UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
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____________
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
INTERNATIONAL GAME TECHNOLOGY
9295 Prototype Drive, Reno, NV 89511
(775) 448-7777
<PAGE>
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
Financial Statements for the Years Ended
December 31, 1999 and 1998, Supplemental
Schedules for the Year Ended December 31, 1999,
and Independent Auditors' Report
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
TABLE OF CONTENTS
--------------------------------------------------------------------------------
Page
Independent Auditors' Report 1
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available
for Benefits 3
Notes to Financial Statements 4
Item 27a - Supplemental Schedule of Assets Held
for Investment Purposes 9
Item 27d - Supplemental Schedule of Reportable
Transactions - Single Transactions in Excess of 5% of
Plan Assets 10
Item 27d - Supplemental Schedule of Reportable Transactions -
Series of Transactions in Excess of 5% of Plan Assets 11
<PAGE>
INDEPENDENT AUDITORS' REPORT
International Game Technology Profit Sharing Plan:
We have audited the accompanying statements of net assets available for benefits
of International Game Technology Profit Sharing Plan (the "Plan") as of December
31, 1999 and 1998, and the related statements of changes in net assets available
for benefits 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 benefits of the Plan at December 31, 1999
and 1998, and the changes in net assets available for benefits for the years
then ended in conformity with accounting standards 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 listed in the
Table of Contents 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 supplemental schedules are the responsibility of the Plan's
management. Such 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.
DELOITTE & TOUCHE LLP
Reno, Nevada
June 9, 2000
<PAGE>
4
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
ASSETS 1999 1998
Cash equivalents $ 165,913 $ 625,827
Investments, at fair value 98,384,023 87,659,661
Contributions receivable 16,354 291,822
Loans to participants 4,573,307 4,195,026
Refunds payable (63,053) (54,520)
------------- ------------
NET ASSETS AVAILABLE FOR
BENEFITS $ 103,076,544 $ 92,717,816
============= ============
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Investment income:
Net increase in fair value of investments $ - $ 3,443,483
Interest 539,685 461,061
Dividends and capital gains 4,708,713 3,975,441
------------ -----------
5,248,398 7,879,985
Contributions:
Employer 9,069,152 8,675,950
Participant 4,484,857 3,793,454
------------ -----------
Total additions 18,802,407 20,349,389
------------ -----------
DEDUCTIONS FROM NET ASSETS
ATTRIBUTED TO:
Net decrease in fair value of investments 395,119 -
Benefits paid to participants 7,910,308 7,171,897
Administrative expenses 138,252 482,138
------------ -----------
Total deductions 8,443,679 7,654,035
------------ -----------
NET INCREASE 10,358,728 12,695,354
NET ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF YEAR 92,717,816 80,022,462
------------ -----------
END OF YEAR $103,076,544 $92,717,816
============ ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 and 1998
--------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
The International Game Technology ("IGT") Profit Sharing Plan (the "Plan")
is sponsored by International Game Technology (the "Company") and consists
of two programs: The Profit Sharing Program and the 401(k) Program. The
following is a brief description of the Plan and provides general
information. Participants should refer to the IGT Plan Document and
Summary Plan Description for a more complete description of the Plan's
provisions.
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"), as amended, and other provisions of the
Internal Revenue Code.
The Plan, adopted December 10, 1980, is a defined contribution plan
covering all eligible employees of IGT. On June 1, 1993 the Plan was
restated to offer additional investment options to participants as well as
transfer the administration to a Third-Party Administrator. On April 1,
1999, the Plan Third-Party Administrator changed to Fidelity Investments.
Refer to "Investment Options" below for further information of available
investment funds with Fidelity Investments.
In September 1999, IGT purchased Sodak Gaming, Inc. ("Sodak"), a South
Dakota distributor of casino gaming products. On October 1, 1999, Sodak
employees became eligible to participate in the 401(k) Program. For Plan
year 2000, Sodak employees will be eligible for the Profit Sharing
Program.
