-----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, MqsiaeLsoVbm3eRseUEApC3FUZ7lCEfX7IDa97Mwp+/zvW8RygO5HWbkJlQl+sVz rhSM4pbeDYxDvKPbWhP2iA== /in/edgar/work/20000628/0000891618-00-003629/0000891618-00-003629.txt : 20000920 0000891618-00-003629.hdr.sgml : 20000920 ACCESSION NUMBER: 0000891618-00-003629 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: GYMBOREE CORP CENTRAL INDEX KEY: 0000786110 STANDARD INDUSTRIAL CLASSIFICATION: [5600 ] IRS NUMBER: 942615258 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 000-21250 FILM NUMBER: 663620 BUSINESS ADDRESS: STREET 1: 700 AIRPORT BLVD STE 200 CITY: BURLINGAME STATE: CA ZIP: 94010 BUSINESS PHONE: 4155790600 MAIL ADDRESS: STREET 1: 700 AIRPORT BLVD #200 STREET 2: 700 AIRPORT BLVD #200 CITY: BURLINGAME STATE: CA ZIP: 94010 11-K 1 e11-k.txt FORM 11-K 1 FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549 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 For the fiscal year ended December 31, 1999 -------------------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION (SLD) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to -------------- -------------- Commission file number: 0-21250 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Gymboree 401(k) Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Gymboree Corporation 700 Airport Boulevard Suite 200 Burlingame, CA 94010-1912 SIGNATURE The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the administrator has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. THE GYMBOREE CORPORATION Date: June 26, 2000 By /s/ L.H. Meyer ------------------------ L.H. Meyer 2 GYMBOREE 401(k) PLAN FINANCIAL STATEMENTS DECEMBER 31, 1999 AND 1998 2 3 GYMBOREE 401(k) PLAN Financial Statements Years ended December 31, 1999 and 1998 TABLE OF CONTENTS Independent Accountants' Report................................................4 Financial Statements: Statements of Net Assets Available for Benefits................................5 Statements of Changes in Net Assets Available for Benefits.....................6 Notes to Financial Statements..................................................7 3 4 To the Participants and Plan Administrator of the Gymboree 401(k) Plan INDEPENDENT ACCOUNTANTS' REPORT ------------------------------- We have audited the financial statements of the Gymboree 401(k) Plan (the Plan) as of December 31, 1999 and 1998, and for the years then ended, as listed in the accompanying table of contents. 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 audits 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 the Plan's 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 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. By /s/ MOHLER, NIXON & WILLIAMS ---------------------------------------------- MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 9, 2000 4 5 GYMBOREE 401(k) PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
December 31, -------------------------- 1999 1998 Investments, at fair value $6,957,355 $4,319,889 ---------- ---------- Assets held for investment purposes 6,957,355 4,319,889 Contributions receivable 39,011 ---------- ---------- Net assets available for benefits $6,996,366 $4,319,889 ========== ==========
See independent accountants' report and accompanying notes to financial statements. 5 6 GYMBOREE 401(k) PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
For the years ended December 31, --------------------------- 1999 1998 ------------ ---------- Additions to net assets attributed to: Investment income: Dividends and interest $ 293,435 $ 170,509 Net realized and unrealized appreciation in fair value of investments 1,532,942 287,449 ---------- ---------- 1,826,377 457,958 ---------- ---------- Contributions: Participants' 1,254,911 1,205,026 Employer's 214,702 170,297 ---------- ---------- 1,469,613 1,375,323 ---------- ---------- Total additions 3,295,990 1,833,281 ---------- ---------- Deductions from net assets attributed to: Benefits paid to participants 619,513 897,096 Administrative expenses 2,104 ---------- --------- Total deductions 619,513 899,200 ---------- --------- Net increase 2,676,477 934,081 Net assets available for benefits: Beginning of year 4,319,889 3,385,808 ---------- ---------- End of year $6,996,366 $4,319,889 ========== ==========
