30, 2019, the plan year was amended to begin each January 1 and end on the immediately following December 31, with a one-day plan year occurring on December 31, 2019.

In accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification (“ASC”) 962 - Plan Accounting - Defined Contribution Pension Plans, the Statement of Net Assets Available for Benefits presents the fair value of the Plan’s investments. In addition, the Statement of Changes in Net Assets Available for Benefits is presented on a fair value basis.

 

b.

Master Trust: The Company entered into a Master Trust Agreement with Fidelity Management Trust Company (“Fidelity”) and established the Cincinnati Bell Retirement Savings Master Trust (the “Master Trust”). The Plan is a participant in the Master Trust. Under the terms of the Master Trust Agreement, Fidelity serves as Trustee and custodian for the Master Trust.

 

c.

Employee Contributions: Upon commencement of employment by the Company, the Plan generally permits each participant to contribute each pay period any amount that is a whole percent up to a maximum of 75% of the participant’s plan compensation.

A participant’s contributions to the Plan can be made either on a before-tax basis or as Roth contributions. Roth contributions are made on an after-tax basis, but the earnings on such contributions can be paid later to the participant on a tax-free basis if certain conditions are met.


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CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

The Plan provides for newly eligible participants to be automatically enrolled into the Plan and contribute 3% of their plan compensation, which is invested in the Plan’s default investment option, an age specific Vanguard Target Retirement Fund. Plan participants may elect to change their contribution and investment elections or discontinue participation in the Plan at any time.

The amount of a participant’s combined before-tax and Roth contributions for any calendar year generally cannot exceed $19,000, the legal limit in 2019. If the participant is age 50 or older by the end of the calendar year, the participant is also allowed to make additional combined before-tax and Roth contributions up to $6,000, the maximum amount per the Code in 2019. The amount of a participant’s contributions is subject to additional provisions under the Code, which could further limit the amount of a participant’s contributions for any plan year.  However, by reason of certain “safe harbor” conditions having been met, a Code provision restricting the average level of participant contributions made by highly compensated employees was automatically met by the Plan for the Plan's years ended December 30, 2019 and 2018.

Participant contributions are allocated to the participant’s account under the Plan (“Plan account”). A participant is always fully vested in the part of the Plan account attributable to employee contributions.

Except as noted above with respect to Roth contributions, a participant is generally not subject to federal income tax on the amount of employee contributions to the Plan or on the earnings on those contributions until the amounts are distributed from the Plan to the participant.

 

d.

Employer Contributions: Under the current terms of the Plan (which applied to all pay periods occurring in the Plan's plan year ending December 30, 2019) the Company made matching contributions for each participant in an amount equal to the sum of: (i) 100% of the portion of the participant's contributions to the Plan for such pay period that were not in excess of 3% of his or her plan compensation for such pay period, and (ii) 50% of the portion of his or her contributions to the Plan for such pay period that were in excess of 3% but not in excess of 5% of the participant's plan compensation for such pay period. The amount of matching contributions made for a participant is subject to additional provisions under the Code, which could limit the amount of the matching contributions made for a participant for any plan year. However, by reason of certain “safe harbor” conditions having been met, a Code provision restricting the average level of matching contributions made for highly compensated employees was automatically met by the Plan for the Plan's years ended December 30, 2019 and 2018.

Matching contributions are generally made on a bi-weekly basis under the current practice of the Company and must be made by the end of the first full month that ends after the participants' related contributions are made.

The Company's matching contributions for a participant are allocated to the participant's Plan account. In general, a participant is fully vested in the part of the Plan account attributable to the Company's matching contributions.

A participant is generally not subject to federal income tax on the amount of the matching contributions or on the earnings on these contributions until the amounts are distributed from the Plan to the participant.

 

e.

Rollovers: A participant may elect to rollover to the Plan an otherwise taxable distribution from another employer’s tax-qualified savings, profit sharing, or other employer plan, if the distribution meets certain conditions set forth in the Plan and the Code.

Any rollover contributions are allocated to the participant’s Plan account. A participant is always fully vested in the part of the Plan account attributable to rollover contributions.

A participant is generally not subject to federal income tax on the rollover contributions or on the earnings on the rollover contributions until the amounts are distributed from the Plan to the participant.

