11-K 1 e11-k.txt DIEBOLD, INC. 11-K 1 -------------------------------------------------------------------------------- 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, 1999 OR ( ) TRANSITION REPORT PURSUANT TO 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------ ------ Commission file number 1-4879 ------ DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN -------------------------------------------------------------------------------- (Full title of the plan) Diebold, Incorporated 5995 Mayfair Road PO Box 3077 North Canton, Ohio 44720-8077 -------------------------------------------------------------------------------- (Name of issuer of the securities held by the plan and the address of its principal executive office) 2 REQUIRED INFORMATION Audited plan financial statements and schedules prepared in accordance with the financial reporting requirements of the Employee Retirement Income Security Act of 1974, as amended, are filed herewith in lieu of the requirements of an audited statement of financial condition and statement of income and changes in plan equity. Financial Statements and Exhibits --------------------------------- A) The following financial statements and schedules are filed as part of this annual report: 1) Statements of Net Assets Available for Benefits - December 31, 1999 and 1998 2) Statements of Changes in Net Assets Available for Benefits - Years Ended December 31, 1999 and 1998 3) Notes to Financial Statements - December 31, 1999 and 1998 4) Schedule 1 - Schedule of Assets Held for Investment Purposes - December 31, 1999 5) Schedule 2 - Schedule of Reportable Transactions - Year Ended December 31, 1999 B) The following exhibit is filed as part of this annual report: 23. Consent of Independent Auditors All other schedules required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted because there is no information to report. -2- 3 INDEPENDENT AUDITORS' REPORT The Plan Administrator and Participants Diebold, Incorporated 401(k) Savings Plan We have audited the accompanying statements of net assets available for benefits of Diebold, Incorporated 401(k) Savings Plan as of December 31, 1999 and 1998, 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 generally accepted auditing standards. 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 Diebold, Incorporated 401(k) Savings Plan as of December 31, 1999 and 1998, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are 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. These supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/KPMG LLP KPMG LLP Cleveland, Ohio June 23, 2000 -3- 4 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1999 and 1998 1999 1998 ------------ ------------ Assets: Investments $193,634,788 $187,656,240 ------------ ------------ Net assets available for benefits: $193,634,788 $187,656,240 ============ ============ See accompanying notes to financial statements -4- 5 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEARS ENDED DECEMBER 31, 1999 and 1998 1999 1998 ------------ ------------ Additions: Contributions Participant $ 15,547,201 $ 15,562,701 Employer 8,934,418 9,201,762 Rollover 2,565,237 3,171,189 ------------ ------------ Total Contributions 27,046,856 27,935,652 Registered investment funds -- 1,158,537 Interest and dividends 7,535,552 5,582,730 Net depreciation in the fair value of investments (19,784,023) (17,552,712) ------------- ----------- (12,248,471) (10,811,445) ------------ ------------ Total additions, net 14,798,385 17,124,207 Deductions: Withdrawals (8,819,837) (6,379,653) ------------ ------------ Excess of additions over deductions 5,978,548 10,744,554 Net assets available for benefits: Beginning of year $187,656,240 $176,911,686 ============ ============ End of year $193,634,788 $187,656,240 ============ ============ See accompanying notes to financial statements -5- 6 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (1) DESCRIPTION OF THE PLAN The following brief description of the Diebold, Incorporated 401(k) Savings Plan (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. (a) GENERAL The Board of Directors of Diebold, Incorporated (the "Employer") established this defined contribution plan effective as of April 1, 1990. On January 1, 1999 the Diebold, Incorporated 401(k) Savings Plan for Certain Canton Hourly Employees and the Diebold, Incorporated Retiree Medical Funding Plan for Newark Hourly Employees were merged into the Diebold, Incorporated 401(k) Savings Plan. The Diebold, Incorporated 401(k) Savings Plan covers all non-bargaining unit employees of the Employer and affiliates who have completed ninety days of employment. The Diebold, Incorporated Retiree Medical Funding Plan for Newark Hourly Employees covers all hourly employees of the Employer at the Newark, Ohio facility who are represented by Local 710 of the International Union of Electrical Workers, who have completed ninety days of employment and have attained the age of twenty-one. The Diebold, Incorporated 401(k) Savings Plan for Certain Canton Hourly Employees covers all employees of the Employer at the Canton Plant who commenced active employment on or after May 1, 1992 and all