See independent accountants' report and accompanying notes to financial statements. 6 7 GYMBOREE 401(k) PLAN NOTES TO FINANCIAL STATEMENTS December 31, 1999 and 1998 NOTE 1 - THE PLAN AND ITS SIGNIFICANT ACCOUNTING POLICIES: The following description of the Gymboree 401(k) Plan (the Plan) provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. The Plan is a defined contribution plan that was established in 1992 by The Gymboree Corporation (the Company) to provide benefits to eligible employees. The Plan covers all full-time employees of the Company who have completed one year of service and are age 21 or older. Effective December 1, 1998, the Company amended and restated the Plan and Trust Agreement designating Putnam Fiduciary Trust Company (Putnam) successor trustee of the Plan. The Plan administrator believes that the Plan is currently designed and operated in compliance with the applicable requirements of the Internal Revenue Code and the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). ADMINISTRATION - The Company has appointed an Administrative Committee (the Committee) to manage the operation and administration of the Plan. Concurrent with the appointment of Putnam as successor trustee, the Committee designated Putnam to replace Van Kampen American Capital (Van Kampen) as custodian and third-party administrator. Substantially all expenses incurred for administering the Plan are paid by the Company. BASIS OF ACCOUNTING - The financial statements of the Plan are prepared on the accrual method of accounting. Participant and Company matching contributions are recorded in the period during which the Company withholds payroll deductions from participant's earnings. Benefits are recorded when paid. 7 8 INVESTMENTS - Plan assets are invested in mutual funds and Gymboree Corporation common stock, The Gymboree Stock Fund, based solely on instructions received from participants. From January 1, 1998 to November 30, 1998, Van Kampen was custodian of Plan assets and investments included seven mutual funds sponsored by Van Kampen. In conjunction with the appointment of Putnam as successor trustee of the Plan on December 1, 1998, Van Kampen funds were replaced with seven new funds sponsored by Putnam. Plan investments in mutual funds as well as The Gymboree Stock Fund are valued at fair value as of the last day of the Plan year, as measured by quoted market prices. Participant loans are valued at cost which approximates fair value. INCOME TAXES - The Plan has been amended since receiving its latest favorable determination letter dated June 1995. However, the Company intends that the Plan continue to qualify under the applicable requirements of the Internal Revenue Code and related state statutes, and that the trust, which forms a part of the Plan, is exempt from federal income and state franchise taxes. RECLASSIFICATIONS - Certain reclassifications were made in the 1998 financial statements to conform with the 1999 presentation. 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 assets and liabilities, and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. RISKS AND UNCERTAINTIES - The Plan provides for various investment options in any combination from among seven different Putnam mutual funds as well as The Gymboree Stock Fund. Investment securities are exposed to various risks, such as interest rate, market fluctuations and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in risks in the near term would materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits and the statements of changes in net assets available for benefits. 8 9 NEW ACCOUNTING PRONOUNCEMENT - In September 1999, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position (SOP) 99-3, "Accounting for and Reporting of Certain Defined Contribution Benefit Plan Investments and Other Disclosure Matters." This SOP eliminates the previous requirement for a defined contribution plan to disclose participant-directed investment programs by fund. The Plan has adopted SOP 99-3 in its financial statements for the years ended December 31, 1999 and 1998. NOTE 2 - RELATED PARTY TRANSACTIONS: Certain Plan investments in mutual funds are managed by Putnam. These transactions qualify as party-in-interest. Any purchases and sales of these funds are open market transactions at fair market value. Such transactions, although considered party-in-interest transactions under ERISA Regulations, are permitted under the provisions of the Plan and are exempt from the prohibition of party-in-interest transactions under ERISA and its applicable exemptions. As allowed by the Plan, participants may elect to invest a portion of their accounts in the common stock of the Company. The aggregate investment in Company common stock was as follows at December 31:
