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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
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from___________ to __________
Commission file number: 0-4466
Artesyn Technologies, Inc.
Employees' Tax-Favored Thrift and Savings Plan
(Full title of Plan)
Artesyn Technologies, Inc.
(Name of issuer of securities held pursuant to the Plan)
7900 Glades Road, Suite 500
Boca Raton, Florida 33434
(Address of principal executive office)
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<PAGE>
CONTENTS
PAGE
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o Report of Independent Certified Public Accountants 1
o Statements of Net Assets Available for Benefits
as of December 31, 1999 and 1998 2
o Statement of Changes in Net Assets Available for
Benefits for the Year Ended December 31, 1999 3
o Notes to Financial Statements 4
o Schedules:
---------
Schedule I - Schedule H, Part IV, Line 4i - Schedule of Assets
Held for Investment Purposes as of December 31, 1999 11
o Signatures 12
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Plan Administrator of the Artesyn Technologies, Inc.
Employees' Tax-Favored Thrift and Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of the Artesyn Technologies, Inc. Employees' Tax-Favored Thrift and Savings Plan
(the "Plan", formerly known as the Computer Products, Inc. Employees'
Tax-Favored Thrift and Savings Plan) as of December 31, 1999 and 1998, and the
related statement of changes in net assets available for benefits for the year
ended December 31, 1999. These financial statements and the schedule referred to
below are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements and schedule 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 as of
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 basic
financial statements taken as a whole. The schedule of Assets Held for
Investment Purposes is presented for the purpose of additional analysis and is
not a required part of the basic financial statements but is 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
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.
Arthur Andersen LLP
Fort Lauderdale, Florida,
June 26, 2000.
1
<PAGE>
Artesyn Technologies, Inc.
Employees' Tax-Favored Thrift and Savings Plan
Statements of Net Assets Available for Benefits
as of December 31, 1999 and 1998
--------------------------------
1999 1998
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ASSETS:
Investments, at fair value $59,682,902 $20,423,769
Receivables:
Employer contributions 1,288,968 579,665
Participant contributions 80,380 115,715
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Total receivables 1,369,348 695,380
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Total assets 61,052,250 21,119,149
LIABILITIES:
Refunds payable for excess
contributions 46,568 --
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Net assets available for plan
benefits $61,005,682 $21,119,149
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See accompanying notes to financial statements.
2
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Artesyn Technologies, Inc.
Employees' Tax-Favored Thrift and Savings Plan
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1999
------------------------------------
ADDITIONS:
Net appreciation in fair value of investments $13,502,123
Contributions:
Employer 1,288,968
Participant 4,726,389
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Total contributions 6,015,357
Transfers in 25,263,272
Other 8,297
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Total additions 44,789,049
DEDUCTIONS:
Benefits paid to participants 4,881,672
Fees and other charges 20,844
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Total deductions 4,902,516
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NET INCREASE 39,886,533
NET ASSETS AVAILABLE FOR BENEFITS
Beginning of year 21,119,149
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End of year $61,005,682
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See accompanying notes to financial statements.
3
<PAGE>
Artesyn Technologies, Inc.
Employees Tax Favored Thrift and Savings Plan
Notes to Financial Statements
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1. PLAN DESCRIPTION
The following description of the Artesyn Technologies, Inc. Employees'
Tax-Favored Thrift and Savings Plan (the "Plan", formerly known as the
Computer Products, Inc. Employees' Tax-Favored Thrift and Savings Plan)
provides only general information. Participants should refer to the
plan document for a more complete description of the Plan's provisions.
General
The Plan was established in January 1979. During 1993, the Plan adopted
a prototype plan established by Connecticut General Life Insurance
Company ("Cigna"). The Plan, as amended, is a defined contribution
plan, which provides that all employees who have attained the age of 18
by the Plan entrance date and who have three months of service with
Artesyn Technologies, Inc. (the "Company") become eligible to
participate. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"), as amended.
In December 1997, the Company merged with Zytec Corporation ("Zytec").
As result of the merger, the assets of the Zytec Savings and Retirement
Plan (the "Zytec Plan"), which totaled approximately $25.3 million,
were transferred to the Plan as of January 1, 1999. At that time, all
previous members of the Zytec Plan became members of the Plan, and the
Zytec Plan was terminated.