employees on layoff status from the Canton Plant as of May 1, 1992 who return to active service from the Canton Plant on or after May 1, 1992. In addition, Canton Plant employees must have completed ninety days of employment and have attained the age of twenty-one. The Plan is subject to certain provisions of the Employee Retirement Income Security Act of 1974 (ERISA). (b) CONTRIBUTIONS Salary Plan For the years ended December 31, 1999 and 1998, the Plan allowed each participant to contribute from one to ten percent (in one percent increments) of pre-tax compensation, but not in excess of the maximum amount permitted by the Internal Revenue Code of 1986. In 1999 and 1998, the Employer contributed as a Basic Matching Contribution an amount equal to sixty cents for each dollar of a participant's pre-tax contributions during each payroll period up to three percent of the participant's compensation in such payroll period and thirty cents for each dollar of a participant's pre-tax contributions on the next three percent of the participant's compensation in such payroll period. At the end of any Plan Year, the Employer, at its discretion, may determine that an Additional Matching Contribution be made for the next succeeding Plan year. The amount of any Additional Matching Contribution shall be determined solely by action of the Board of Directors. An Additional Matching Contribution was made for the entire year of 1999 and the last three quarters of 1998 such that the total matching contribution (including the Basic Matching Contribution) was eighty cents for each dollar of a participant's pre-tax contributions during each payroll period up to four percent of the participant's compensation in such payroll period and forty cents for each dollar of a participant's pre-tax contributions on the next four percent of the participant's compensation in such payroll period. There was not an additional matching contribution for the corporate officers for the last three quarters of 1999. -6- 7 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (continued) (b) CONTRIBUTIONS (CONTINUED) Salary Plan (continued) For the first quarter of 1998, an Additional Matching Contribution was made such that the total matching contribution (including the Basic Matching Contribution) was one dollar for each dollar of a participant's pre-tax contributions during each payroll period up to four percent of the participant's compensation in such payroll period and forty cents for each dollar of a participant's pre-tax contributions on the next four percent of the participant's compensation in such payroll period. Newark Plan For the years ended December 31, 1999 and 1998, the Plan allowed each participant to contribute from one to three percent (in one percent increments) of pre-tax compensation, but not in excess of the maximum amount permitted by the Internal Revenue Code of 1986. In 1999 and 1998, the Employer contributed as a Basic Matching Contribution an amount equal to thirty percent of participant's pre-tax contributions during each payroll period up to three percent of the participant's compensation in such payroll period. Canton Hourly For the years ended December 31, 1999 and 1998, the Plan allowed each participant to contribute from one to three percent, in one percent increments of pre-tax compensation, but not in excess of the maximum amount permitted by the Internal Revenue Code of 1986. During 1999 and 1998 respectively, the Employer contributed as a basic matching contribution an amount equal to thirty percent of a participant's pre-tax contributions during each payroll period up to three percent of the participant's compensation in such payroll period. (c) PARTICIPANTS' ACCOUNTS Salary Plan As of January 1, 1992, the Employer, as the plan administrator for the Plan, established two separate accounts for each participant, a Regular Account and a Retiree Medical Funding Account. All participant contributions are deposited into the Regular Account. Each participant may direct that his or her contributions to the Regular Account be invested in the Vanguard Mutual Funds, Vanguard Retirement Savings Trust, Loomis Sayles Mutual Funds, Equities or any combination thereof with the minimum investment in any fund/portfolio of one percent. -7- 8 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (continued) (c) PARTICIPANTS' ACCOUNTS (CONTINUED) Salary Plan (continued) For 1999 and 1998, the Employer's Basic Matching Contribution was divided between the Regular Account and the Retiree Medical Funding Account. The portion of the Employer's Basic Matching Contribution which was equal to thirty cents for each dollar contributed by a participant up to three percent of the participant's compensation in such payroll period was deposited in the Retiree Medical Funding Account. These Employer contributions were invested in the above named funds and/or portfolios according to the participant's direction. In 1999 and 1998, any additional Matching Contribution was deposited in the Regular Account and was invested in the Company Stock Fund. Newark Plan The Employer, as the Plan administrator for the Plan, established two separate accounts for each