1999 1998 ----- ----- Number of shares 15,764 11,045 Cost $258,016 $224,931 Fair value $ 88,675 $ 70,421
NOTE 3 - PARTICIPATION AND BENEFITS: PARTICIPANT CONTRIBUTIONS - Participants may elect to have the Company contribute a percentage, from 1% to 20%, of their eligible pre-tax compensation up to the amount allowable under current income tax regulations. Participants who elect to have the Company contribute a portion of their compensation to the Plan agree to accept an equivalent reduction in taxable compensation. Contributions withheld are invested in accordance with the participant's direction and are allocated to funds in 1% increments. 9 10 Participants are also allowed to make rollover contributions of amounts received from other tax-qualified employer-sponsored retirement plans. Such contributions are deposited in the appropriate investment funds in accordance with the participant's direction and the Plan's provisions. EMPLOYER CONTRIBUTIONS - The Company is allowed to make discretionary matching contributions as defined in the Plan and as approved by the Board of Directors. In 1999 and 1998, the Company matched 50% of each eligible participant's contribution up to a maximum of $500. PARTICIPANT ACCOUNTS - Each participant's account is credited with the participant's contribution, Plan earnings or losses and an allocation of the Company's contribution. Allocation of the Company's contribution is based on participant contributions. PAYMENT OF BENEFITS - Upon termination, the participant or beneficiary will receive the benefits in a lump sum amount equal to the value of the participant's account. The Plan allows for automatic lump sum distribution of participant account balances that do not exceed $5,000. LOANS TO PARTICIPANTS - The Plan allows participants to borrow not less than $1,000 and up to the lesser of $50,000 or 50% of their account balance. The loans are secured by the participant's account balance. Such loans bear interest at rates established by the Committee and must be repaid to the Plan within a five-year period, unless the loan is used for the purchase of a residence in which case the maximum repayment period may be extended. The Committee establishes the specific terms and conditions of such loans. Outstanding loans at December 31, 1999 carry interest rates which range from 9.0% to 9.5%. VESTING - Participants are immediately vested in their entire account balance. NOTE 4 - PLAN TERMINATION AND/OR MODIFICATION: The Company intends to continue the Plan indefinitely for the benefit of its employees; however, it reserves the right to terminate and/or modify the Plan at any time by resolution of its Board of Directors and subject to the provisions of ERISA. 10 11 NOTE 5 - INVESTMENTS: The following table includes the fair values of investments and investment funds that represent 5% or more of the Plan's net assets at December 31:
1999 1998 ---------- ---------- Putnam: The George Putnam Fund of Boston $ 142,007 $ 5,565 Investors Fund 2,488,732 1,695,818 Voyager Fund 1,179,192 525,715 Diversified Income Fund 143,899 65,858 New Opportunities Fund 958,282 501,975 International Growth Fund 1,154,576 699,949 Stable Value Fund 615,720 571,253 The Gymboree Stock Fund 88,675 70,421 Participant Loans 186,272 183,335 ---------- ---------- Total investments at fair value $6,957,355 $4,319,889 ========== ==========
The Plans investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value as follows:
Years ended December 31, 1999 1998 ------ ------ Mutual funds $ 1,548,706 $ 456,285 The Gymboree Stock Fund (15,764) (168,836) ------------ ----------- $ 1,532,942 $ 287,449 ============ ===========
11 12 EXHIBIT INDEX
Exhibit Description - -------- ----------- 23.1 Consent of Independent Accountants
EX-23.1 2 ex23-1.txt EXHIBIT 23.1 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-74269) of Gymboree 401(k) Plan of our report dated June 9, 2000, with respect to the financial statements of the Gymboree 401(k) Plan included in this Annual Report on Form 11-K. By /s/ MOHLER, NIXON & WILLIAMS --------------------------------------------- MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 26, 2000 -----END PRIVACY-ENHANCED MESSAGE-----