-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UuaN2LACB0ZCQJvtDf8jzJzvu0eyGIgjzpC7mHnbGKSyYWP1Wr1YyD9WN+eK+Ka7 f0RsosvEAl1yFcV1Wy6TRA== /in/edgar/work/20000628/0000912057-00-030101/0000912057-00-030101.txt : 20000920 0000912057-00-030101.hdr.sgml : 20000920 ACCESSION NUMBER: 0000912057-00-030101 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REMEC INC CENTRAL INDEX KEY: 0000769874 STANDARD INDUSTRIAL CLASSIFICATION: [3674 ] IRS NUMBER: 953814301 STATE OF INCORPORATION: CA FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 000-27414 FILM NUMBER: 662578 BUSINESS ADDRESS: STREET 1: 9404 CHESAPEAKE DRIVE CITY: SAN DIEGO STATE: CA ZIP: 92123 BUSINESS PHONE: 6195601301 11-K 1 a11-k.txt 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 [X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED, EFFECTIVE OCTOBER 7, 1996). For the fiscal year ended DECEMBER 31, 1999 ------------------------------------------------------ OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]. For the transition period from to ------------- -------------- Commission file number 0-27414 REMEC, Inc. Profit Sharing 401(k) Plan 9404 Chesapeake Drive San Diego, CA 92123 (Full title of the plan and the address of the plan) REMEC, Inc. 9404 Chesapeake Drive San Diego, CA 92123 (Name of issuer of the securities held pursuant to the plan and the address of its principal executive office) REMEC, Inc. Profit Sharing 401(k) Plan Audited Financial Statements and Supplemental Schedules Year ended December 31, 1999 CONTENTS Report of Independent Auditors.......................................................................... 1 Financial Statements Statements of Net Assets Available for Benefits as of December 31, 1999 and 1998........................................................................... 2 Statement of Changes in Net Assets Available for Benefits for the year ended December 31, 1999.................................................................................... 3 Notes to Financial Statements........................................................................... 4 Schedule Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes as of December 31, 1999....................................................................................10 Exhibits................................................................................................11 Signature...............................................................................................11
Report of Independent Auditors REMEC, Inc. as Plan Administrator of REMEC, Inc. Profit Sharing 401(k) Plan We have audited the accompanying statements of net assets available for benefits of REMEC, Inc. Profit Sharing 401(k) Plan as of December 31, 1999 and 1998, and the statement of changes in net assets available for benefits for the year ended December 31, 1999. 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. 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 Plan at December 31, 1999 and 1998, and the changes in its net assets available for benefits for the year ended December 31, 1999, in conformity with accounting principles generally accepted in the United States. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment purposes as of December 31, 1999 is presented for purpose of additional analysis and are not a required part of the 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. This supplemental schedule is the responsibility of management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. /s/ Ernst & Young LLP --------------------- ERNST & YOUNG LLP May 17, 2000 1 REMEC, Inc. Profit Sharing 401(k) Plan Statements of Net Assets Available for Benefits
DECEMBER 31, 1999 1998 ----------------- ---------------- Investments, at fair value based on market price: Mutual funds $ 28,006,986 $ 19,568,513 Common Stock 5,006,900 3,926,700 Investments, at estimated fair value: Participant loans 1,280,708 1,083,218 ----------------- ---------------- Total investments 34,294,594 24,578,431 Receivables: Employee contributions receivable 111,000 140,824 Employer contributions receivable - 8,863 Income receivable 169 152 Due from sales of securities 187,775 84,856 ----------------- ---------------- 298,944 234,695 ----------------- ---------------- Net assets available for benefits $ 34,593,538 $ 24,813,126 ================= ================
SEE ACCOMPANYING NOTES. 2 REMEC, Inc. Profit Sharing 401(k) Plan Statement of Changes in Net Assets Available for Benefits Year ended December 31, 1999 ADDITIONS: Employee contributions $ 3,134,934 Rollover contributions 301,517 Employer contributions (net of forfeitures) 126,236 Interest and dividends 2,194,320 Net appreciation in fair value of investments 4,980,508 -------------------- Total additions 10,737,515 DEDUCTIONS: Distributions to participants 938,928 Administrative expenses 18,175 -------------------- Total deductions 957,103 Net increase 9,780,412 Net assets available for benefits at: Beginning of year 24,813,126 -------------------- End of year $ 34,593,538 ====================
