-----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, FNgoZOjm1DZ7Vwd7Rfk7+XWx9YOevgd2zJJKtFMOGKT3xxrLggrhCXy3ogfDRKRZ g+/NzMhoodP+cyzN/r1QyQ== /in/edgar/work/0000897101-00-000695/0000897101-00-000695.txt : 20000714 0000897101-00-000695.hdr.sgml : 20000714 ACCESSION NUMBER: 0000897101-00-000695 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000713 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DIGITAL BIOMETRICS INC CENTRAL INDEX KEY: 0000868373 STANDARD INDUSTRIAL CLASSIFICATION: [3577 ] IRS NUMBER: 411545069 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 333-72031 FILM NUMBER: 672055 BUSINESS ADDRESS: STREET 1: 5600 ROWLAND RD CITY: MINNETONKA STATE: MN ZIP: 55343 BUSINESS PHONE: 6129320888 MAIL ADDRESS: STREET 1: 5600 ROWLAND RD STREET 2: 5600 ROWLAND RD CITY: MINNETONKA STATE: MN ZIP: 55343 11-K 1 0001.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999 ------------------------------------------------------- [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE EXCHANGE ACT OF 1934 For the transition period from _______________ to __________________ DIGITAL BIOMETRICS, INC. RETIREMENT PLAN ---------------------------------------- (Exact name of the plan) Digital Biometrics, Inc. ------------------------ (Name of issuer.) 5600 Rowland Road, Minnetonka, Minnesota 55343 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) 1 UNAUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES DIGITAL BIOMETRICS, INC. RETIREMENT PLAN YEARS ENDED DECEMBER 31, 1999, AND 1998 TABLE OF CONTENTS Page ---- Financial Statements - -------------------- Statements of Net Assets Available for Plan Benefits 3 Statements of Changes in Net Assets Available for Plan 4 Notes to Financial Statements 5 Supplemental Schedules - ---------------------- Schedule of Assets Held for Investment Purposes, December 31, 1999 10 Schedule of Reportable 5% Transactions for the Year ended December 31, 1999 11 2 DIGITAL BIOMETRICS, INC. RETIREMENT PLAN STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31, ------------------------- ASSETS 1999 1998 ---------- ---------- Investment in Digital Biometrics, Inc. common stock $ 802,167 $ 198,429 Other investments at market value 1,697,314 1,134,976 Loans to participants 96,413 54,331 Employee contributions receivable 404 13,118 Employer match receivable 152,367 118,453 Other receivables 850 850 ---------- ---------- Net assets available for plan benefits $2,749,515 $1,520,157 ========== ==========
See accompanying notes. 3 DIGITAL BIOMETRICS, INC. RETIREMENT PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
1999 1998 ---------- ---------- Additions to net assets: Investment income: Net appreciation in fair value of assets $ 697,492 $ 127,851 Interest and dividends 129,649 47,484 Loan interest income 6,620 6,479 ---------- ---------- 833,761 181,814 ---------- ---------- Contributions: Employer 154,774 120,860 Participants 537,228 335,342 ---------- ---------- 692,002 456,202 ---------- ---------- Total additions 1,525,763 638,016 Deductions from net assets: Benefits paid to participants 296,003 314,718 Administrative expenses 402 454 ---------- ---------- Net increase in net assets available for plan benefits 1,229,358 322,844 Net assets available for plan benefits at beginning of year 1,520,157 1,197,313 ---------- ---------- Net assets available for plan benefits at end of year $2,749,515 $1,520,157 ========== ==========
See accompanying notes. 4 Digital Biometrics, Inc. Retirement Plan Notes to Financial Statements December 31, 1999 1. DESCRIPTION OF PLAN The following brief description of the Digital Biometrics, Inc. Retirement Plan ("Plan") provides only general information. Participants should refer to the Plan Document for more complete information. Copies of the Plan Document are available from the Human Resources Benefits Office. GENERAL The Plan is a defined contribution plan incorporating the provisions of Section 401(k) of the Internal Revenue Code and covering substantially all employees of Digital Biometrics, Inc. ("Employer" or "Company"). The Employer may make matching contributions equal to a discretionary percentage, to be determined by the Employer, of the participant's salary reductions. Contributions by and on behalf of participants are invested in accordance with the participants' investment designations in one or more investment options. Plan participants have nine investment options in which they may choose to have their funds invested. Employees of the Company or its wholly owned subsidiary may elect to participate in the Plan upon becoming eligible, which is on the first day of the month following one entire month from their hire date. Employees may also be permitted to deposit distributions from other qualified plans into the Plan at the discretion of the Plan administrator. The Employer pays most of the Plan's administrative expenses. These expenses include, but are not limited to, legal, accounting and recordkeeping fees. Loan fees are paid by participants. