SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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Form 11-K
(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 SECTION 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from __________ to __________
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Commission File No. 0-3319
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Del Global Technologies Corp.
401(k) Plan
(Full title of the Plan)
Del Global Technologies Corp.
(Name of issuer of the securities held pursuant to the Plan)
One Commerce Park
Valhalla, NY 10595
(Address of principal executive office)
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DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS FOR THE YEARS ENDED
DECEMBER 31, 1999 AND 1998
Statements of Net Assets Available for Plan
Participants as of December 31, 1999
and 1998 2
Statements of Changes in Net Assets Available for
Plan Participants for the Years Ended December 31,
1999 and 1998 3
Notes to Financial Statements 4
SUPPLEMENTAL SCHEDULES:
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1999 8
Item 27d - Schedule of Reportable Transactions
for the Year Ended December 31, 1999 9
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INDEPENDENT AUDITORS' REPORT
To the Trustees and Participants of
Del Global Technologies Corp. 401(k) Plan
We have audited the accompanying statements of net assets available for plan
participants of Del Global Technologies Corp. 401(k) Plan (the "Plan") as of
December 31, 1999 and 1998, and the related statements of changes in net assets
available for plan participants for the years then ended. 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 auditing standards generally accepted
in the United States of America. 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, such financial statements present fairly, in all material
respects, the net assets available for plan participants of the Plan as of
December 31, 1999 and 1998, and the changes in net assets available for plan
participants for the years then ended in conformity with accounting principles
generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of (1) assets
held for investment purposes as of December 31, 1999 and (2) reportable
transactions for the year ended December 31, 1999 are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements but are 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. These schedules are the responsibility
of the Plan's management. Such supplemental schedules have been subjected to the
auditing procedures applied in our audit of the basic 1999 financial statements
and, in our opinion, are fairly stated in all material respects when considered
in relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
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Deloitte & Touche LLP
Jericho, New York
June 26, 2000
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DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN PARTICIPANTS
DECEMBER 31, 1999 AND 1998
December 31, December 31,
1999 1998
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ASSETS
Investments, at fair value $8,846,088 $7,580,377
Contributions receivable from:
Participants 77,700 76,235
Employer 50,000 68,818
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Total receivables 127,700 145,053
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LIABILITIES
Accrued expenses and accounts payable 26,058 50,674
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NET ASSETS AVAILABLE FOR
PLAN PARTICIPANTS $8,947,730 $7,674,756
========== ==========
See notes to financial statements.
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DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN
PARTICIPANTS
YEARS ENDED DECEMBER 31, 1999 AND 1998
Year Ended Year Ended
December 31, December 31,
1999 1998
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ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Contributions from:
Participants $ 914,979 $ 770,694
Employer 50,000 68,818
Rollovers -- --
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Total contributions 964,979 839,512
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Investment income:
Net appreciation in fair value
of investments 367,721 349,141
Interest and dividends 544,909 428,719
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Total investment income 912,630 777,860
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Total additions 1,877,609 1,617,372
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DEDUCTIONS FROM NET ASSETS
ATTRIBUTED TO:
Benefits paid to participants 578,577 191,730
Administrative expenses 26,058 50,674
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Total deductions 604,635 242,404
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NET INCREASE IN NET ASSETS
AVAILABLE FOR
PLAN PARTICIPANTS 1,272,974 1,374,968
NET ASSETS AVAILABLE FOR
PLAN PARTICIPANTS,
BEGINNING OF YEAR 7,674,756 6,299,788
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NET ASSETS AVAILABLE FOR
PLAN PARTICIPANTS,
END OF YEAR $8,947,730 $7,674,756
========== ==========
See notes to financial statements.