Profit Sharing Program - The Company may make an annual profit sharing
contribution, as determined by the Company's Board of Directors, based on
operating profits. The contribution is then allocated to participant's
accounts proportionately based on annual eligible compensation. Refer to
"Benefit Payments and Vesting" below for the Profit Sharing Program
vesting schedule.
Company employees are eligible to participate in the Profit Sharing
Program after completing 1,000 hours of service in a calendar year and
reaching the age of 18. Once eligible, a Plan participant must be employed
on the last day of the Plan year (December 31) to receive their annual
profit sharing allocation. Participation in the Plan is retroactive to
January 1 of the year in which the employee became eligible.
401(k) Program - Effective January 1, 1989, the Plan was amended to allow
participants to defer up to 20% of their annual salary as contributions to
their accounts, as governed by IRC Section 401(k). On January 1, 1995, the
Company again amended the Plan to lower the elective deferrals from 20% to
15%. On January 1, 1998, the Company amended the Plan to lower the
elective deferrals for highly compensated employees to 7%. An employee may
begin contributing pre-tax contributions to their accounts upon completion
of 90 days of full time employment, or one year as a part-time employee. A
participant may stop contributing to the Plan at any time by notifying the
Third-Party Administrator.
On January 1, 1993, the Company began a 401(k) contribution matching
program whereby the Company matches 100% of an employee's contributions up
to $500 and an additional 50% of the next $500 contributed by the
employee. This allows for maximum annual Company matching contributions of
$750 to each employee's account. Employees are 100% vested in all 401(k)
contributions.
<PAGE>
The Plan also allows for rollover contributions from other qualified
retirement plans. If the rollover is by way of an individual retirement
arrangement, all assets in the prior retirement plan must have originated
as contributions made under a qualified plan.
Participant Accounts - Each participant's account is credited with
employee 401(k) and employer matching contributions, the allocations of
the Company's profit sharing contribution and forfeitures of non-vested
portions of terminated participants' account balances. Additionally,
participants' accounts are affected by earnings and losses on investments.
Each participant is provided a quarterly account statement detailing the
account activity by investment fund.
Investment Options - The Company has selected eleven investment options
that have a variety of growth and risk characteristics. Plan participants
are able to elect how their contributions are invested. A participant may
allocate all contributions to one investment fund or split them between
any combination of funds in increments of 1%. A participant may change how
current and/or future contributions are invested at any time during the
Plan year. The Plan's investment options are:
Retirement Money Market Portfolio
PIMCO Total Return Fund
Fidelity Puritan Fund
Fidelity Equity-Income II
Spartan U.S. Equity Index Fund
Baron Asset Fund
Fidelity Dividend Growth Fund
Fidelity OTC Portfolio
UAM: FMA Small Company Portfolio
Fidelity Diversified International Fund
IGT Unitized Stock Fund
The Company invests employer profit sharing contributions in Money Funds
that are not yet allocated to participants and distributed.
Benefit Payments and Vesting - Participants are immediately vested in
their pre-tax 401(k) contributions, Company 401(k) matching contributions,
and rollover contributions from other qualified plans, plus earnings
thereon. The vested portion of a participant's profit sharing account is
based upon years of continuous service. A participant is 100% vested after
seven consecutive years of service, per the following vesting table:
Completed Years
of Vesting Service Vested Portion
0 0%
1 10%
2 20%
3 30%
4 45%
5 60%
6 80%
7 100%
A participant earns a year of vesting service for each Plan year (January
1 to December 31) in which he or she worked at least 1,000 hours.
<PAGE>
Upon termination of employment, a participant may receive a lump sum
payment equal to the value of his or her account. If the termination of
employment is by normal retirement (retirement after age 65), by death or
by reason of total disability, the participant is 100% vested and has the
right to receive payment in full. If a participant leaves the Company for
any other reason, he or she is entitled to a distribution from the vested
portion of his or her account.
