UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[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 SECURITIES EXCHANGE
ACT OF 1394.
For the transition period from _____________ to _____________
Commission file number 1-6035
THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN
THE TITAN CORPORATION
3033 Science Park Road
San Diego, CA 92121-1199
(Name and address of principal executive
office of issuer of securities)
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[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 SECURITIES EXCHANGE
ACT OF 1394.
For the transition period from _____________ to _____________
Commission file number 1-6035
THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN
THE TITAN CORPORATION
3033 Science Park Road
San Diego, CA 92121-1199
(Name and address of principal executive
office of issuer of securities)
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Plan Administrator has duly caused this annual report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: June 27, 2000
THE TITAN CORPORATION
CONSOLIDATED RETIREMENT PLAN
By /s/ Eric M. DeMarco
Eric M. DeMarco
----------------------------------
Chairperson, Administrative
Committee of The Titan Corporation
Consolidated Retirement Plan
<PAGE>
<TABLE>
<CAPTION>
THE TITAN CORPORATION
CONSOLIDATED RETIREMENT PLAN
INDEX TO FINANCIAL STATEMENTS
Page
<S> <C>
Report of Independent Public Accountants............................................................. 4
Statement of Net Assets Available for Plan Benefits as of
December 31, 1999................................................................................ 5
Statement of Net Assets Available for Plan Benefits as of
December 31, 1998................................................................................ 6
Statement of Changes in Net Assets Available for Plan Benefits as of
December 31, 1999................................................................................ 7
Notes to Financial Statements........................................................................ 8
Supplemental Schedules:
Schedule I - Schedule of Assets Held For Investment Purposes as of December 31, 1999............ 16
Schedule II - Schedule of Reportable Transactions for the year ended
December 31, 1999............................................................................ 17
All other financial statements and schedules are
omitted because they are not applicable or because the
required information is shown in the financial
statements or the notes thereto.
</TABLE>
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Trustee and Plan Administrator of The Titan Corporation Consolidated
Retirement Plan:
We have audited the accompanying statements of net assets available for plan
benefits of THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN as of December
31, 1999 and 1998, and the related statement of changes in net assets available
for plan benefits for the year ended December 31, 1999. These financial
statements and the schedules referred to below are the responsibility of the
Plan's management. Our responsibility is to express an opinion on the financial
statements 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 plan benefits of the plan as
of December 31, 1999 and 1998, and the changes in its net assets available for
plan 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 supplemental schedule of assets held
for investment purposes and the schedule of reportable transactions 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. The supplemental schedules
have been subjected to the auditing procedures applied in the audits of the
basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
San Diego, California
June 27, 2000
<PAGE>
<TABLE>
<CAPTION>
THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1999
Non-
Participant Participant
Directed Directed Total
------------ ------------ -------------
ASSETS:
<S> <C> <C> <C>
Investments, at fair market value:
The Titan Corporation
Common Stock $ 23,985,783 $ 64,519,632 $ 88,505,415
Vanguard Funds 80,758,538 0 80,758,538
Short-term Investments 703,483 0 703,483
Participant Loans 1,641,693 0 1,641,693
------------ ------------ -------------
Total Investments 107,089,497 64,519,632 171,609,129
------------ ------------ -------------
Receivables for:
Employee Contributions 135,475 0 135,475
Employer Contributions 0 0 0
------------ ------------
-------------
Total Receivables 135,475 0 135,475
------------ ------------ -------------
Total Assets 107,224,972 64,519,632 171,744,604
LIABILITIES:
Accrued investment and