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Table of Contents

 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

 

f.

Employee-Directed Investments: A participant can specify the manner in which contributions made by or for the participant to the Plan shall be invested in the available funds under the Plan and may elect to change the funds to which future contributions are allocated and transfer amounts held in the participant’s Plan account from one fund to another.

 

g.

Distributions to Participants: A participant may receive a distribution of all or a portion of the Plan account while employed by the Company, only in certain circumstances.

In general, a participant, while still employed by the Company, may withdraw, for any reason, the part of the Plan account attributable to: regular (non-Roth) after-tax contributions (prior to December 20, 2004, the Plan accepted regular (non-Roth) after-tax contributions); rollover contributions; and the Company’s matching contributions made for plan years that ended before December 31, 2000.

Further, a participant, while still employed by the Company, can withdraw amounts that are attributable to before-tax or Roth contributions if the withdrawal is required by reason of the participant’s hardship situation, which meets the rules set forth in the Plan concerning hardship withdrawals, or if the participant has reached at least age 59 1/2. Effective for plan years beginning on or after December 31, 2017, a participant who has reached 59 1/2 can withdraw his or her entire Plan account.

Other than for the withdrawals described above, the distribution of a participant’s Plan account will generally occur only after the participant’s employment with the Company has terminated for any reason, including retirement, discharge, termination, disability, or death.

If the value of the participant’s Plan account is $1,000 or less, the participant’s account can be distributed, within a reasonable administrative period, in a lump sum and without the consent of the participant after the participant’s employment with the Company ends for any reason.

 

h.

Participant Loans: Loans are available from the Plan to participants under the current provisions and policies of the Plan. Loans are subject to several conditions, certain of which are described below.

A participant cannot have more than two outstanding loans from the Plan at any time. The minimum amount of any loan to a participant is $1,000, while the maximum amount cannot exceed the lesser of (i) 50% of the vested balance of the participant’s Plan account or (ii) $50,000 reduced by the highest outstanding balance of loans made to the participant from the Plan and other plans of the Company during the one year period preceding the new loan date.

The Company's Employees’ Benefit Committee determines the interest rate charged by the Plan on a loan made to a participant. In general, the interest rate is based on the prime rate plus 1.0% at the time the loan is made. As of December 30, 2019, interest rates on loans made under the Plan ranged between 3.3% and 6.5% per annum. For the Plan year ended December 30, 2019, a participant also paid to Fidelity a $35 origination fee for processing a new Plan loan and a $15 annual maintenance fee for the life of the loan.

In general, any loan to a participant must be repaid through payroll deductions and be collateralized by up to 50% of the participant’s Plan account. The minimum term of any loan to a participant is 6 months, and the maximum term of a loan is generally 60 months. A participant may extend the term of the loan to a maximum of 30 years, if the loan is acquired to provide the participant with funds to purchase a primary residence.

 

 

i.

 Investments: As of December 30, 2019, the following funds were available for investment under the Plan:

 

American Funds EuroPacific Growth Fund

 

Cincinnati Bell Inc. Common Stock Fund*

 

Dimensional Fund Advisors US Small Cap I

 

Fidelity 500 Index Fund*

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Table of Contents

 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

 

Fidelity Extended Market Index Fund*

 

Fidelity Growth Company Fund*

 

Fidelity International Discovery Fund*

 

Fidelity Managed Income Portfolio II*

 

Fidelity Mid-Cap Stock Fund*

 

PIMCO Total Return Fund

 

Vanguard Balanced Index Fund

 

Vanguard Developed Markets Index Fund

 

Vanguard Dividend Growth Fund

 

Vanguard Mid-Cap Value Index Fund

 

Vanguard Target Retirement 2015 Fund

 

Vanguard Target Retirement 2020 Fund

 

Vanguard Target Retirement 2025 Fund

 

Vanguard Target Retirement 2030 Fund

 

Vanguard Target Retirement 2035 Fund

 

Vanguard Target Retirement 2040 Fund

 

Vanguard Target Retirement 2045 Fund

 

Vanguard Target Retirement 2050 Fund

 

Vanguard Target Retirement 2055 Fund

 

Vanguard Target Retirement 2060 Fund

 

Vanguard Target Retirement 2065 Fund

 

Vanguard Target Retirement Income Fund

 

Vanguard Total Bond Market Index Fund

 

Vanguard Windsor II Fund

* Party-in-interest funds

Purchases and sales of securities are reflected as of the trade date. Dividend income is recorded on the ex-dividend date. Income from other investments is recorded on an accrual basis.