If a terminating participant's vested account balance totals $3,500 or
more, he or she may voluntarily defer payment of benefits until the normal
retirement date. In any case, he or she may not defer payment past the age
of 70 1/2. The only form of benefit payments are lump-sum payments,
however, a terminating participant may take a partial lump-sum payment and
defer the balance of his or her account as long as the remaining balance
is at least $3,500. Effective December 31, 1998, the Company amended the
Plan allowing terminated participants to voluntarily defer payment of
benefits until the normal retirement date if his or her vested account
balance totals $5,000 or more.
Hardship Withdrawals - The Plan allows for hardship withdrawals under
defined circumstances. The necessity of the hardship withdrawal is
reviewed by the Company's Benefits Committee and includes allowance for
major medical expenses, purchase of a primary residence, college expenses
for a family member, and prevention of eviction from or foreclosure on a
principal residence. A participant must stop making pre-tax 401(k)
contributions for a year following the hardship withdrawal.
Plan Termination - In the event of Plan termination, participants will
become 100% vested in their accounts. Although the Company has not
expressed any intent to do so, International Game Technology has the right
under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA.
Loans - The Plan allows for loans to be taken against a participant's
vested account, subject to the following restrictions: the loan amount may
be no less than $1,000 and no more than the lesser of 50% of the
participant's vested account balance or $50,000; interest is charged on a
simple interest basis at the prime rate plus 1%; and repayment must be
over a period not to exceed 60 months. Payments are made by payroll
deduction on a bi-weekly basis.
Administrative Expenses - Plan administrative expenses totaling $138,252
and $482,138 in 1999 and 1998, respectively, were paid by the Plan. These
include management fees and trustee fees. Consulting fees and
recordkeeping fees are paid by the Company.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The Plan is accounted for on the accrual basis of
accounting.
Cash Equivalents - Securities with maturities upon purchase of three
months or less are considered cash equivalents. Such investments are
stated at cost, which approximates market.
Investments, at Fair Value - All investments of the Plan are valued at
quoted market prices as of December 31, 1999 and 1998. Investments include
employer profit sharing contributions not yet distributed, and participant
investment options.
Beginning April 1, 1999 with Fidelity Investments, the IGT stock fund is a
unitized employer stock fund. The fund is comprised of the underlying
company stock and a short-term cash component. The value of a unit
reflects the combined market value of the stock and market value of the
cash component.
<PAGE>
Benefits Payable - As of December 31, 1999 and 1998, net assets available
for benefits included $13,696,112 and $8,524,708 due to participants who
have withdrawn from participation in the Plan, respectively.
Recently Issued Accounting Standards - The Plan has adopted Statement of
Position 99-3, "Accounting and Reporting of Certain Defined Contribution
Plan Investments and Other Disclosure Matters." As a result, the
reclassification of the prior year financial statements has been made to
eliminate the by-fund disclosure.
Reclassifications - Certain amounts in the 1998 financial statements have
been reclassified to conform to the 1999 method of presentation.