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<PAGE>
DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1999 AND 1998
1. DESCRIPTION OF THE PLAN
The following summary of certain provisions of the Del Global Technologies
Corp. 401(k) Plan (formerly the Del Electronics Corp. 401(k) Plan) (the
"Plan") is provided for general information purposes only. Participants
should refer to the summary Plan description and the Plan document for
complete information.
a. General - The Plan is a defined contribution plan covering all
employees of Del Global Technologies Corp. (formerly Del Electronics
Corp.) (the "Company") and participating subsidiaries (RFI
Corporation, Dynarad Corp., Del Medical Systems Corp., Bertan High
Voltage Corp., Gendex-Del Medical Imaging Corp. and the Del Power
Conversion Division) who have completed one-quarter year of service
and are age twenty-one or older. The Company's Board of Directors
has appointed Seymour Rubin, David Engel, and Leonard Trugman to the
Plan's Administrative Committee. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
("ERISA").
b. Participant Contributions - Employees may elect to contribute to the
Plan from 1% to 15% (in full percentage points) of their
"before-tax" earnings, and from 1% to 10% (in full percentage
points) of their "after tax" earnings, up to a maximum in accordance
with Section 415(c) of the Internal Revenue Code and adjusted
annually for inflation thereafter.
c. Employer Contributions - Under the Plan's terms, the Company is not
required to contribute to the Plan. The Company made contributions
of $50,000 and $68,818 for the Plan's fiscal years ended December
31, 1999 and 1998, respectively. The contributions in the form of
the Company's common stock were recorded at fair value based on the
closing market price on the date of transfers.
d. Participant Accounts - Each participant's account is credited with
the participant's contribution and allocations of (a) the Company's
contribution and (b) Plan earnings, and charged with an allocation
of administrative expenses. Allocations are based on participant
earnings or account balances, as defined. The benefit to which a
participant is entitled is the benefit that can be provided from
the participant's vested account.
e. Withdrawals - Under the terms of the Plan, a participant may make a
withdrawal for reasons of economic hardship before attaining age 59
1/2. Upon attaining age 59 1/2, participants may withdraw their
entire account balance.
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f. Vesting - Employee and rollover contributions are fully vested upon
entering the Plan. Employer contributions vest at the following
rates:
Years of Service Vesting Percentage
Less than one 0%
One but less than two 20
Two but less than three 40
Three but less than four 60
Four but less than five 80
Five or more 100
g. Expenses - Administrative expenses are paid by the Plan and are
allocated to each fund when paid.
h. Participant Loans - The Plan allows participants to borrow up to the
lesser of $50,000 or 50% of the vested portion of their account
balances, subject to certain restrictions. Loan terms range from 1-5
years except for the purchase of a primary residence. The loans are
secured by the balance in the participants' accounts and bear
interest at market rates.
i. Forfeitures - Forfeited balances of terminated participants'
non-vested accounts are reallocated among remaining participants.
2. SIGNIFICANT ACCOUNTING POLICIES
a. Basis of Accounting - The financial statements of the Plan have been
prepared under the accrual basis of accounting.
b. Accounting Estimates - The preparation of financial statements in
accordance with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of net assets available for plan participants and
changes therein. Actual results could differ from those estimates.
c. Benefit Payments - Distributions to Plan participants are recorded
when paid.
d. Valuation of Investments and Income Recognition - Purchases and
sales of securities are recorded on the trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on
the ex-dividend date.
e. Participant Loans Receivable - Participant loans are valued at cost,
which approximates fair value.
f. Recently Issued Accounting Pronouncements - In 1999, the Plan
adopted the AICPA's Statement of Position ("SOP") 99-3, "Accounting
and Reporting of Certain Defined Contribution Benefit Plan
Investments and Other Disclosure Matters". The SOP simplifies the
disclosures for certain investments and eliminates the requirement
to disclose by investment fund option the statement of net assets
available for plan participants and the changes in net assets
available for plan participants for all years presented.
Accordingly,
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certain reclassifications have been made in the prior year's
financial statements to correspond to the current year's
presentation.
3. TRUSTEES OF THE PLAN
The Company's Board of Directors has appointed Merrill Lynch Trust Company
of America ("Merrill Lynch") as trustee of the Plan and related trust
effective January 1, 1997. Merrill Lynch also serves as custodian of the
Plan's assets and executes investment transactions.
4. INVESTMENTS
The assets of the Plan, held by Merrill Lynch, are invested in the
following investment accounts: a guaranteed trust account, two diversified
equity and fixed-income accounts and three diversified common stock funds,
at the discretion of the participant. The accounts were credited with
actual earnings on the underlying investments and charged for Plan
withdrawals.
