<PAGE>
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
FRIEDE GOLDMAN HALTER, INC.
(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
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the transition period from _________ to ________
Commission file number 0-22595
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
FRIEDE GOLDMAN HALTER, INC.-401(K) PROFIT SHARING PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
FRIEDE GOLDMAN HALTER, INC.
13085 Industrial Seaway Road
Gulfport, Mississippi 39503
FRIEDE GOLDMAN HALTER,INC.-401(K) PROFIT SHARING PLAN
Financial Statements as of December 31, 1999 and
March 31, 1999 and for the Nine-month Period
Ended December 31, 1999 and the Year Ended
March 31, 1999; Supplemental Schedules as of and
for the Nine-month Period Ended December 31, 1999;
and Independent Auditors' Report
<PAGE>
Financial Statements and
Supplemental Schedule
Friede Goldman Halter, Inc.
401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc.
401(k) Profit Sharing Plan)
Nine-month period ended December 31, 1999
and year ended March 31, 1999
with Report of Independent Auditors
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Financial Statements and Supplemental Schedule
Nine-month period ended December 31, 1999
and year ended March 31, 1999
CONTENTS
Report of Independent Auditors................................ 1
Financial Statements
Statements of Net Assets Available for Benefits............... 3
Statements of Changes in Net Assets Available for Benefits.... 4
Notes to Financial Statements................................. 5
Supplemental Schedule
Schedule H, Line 4(i)--Schedule of Assets Held for Investment
Purposes at End of Year...................................... 11
Exhibit 23.1--Consent of Ernst & Young LLP
<PAGE>
Report of Independent Auditors
The Administrative Committee
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
We have audited the accompanying statements of net assets available for benefits
of Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan (formerly Halter
Marine Group, Inc. 401(k) Profit Sharing Plan) as of December 31, 1999 and March
31, 1999, and the related statements of changes in net assets available for
benefits for the nine-month period ended December 31, 1999 and the year ended
March 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.
Except as explained in the following paragraph, 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.
As permitted by 29 CFR 2520.103-8 of the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, investment assets held by Metropolitan Life Insurance
Company and Chase Manhattan Bank, N.A., the trustees of the Plan as of March 31,
1999, and transactions in those assets were excluded from the scope of our audit
of the Plan's March 31, 1999 financial statements, except for comparing the
investment information provided by the trustees, which is summarized in Note 3,
with the related information included in the financial statements.
Because of the significance of the information that we did not audit, we are
unable to, and do not, express an opinion on the Plan's financial statements as
of or for the year ended March 31, 1999. The form and content of the information
included in the March 31, 1999 financial statements, other than that derived
from the investment information certified by the trustees, have been audited by
us and, in our opinion, are presented in compliance with the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974.
1
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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 changes in its net assets available for benefits for the
nine-month period then ended in conformity with accounting principles generally
accepted in the United States.
Our audit of the Plans' financial statements as of and for the nine-month period
ended December 31, 1999 was made for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying supplemental schedule of
assets held for investment purposes at the end of the year as of December 31,
1999 is presented for the purposes of additional analysis and is not a required
part of the 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. The supplemental
schedule is the responsibility of the Plan's management. The supplemental
schedule has been subjected to the auditing procedures applied in the audit of
the financial statements for the nine-month period ended December 31, 1999 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
New Orleans, Louisiana
June 27, 2000
2
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Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Statements of Net Assets Available for Benefits
<TABLE>
<CAPTION>
December 31 March 31
1999 1999
-----------------------------
<S> <C> <C>
Assets
Investments:
MetLife Guaranteed Fixed Income Account $19,857,159 $16,378,813
Mutual funds 15,094,338 13,148,914
Loans to participants 2,953,409 2,281,131
Friede Goldman Halter, Inc. Common Stock 2,579,017 2,799,797
Pooled separate account 1,569,854 826,747
Money market fund 107,105 100,155
----------- -----------
Total investments 42,160,882 35,535,557
Receivables:
Participants' contributions 592,714 678,304
Employer contributions 425,933 489,381
----------- -----------
Total receivables 1,018,647 1,167,685
----------- -----------
Net assets available for benefits $43,179,529 $36,703,242
=========== ===========
</TABLE>
See accompanying notes.
3
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Statements of Changes in Net Assets Available for Benefits
<TABLE>
<CAPTION>
NINE-MONTH
PERIOD ENDED YEAR ENDED
DECEMBER 31 MARCH 31
1999 1999
-------------------------------
<S> <C> <C>
ADDITIONS
Investment income:
Net depreciation in fair value of mutual $ (709,860) $(1,874,146)
funds
Net depreciation in fair value of common (1,273,768) (2,664,802)
stock
Net appreciation in fair value of pooled
separate account 168,745 76,796
Interest and dividend income 2,081,679 1,879,099
----------- -----------
266,796 (2,583,053)
Contributions:
Participants' 5,879,445 8,635,505
Employer 2,879,111 4,146,495
Rollovers 430,720 4,259,393
----------- -----------
9,189,276 17,041,393
----------- -----------
Total additions 9,456,072 14,458,340
DEDUCTIONS
Benefit payments 2,979,785 1,870,933
----------- -----------
Net increase 6,476,287 12,587,407
Net assets available for benefits:
Beginning of year 36,703,242 24,115,835
----------- -----------
End of year $43,179,529 $36,703,242
=========== ===========
</TABLE>
See accompanying notes.