Management fees and operating expenses charged to the Plan for investments in the mutual funds are deducted from income earned on a daily basis and are not separately reflected. Consequently, management fees and operating expenses are reflected as a reduction of investment return for such investments.

 

j.

Administrative Expenses: Administrative expenses that are not clearly related to a specific investment fund may be paid by the Company. However, the Plan permits certain of these expenses to be paid from Plan assets. Revenue credits received by the Plan can be used to offset other administrative expenses.

 

k.

Forfeitures: Any amounts forfeited by participants under the Plan (for instance, because such participants cannot be located) are applied to reduce subsequent contributions of the Company to the Plan. At December 30, 2019 and 2018, unapplied forfeited amounts totaled $3,206 and $2,134, respectively.

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Table of Contents

 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

 

l.

Transfer to/from Other Plans: If a Plan participant becomes a participant of the Cincinnati Bell Inc. Savings and Security Plan, another defined contribution plan sponsored by the Company, or if a participant of the Cincinnati Bell Inc. Savings and Security Plan becomes a participant of the Plan, the Plan account balance is generally transferred to and assumed by the recipient plan. These transfers are included in “Transfers from other Company-sponsored plans, net” on the Statement of Changes in Net Assets Available for Benefits.

 

m.

Uncertain Tax Positions: U.S. GAAP requires Plan management to evaluate tax positions taken by the Plan and recognize a tax liability if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the Internal Revenue Service ("IRS"). There are no uncertain tax positions taken or expected to be taken that would require recognition of a liability or disclosure in the financial statements. The Plan is not currently under audit by any taxing jurisdictions.

 

n.

Use of Estimates: The preparation of financial statements in conformity with U.S. GAAP requires management of the Plan to make estimates and assumptions that affect the reported amounts of Net Assets Available for Benefits and the reported Changes in Net Assets Available for Benefits during the reporting period. Actual results could differ from these estimates.

(2)

Fair Value Measurements

The Plan’s investments in the Master Trust are stated at fair value. Mutual funds of the Plan are valued using the quoted market prices of the shares of each applicable mutual fund. The value of the Plan’s Cincinnati Bell Inc. Common Stock Fund was determined by the ending share values as last published by the New York Stock Exchange on December 30, 2019 and 2018. Common collective trust funds are based on the NAV of units of a collective trust as published by the trustee.

Certain events limit the ability of the Plan to transact with the participants at fair value of the Fidelity Managed Income Portfolio II Fund, a common collective trust. Such events include the following: (a) amendments to the Plan documents (including complete or partial plan termination or merger with another plan), (b) changes to the Plan’s prohibition on competing investment options or deletion of equity wash provisions, (c) bankruptcy of the plan sponsor or other plan sponsor events (e.g., divestitures or spin-offs of a subsidiary) which cause a significant withdrawal from the Plan, or (d) the failure of the Plan to qualify for exemption from federal income taxes or any other prohibited transaction exception under ERISA. The Plan Administrator does not believe that the occurrence of any such event, which would limit the Plan’s ability to transact with the participants, is probable.

ASC 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1 - Quoted market prices for identical instruments in an active market;

Level 2 - Quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs); and

Level 3 - Unobservable inputs that reflect management's determination of assumptions that market participants would use in pricing the asset or liability. These inputs are developed based on the best information available, including our own data.

 

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Table of Contents

 

CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

There were no significant transfers between the fair value hierarchy levels in the year ended December 30, 2019. At December 30, 2019 and 2018, the fair value and placement in the fair value hierarchy of the underlying assets of the Master Trust that are required to be measured at fair value on a recurring basis are as follows:

 

 

Assets at Fair Value as of December 30, 2019

 

(dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Mutual funds

 

$

428,361

 

 

$

 

 

$

 

 

$

428,361

 

Common collective trust funds

 

 

 

 

 

23,305

 

 

 

 

 

 

23,305

 

Common stock of Cincinnati Bell Inc.