3. INVESTMENTS
All investments of the Plan are administered by an investment management
agent. The following table presents the fair value of investments at
quoted market prices at December 31:
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
Capital Market Group Government Money Fund $ - $ 12,021,465
Capital Market Group Intermediate Fixed
Income Fund - 5,877,761
Capital Market Group Small Capitalization
Growth Equity Fund - 10,469,793
Capital Market Group Large Capitalization
Growth Equity Fund - 17,934,439
Capital Market Group Large Capitalization
Value Equity Fund - 15,289,329
Capital Market Group International Equity
Investment Fund - 2,783,819
Money Funds - 7,845,154
Retirement Money Market Portfolio 14,655,845 -
PIMCO Total Return Fund 5,844,231 -
Fidelity Puritan Fund 635,900 -
Fidelity Equity-Income II 14,999,743 -
Spartan U.S. Equity Index Fund 1,656,265 -
Baron Asset Fund 10,766,104 -
Fidelity Dividend Growth Fund 19,648,161 -
Fidelity OTC Portfolio 3,967,991 -
UAM: FMA Small Company Portfolio 236,177 -
Fidelity Diversified International Fund 5,503,269 -
IGT Unitized Stock Fund 12,420,504 15,437,901
Spartan Money Market Fund 8,049,833 -
------------ ------------
Total investments $ 98,384,023 $ 87,659,661
============ ============
</TABLE>
<PAGE>
4. FUND INFORMATION
Changes in fair value of investments by fund are as follows for the years
ended December 31, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
<S> <C> <C>
Increase (Decrease) in Fair Value of Investments:
Capital Market Group Intermediate Fixed Income Fund $ (102,571) $ 57,966
Capital Market Group Small Capitalization Growth
Equity Fund (306,532) (196,025)
Capital Market Group Large Capitalization Growth
Equity Fund 1,406,914 4,209,487
Capital Market Group International Equity
Investment Fund (3,453) (309,809)
Capital Market Group Large Capitalization Value
Equity Fund 218,217 215,987
PIMCO Total Return Fund (284,409) -
Fidelity Puritan Fund (13,202) -
Fidelity Equity-Income II (1,532,784) -
Spartan U.S. Equity Index Fund 129,784 -
Baron Asset Fund 849,410 -
Fidelity Dividend Growth Fund (884,898) -
Fidelity OTC Portfolio 800,272 -
UAM: FMA Small Company Portfolio 7,629 -
Fidelity Diversified International Fund 1,448,288 -
IGT Unitized Stock Fund (2,121,891) (534,123)
-
Spartan Money Market Fund (5,893) -
----------- ----------
Total $ (395,119) $3,443,483
=========== ==========
</TABLE>
5. FEDERAL INCOME TAXES
The Plan has received a determination letter dated January 21, 2000 from
the Internal Revenue Service qualifying it as an exempt organization under
Sections 401(a) and 501(a) of the Internal Revenue Code. Accordingly, no
provision for federal income taxes has been made in the accompanying
financial statements.
******
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
ITEM 27a - SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1999
------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(b) (c) (d) (e)
-----------------------------------
Maturity Interest Current
Description Date Rate Units Cost Value
<S> <C> <C> <C>
Retirement Money Market Portfolio 14,655,845 $ 14,655,845 $ 14,655,845
PIMCO Total Return Fund 590,326 6,089,571 5,844,231
Fidelity Puritan Fund 33,416 643,544 635,900
Fidelity Equity-Income II 548,036 16,512,228 14,999,743
Spartan U.S. Equity Index Fund 31,796 1,532,695 1,656,265
Baron Asset Fund 183,190 9,986,558 10,766,104
Fidelity Dividend Growth Fund 677,757 20,417,199 19,648,161
Fidelity OTC Portfolio 58,379 3,177,347 3,967,991
UAM: FMA Small Company Portfolio 16,822 228,647 236,177
Fidelity Diversified International Fund 214,804 4,133,819 5,503,269
IGT Unitized Stock Fund 930,486 10,939,969 12,420,504
Spartan Money Market Fund 8,049,833 8,049,833 8,049,833
------------ -------------
Total investments 96,367,255 98,384,023
------------ -------------
Loan Fund 4,573,307 4,573,307
------------ -------------
Total investments and loan fund $100,940,562 $ 102,957,330
============ =============
<FN>
Notes on Columns (a) through (e):
(a) Omitted from the Department of Labor format because the answer is none.
(b) General description of investments.
(c) Maturity dates and stated rates of interest are not applicable due to the nature of these investments.
(d) Purchase price of investments.
(e) Fair market value of investments.
