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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
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(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED]
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED]
For the transition period from _________ to _________
Commission file number 000-22651
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
STB SYSTEMS, INC. 401(k) SAVINGS PLAN
3400 WATERVIEW PARKWAY
RICHARDSON, TEXAS 75080
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
3DFX INTERACTIVE, INC.
4435 FORTRAN DRIVE
SAN JOSE, CALIFORNIA 95134
The issuer acquired STB Systems, Inc. by merger on May 13, 1999, and the shares
of common stock of STB Systems, Inc. previously held pursuant to the plan were
converted into shares of common stock of the issuer and held by the plan
pursuant to its terms.
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REQUIRED INFORMATION
The following financial statements and forms are furnished with this
Form 11-K Annual Report for the STB Systems, Inc. 401(k) Savings Plan (the
"Plan"):
1. Report of Independent Accountants.
2. Statement of Net Assets Available for Benefits at December 31, 1999
and 1998.
3. Statement of Changes in Net Assets Available for Benefits For the
Year Ended December 31, 1999.
4. Notes to Financial Statements.
5. Supplemental Schedule. Schedule I: Schedule H, Line 4i-Schedule of
Assets Held for Investment Purposes at End of Year.
Each of the statements set forth above has been prepared in accordance
with the financial reporting requirements of the Employee Retirement Income
Security Act of 1974, as amended.
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULE
DECEMBER 31, 1999 AND 1998
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
INDEX
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<TABLE>
<CAPTION>
Page(s)
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Report of Independent Accountants 1
Financial Statements:
Statements of Net Assets Available for Benefits at 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 4-8
Supplemental Schedule (Note A):
Schedule I: Schedule H, Line 4i--Schedule of Assets Held for
Investment Purposes at End of Year 9
</TABLE>
Note A: Other schedules required by Section 2520.103-10 of the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974 not included herein
have been omitted as there were no transactions of the type required to
be disclosed in such schedules.
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of the
STB Systems, Inc. 401(k) Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the STB Systems, Inc. 401(k) Savings Plan (the "Plan") at December 31, 1999
and 1998, and the changes in net assets available for benefits for the year
ended December 31, 1999 in conformity with accounting principles generally
accepted in the United States. 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 of these
statements in accordance with auditing standards generally accepted in the
United States, which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes at end of year is presented for purposes of additional
analysis and is not a required part of the basic financial statements but is
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 the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
As discussed in Note 6 to the financial statements, the Plan was merged during
March 2000.
PricewaterhouseCoopers LLP
Dallas, Texas
July 10, 2000
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
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<TABLE>
<CAPTION>
DECEMBER 31,
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1999 1998
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ASSETS:
Investments - at fair value:
Interests in pooled separate accounts:
Principal Bond & Mortgage Account $ 130,833 $ 77,920
Principal Large Cap Stock Index Account, formerly
Principal Stock Index 500 Account 735,188* 478,245*
Principal Large Company Growth Account 619,979* 356,538*
Principal Small Company Blend Account 293,664* 198,108*
Principal International Stock Account 261,486* 177,430
Interests in common/collective trust:
Principal Stable Value Fund Account 415,295* 343,189*
Shares of registered investment companies:
T. Rowe Price New Horizons Fund 171,497 134,106
Vanguard Primecap Fund 891,169* 499,536*
Vanguard Windsor II Fund 321,889* 302,546*
Vanguard Asset Allocation Fund 446,504* 379,015*
3dfx Interactive, Inc. common stock 390,998* --
STB Systems, Inc. common stock -- 485,903*
New England Guaranteed Interest Contract -- 36,309
Participant notes receivable 157,098 117,603
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Total investments 4,835,600 3,586,448
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Contributions receivable:
Participants' 53,905 70,832
Employer's 14,267 17,440
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Total contributions receivable 68,172 88,272
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Net assets available for benefits $ 4,903,772 $ 3,674,720
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</TABLE>
* Investment represents five percent or more of the Plan's net assets available
for benefits.
The accompanying notes are an integral part of these financial statements.
2
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
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<TABLE>
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Additions to net assets attributed to:
Investment income:
Net appreciation in fair value of investments $ 616,962
Interest 10,587
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627,549
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Contributions:
Participants' 1,012,418
Employer's 236,387
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1,248,805
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Total additions 1,876,354
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Deductions from net assets attributed to:
Distributions to participants 603,760
Administrative expense 43,542
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Total deductions 647,302
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Net increase 1,229,052
Net assets available for benefits:
Beginning of year 3,674,720
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End of year $ 4,903,772
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</TABLE>
The accompanying notes are an integral part of these financial statements.
3
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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1. DESCRIPTION OF PLAN
The following description of the Plan provides only general information.