participant, a Regular Account and a Retiree Medical Funding Account. All participant contributions are deposited into the Regular Account and all Employer contributions are deposited into the Retiree Medical Funding Account. Each participant may direct that his or her contributions to the Regular Account as well as all Employer contributions to the Retiree Medical Funding Account be invested in the Vanguard Mutual Funds, Vanguard Retirement Savings Trust, Loomis Sayles Mutual Funds, Equities or any combination thereof with the minimum investment in any fund/portfolio of one percent. Canton Plan The Employer, as the plan administrator for the Plan, established two separate accounts for each participant, a Regular Account and a Retiree Medical Funding Account. All participant contributions are deposited into the Regular Account. Each participant may direct that his or her contributions to the Regular Account be invested in the Vanguard Mutual Funds, Vanguard Retirement Savings Trust, Loomis Sayles Mutual Funds, Equities or any combination thereof with the minimum investment in any fund/portfolio of one percent. The Retiree Medical Funding Account is intended to help accumulate funds to cover medical expenses after a participant retires which are no longer covered by an employer-sponsored plan. The employer's basic matching contribution which is equal to thirty cents for each dollar contributed by a participant up to three percent of the participant's compensation in such payroll period is deposited in the Retiree Medical Funding Account as is the employer's past service contribution. These employer contributions are invested in the above named funds and/or portfolios according to the investment elections made by the participant for his or her contributions. (d) VESTING A participant's pre-tax contributions and earnings and the Employer's pre-tax contributions and earnings are immediately vested and nonforfeitable. -8- 9 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (continued) (e) DISTRIBUTION OF BENEFITS Upon termination of service with the Employer or affiliate, a participant shall receive his or her total account balance in a lump sum payment if such total account balance does not exceed $5,000. Otherwise, the participant may elect to receive his or her total account balance in a lump sum payment upon termination, defer receipt until retirement date, or make a direct rollover to a qualified plan. A participant entitled to a distribution during the years ended December 31, 1999 and 1998, received cash for his or her lump sum distribution, except for funds in the Company Stock Fund for which an election of cash or the Employer's Common Shares was made. (f) PARTICIPANT NOTES RECEIVABLE (SALARY PLAN) Effective April 1, 1995, the Plan was amended and the Loan Fund was established to administer the activities of participant loans. Loan transactions are treated as a transfer to (from) the investment fund from (to) the Loan Fund. Under the terms of the Plan, active participants of the Plan may borrow against their account balances. The minimum amount of any loan is $1,000 and the maximum is $50,000 or 50% of a participant's total vested balance (in $100 increments), whichever is less. Loan payments are made through equal payroll deductions over the loan period of one to five years. All loans must be repaid in full year increments. Interest charged is determined by the Savings Plan Committee based on the prime interest rate plus one percent as of the loan effective date. (g) WITHDRAWALS (NEWARK AND CANTON PLAN) A financial hardship provision is available enabling a participant to withdraw an amount to cover an immediate and heavy financial need. (h) PLAN MERGER On September 30, 1998 the Griffin Technology 401(k) Plan was merged into the Diebold, Incorporated 401(k) Savings Plan. On January 1, 1999 the Diebold, Incorporated 401(k) Savings Plan for Certain Canton Hourly Employees and the Diebold, Incorporated Retiree Medical Funding Plan for Newark Hourly Employees were merged into the Diebold, Incorporated 401(k) Savings Plan. (i) EXPENSES All costs and expenses incident to the administration of the Plan and the management of the trust fund are paid by the Plan administrator except for loan processing and administration fees associated with the Loan Fund which are borne by the individual loan participants. -9- 10 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (continued) (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) BASIS OF PRESENTATION The accompanying financial statements have been prepared on an accrual basis in accordance with generally accepted accounting principles. (b) INVESTMENT VALUATION The Plan's investments are stated at fair value as of the last business day of the Plan year. The fund is fully benefit-responsive, and accordingly, investments in this fund are valued at the underlying contract value. Shares of registered investment companies are valued at quoted market prices which represent the net asset value of shares held by the Plan at year-end. The Company stock is valued at its quoted market price. Participant notes receivable are valued at cost which approximates fair value. All