The following investments represent five percent or more of the Plan's net
assets available for plan participants:
December 31, December 31,
1999 1998
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Merrill Lynch Preservation Trust Fund $4,060,282 $3,953,860
AIM Value Fund 2,429,194 1,548,905
Merrill Lynch Basic Value Fund 792,128 678,403
Merrill Lynch Capital Fund 570,485 645,381
MFS Emerging Growth Fund 524,236 --
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$8,376,325 $6,826,549
========== ==========
All investments, except for the Merrill Lynch Preservation Trust Fund, are
recorded at fair market value based upon closing market prices.
During 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
(depreciated) in value by $367,721 as follows:
For the
Year Ended
December 31,
1999
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Common stocks $ 394,200
Diversified equity and fixed income (26,479)
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$ 367,721
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The Merrill Lynch Preservation Trust primarily invests in investment
contracts providing a guaranteed return on principal invested over a
specified period. The crediting interest rate, which
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approximates the average yield as of December 31, 1999, was 6.01%. The
investments are fully benefit responsive and are recorded at contract value,
which equals principal plus accrued interest, and was determined to
approximate fair value.
5. PRIORITIES UPON TERMINATION OF THE PLAN
Although it has not expressed any intention to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. However, in the event
of Plan termination, participants will become 100% vested in their accounts
and the assets of the Plan shall be distributed to participants and
beneficiaries based on their individual accounts as of the termination date.
6. TAX STATUS
The Internal Revenue Service has determined and informed the Company by
letter dated June 21, 1995 that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (the
"Code"). The Plan has been amended since receiving the determination letter.
However, the Plan administrator believes that the Plan is designed and is
currently being operated in compliance with the applicable requirements of
the Code. Therefore, no provision for income taxes has been included in the
Plan's financial statements.
7. PARTY-IN-INTEREST
A portion of the plan's investments are shares in funds managed by Merrill
Lynch. Merrill Lynch is the custodian of these investments as defined by the
Plan and, therefore, these transactions qualify as party-in-interest.
******
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SUPPLEMENTAL SCHEDULES
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DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1999
Number of Current
Description Units/Shares Cost Value
----------- ------------ ---- -------
COMMON TRUST
Merrill Lynch Preservation
Trust Fund 4,045,354 $4,045,354 $4,060,282
MUTUAL FUNDS
MFS Emerging Growth Fund 7,856 365,805 524,236
AIM Value Fund 49,861 2,075,440 2,429,194
Merrill Lynch Basic Value Fund 20,819 797,275 792,128
Merrill Lynch Global
Allocation Fund 6,664 86,796 93,828
Merrill Lynch Capital Fund 17,841 611,535 570,485
COMMON STOCK:
Del Global Technologies Corp. 40,533 452,769 263,398
Participant Loan Funds* 124,782 124,782 124,782
Other (12,245) (12,245)
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Total $8,547,511 $8,846,088
========== ==========
* Range of interest rates:
8.75% - 9.5%
Range of maturity dates:
May 2000 to September 2004
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<PAGE>
DEL GLOBAL TECHNOLOGIES CORP.
401(k) PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
Purchases Sales
Identity of Description Purchase Number of Selling Number of Net Gain
Party Involved of Asset Price Transactions Price Transactions or (Loss)
-------------- ---------- ----- ------------ ------- ------------ ---------
<S> <C> <C> <C> <C> <C> <C>
A series of transactions in excess of 5% of the beginning value of plan assets:
Merrill Lynch Preservation Trust Fund Trust Fund $861,749 137 $ - - -
Merrill Lynch Preservation Trust Fund Trust Fund 755,329 - 755,329 84 -
AIM Value Fund Mutual Fund 738,177 71 - - -
</TABLE>
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SIGNATURE
Pursuant to the requirement of the Securities Exchange Act of 1934, the Plan
Committee has duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Del Global Technologies Corp.
401(k) Plan
Date: June 29, 2000 By: /s/ Michael H. Taber
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Chief Financial Officer,
Plan Administrator,
Del Global Technologies Corp.
401(k) Plan