SEE ACCOMPANYING NOTES. 3 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements 1. SIGNIFICANT ACCOUNTING POLICIES GENERAL The financial statements of REMEC, Inc. Profit Sharing 401(k) Plan (the "Plan") are prepared on the accrual basis of accounting. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. RECLASSIFICATION Certain amounts from the previous year have been reclassified to conform to current year presentation. INVESTMENT VALUATION AND INCOME RECOGNITION Investments in registered investment company mutual funds are valued at quoted market prices, which represent the net asset value of shares held by the Plan at year-end. The shares of REMEC, Inc. common stock are valued at quoted market prices at year-end. The participant loans are valued at their outstanding balance, which approximates fair value. The REMEC, Inc. Common Stock Fund consists of the underlying company stock and a short-term cash component, Fidelity Institutional Money Market Fund, to provide liquidity for daily trading. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. The realized gain or loss on investments is included with unrealized appreciation or depreciation in the current value of investments. 4 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements (continued) 2. DESCRIPTION OF THE PLAN The following description of the Plan provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provision. GENERAL The Plan is a defined contribution profit sharing and retirement plan covering all eligible employees of REMEC, Inc. (the "Company"). The effective date of the Plan is January 1, 1997. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The Company pays most administrative expenses of the Plan. Certain investment management fees and other charges paid to the trustee are offset against fund performance in the net appreciation (depreciation) section of the statement of changes in net assets available for benefits and are not, therefore, separately reflected as administrative expenses. The Plan is exposed to credit risk in the event of default by the issuers of the investments to the extent of amounts recorded on the Statement of Net Assets Available for Benefits. ELIGIBILITY The Plan covers all employees of the Company who have attained age 18. There is no service requirement. Employees may elect to join the Plan quarterly on January 1, April 1, July 1, and October 1. CONTRIBUTIONS Each year, participants may contribute from 1% to 15% of pretax compensation, as deferred in the Plan and subject to the annual limits of the Internal Revenue Code. The Company may make a discretionary profit-sharing contribution in an amount to be determined annually by the Sponsor. A participant must be employed on the last day of the Plan year and have earned at least 500 hours of service to be eligible for any profit-sharing contributions. The profit-sharing contributions to the Plan are allocated based on 5 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements (continued) the ratio of each participant's compensation to total compensation of all eligible participants. There were no discretionary profit-sharing contributions during 1999. 6 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements (continued) 2. DESCRIPTION OF THE PLAN (CONTINUED) The Company may also make a discretionary matching contribution. The matching contribution is an amount equal to the percentage determined by the Sponsor of all or a portion of the tax deferred contributions of eligible participants for the contribution period up to a maximum match of $600 annually. There was no Company match for 1999. PARTICIPANT ACCOUNTS Each participant's account is credited with the participant's contributions, the participant's share of the employer's contributions, if any, and Plan earnings or losses. The benefit to which a participant is allowed is limited to the balance in his account. FORFEITURES Forfeited balances of terminated participants' non-vested accounts are retained in the Plan and will first be applied against the Plan expenses for the Plan year, and will then be used to reduce future employer contributions. The balance of forfeited non-vested accounts was not material as of December 31, 1999 or 1998. VESTING Participants are immediately vested in their elective contributions, plus actual earnings thereon, and such amounts are non-forfeitable. With regard to employer matching and discretionary contributions, participants are 50% vested after one year and 100% vested after two years of service. PARTICIPANTS NOTES RECEIVABLE Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Loan transactions are treated as a transfer from (to) the investment fund to (from) the loan fund. Loan terms range from 1-5 years or up to 10 years for the purchase of a primary residence. The loans are secured by the balance in the participant's account and bear interest at a rate commensurate with local prevailing rates. Interest rates range from 6.50% - 12%. Principal and interest is paid through bi-weekly payroll deductions. 