purchases and sales transactions are recorded on a trade date basis. (c) 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 and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of changes in net assets available for plan benefits during the reporting period. Actual results could differ from those estimates. (3) INVESTMENTS The following presents investments that represent 5 percent or more of the Plan's net Assets: 1999 1998 ----------- ----------- Vanguard Index 500 Portfolio $37,879,571 $28,959,437 Vanguard Total Bond Fund 11,001,951 11,260,947 Vanguard US Growth 44,872,348 34,996,733 Vanguard Retirement Savings Trust 12,711,043 10,518,796 Diebold Company Stock 66,537,527 86,528,289 During 1999, the Plan's investment (including gains and losses on investments bought and sold, as well as held during the year) depreciated in value by $19,784,023, as follows: Mutual funds $ 10,326,688 Common Stock (30,110,711) ------------ $(19,784,023) ============ -10- 11 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 (continued) (4) FEDERAL INCOME TAXES The Internal Revenue Service has determined and informed the Company by a letter dated November 19, 1992, that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code (IRC). Although the Plan has been amended since receiving the determination letter, the plan administrator and the Plan's tax council believe that the Plan is designed and is currently being operated in compliance with applicable requirements of the IRC. (5) PLAN TERMINATION Although it has not expressed any intent to do so, the Employer reserves the right at any time, by action of its Board of Directors, to terminate the Plan or discontinue contributions thereto. -11- 12 Schedule 1 ---------- DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1999 EIN: 34-0183970 Plan Number: 012
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E -------- -------- -------- -------- -------- Description of Investment including Identity of Issue, Borrower, Lessor, Maturity Date, Rate of Interest, or Similar Party Collateral, Par, or Maturity Value Cost Current Value --------------------------------------------------------------------------------------------------------------------- Loomis Sayles Bond Registered Investment Company $ 496,718 $ 477,624 Loomis Sayles Small Cap Value Registered Investment Company 705,372 748,368 Vanguard 500 Index Fund Registered Investment Company 30,296,032 37,879,571 Vanguard International Growth Fund Registered Investment Company 2,716,055 3,233,624 Vanguard PRIMECAP Fund Registered Investment Company 3,427,426 3,855,898 Vanguard Total Bond Market Index Registered Investment Company 11,652,706 11,001,951 Vanguard U.S. Growth Registered Investment Company 37,396,191 44,872,348 Vanguard Windsor II Fund Registered Investment Company 10,674,652 8,673,235 Vanguard Retirement Savings Trust Common/ Collective Trust 12,711,043 12,711,043 * Diebold Company Stock Company Stock Fund 68,500,706 66,537,527 * Participant Loans 9.25% - 12% -- 3,643,599 --------------------------------------- $178,576,901 $193,634,788 =======================================
* Party-in-interest NOTE: The cost of participant loans is $0 based upon instructions for the Form 5500 Line 27a. See accompanying independent auditors' report. -12- 13 Schedule 2 DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN Schedule of Reportable (5%) Transactions Year ended December 31, 1999 Ein: 34-0183970 Plan Number: 012 Series transactions, when aggregated, involving an amount in excess of 5 percent of the current value of Plan assets:
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F COLUMN G COLUMN H COLUMN I -------- -------- -------- -------- --------- -------- -------- -------- -------- Current Description of Assets Expense Value of (include interest rate and Incurred Historical Asset on Net Identity of Party maturity in the case of a Purchase Selling Lease with Cost of Transaction Gain Involved loan) Price Price Expense Transactions Asset Date (Loss) ----------------------------------------------------------------------------------------------------------------------------------- The Vanguard Group Vanguard 500 Index Fund $ 7,018,155 $ -- $ -- $ -- $ -- $ 7,018,155 $ -- The Vanguard Group Vanguard 500 Index Fund -- 4,131,811 -- -- 3,656,640 4,131,811 475,171 The Vanguard Group Vanguard U.S. Growth 8,624,557 -- -- -- -- 8,624,557 -- The Vanguard Group Vanguard U.S. Growth -- 4,985,384 -- -- 4,561,151 4,985,384 424,233 Diebold, Inc. Diebold Company Stock 17,943,843 -- -- -- -- 17,943,843 -- Diebold, Inc. Diebold Company Stock -- 8,237,044 -- -- 7,523,695 8,237,044 713,349
See accompanying independent auditors' report. -13- 14 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. DIEBOLD, INCORPORATED 401(k) SAVINGS PLAN ----------------------------------------- (Name of Plan) Date: June 26, 2000 By: /s/ Gregory T. Geswein -------------- -------------------------- Gregory T. Geswein Senior Vice President and Chief Financial Officer (Principal Accounting and Financial Officer) -14- 15 DIEBOLD, INCORPORATED FORM 11-K INDEX TO EXHIBITS EXHIBIT NO. PAGE NO. ----------- -------- 23. Consent of Independent Auditors 16 -15-