 

 

6,789

 

 

 

 

 

 

 

 

 

6,789

 

Total assets at fair value

 

$

435,150

 

 

$

23,305

 

 

$

 

 

$

458,455

 

 

 

Assets at Fair Value as of December 30, 2018

 

(dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Mutual funds

 

$

349,837

 

 

$

 

 

$

 

 

$

349,837

 

Common collective trust funds

 

 

 

 

 

22,177

 

 

 

 

 

 

22,177

 

Common stock of Cincinnati Bell Inc.

 

 

4,383

 

 

 

 

 

 

 

 

 

4,383

 

Total assets at fair value

 

$

354,220

 

 

$

22,177

 

 

$

 

 

$

376,397

 

 

(3)

Interest in Master Trust

At December 30, 2019 and 2018, the Plan’s assets were held by the Master Trust. The Master Trust holds only the assets of the Plan and the Cincinnati Bell Inc. Savings and Security Plan.

The purpose of the Master Trust is the collective investment of assets of the Plan and the Cincinnati Bell Inc. Savings and Security Plan (collectively the “Savings Plans”). Master Trust assets are allocated to the Savings Plans by assigning to each plan those transactions (primarily contributions and benefit payments) which can be specifically identified to that Savings Plan.  When applicable, net investment income, gains and losses, and expenses resulting from the collective investment of the assets are allocated to the Savings Plans in proportion to the fair value of the assets allocated to the Savings Plans.

The following table presents the fair value of the total net assets held by the Master Trust and the Plan's divided interest in the Master Trust at December 30, 2019 and 2018:

 

 

December 30, 2019

 

 

December 30, 2018

 

(dollars in thousands)

 

Master Trust

Balances

 

 

Plan's Interest

in Master

Trust Balances

 

 

Master Trust

Balances

 

 

Plan's Interest

in Master

Trust Balances

 

Mutual funds

 

$

428,361

 

 

$

344,608

 

 

$

349,837

 

 

$

278,674

 

Common collective trust funds

 

 

23,305

 

 

 

17,815

 

 

 

22,177

 

 

 

16,349

 

Common shares of Cincinnati Bell Inc.

 

 

6,789

 

 

 

4,797

 

 

 

4,383

 

 

 

2,928

 

Total investments at fair value

 

$

458,455

 

 

$

367,220

 

 

$

376,397

 

 

$

297,951

 

 

During the plan year ended December 30, 2019, realized and unrealized gains and interest and dividends on investments held by the Master Trust and the Plan were as follows:

 

 

Gain on Investments

 

 

Interest and

 

(dollars in thousands)

 

Realized

 

 

Unrealized

 

 

Dividends

 

Investments held by the Master Trust

 

$

8,358

 

 

$

69,284

 

 

$

15,811

 

Plan's interest in investments held by the Master Trust

 

$

6,418

 

 

$

55,707

 

 

$

12,484

 

 


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CINCINNATI BELL RETIREMENT SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

(4)

Amendment or Termination of the Plan

While the Company has not expressed any intent to terminate the Plan, it reserves the right to amend or terminate the Plan at any time. On July 2, 2018, the Company acquired Hawaiian Telcom Holdco, Inc., the largest full service provider of communication services on all of Hawaii’s major islands. Effective as of December 31, 2019, the Plan was amended to reflect the merger of the Hawaiian Telcom 401(k) Plan for Management Employees into the Plan as of such date (and assets previously held by such plan, including notes receivable from participants, were transferred to the Plan's Master Trust as of December 31, 2019). Hawaiian Telcom employees began participating in the Plan effective January 1, 2020.

 

(5)

Tax Status

The Company has obtained favorable determination that the Plan meets the requirements of Section 401(a) of the Code and is exempt from federal income taxes under Section 501(a) of the Code. Although the Plan has been amended since receiving favorable determination, the Plan administrator and the Plan’s tax counsel believe that the Plan is designed, and is currently being operated, in compliance with the applicable requirements of the IRC and, therefore, believe that the Plan is qualified, and the related trust is tax-exempt.