The inclusion of the members of the Zytec Plan as participants required
the Plan to be re-written as a custom document to take into account
differences in the provisions of the individual plans. The two plans
operated separately during 1998, and the required changes became
effective as of January 1, 1999. Included in these changes was the
provision that all members of the Zytec Plan would be fully vested as
of December 31, 1998. Also included was a change in the name of the
Plan from the Computer Products, Inc. Employees' Tax-Favored Thrift and
Savings Plan to its current designation.
Plan Administration
As of January 1, 1999, the Company entered into an agreement whereby
Putnam Fiduciary Trust Company (the "Trustee") was appointed trustee of
the Plan. Under the terms of the agreement, the Trustee holds and
invests the funds of the Plan subject to the direction of the Plan
Administrator. Management of the Company serves as the Plan
Administrator.
Contributions and Vesting
Each year, participants may elect to contribute up to 20% of their
pretax annual compensation, as defined in the Plan agreement, through
payroll deductions subject to certain limitations. Participants are
immediately vested in their contributions plus earnings thereon. In
1999, qualified employees could contribute up to $10,000, as limited by
the Internal Revenue Code ("IRC"). Matching contributions may be made
to the Plan by the Company at the discretion of its Board of Directors
up to 50% of the first 6% of compensation (as defined in the Plan) that
a participant contributes to the Plan. In 1999, employee contributions
were matched at 50% of the first 6% of compensation.
Under the Plan, the Plan Administrator has the right to direct the
investment of the matching contribution. The Plan Administrator
provides that currently 100% of such contribution is to be
4
<PAGE>
Artesyn Technologies, Inc.
Employees Tax Favored Thrift and Savings Plan
Notes to Financial Statements
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invested in the Company's Artesyn Stock Fund. Vesting in the Company's
matching contributions plus earnings thereon occurs at a rate of 20%
for each year in which an employee completes 1,000 hours of service,
except that such amounts become fully vested upon a participant's
retirement, death or termination of employment because of inability to
work due to total or permanent disability. All participants in the
Zytec Plan were 100% vested prior to the merger of the two plans. The
forfeited, non-vested interest in participants' accounts may be used to
reduce the Company's matching contribution or reduce the reasonable
expenses of the administration of the Plan. In 1999, $172,685 was
forfeited and used to reduce the Company's matching contributions.
Investment Options
Participants may elect to invest in any of the available fund options.
Participants are allowed to change the investment election for future
salary deferral contributions or to transfer their existing accounts
among the available investments at any time. The following is a
description of investment options currently offered by the Plan to
participants:
o The Artesyn Stock Fund, which is invested in the Company's
common stock.
o The George Putnam Fund of Boston seeks both income and growth
of capital by investing in equity and investment grade fixed
income securities with income, growth and capital appreciation
potential.
o The Putnam Fund for Growth and Income seeks equity securities
that have both capital growth potential and current income in
the form of regular dividends.
o The Putnam Investors Fund seeks long-term capital appreciation
by investing in equity securities of larger, well-established
companies. These firms are selected from a range of industries
to ensure a significant level of diversification.
o The Putnam Income Fund seeks fixed income securities of
corporations and governments worldwide, that are either
investment-grade or below investment-grade, with intermediate
or long-term maturities.
o The Putnam OTC and Emerging Growth Fund seeks capital
appreciation by investing primarily in common stocks traded in
the Over-the-Counter market and common stock of small to
medium sized companies listed on designated securities
exchanges that have potential for capital appreciation greater
than market averages.
o The Putnam New Opportunities Fund seeks long-term capital
appreciation by investing in equity securities of companies in
the fastest growing industry sectors.
o The Putnam International Growth Fund seeks to invest mainly in
common stocks of mid-size and large companies outside the
United States. The fund seeks capital appreciation in the
stocks of companies who are undervalued and companies whose
earnings will grow faster than the economy as a whole.
o The Putnam S&P 500 Index Fund seeks securities that constitute
the Standard & Poor's Composite Stock Price Index, a common
measure of U.S. market performance, in order to closely
approximate its performance.
o Putnam Stable Value Fund is a collective investment trust that
seeks high quality guaranteed investment contracts issued by
insurance companies, banks, and other financial institutions.
The fund may also invest up to 50% of its balance in fixed
income securities owned by the fund or "wrapped" by a
financial institution.
Participant Accounts
Individual accounts are maintained for each of the Plan's participants
to reflect each participant's share of the Plan's income, the Company's
contributions and the participant's contributions.