administrative expenses 29,715 0 29,715
------------ ------------ -------------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $ 107,195,257 $ 64,519,632 $ 171,714,889
============ ============ =============
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999
Non-
Participant Participant
Directed Directed Total
-------------- ------------- --------------
<S> <C> <C> <C>
Contributions:
Employee $ 5,510,484 $ 0 $ 5,510,484
Employer 1,210,770 911,162 2,121,932
Asset transfers 14,752,241 1,742,869 16,495,110
-------------- ------------- --------------
Total Contributions 21,473,495 2,654,031 24,127,526
-------------- ------------- --------------
Investment Income:
Vanguard Funds 5,990,300 0 5,990,300
Interest 139,573 0 139,573
Investment and administrative expenses (93,089) 0 (93,089)
-------------- ------------- --------------
Net Investment Income 6,036,784 0 6,036,784
-------------- ------------- --------------
Net realized gain on sale of investments 2,585,256 1,635,984 4,221,240
Net change in unrealized gain/
appreciation of investments 18,133,712 56,977,869 75,111,581
Transfers (to) from other funds 487,017 (487,017) 0
Withdrawals and distributions to withdrawing
and terminated participants (11,514,512) (2,013,842) (13,528,354)
-------------- ------------- --------------
NET INCREASE 37,201,752 58,767,025 95,968,777
NET ASSETS AVAILABLE FOR PLAN BENEFITS:
BEGINNING OF YEAR 69,993,505 5,752,607 75,746,112
-------------- ------------- --------------
END OF YEAR $ 107,195,257 $ 64,519,632 $ 171,714,889
============== ============= ==============
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE TITAN CORPORATION CONSOLIDATED RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1998
Non-
Participant Participant
Directed Directed Total
------------- ----------- -----------
ASSETS:
<S> <C> <C> <C>
Investments, at fair market value:
The Titan Corporation
Common Stock $ 1,956,043 $ 5,722,518 $ 7,678,561
Vanguard Funds 66,497,834 0 66,497,833
Short-term Investments 32,131 0 32,132
Participant Loans 1,428,060 0 1,428,060
------------- ----------- -----------
Total Investments 69,914,068 5,722,518 75,636,586
------------- ----------- -----------
Receivables for:
Employee Contributions 71,161 0 71,161
Employer Contributions 27,904 30,089 57,993
------------- ----------- -----------
Total Receivables 99,065 30,089 129,154
------------- ----------- -----------
Total Assets 70,013,133 5,752,607 75,765,740
LIABILITIES:
Accrued investment and
administrative expenses 19,628 0 19,628
------------- ----------- -----------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $ 69,993,505 $ 5,752,607 $ 75,746,112
============= =========== ===========
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
THE TITAN CORPORATION
CONSOLIDATED RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN DESCRIPTION AND RELATED INFORMATION
General
The Titan Corporation (the "Company") maintains The Titan Corporation
Consolidated Retirement Plan (the "Plan"), which is comprised of a
Retirement Plan and an Employee Stock Ownership Plan ("ESOP"). The Plan was
originally effective May 1, 1984. Prior to January 1, 1999, the Plan was
known as The Titan Corporation 401(k) Retirement Plan. The Plan was amended
and restated in its entirety, effective as of January 1, 1999, and renamed
The Titan Corporation Consolidated Retirement Plan to reflect the merger
into the Plan, as of January 1, 1999, of The Titan Corporation Employee
Stock Ownership Plan and the Horizons Technology, Inc. Employee Stock
Ownership Plan, and the subsequent merger of the VisiCom Laboratories, Inc.
Savings Plan and Trust and the Validity Corporation 401(k) Profit Sharing
Plan. The transfers of assets from the merged plans into the Plan, were
completed during 1999 and are reflected as asset transfers in the Statement
of Changes in Net Assets Available for Plan Benefits for the year ended
December 31, 1999.
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"). The following description of the Plan
provides only general information. Participants should refer to the Plan
document for a more complete description of the Plan's provisions.
The purpose of the Retirement Plan portion of the Plan, which is a
profit-sharing plan, is to provide a convenient way for eligible employees
to save on a regular and long-term basis. The purpose of the ESOP portion
of the Plan, which is an employee stock ownership plan and a stock bonus
plan, is to provide eligible employees with an opportunity to acquire and
hold for long-term investment an ownership interest in the Company.