</FN>
</TABLE>
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
ITEM 27d - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS - SINGLE
TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1999
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(a) (b) (c) (d) (g) (h) (i)
Identity of Description Purchase Selling Cost of Value of Net
Party Involved of Transaction Price Price Asset Transaction Gain (Loss)
<S> <C> <C> <C> <C> <C>
Salomon Smith Barney Redemption of Govt Money Invts $ - $ 12,893,508 $ 12,893,508 $ 12,893,508 $ -
Salomon Smith Barney Purchase of Inter Fixed Income Invts - 5,745,861 5,785,093 5,745,861 (39,232)
Salomon Smith Barney Redemption of Large Cap Value
Equity Investments - 15,300,449 14,259,377 15,300,449 1,041,072
Salomon Smith Barney Redemption of Large Cap Growth
Investments - 19,253,756 12,300,539 19,253,756 6,953,217
Salomon Smith Barney Redemption of Small Cap Growth
Investments - 10,129,734 10,032,962 10,129,734 96,772
Salomon Smith Barney Redemption of Money Fund - 7,852,093 7,852,093 7,852,093 -
Fidelity Purchase of Fidelity Equity-Income II 15,300,543 - - - -
Fidelity Purchase of Fidelity Dividend Growth 19,253,784 - - - -
Fidelity Purchase of Retirement Money Market 12,906,602 - - - -
Fidelity Purchase of PIMCO Total Return 5,745,865 - - - -
Fidelity Purchase of Baron Asset Fund 10,129,820 - - - -
Fidelity Purchase of Spartan Money Market
Fund 7,941,681 - - - -
<FN>
Notes to columns (c) through (i)
(c) Purchase price of investments bought during the year.
(d) Proceeds received from redemption of investments maturing or sold during the year.
(e) and (f) Omitted from the Department of Labor format because the answer in none.
(g) Purchase price of investment plus or minus the amortization of discount or premium received or paid at the date of sale.
(h) Market value at the date of maturity or sale for each investment shown in column (d).
(i) Difference between columns (d) and (g).
</FN>
</TABLE>
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
ITEM 27d - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS - SERIES OF
TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1999
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(a) (b) (c) (d) (g) (h) (i)
Identity of Description Purchase Selling Cost of Value of Net
Party Involved of Transaction Price Price Asset Transaction Gain (Loss)
<S> <C> <C> <C> <C> <C>
Salomon Smith Barney Redemption of Gov't Money Invts $ - $ 13,959,261 $ 13,959,261 $ 13,959,261 $ -
Salomon Smith Barney Redemption of Intermediate Fixed
Income - 6,443,506 6,476,781 6,443,506 (33,275)
Salomon Smith Barney Redemption of Large Capitalization
Value Equity Invts - 16,246,223 15,151,108 16,246,223 1,095,115
Salomon Smith Barney Redemption of Large Capitalization
Growth Invts - 20,283,523 12,985,681 20,283,523 7,297,842
Salomon Smith Barney Redemption of Small Capitalization
Growth Invts - 10,942,945 10,824,369 10,942,945 118,576
Fidelity Redemption of Retirement Money
Market - 5,516,888 5,516,888 5,516,888 -
Fidelity Purchase of Fidelity Equity-Income II 15,922,955 - - - -
Fidelity Purchase of Fidelity Dividend Growth 20,433,827 - - - -
Fidelity Purchase of Retirement Money Market 17,075,024 - - - -
Fidelity Purchase of PIMCO Total Return 6,380,292 - - - -
Fidelity Purchase of Baron Asset Fund 11,053,620 - - - -
<FN>
Notes to columns (c) through (i)
(c) Purchase price of investments bought during the year.
(d) Proceeds received from redemption of investments maturing or sold during the year.
(e) and (f) Omitted from the Department of Labor format because the answer is none.
(g) Purchase price of investment plus or minus the amortization of discount or premium received or paid at the date of sale.
(h) Market value at the date of maturity or sale for each investment shown in column (d).
(i) Difference between columns (d) and (g).
</FN>
</TABLE>
<PAGE>
The Plan. 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, thereunto duly authorized.
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
Date: June 27, 2000
By: /s/ Maureen T. Mullarkey
------------------------
Maureen T. Mullarkey
Vice President, Finance and
Chief Financial Officer