5
<PAGE>
Artesyn Technologies, Inc.
Employees Tax Favored Thrift and Savings Plan
Notes to Financial Statements
--------------------------------------------------------------------------------
Allocations of the Plan's income, forfeitures of terminated
participants' nonvested accounts and administrative expenses are based
on participant account balances, as defined.
Loans to Participants
Participants may borrow the lesser of $50,000 or 50% of their vested
account balance with a minimum loan amount of $1,000. Loans are
repayable primarily through payroll deductions over periods ranging up
to 60 months unless the loan is for the purchase of a primary
residence, in which case a reasonable period is determined at the time
of the loan. The interest rate is determined by the Plan Administrator
based on prevailing market conditions and is fixed over the life of the
loan. Interest rates on outstanding loans range from 8.75% to 9.50%.
Benefits
Upon termination of services due to death, disability or retirement, a
participant may elect to receive either a lump-sum distribution equal
to his or her vested account balance or a life annuity. In addition,
hardship distributions are permitted if certain criteria are met.
Plan Termination
Although it has not expressed any intent to do so, the Company has the
right 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
and the Plan will continue until all accounts have been distributed.
2. SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying financial statements 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 reported amounts of
assets and liabilities and changes therein and disclosure of contingent
assets and liabilities. Actual results could differ from those
estimates.
Valuation of Investments and Income Recognition
In 1999, the Plan adopted Statement of Position No. 94-4 "Reporting of
Investment Contracts Held by Health and Welfare Benefit Plans and
Defined Contribution Pension Plans" ("SOP 94-4") which specifies the
accounting for investment contracts issued by either an insurance
enterprise or other entity.
The Putnam Stable Value Fund (the "Stable Value Fund") is a collective
investment trust offered as an investment by the Plan. The Stable Value
Fund invests mainly in Guaranteed Investment Contracts and security
backed investments "wrapped" by insurance companies, banks, and other
financial institutions. The Stable Value Fund maintains the
contributions from the participants in a pooled account. The account is
credited with earnings on the underlying investments and charged for
Plan withdrawals and administrative expenses. There are no reserves
against contract value for credit risk of the issuers of the contracts
or otherwise.
The Stable Value Fund is fully benefit-responsive and in accordance
with SOP 94-4 is recorded at contract value, which approximates fair
value. Contract value represents contributions made under the contract,
plus accrued interest. The 1999 crediting interest rate and average
effective yield on this account, which equals the average crediting
interest rate, were as follows:
Crediting Interest Rate - January 1, 1999 & December 31, 1999 5.56%
Average Yield 5.77%
Investments in the Artesyn Stock Fund are stated at fair value based on
the last reported sales price on the last business day of the year.
Shares of listed mutual funds are valued at their
6
<PAGE>
Artesyn Technologies, Inc.
Employees Tax Favored Thrift and Savings Plan
Notes to Financial Statements
--------------------------------------------------------------------------------
quoted market prices which represent the net asset value of shares held
by the Plan at year-end. Investments in participant loans are valued at
cost which approximates fair value.
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.
Payment of benefits
Benefits are recorded when paid.
Administrative Expenses
Except for certain investment fees and charges, expenses of the Plan
for legal, accounting and other administrative services are paid by the
Company. For 1999, $31,260 was paid by the Company on behalf of the
Plan.
Reclassifications
Certain prior year amounts have been reclassified to conform to the
current year's presentation.
3. INVESTMENTS
The following table presents the individual investment securities that
exceeded 5% of the Plan's net assets available for benefits at December
31, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
Participant Directed Investments:
Putnam Fund for Growth and Income, 333,814 shares $ 6,259,011 $ --
Putnam Investors Fund, 481,216 shares 9,215,288 --
Putnam OTC and Emerging Growth Fund, 194,348 shares 7,192,822 --
Putnam New Opportunities Fund, 63,272 shares 5,755,215 --
Putnam International Growth Fund, 183,452 shares 5,444,852 --
Putnam S&P 500 Index Fund, 109,136 shares 3,813,232 --
Putnam Stable Value Fund, 13,411,526 shares 13,411,525 --
Cigna Guaranteed Long-Term Account, 126,665 shares -- 4,472,015
Fidelity Advisor Balanced Account, 52,698 shares -- 1,668,337
Fidelity Advisor Equity Portfolio Growth Account,
94,105 shares -- 7,789,968
Fidelity Equity Income II, 29,959 shares -- 1,278,677
Janus Worldwide Account, 23,976 shares -- 1,287,335
Nonparticipant Directed Investments:
Artesyn Company Stock Fund, 218,001 shares in 1999
and 225,620 shares in 1998 4,578,021 2,567,901
</TABLE>
7
<PAGE>
Artesyn Technologies, Inc.