The Trustee of the Plan, who is responsible for the administration of the
trust fund under the terms of a trust agreement, is Vanguard Fiduciary
Trust Company ("Vanguard"). The Company is the Plan Administrator and has
full power to administer the Plan and apply all of its provisions on behalf
of participating employees. The Plan Administrator has appointed a
committee (the "Committee") consisting of Company employees to perform
these duties with respect to the operation of the Plan.
Eligible Employees
Employees are eligible to participate in the Plan on or after attainment of
age 21. Participation by eligible employees in the Plan is voluntary for
the Retirement Plan portion of the Plan and is available to each employee
of the companies which have adopted the Plan.
<PAGE>
1. PLAN DESCRIPTION AND RELATED INFORMATION (continued)
Contributions
Participants may make tax deferred contributions of between 1% and 15% of
their annual compensation to a maximum dollar amount established by the
IRS. Tax deferred contributions are subject to certain limitations provided
by the IRS. Deferred contributions are matched by the employer based on The
Matching Formula. The Matching Formula applicable to participants employed
by the Company or a participating affiliate shall be determined by its
board of directors (or the delegate of such board) and disclosed prior to
the commencement of the Plan year in which the Matching Formula shall be
applicable. If so determined by the applicable board of directors or its
delegate, the Matching Formula may be a discretionary amount to be
determined by such board of directors or delegate after the end of the Plan
year.
Each participant may specify that his deferral contributions be invested
entirely in one fund or divided among the funds in multiples of 10% of his
contributions. Participants may elect in which fund to invest 50% of the
employer matching contribution. The remaining 50% of the employer matching
contribution is mandatorily invested in the Titan Common Stock Fund.
Employer discretionary contributions are allocated to any of the ten
investment funds in 10% increments as directed by each participant. Each
participant may change his investment fund designation for investment of
new contributions as well as for investment of the balance of his accounts
in the plan on a daily basis. A participant may elect at any time to
suspend, change or resume compensation deferrals, provided he makes an
election in the manner prescribed by the Committee.
In accordance with procedures approved by the Committee, a participant may
contribute (rollover) to the Plan all or a portion due to the participant
from another plan qualified under Section 401(a) of the Internal Revenue
Code ("Code"). Rollover contributions are not matched in whole or in part
by the employer.
In addition to matching contributions, the employer may elect to make an
employer profit sharing contribution or an ESOP contribution. These
discretionary contributions are allocated to participants employed on the
last day of the Plan year generally based upon the ratio that each
participant's compensation of the contributing employer bears to the
aggregate of all such participants' compensation.
Participant Accounts
Separate accounts are maintained in the name of each participant for
deferred contributions, rollover contributions, voluntary contributions,
employer matching contributions, employer discretionary contributions,
employer non-elective contributions, ESOP contributions and prior profit
sharing plan contributions, if applicable. Each account is credited with
contributions, adjusted for investment results and charged with
withdrawals.
<PAGE>
1. PLAN DESCRIPTION AND RELATED INFORMATION (continued)
Vesting
Each participant's deferred, prior voluntary, employer non-elective
contributions and rollover contributions are fully vested as contributions
are made. For all active participants, all employer matching and
discretionary contributions vest in increments over the participant's first
five years of employment, after which full vesting occurs. Participants
inactive at the time of the Plan merger are subject to grandfathered
vesting schedules.
Termination of Employment Benefits and Forfeitures
If a participant's employment is terminated for reasons other than
retirement, disability or death, benefits payable will be equal to the
vested value of the participant's accounts. Forfeited amounts are first
used to restore forfeitures of reemployed participants, second to pay
administrative expenses and third to reduce the amount of employer matching
contributions. Forfeitures of employer contributions totaled $690,541 for
the year ended December 31, 1999.
Fund balances for employees that have been terminated and requested payouts
that are in various stages of processing and approval but not yet paid out
have been included in the Statement of Net Assets Available For Plan
Benefits. They will be reflected in the Statement of Changes in Net Assets
Available for Plan Benefits when actually paid. At December 31, 1999 and
1998, these amounts were $227,753 and $318,867, respectively.