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). CONTRIBUTIONS Each participant can contribute from 1% to 20% of his or her compensation, in whole percentages, on a pre-tax basis to the Plan up to an annual maximum determined by the Internal Revenue Code, by means of regular payroll deductions. Participants may change their contribution percentages on a monthly basis. In addition, participants may cease making contributions at any time. During 1999 and 1998, the Company matched participant pre-tax contributions on a 50 percent basis up to 5 percent of compensation, as defined by the Plan Agreement. Matching contributions made by the Company are paid in common stock of Digital Biometrics, Inc. and are immediately available for transfer to the other fund options of the Plan subject to the Company's insider trading policy limitations. 5 VESTING Participants are immediately vested in their pre-tax contributions and Employer matching contributions plus actual earnings thereon. PARTICIPANT ACCOUNTS Each participant's account is credited with the participant's and the employer's contributions and an allocation of Plan's earnings. Allocations are based on the balance of each investment type in the participant's account. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account. Participants can choose to invest their contributions in Digital Biometrics, Inc. common stock, Great Hall Money Market Fund and various mutual funds including Oppenheimer Main Street Growth & Income Fund, Oppenheimer Global Fund, Oppenheimer Quest Opportunity Value Fund, Fidelity Advisor Growth Opportunities Fund, Seligman Communications & Information Fund, MFS Emerging Growth Fund and Alliance Bond Fund. Participants can allocate their investment among Digital Biometrics, Inc. common stock, subject to the Company's insider trading policy, or any of the funds at their discretion. Investment options are selected by the trustees of the Plan and may be changed at any time. PARTICIPANT LOANS The Plan also includes, among other things, a loan feature (see Note 7). Under specified guidelines, a participant may request the Trustee to disburse a portion of the participant's fund balance as a loan to the participant. Repayment of principal and interest is generally made by payroll deduction and the loans are fully secured by the participant's account balance. Loans are made at the prime rate of interest at the time of loan approval. HARDSHIP DISTRIBUTIONS The Plan allows for hardship distributions as permitted by the Internal Revenue Code. PAYMENT OF BENEFITS Upon termination of service, a participant may generally elect to receive the value of his or her account in a lump-sum amount or they may leave their funds in the Plan. Benefits become payable to participants upon their termination of employment with the Employer or in the event of elective withdrawal as permitted by the Plan. PLAN TERMINATION The Employer has the right under the Plan to terminate the Plan subject to the provisions set forth in ERISA. Should the Plan terminate, or should contributions be discontinued at some future time, the rights of each 6 affected participant to the entire amount credited to his or her account on the date of such termination or discontinuance shall be non-forfeitable and fully vested. Payment of such amounts to each participant or beneficiary, upon the termination of the Plan or upon the complete discontinuance of contributions under the Plan, shall be made by the Plan administrator at such time and in such manner as the Plan administrator shall state, provided, however, that all participants and beneficiaries similarly situated shall be treated in a nondiscriminatory manner. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES GENERAL The Plan's financial statements are prepared on the accrual basis of accounting. Participant benefit payments are recorded when paid. USE OF ESTIMATES The preparation of financial statements in accordance with generally accepted accounting principles requires the Plan to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. VALUATION OF INVESTMENTS Investments are reported at fair value, using quoted market prices at December 31, 1999 and 1998. Participant loans are reported at amounts owed by the participants. The Company's common stock is traded on The Nasdaq National Market. The Plan's investment in the Company's common stock is stated at quoted market value. At December 31, 1999 and 1998, the quoted market value of the Company's common stock was $3.375 and $1.375 per share, respectively. 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. 3. INVESTMENTS The Plan's investments are invested in Digital Biometrics, Inc. common stock, one money market fund and seven mutual funds. The Plan is administered by the Company, which also acts as trustee for the Plan. Tax sheltered Compensation, Inc. provides third-party administration services, including recordkeeping and Dain Rauscher Investment Services provides brokerage services for the Plan. 7 The following table presents the Plan's investments at fair market value: December 31 -------------------------- 1999 1998 ---------- ---------- Digital Biometrics, Inc. common stock $ 956,750 * $ 322,829 * Oppenheimer Main Street Growth & Income Fund 346,888 * 270,600 * Oppenheimer Global Fund 258,867 * 140,769 * Oppenheimer Quest Opportunity Value Fund 41,731 30,719 Fidelity Advisor Growth Opportunities Fund 307,618 * 264,520 * Seligman Communications & Information Fund 297,500 * 166,636 * MFS Emerging Growth Fund 259,347 * 146,814 * Alliance Bond Fund 140,837 * 95,926 * Great Hall Money Market Fund 43,564 27,013 Loan Account 96,413 54,331 ---------- ---------- $2,749,515 $1,520,157 ========== ========== * Represents 5% or more of the fair value of net assets available for benefits. Investment interest and dividend income was $129,649 for 1999 and $47,484 for 1998. 