Participants should refer to the Plan document for a more comprehensive
description of the Plan's provisions.
GENERAL
The Plan, established in 1991, is a defined contribution plan for all
employees of STB Systems, Inc. (the "Company" or "Employer") who have
completed one month of eligible service and elect to participate. The
Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
On May 13, 1999, the Company was acquired by 3dfx Interactive, Inc.
("3dfx") and now operates as 3dfx Interactive of Texas, a wholly owned
subsidiary of 3dfx. As described in Note 6, in March 2000 the Plan was
merged into another defined contribution plan sponsored by 3dfx.
CONTRIBUTIONS
Eligible employees may elect to make contributions to the Plan by means
of compensation reductions of up to 15% of their compensation
("employees' contributions"). Employees may allocate their contributions
to investment options in 1% increments.
The Company matches 50% of up to 4% of the employees' contribution. The
Company may also make discretionary contributions. During the year ended
December 31, 1999, the Company did not make any discretionary
contributions.
PARTICIPANTS' ACCOUNTS
Participants' accounts are credited with the participants' contributions,
the Employer's matching contributions and allocations of (a) the
Company's discretionary contributions and (b) Plan earnings. The
Company's discretionary contribution is allocated based upon the ratio of
the eligible participant's compensation to the total compensation for all
eligible participants. Plan earnings are allocated based on the ratio of
the participant's account balance to the total account balances in the
respective investment. The benefit to which a participant is entitled is
the benefit that can be provided from the participant's vested account.
At December 31, 1999 and 1998, forfeited nonvested accounts totaled
$31,268 and $8,051, respectively. These funds are first applied to pay
Plan expenses and then are used to reduce the Employer's contributions.
4
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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VESTING
Participants' contributions to the Plan are 100% vested at all times.
Employer contributions to the Plan vest as follows:
<TABLE>
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COMPLETED YEARS VESTING
OF VESTING SERVICE PERCENTAGE
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Less than 1 0
1 20
2 40
3 60
4 80
5 or more 100
</TABLE>
PARTICIPANT NOTES RECEIVABLE
Participants may borrow from their accounts an amount subject to a
minimum of $1,000, and up to a maximum equal to the lesser of (a) or (b)
below:
(a) $50,000 reduced by the highest outstanding balance of loans during
the one-year period ending on the day before the new loan is made;
or,
(b) The greater of (1) or (2), reduced by (3) below:
(1) One-half of the participant's vested account balance; or,
(2) $10,000.
(3) Any outstanding loan balance on the date the new loan is made.
All loans are required to be repaid within five years. The loans are
secured by the balance in the participant's account and bear a reasonable
rate of interest as determined by the Loan Administrator. Principal and
interest are repaid through payroll deductions.
PAYMENT OF BENEFITS
In the event of a participant's termination of employment, retirement,
disability, or death, the participant or beneficiary receives an amount
equal to the vested value of their account in a lump-sum payment. In the
event of a participant's termination of employment, the participant may
also elect to have the vested portion of the account balance transferred
to another plan.
5
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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EXPENSES OF ADMINISTERING THE PLAN
Forfeitures are applied to pay Plan expenses. Certain transaction costs
borne by the Plan are charged to the individual participant who initiated
the transaction by reducing his/her account balance. Some costs of
administering the Plan are paid by the Company.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan are prepared in accordance with
accounting principles generally accepted in the United States.
FINANCIAL STATEMENT PRESENTATION
On September 15, 1999, the American Institute of Certified Public
Accountants issued Statement of Position 99-3, Accounting for and
Reporting of Certain Defined Contribution Plan Investments and Other
Disclosure Matters ("SOP 99-3") which, among other things, eliminated
previous requirements for defined contribution plans to present plan
investments by general type for participant-directed investment programs
and to disclose participant-directed investment programs. SOP 99-3 is
effective for financial statements for plan years ending after December
15, 1999. Accordingly, the Plan has adopted SOP 99-3 and the accompanying
financial statements do not include details of the Plan's
participant-directed investment programs.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States 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 these estimates.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options, in any combination, of
specified accounts. The underlying investments may include stocks, bonds,
fixed income securities, mutual funds and other investment securities.
Such investments are exposed to various risks, such as interest rate,
market and credit risk. Due to the level of risk associated with certain
investment securities and the level of uncertainty related to changes in
the value of investment securities, it is at least reasonably possible
that changes in the values of investment securities in the near term
could materially affect participants' account balances and the amounts
reported in the Statement of Net Assets Available for Benefits.
6
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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INVESTMENTS AND INCOME RECOGNITION
Investments are stated at fair value. Valuation of investments is based
on the last recorded sales price at year-end, as reported by the
principal security exchange on which the security is traded. Securities
transactions are recorded on a trade-date basis. Interest is recognized
on an accrual basis.