Distributions and Withdrawals
Distributions are generally made upon termination of employment, including
retirement, disability or death. Benefits payable upon retirement or other
termination are made as a single lump sum cash payment or in substantially
equal monthly installments, except for distributions from the Titan Common
Stock Fund which are made in either shares of The Titan Corporation common
stock or cash as elected by the participant. Benefits payable upon death
are made in a lump sum cash payment, except for distributions from The
Titan Common Stock Fund, which are distributed in cash or stock as elected
by the participant or beneficiary. Participants with balances from the
M/A-COM Government Systems, Inc. and the VisiCom Laboratories, Inc. Savings
Plan and Trust merger and deferral accounts are subject to different rules
regarding the distribution of those funds. When a participant terminates
employment for any reason except for the attainment of age 65, and the
value of the vested portion of a participant's account exceeds $5,000, the
participant must consent to the receipt of the distribution. If an inactive
participant does not consent to the receipt of the distribution, the
distribution shall be made upon reaching age 65.
Participants under age fifty-nine and one half may withdraw the value of
the deferred contributions account, upon providing 30 days written notice
to the Committee, to the extent necessary to meet a financial hardship, as
defined in accordance with the regulations or rulings of the Code. After
withdrawal, certain periods of time, as required under the Plan, must lapse
before a participant can make additional deferred contributions.
<PAGE>
1. PLAN DESCRIPTION AND RELATED INFORMATION (continued)
Loans
Participants may obtain loans from the Plan subject to written application
to and approval by the Committee. The amount of a participant loan may not
exceed the lesser of: 1) $50,000 (reduced by the amount, if any, of the
highest outstanding balance of loans from the Plan during the one-year
period ending on the day before the date on which the loan is made), or 2)
one-half the present value of the participant's vested interest in his or
her accounts. Repayment is made over a period not to exceed five years
(except for loans for the purchase of a participant's principal residence).
The loan must be repayable in substantially level payments, with payments
not less frequently than quarterly. Loans must be for a minimum one-year
term and for a minimum of $1,000. Interest is charged based on the prime
rate as of the last day of the calendar quarter preceding the calendar
quarter in which the loan is made, plus one percent. Loan disbursements can
be made from all of the borrowing participant's individual accounts, except
for the ESOP, as directed by the participant. Upon disbursement, the loan
balance is transferred from the applicable investment fund (s) to a
separate loan fund (participant loan receivable) until repayment.
Termination of Plan
The Company may elect to amend or terminate the Plan at any time. In the
event of a Plan termination, the balance in each participant account
becomes 100% vested.
Investment and Administrative Expenses
Substantially all costs and expenses incurred in connection with the
administration of the Plan were paid by the forfeitures of the Plan.
Expenses include, but are not limited to, trustee, actuarial, accounting,
legal, and investment advisory fees. Brokerage fees relating to the
purchase or sale of investments are added to the cost thereof or deducted
from the proceeds thereof, respectively.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The financial statements are reported on the accrual basis of accounting
and investments are reflected at fair value. Plan assets are invested with
the Trustee, who determines fair values based upon quoted market prices,
except as indicated under Valuation of Vanguard Fund Investments.
Valuation of Vanguard Fund Investments
Vanguard Funds are valued by Vanguard each business day.
Mutual Funds
Deposits to the Vanguard Mutual Funds are used to buy shares from a
diversified portfolio of securities. Securities listed on any securities
exchange are valued at the last sale price as of each valuation date.
<PAGE>
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Securities not listed or traded as of the close of trading on the valuation
date are valued at the latest quoted bid price of a dealer who regularly
trades in the security being valued.
Investment transactions are accounted for on the date the shares in the
funds are purchased or sold. Realized gains and losses on shares sold are
computed based on the market value at the beginning of the plan year or the
cost of current year purchases of the shares sold.
Vanguard Retirement Savings Trust
Deposits to the Vanguard Retirement Savings Trust are used by the Plan to
purchase an interest in various contracts negotiated by Vanguard and
several insurance companies and financial institutions which are valued at
cost plus net investment income.