4. NET APPRECIATION (DEPRECIATION) IN FAIR VALUE OF INVESTMENTS During the years ended December 31, 1999 and 1998, the Plan's investments (including investments bought, sold, as well as held during the period) appreciated in value by $697,492 and $127,851, respectively, as follows: 1999 1998 ---------- ---------- Digital Biometrics, Inc. common stock $ 469,070 $ (27,996) Mutual funds 228,422 155,847 ---------- ---------- $ 697,492 $ 127,851 ========== ========== 5. INCOME TAX STATUS The Internal Revenue Service issued a determination letter dated May 8, 1996 stating that the Plan qualifies, in form, under Sections 401(a) and 401(k) of the Internal Revenue Code of 1986, as amended (the "Code"), and the underlying trust is, therefore, exempt from federal income taxes under Section 501(a) of the Code. The Plan is required to operate in accordance with the Code to maintain its tax qualified status. The Plan administrator is not aware of any course of actions or series of events that have occurred which might adversely affect the Plan's qualified status. 8 6. PLAN AMENDMENTS Under the terms and conditions of the Plan, the Company is authorized to amend the Plan. Since the adoption of the Plan, the Company has periodically amended the Plan to comply with the requirements of the Internal Revenue code as well as to implement certain design changes. No amendments were made to the Plan during 1999. The Plan was amended in 1998 to include employees of affiliated employers. 7. LOANS TO PARTICIPANTS The Plan has a loan feature available to all Plan participants. All loans are treated as directed investments. Loans are made from the participant's account, reducing the investment balance and creating a receivable in the Loan Account. Loans are secured by the participant's vested account balance. Loans are generally repaid through payroll deduction including principal and interest. The principal portion reduces the receivable from participants and both principal and interest are transferred to the participant's investment account as repayments are received. Participants may obtain loans based on the vested value of their accounts. New loans cannot exceed 50 percent of the participant's account value or a maximum of $50,000 to comply with the Department of Labor's regulations on loans to participants. Loans bear a rate of interest equal to the prime rate and are repaid over a period not to exceed five years unless used to purchase the participant's primary residence, in which case the loan must be repaid over a reasonable period. 9 Digital Biometrics, Inc. Retirement Plan EIN: 41-1545069 Plan: 001 Schedule of Assets Held for Investment Purposes December 31, 1999
Description of Investment, Including Identity of Issue, Borrower, Lessor Maturity Date, Rate of Interest, Par or Fair or Similar Party Maturity Value Market Value - -------------------------------------------- --------------------------------------- ------------ Digital Biometrics, Inc. common stock(1) 237,679 Shares $ 956,750 Oppenheimer Main Street Growth & Income Fund 8,259 Mutual Fund Shares 346,888 Oppenheimer Global Fund 4,126 Mutual Fund Shares 258,867 Oppenheimer Quest Opportunity Value Fund 1,211 Mutual Fund Shares 41,731 Fidelity Advisor Growth Opportunities Fund 6,586 Mutual Fund Shares 307,618 Seligman Communications & Information Fund 6,281 Mutual Fund Shares 297,500 MFS Emerging Growth Fund 3,892 Mutual Fund Shares 259,347 Alliance Bond Fund 11,394 Mutual Fund Shares 140,837 Great Hall Money Market Fund Money Market Fund 43,564 Participant Loans(1) Interest rates between 8.75% and 9.50% 96,413 ---------- $2,749,515 ==========
(1) Party-in-interest to the Plan. 10 Digital Biometrics, Inc. Retirement Plan Item 27d Schedule of Reportable 5% Transactions Year Ended December 31, 1999
Current Purchase Selling Cost of Value of Net Gain Identity of Party Involved Description of Asset Price Price Asset Asset or (Loss) - ------------------------------------------------------------------------------------------------------------------------------ Category (iii) - Series of transactions in excess of 5% of Plan assets Purchases - --------- Digital Biometrics, Inc. Common stock - 36 transactions $ 77,948 -- $ 77,948 $ 77,948 $ -- Fidelity Advisor Growth Opportunities Fund Mutual fund - 42 transactions 151,324 -- 151,324 151,324 -- MFS Emerging Growth Fund Mutual fund - 34 transactions 82,538 -- 82,538 82,538 -- Oppenheimer Global Fund Mutual fund - 48 transactions 80,297 -- 80,297 80,297 -- Oppenheimer Main Street Growth & Income Fund Mutual fund - 46 transactions 144,340 -- 144,340 144,340 -- Sales - ----- Fidelity Advisor Growth Opportunities Fund Mutual fund - 45 transactions $ -- $88,364 $ 56,362 $ 88,364 $32,002 Oppenheimer Main Street Growth & Income Fund Mutual fund - 55 transactions -- 81,015 53,788 81,015 27,227
There were no category (i), (ii), or (iv) reportable transactions during the year ended December 31, 1999. 11 SIGNATURES 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. Digital Biometrics, Inc. Retirement Plan Date: July 12, 2000 By: /s/ John J. Metil ------------------------ John J. Metil Executive Vice President, Chief Operating Officer and Chief Financial Officer Digital Biometrics, Inc. 12 -----END PRIVACY-ENHANCED MESSAGE-----