Employees Tax Favored Thrift and Savings Plan
Notes to Financial Statements
--------------------------------------------------------------------------------
During 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
appreciated in value by $13,502,123 as follows:
Mutual funds $10,098,173
Artesyn Stock Fund 2,052,354
Collective trusts 1,351,596
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$13,502,123
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4. NONPARTICIPANT DIRECTED INVESTMENTS
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed
investments is as follows:
December 31,
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1999 1998
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Net Assets:
Artesyn Stock Fund $5,889,467 $3,158,673
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Year Ended
December 31, 1999
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Changes in Net Assets:
Contributions $1,460,586
Net appreciation in fair value of investments 2,052,354
Benefits paid to participants (433,116)
Transfers to participant-directed programs (303,427)
Other (45,603)
----------
$2,730,794
==========
5. TAX STATUS
The Plan obtained its latest determination letter in 1995, in which the
Internal Revenue Service (the "IRS") stated that the Plan, as then
designed, was in compliance with the applicable requirements of the
IRC. The Plan has been amended since receiving the determination
letter, and the Company has requested a new determination letter on the
restated Plan. The Company believes the Plan is designed and is being
operated in compliance with the applicable requirements of the IRC, and
that the Plan, therefore, continues to qualify under Section 401 (a)
and the related trust continues to be tax-exempt as of December 31,
1999. Therefore, no provision for income taxes is included in the
Plan's financial statements.
6. RELATED PARTY TRANSACTIONS
The Plan regularly invests in common trust funds and mutual funds
managed by the Trustee. These transactions are not considered
prohibited transactions by statutory exemptions under ERISA
regulations.
8
<PAGE>
Schedule I
Artesyn Technologies, Inc.
Employees' Tax-Favored Thrift and Savings Plan
Schedule H, Part IV, line 4i - Schedule of Assets Held for Investment Purposes
As of December 31, 1999
-----------------------
<TABLE>
<CAPTION>
Description of Investment
Including Maturity Date,
Identity of Issue, Borrower, Rate of Interest, Collateral,
Lessor or Similar Party Par or Maturity Value Cost Fair Value
------------------------------ ------------------------------ ----------- -----------
<S> <C> <C> <C>
Artesyn Technologies, Inc. (a) Company common stock fund $ 3,221,752 $ 4,578,021
Putnam Investments (a) Mutual fund, variable rate and
maturity 2,944,744 2,661,842
Putnam Investments (a) Mutual fund, variable rate and
maturity 6,910,609 6,259,011
Putnam Investments (a) Mutual fund, variable rate and
maturity 7,226,501 9,215,288
Putnam Investments (a) Mutual fund, variable rate and
maturity 568,990 533,298
Putnam Investments (a) Mutual fund, variable rate and
maturity 4,223,646 7,192,822
Putnam Investments (a) Mutual fund, variable rate and
maturity 4,075,142 5,755,215
Putnam Investments (a) Mutual fund, variable rate and
maturity 3,873,353 5,444,852
Putnam Investments (a) Mutual fund, variable rate and
maturity 3,324,159 3,813,232
Putnam Investments (a) Common/collective trust,
variable rate and maturity 13,411,525 13,411,525
Loan Fund Loans from participants, 8.75%
to 9.50% rates, variable maturity 817,796 817,796
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TOTAL $50,598,217 $59,682,902
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</TABLE>
(a) Represents a party-in-interest investment.
9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administrators have duly caused this annual report to be signed by the
undersigned, thereunto duly authorized.
Artesyn Technologies, Inc.
Employees' Tax-Favored
Thrift And Savings Plan
-----------------------
(Name of Plan)
By: /s/Pauline G. Thomas
--------------------
Pauline G. Thomas
Plan Administrator
Date: June 27, 2000.
10
<PAGE>
Exhibit Index
Ex # Exhibit Description
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23 Consent of Independent Certified Public Accountants