Income Tax Status
The plan obtained its latest determination letter on June 30, 1995, in
which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue
Code. The Plan has been amended since receiving the determination letter.
However, The Trustee and the Plan Administrator believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, no provision for
income taxes has been included in the Plan's financial statements.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
New Accounting Standard
During 1999, the Plan adopted the provisions of Statement of Position 99-3
"Accounting for and Reporting of Certain Defined Contribution Plan
Investments and Other Disclosure Matters" ("SOP 99-3") which eliminates the
requirement for participant-directed defined contribution plans to
separately disclose financial statements by fund and requires certain other
disclosure changes. SOP 99-3 is effective for financial statements for plan
years ending after December 15, 1999, with earlier adoption encouraged. The
1999 and 1998 Plan year financial statements are presented in accordance
with the accounting and disclosure provisions of SOP 99-3.
<PAGE>
3. INVESTMENT PROGRAMS
Participants elect from the following investment funds in which their
contributions, employer discretionary contributions and one-half of the
matching contributions are to be invested:
Wellesley Income Fund
A Vanguard mutual fund consisting of bonds and stocks. Bonds will
normally constitute 60% - 65% of fund assets and common stock will
constitute 35% - 40% of fund assets.
Vanguard Retirement Savings Trust
A fund invested primarily in investment contracts issued by insurance
companies and commercial banks, and other similar types of fixed
principal investments. The principal and interest of these contracts
are obligations of the issuing companies. For liquidity purposes, the
Trust also invests in short-term U.S. Government obligations and
repurchase agreements collateralized by U.S. Government obligations or
federally insured deposits.
Windsor II
A Vanguard mutual fund consisting of common stocks that, in the opinion
of the fund's investment advisor, are under-valued in the marketplace.
World - U.S. Growth
A Vanguard mutual fund consisting of common stocks of U.S. companies
whose prospects for growth and appreciation are believed by its
investment advisor to be favorable.
Prime Money Market Reserves Fund (VMMR Fund)
A Vanguard money market fund consisting of negotiable certificates of
deposit, banker's acceptances, commercial paper, and other short-term
corporate obligations.
High-Yield Corporate Fund
A Vanguard fund consisting of high-yield corporate bonds, or "junk
bonds" which pay high interest rates because they are considered to
carry greater risk.
International Growth Fund
A Vanguard mutual fund consisting of stocks of high quality seasoned
companies based outside the United States.
Small Cap Index Fund
A Vanguard mutual fund consisting of a sample of stocks in the Russell
2000 Index.
<PAGE>
3. INVESTMENT PROGRAMS (continued)
Total Bond Market Index Fund
A Vanguard bond fund which attempts to match the performance of the
Lehman Brothers Aggregate Bond index, which is a widely recognized
measure of the entire taxable U.S. Bond Market.
Titan Common Stock Fund
A fund consisting of The Titan Corporation common stock, par value $.01
per share.
4. INVESTMENTS
The Plan's investments were held by Vanguard, the trustee, during 1999. The
Schedule of Assets Held for Investment Purposes is included in Schedule I.
5. PARTY-IN-INTEREST AND 5 PERCENT REPORTABLE TRANSACTIONS
No prohibited transactions with "parties-in-interest", as defined under the
Employee Retirement Income Security Act of 1974 ("ERISA"), occurred during
the year ended December 31, 1999.
Five-percent reportable transactions, as defined under ERISA, which
occurred during the year ended December 31, 1999, are summarized in
Schedule II.
6. NET REALIZED GAIN ON SALE OF INVESTMENTS
A summary of the aggregate costs, proceeds and net gain (loss) on sale of
investments for the year ended December 31, 1999, is as follows:
<TABLE>
Revalued Net Net
Cost (a) Proceeds Gain\(Loss)
----------- ------------------ ------------
<S> <C> <C> <C>
Equity Investments $1,789,221 $1,783,341 $ (5,880)
The Titan Corporation
Common Stock 169,903 4,397,023 4,227,120
-------------- ------------- -------------
$1,959,124 $6,180,364 $4,221,240
============== ============= =============
</TABLE>
(a) Market value at beginning of year or cost of current
year purchases.