 

(6)

Related Party Transactions

The Plan invests in the Master Trust, and the Master Trust’s investments include shares of Cincinnati Bell Inc. common stock and shares of mutual funds managed by Fidelity. Cincinnati Bell is the sponsor of the Plan, and Fidelity is the Plan’s trustee. Therefore, these investments qualify as party-in-interest transactions. Fees paid by the Plan to these parties-in-interest for the plan year were $42,949.

The amount of common stock of Cincinnati Bell Inc. held in the Master Trust for the Plan was 392,084 and 382,157 shares with a cost basis of $7,204,049 and $7,980,885 at December 30, 2019 and 2018, respectively.

 

(7)

Concentrations, Risks, and Uncertainties

The Plan provides for various investment options in money market funds, mutual funds, commingled funds, and Cincinnati Bell Inc. common stock. Investment securities, in general, are exposed to various risks, such as interest rate, credit, and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term, and those changes could materially affect the amounts reported in the Statements of Net Assets Available for Benefits.

(8)

Subsequent Events

Effective as of December 31, 2019, the Plan was amended to reflect the merger of the Hawaiian Telcom 401(k) Plan for Management Employees into the Plan as of such date (and assets previously held by such plan in the amount of $109,811,050, including notes receivable from participants, were transferred to the Plan's Master Trust as of December 31, 2019).

Subsequent to the date of the financial statements, an outbreak of a novel strain of coronavirus (“COVID-19”) has disrupted supply chains and affected production and sales across a range of industries. The extent of the impact of COVID-19 on the Plan Sponsor’s performance and the Plan’s investments will depend on certain developments, including the duration and spread of the outbreak. Impact to the Plan cannot be predicted, and the extent to which COVID-19 may impact the statement of net assets available for benefits is uncertain at this time.

 

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CINCINNATI BELL RETIREMENT SAVINGS PLAN

SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS (HELD AT END OF YEAR)

DECEMBER 30, 2019

FORM 5500 SCHEDULE H (FORM 5500)

EIN 31-1056105

PLAN NUMBER - 002

(Dollars in thousands)

 

Issuer

 

Description of Investment

 

Current Value

 

Participant loans*

 

6 to 360 months (3.3% - 6.5%)

 

$

5,396

 

 

*

Party-in-interest

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.

 

RETIREMENT SAVINGS PLAN

 

By: Cincinnati Bell Inc.

 

 

June 24, 2020

/s/ Sarah E.S. Dodd

 

By: Sarah E.S. Dodd

 

Employees’ Benefit Committee

 

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EXHIBIT INDEX

 

Exhibit

Number

 

Description

 

 

23.1

 

Consent of Independent Registered Public Accounting Firm – Clark, Schaefer, Hackett & Co.

 

23.2

 

Consent of Independent Registered Public Accounting Firm – Barnes, Dennig & Co., LTD

 

14

cbb-ex231_16.htm

Exhibit 23.1

 

 

 

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

Employees’ Benefit Committee Cincinnati Bell Retirement Savings Plan

 

We consent to the incorporation by reference in the Registration Statement (No. 333-192225) on Form S-8 of Cincinnati Bell Inc. of our report dated June 24, 2020, with respect to the statement of net assets available for benefits of the Cincinnati Bell Retirement Savings Plan as of December 30, 2019, the related statement of changes in net assets available for benefits for the year then ended, and the related supplemental schedule as of December 30, 2019, which report appears in the annual report on Form 11-K of the Cincinnati Bell Retirement Savings Plan for the year ended December 30, 2019.

 

/s/ Clark, Schaefer, Hackett & Co.

 

Cincinnati, Ohio

June 24, 2020

cbb-ex232_17.htm

 

Exhibit 23.2

 

 

 

 

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Plan Administrator of the

Cincinnati Bell Retirement Savings Plan

 

We consent to the incorporation by reference in the Registration Statement (No. 333-192225) on Form S-8 of Cincinnati Bell Inc. of our report dated June 24, 2019, with respect to the statements of net assets available for benefits of Cincinnati Bell Retirement Savings Plan as of December 30, 2018, which report appears in the December 30, 2019 annual report on Form 11-K of Cincinnati Bell Retirement Savings Plan.

/s/ Barnes, Dennig & Co., LTD

Cincinnati, Ohio

June 24, 2020