4
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements
December 31, 1999
1. DESCRIPTION OF PLAN
The following is a brief description of the Friede Goldman Halter, Inc. 401(k)
Profit Sharing Plan (formerly the Halter Marine Group, Inc. 401(k) Profit
Sharing Plan) (the Plan). This description is provided for general information
purposes only. Participants should refer to the Plan Adoption Agreement for a
more complete description of the Plan's provisions.
GENERAL
Effective November 3, 1999, Halter Marine Group, Inc. (Halter) completed a
merger with Friede Goldman International, Inc. (Friede Goldman). The surviving
company, Friede Goldman, changed its official name to Friede Goldman Halter,
Inc. (the Company). In addition, the Halter Marine Group, Inc. 401(k) Profit
Sharing Plan was renamed the Friede Goldman Halter, Inc. 401(k) Profit Sharing
Plan and the plan year end was changed from March 31 to December 31.
Accordingly, the accompanying financial statements reflect a short period of
nine months.
The Plan is a defined contribution plan covering all employees of Halter. Highly
compensated and leased employees are not eligible to participate in the Plan.
Prior to July 1, 1999, employees who had attained the age of 18 were eligible to
participate. Effective July 1, 1999, the eligibility requirement was changed to
90 days of service and the age of 18. The entry date of the plan is the earliest
quarterly date after the eligibility requirements are met. The Plan is subject
to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA).
CONTRIBUTIONS
Each year, participants may contribute from 2% to 15% of their total
compensation. Participants may also contribute amounts representing
distributions from other qualified defined benefit or defined contribution plans
subject to approval by the Company.
5
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Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements (continued)
1. DESCRIPTION OF PLAN (CONTINUED)
The Company provides an annual matching contribution on behalf of each
participant which is determined each year by the board of directors. During the
nine-month period ended December 31, 1999 and the year ended March 31, 1999, the
Company matched 50% of the first 6% of base compensation that a participant
contributed to the Plan. In addition, the Company may elect to make
discretionary contributions although it made no such contributions during the
nine-month period ended December 31, 1999 or the year ended March 31, 1999.
Beginning with the quarter ending June 30, 1998, the Company elected to make an
additional contribution of $75 per participant per quarter in conjunction with
freezing the Halter Marine Group Pension Plan. This contribution continued to be
made throughout the nine-month period ended December 31, 1999.
Forfeited balances of terminated participants' nonvested accounts are used to
reduce future Company contributions. The balance of forfeited nonvested accounts
at December 31, 1999 and March 31, 1999 was $601,695 and $254,128, respectively.
INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct employer and employee
contributions in any of eight investment options: (1) Friede Goldman Halter,
Inc. common stock (formerly the Halter Marine Group, Inc. company stock)
(2) State Street Research Alpha Fund, (3) Loomis Sayles Small Cap Fund,
(4) Founders Balanced Fund, (5) Harris Associates - Oakmark Fund, (6) Warburg
Pincus International Equity Fund, (7) MetLife Guaranteed Fixed Income Account,
and (8) MetLife Stock Market Index Guarantee Account (a pooled separate
account).
VESTING
Participants vest immediately in their contributions. Participants vest in the
Company's contributions 25% after one year, 50% after two years, 75% after three
years, and 100% after four years of service.
6
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements (Continued)
1. DESCRIPTION OF PLAN (CONTINUED)
LOANS TO PARTICIPANTS
The Plan allows participants to borrow from their vested account balances. Loans
must be approved by the plan administrator and must be a minimum of $1,000 and a
maximum of the lesser of 50% of the participant's vested account balance or
$50,000 reduced by the highest outstanding loan balance in the participant's
account during the prior 12-month period.
PAYMENTS OF BENEFITS
Upon retirement, termination of service or death, participants or their
beneficiaries receive a lump sum distribution equal to the vested value of the
participant's account. A participant may withdraw all or a portion of his
account in the event of financial hardship, as defined by the Plan.
PRIORITIES UPON TERMINATION
The Company may discontinue its contributions or the Plan may be terminated
subject to the provisions of ERISA, at the Company's option. In the event of
plan termination, the net assets available for plan benefits shall be
liquidated. Amounts credited to the accounts of participants shall become fully
vested and nonforfeitable as of the date of such termination. The Company
currently has no intention to terminate the Plan.
2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of 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
and assumptions that affect the amounts reported in the financial statements and
accompanying notes and schedule. Actual results could differ from those
estimates.
7
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements (Continued)
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
VALUATION OF INVESTMENTS
The Plan's funds are invested in mutual funds, a guaranteed investment contract
and Friede Goldman Halter, Inc. common stock (formerly Halter Marine Group, Inc.
common stock). Investments in mutual funds and the Friede Goldman Halter, Inc.
common stock are valued at quoted market prices on the last business day of the
year. Investments in the pooled separate account is valued at stated redemption
values. Investments in the guaranteed investment contract, which is fully
benefit responsive, is valued at contract value. Loans to participants are
valued at their outstanding balances, which approximate fair value.