During 1999, the Trustee (Vanguard) regularly purchased
and sold interests in short-term investment funds of the
Trustee, investments in guaranteed investment contracts
with insurance companies and financial institutions and
units of Vanguard GIC and mutual funds. These
transactions are not reflected in the foregoing amounts
since the related investment return consisted solely of
interest and investment income, with no resulting gain
or loss.
<PAGE>
7. RECONCILIATION OF FINANCIAL STATEMENTS TO THE FORM 5500
Due to the timing of recording benefit payments to terminated employees,
net assets available for plan benefits, as reported in the financial
statements, is $227,753, higher than the amount reported in the Form 5500,
to reflect the payable for the benefit payments.
8. SUBSEQUENT EVENT
Effective April 1, 2000, T. Rowe Price became the Trustee of the Plan, who
is responsible for the administration of the trust fund under the terms of
a trust agreement, with the transfer of assets also occurring on that date.
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE I
THE TITAN CORPORATION
CONSOLIDATED RETIREMENT PLAN
(EIN 95-2588754)
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
As of December 31, 1999
Market
Identity of Issuer Description of Investment Cost Value
------------------ ----------------------------------- -------------- --------------
<S> <C> <C> <C>
Vanguard* 615,640.085 shares of Wellesley $12,509,016 $11,604,816
Income Fund
Vanguard* 14,272,030.720 shares of Vanguard 14,272,031 14,272,031
Retirement Savings Trust
Vanguard* 642,164.791 shares of Vanguard 16,681,754 16,034,855
Windsor II
Vanguard* 669,352.894 shares of Vanguard World 20,443,158 29,136,931
- US Growth Fund
Vanguard* 4,813,520.130 shares of VMMR Prime 4,813,520 4,813,520
Portfolio
Vanguard* 97,000.855 shares of High-Yield 755,148 716,836
Corporate Fund
Vanguard* 61,154.619 shares of International 1,209,015 1,375,367
Growth Fund
Vanguard* 47,833.273 shares of Small-Cap Index 1,062,464 1,128,865
Fund
Vanguard* 175,242.272 shares of Total Bond 1,735,266 1,675,316
Market Index Fund
Titan Corporation* ^ 519,956.275 shares of Titan Common 11,407,222 89,208,898
Stock Fund and Short-term Investments
Participant Loans* 5.88% - 11.53% 1,641,694 1,641,694
------------- ------------
$86,530,288 $171,609,129
============= ============
* Represents a party-in-interest.
^ Non-participant directed
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE II
THE TITAN CORPORATION
CONSOLIDATED RETIREMENT PLAN
(EIN 95-2588754)
SCHEDULE OF REPORTABLE TRANSACTIONS (a)
FOR THE YEAR ENDED DECEMBER 31, 1999
Purchases Sales
--------------------------------------------------------------- ----------------------------------------------
Number of Number of
Description Amount Transactions Amount Transactions Cost Net Gain
------------------------------ ----------- -------------- ----------- ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Wellesly Income Fund* $ 3,884,495 64 $3,060,041 135 $2,953,763 $ 106,278
Retirement Savings Trust* $ 6,788,294 168 $6,590,784 128 $6,590,784 $ --
Titan Common Stock* $10,933,621 117 $9,951,717 149 $5,817,629 $ 4,134,088
U.S. Growth Fund* $12,397,666 131 $4,838,900 134 $3,762,501 $ 1,076,399
Windsor II* $ 6,528,059 99 $5,083,378 147 $4,526,573 $ 556,805
Prime Money Market* $ 5,538,072 131 $3,547,593 103 $3,547,593 $ --
(a) Represents transactions or a series of transactions in excess of 5% of the fair value of plan assets at the
beginning of the year.
* Represents a party-in-interest.
</TABLE>
<PAGE>
INDEX TO EXHIBITS
Page
Exhibit A. Consent of Independent Public Accountants.............. 19
Exhibit B. Summary Annual Report to Participants.................. 20