7 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements (continued) 2. DESCRIPTION OF THE PLAN (CONTINUED) PAYMENT OF BENEFITS Upon termination of service for any reason, a participant's account is generally distributed in a single lump-sum payment upon request. At the Plan sponsor's option, if the account balance is $5,000 or less, the entire balance may be distributed. Amounts allocated to withdrawn participants at December 31, 1999 and 1998, for claims that have been processed and approved for payment prior to year-end but not yet paid, are $58,798 and $25,039, respectively. PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become fully vested in their accounts. 3. INVESTMENTS Fidelity Management Trust Company, the Trustee of the Plan, holds the Plan's investments and executes all investment transactions. During 1999, the Plan's investments (including investments purchased, sold, as well as held during the year) appreciated in fair value as determined by quoted market prices as follows:
NET REALIZED AND UNREALIZED APPRECIATION IN FAIR VALUE OF INVESTMENTS ------------------------- Common stock $2,113,917 Mutual funds 2,866,591 ------------------------- Total $4,980,508 =========================
8 REMEC, Inc. Profit Sharing 401(k) Plan Notes to Financial Statements (continued) 3. INVESTMENTS (CONTINUED) The fair value of individual investments that represent 5% or more of the Plan's net assets is as follows:
DECEMBER 31, 1999 1998 ---------------- ----------------- Fidelity Magellan Fund $ 5,928,515 $ 4,001,916 Fidelity Contrafund 3,680,023 2,624,279 Fidelity Growth Company Fund 5,726,395 2,199,620 Fidelity Growth and Income Fund 4,713,631 4,627,921 Fidelity Asset Manager Fund 2,447,596 2,137,373 Fidelity Retirement Money Market Fund 3,729,854 2,565,705 REMEC, Inc. Common Stock Fund 5,006,900 3,926,700
4. INCOME TAX STATUS The Plan has received a determination letter from the Internal Revenue Service dated May 26, 1995, stating that the Plan is qualified, in form, under Section 401(a) of the Internal Revenue Code (the "Code") and, therefore, the related trust is exempt from taxation. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Plan Administrator believes the Plan is being operated in compliance with the applicable requirements of the Code and, therefore, believes that the Plan qualifies and the related trust is tax exempt. Subsequent amendments have been structured to, and are intended to, maintain the Plan's tax qualified status. 5. SUBSEQUENT EVENT During 1999, REMEC, Inc. acquired Airtech plc and WACOM Products. Both of these companies have 401(k) plans, which will be merged into the REMEC, Inc. Profit Sharing 401(k) Plan in early 2000. 9 Supplemental Schedule Remec, Inc. Profit Sharing 401(k) Plan Employer ID #95-3814301, Plan 001 Schedule H, Line 4i - Schedule of Assets Held for Investment Purposes December 31, 1999
(e) (b) (c) (d) CURRENT (a) IDENTITY OF ISSUE DESCRIPTION OF ASSET COST VALUE - ------------------------------------------------------------------------------------------------------------------------------------ * Fidelity Management Trust Company Fidelity Magellan Fund 43,391.021 shares $ 4,656,895 $ 5,928,515 Fidelity Contrafund 61,313.273 shares 3,243,143 3,680,023 Fidelity Growth Company Fund 67,928.764 shares 3,763,644 5,726,395 Fidelity Investment Grade Bond Fund 147,737.237 shares 1,063,146 1,017,910 Fidelity Growth and Income Fund 99,949.767 shares 3,875,188 4,713,631 Fidelity Asset Manager Fund 133,166.286 shares 2,308,774 2,447,596 Fidelity Retirement Money Market Fund 3,729,854.360 shares 3,729,854 3,729,854 Fidelity Diversified International Fund 6,546.562 shares 127,314 167,723 Spartan US Equity Index Fund 11,405.861 shares 476,976 594,131 Fidelity Institutional Money Market Fund 1,208.490 shares 1,208 1,208 * REMEC, Inc. Common Stock 196,349.000 shares 2,585,170 5,006,900 * Participant loans 6.50% to 12.00% interest, various maturities 1,280,708 --------------- $ 34,294,594 ===============
* Indicates party-in-interest 10 EXHIBITS 23.1. Consent of Independent Auditors SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, REMEC, Inc., as the administrator of the Plan, has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Date: June 28, 2000 REMEC, Inc. PROFIT SHARING 401(k) PLAN By: REMEC, Inc. By: /s/ Michael McDonald --------------------------------- Michael McDonald Senior Vice President, Chief Financial Officer and Secretary 11 EX-23.1 2 ex-23_1.txt EXHIBIT 23.1 EXHIBIT 23.1 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the incorporation of our report dated May 17, 2000, with respect to the financial statements and supplemental schedules of the REMEC, Inc. Profit Sharing 401(k) Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1999. /s/ Ernst & Young LLP ERNST & YOUNG LLP San Diego, California June 27, 2000 -----END PRIVACY-ENHANCED MESSAGE-----