The Statement of Changes in Net Assets Available for Benefits presents
the net appreciation in fair value of investments which consists of the
realized gains or losses and the unrealized appreciation (depreciation)
of those investments as well as dividends on shares of registered
investment companies.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
TAX STATUS
The Internal Revenue Service granted a favorable letter of determination
to the Plan in July 1998. Management of the Company believes that the
Plan continues to be designed and to be operated in compliance with the
applicable sections of the Internal Revenue Code.
3. INVESTMENTS
Interests in pooled separate accounts and of registered investment
companies are maintained by The Principal Life Insurance Company (the
"Principal") as custodian. Shares of common stock of 3dfx Interactive,
Inc., and previously of STB Systems, Inc. common stock, are maintained by
Dain Rauscher as custodian. The New England Guaranteed Interest Contract
("New England contract") was maintained by New England Insurance and
Investment Company as custodian. The New England contract matured on June
30, 1999.
As described in Note 1, the Company was acquired by 3dfx in May 1999.
Coincident with the acquisition, shares of STB Systems, Inc. common stock
held in the Plan were exchanged for shares of 3dfx Interactive, Inc.
common stock. The option for participants to invest in shares of common
stock was discontinued. Account balances invested in STB Systems, Inc.
common stock at the date of the merger could remain invested in 3dfx
Interactive, Inc. common stock or could be re-directed at the discretion
of the participant.
4. RELATED-PARTY TRANSACTIONS
Certain Plan investments are interests in pooled separate investment
accounts managed by the Principal. The Principal is also the custodian of
the Plan.
7
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STB SYSTEMS, INC.
401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
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5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of other loans and other receivables on
Form 5500 to the financial statements at December 31, 1998:
<TABLE>
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Per Form 5500 -
Other receivables, loans payments not allocated to accounts at
December 31 $ 4,065
Other loans 113,538
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Per financial statements -
Participant notes receivable $ 117,603
==========
</TABLE>
6. SUBSEQUENT EVENTS
PLAN MERGER
During March 2000, the Plan was merged into the 3dfx Interactive, Inc.
401(k) Savings Plan, a defined contribution plan sponsored by 3dfx.
Assets held by the Plan were liquidated and investments were made in
similar funds offered by Diversified Investment Advisors ("Diversified").
Shares of 3dfx Interactive, Inc. common stock were transferred to
Diversified and were used to establish the 3dfx Interactive Stock Fund
(the "3dfx Fund"). The 3dfx Fund is comprised of both 3dfx Interactive,
Inc. common stock and cash. The 3dfx Fund is not available for investment
of new contributions or for re-investment.
8
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STB SYSTEMS, INC. SCHEDULE I
401(k) SAVINGS PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT
END OF YEAR
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<TABLE>
<CAPTION>
IDENTITY OF ISSUE, BORROWER, DESCRIPTION OF INVESTMENT INCLUDING MATURITY DATE, CURRENT
LESSOR OR SIMILAR PARTY RATE OF INTEREST, COLLATERAL, PAR, OR MATURITY VALUE VALUE
---------------------------- ---------------------------------------------------- -------
<S> <C> <C>
The Principal Life Insurance Company* Bond & Mortgage Account $ 130,833
The Principal Life Insurance Company* Cap Stock Index Account, formerly Stock Index 500 Account 735,188
The Principal Life Insurance Company* Large Company Growth Account 619,979
The Principal Life Insurance Company* Small Company Blend Account 293,664
The Principal Life Insurance Company* International Stock Account 261,486
Union Bond & Trust Company Stable Value Fund Account 415,295
T. Rowe Price Funds New Horizons Fund 171,497
Vanguard Group Primecap Fund 891,169
Vanguard Group Windsor II Fund 321,889
Vanguard Group Asset Allocation Fund 446,504
3dfx Interactive, Inc. Common stock 390,998
Participant notes receivable* General purpose loans, maturing from February 2000 to
December 2004, interest ranging from 9.25% to 10.50% 157,098
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$ 4,835,600
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</TABLE>
* Parties denoted are known to be parties-in-interest.
9
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EXHIBITS
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
23.1 Consent of Independent Accountants
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees of the STB Systems 401(k) Savings Plan have duly caused this Annual
Report to be signed on its behalf by the undersigned, hereunto duly authorized.
STB SYSTEMS, INC. 401(k) SAVINGS PLAN
By: STB Systems, Inc., Plan Sponsor
Dated: July 13, 2000 By: /s/ Bryan F. Keyes
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Printed Name: Bryan F. Keyes
Title: Vice President and General Counsel
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
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<S> <C>
23.1 Consent of Independent Accountants
</TABLE>