The average yield on the investment contract was 5.79% and 6.31% for the nine-
month period ended December 31, 1999 (annualized) and for the year ended March
31, 1999, respectively. The crediting interest rate on the contract is revalued
every 12 months on January 1. As of December 31, 1999 and March 31, 1999, the
crediting interest rate on the contract was 6.15%.
ADMINISTRATIVE EXPENSES
The Company pays all of the administrative costs of the Plan.
3. INFORMATION CERTIFIED BY TRUSTEES
The Plan's trustee during the year ended March 31, 1999 was Metropolitan Life
Insurance Company (MetLife) for the mutual funds, pooled separate account and
guaranteed investment contract. Chase Manhattan Bank, N.A. (Chase) was trustee
for the Company's common stock and the money market fund.
All investment information disclosed in the accompanying financial statements,
including investments held at March 31, 1999, and net appreciation/depreciation
in fair value of investments and interest and dividend income for the year ended
March 31, 1999, was obtained or derived from information supplied to the plan
administrator and certified as complete and accurate by MetLife and Chase.
8
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements (Continued)
4. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated February 11, 1999, stating that the Plan is qualified 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 has been
amended since receiving the determination letter. However, the plan
administrator believes the Plan is being operated in compliance with the
applicable requirements of the Code and, therefore, believes that the Plan is
qualified and the related trust is exempt.
5. INVESTMENTS
The following presents investments that represent 5% or more of the Plan's net
assets.
<TABLE>
<CAPTION>
DECEMBER 31 MARCH 31
1999 1999
----------------------------
<S> <C> <C>
MetLife Guaranteed Fixed Income Account $19,857,159 $16,378,813
Harris Associates - Oakmark Fund 4,249,736 4,115,408
Loomis Sayles Small Cap Fund 3,952,024 3,226,783
State Street Research Alpha Fund 3,112,793 2,989,371
Friede Goldman Halter, Inc. Common Stock 2,579,017 2,799,797
Founders Balanced Fund 2,315,560 2,141,639
</TABLE>
6. SUBSEQUENT EVENTS
Effective January 1, 2000, the Plan changed from Chase as trustee for the
Company's common stock to Reliance Trust.
Effective April 1, 2000, the Plan added the following four investment options:
Janus Balanced Fund, Janus Fund, Scudder International Fund, and Loomis Sayles
Small Cap Growth Fund.
9
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Notes to Financial Statements (Continued)
6. SUBSEQUENT EVENTS (CONTINUED)
In April 2000, the Company sold the yacht division of its vessel operating
segment. Since the sale, approximately $1.5 million of plan assets have been
distributed to the former employees either as lump sum distributions or direct
rollovers to qualified plans.
10
<PAGE>
Friede Goldman Halter, Inc. 401(k) Profit Sharing Plan
(formerly the Halter Marine Group, Inc. 401(k) Profit Sharing Plan)
Schedule H, Line 4(i)--Schedule of Assets Held for Investment Purposes
at End of Year
EIN: 75-2656828 PN: 001
December 31, 1999
<TABLE>
<CAPTION>
Description Of Investment,
Including Maturity Date,
Identity of Issue, Borrower, Rate Of Interest, Current
or Similar Party Par Or Maturity Value Value
------------------------------------------------------------------------------------------------------
Mutual Funds:
<S> <C> <C>
State Street Research Alpha Fund 222,660 shares $ 3,112,793
Loomis Sayles Small Cap Fund 222,398 shares 3,952,024
Founders Balanced Fund 221,161 shares 2,315,560
Harris Associates - Oakmark Fund 156,240 shares 4,249,736
Warburg Pincus International Equity Fund 52,765 shares 1,464,225
Pooled separate account:
MetLife Stock Market Index Guarantee
Account* 2,995 shares 1,569,854
Money market fund:
Chase Manhattan Cash Investment Fund* 107,105 shares 107,105
Friede Goldman, Halter, Inc. Common Stock* 371,597 shares 2,579,017
Guaranteed Fixed Income Account:
MetLife Guaranteed Fixed Income Account* Guaranteed interest contract, 6.15% 19,857,159
Loans to participants* Maturity dates ranging through
September 2029 at interest rates
from 7.75% to 10.75%; payments are
made through payroll deduction;
loans are collateralized by
participant's vested account balance 2,953,409
-----------
$42,160,882
===========
*Indicates party-in-interest to the Plan.
</TABLE>
11
<PAGE>
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.
THE FRIEDE GOLDMAN HALTER, INC.
401(K) PROFIT SHARING PLAN
By: FRIEDE GOLDMAN HALTER, INC.
Plan Administrator
June 28, 2000 By: /s/ Richard T. McCreary
---------------------------
Richard T. McCreary
Group President, Halter Marine
June 28, 2000 By: /s/ Leamon C. Cooley Jr.
----------------------------
Leamon C. Cooley Jr.
Director of Human Resources
12
