SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM - 11K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES ACT OF 1934
[ ] 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 1934
COMMISSION FILE NUMBER: 1-10210
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
EGLOBE, INC.
1250 24TH STREET, N.W. SUITE 725, WASHINGTON, DC, 20037
<PAGE>
eGLOBE, INC. 401(K)
PROFIT SHARING PLAN
CONTENTS
--------------------------------------------------------------------------------
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS F-1
FINANCIAL STATEMENTS
Statements of Net Assets Available for Benefits F-2 - F-3
Statements of Changes in Net Assets Available
for Benefits F-4 - F-5
Notes to Financial Statements F-6 - F-10
SUPPLEMENTAL SCHEDULE
Schedule H, Line 4i - Assets Held for Investment
Purposes at End of Year F-11
SIGNATURE PAGE
EXHIBIT 23.1
Consent of BDO Seidman, LLP
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Plan Administrator of eGlobe, Inc.
401(k) Profit Sharing Plan
Washington, D.C.
We have audited the accompanying statements of net assets available for benefits
of the eGlobe, Inc. 401(k) Profit Sharing Plan (formerly the Executive Telecard,
Ltd. 401(k) 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 year ended December 31, 1999 and the nine months ended December 31, 1998.
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 generally accepted auditing
standards. 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 eGlobe, Inc.
401(k) Profit Sharing Plan at December 31, 1999 and 1998, and the changes in its
net assets available for benefits for the year ended December 31, 1999 and the
nine months ended December 31, 1998, in conformity with generally accepted
accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
accompanying table of contents is presented for the purpose of additional
analysis and is not a required part of the basic financial statements but is
supplementary information required by the Department of Labor's Rule and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The Fund information in the statements of net assets
available for benefits and the statements of changes in net assets available for
benefits is presented for purposes of additional analysis rather than to present
the net assets available for plan benefits and changes in net assets available
for plan benefits of each fund. The supplemental 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.
/s/ BDO Seidman, LLP
Denver, Colorado
June 6, 2000
F-1
<PAGE>
<TABLE>
<CAPTION>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
Money Investment Large Cap eGlobe, Inc.
Market Grade Bond Blend Appreciation World Common Participant
December 31, 1999 Funds Fund Fund Fund Fund Stock Loans
------------------------------------ -------- -------------- --------- ------------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT FAIR VALUE (Note 2)
Money Market Funds $ 70,887 $ -- $ -- $ -- $ -- $ -- $ --
Mutual Funds:
Smith Barney Investment
Grade Bond Fund -- 56,570 -- -- -- -- --
Smith Barney Large Cap
Blend Fund -- -- 130,559 -- -- -- --
Smith Barney Appreciation Fund -- -- -- 172,835 -- -- --
Smith Barney World Fund -- -- -- -- 59,905 -- --
eGlobe, Inc. Common Stock -- -- -- -- -- 162,919 --
Participant Loans -- -- -- -- -- -- 44,757
------------------------------------ ------------ ------------- ------------ ------------- ------------ -------------- ----------
Total investments 70,887 56,570 130,559 172,835 59,905 162,919 44,757
CONTRIBUTIONS RECEIVABLE -
Employee -- -- -- -- -- -- --
INTERFUND RECEIVABLE/PAYABLE (38,678) 1,541 19,630 12,547 10,169 (5,209) --
------------------------------------ ------------ ------------- ------------ ------------- ------------ -------------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $ 32,209 $ 58,111 $ 150,189 $ 185,382 $ 70,074 $ 157,710 $ 44,757
==================================== ========= ========= ========= ========= ========= =========== ========
</TABLE>
<TABLE>
<CAPTION>
Other Total
----- ------------
<S> <C> <C>
ASSETS
INVESTMENTS, AT FAIR VALUE (Note 2)
Money Market Funds $ -- $ 70,887*
Mutual Funds:
Smith Barney Investment
Grade Bond Fund -- 56,570*
Smith Barney Large Cap
Blend Fund -- 130,559*
Smith Barney Appreciation Fund -- 172,835*
Smith Barney World Fund -- 59,905*
eGlobe, Inc. Common Stock -- 162,919*
Participant Loans -- 44,757*
------------------------------------------------- -----------
Total investments -- 698,432
CONTRIBUTIONS RECEIVABLE -
Employee 17,744 17,744
INTERFUND RECEIVABLE/PAYABLE -- --
------------------------------------------------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $ 17,744 $ 716,176
==============================================================
*Represents 5% or more of net assets available for benefits See accompanying notes to financial statements.
</TABLE>
F-2
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Money Investment eGlobe, Inc.
Market Grand Bond Large Cap Appreciation World Common
December 31, 1998 Funds Fund Blend Fund Fund Fund Stock Other Total
------------------------------------ ----------- ----------- ------------- ----------- --------- ------------- ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
INVESTMENTS, AT FAIR VALUE (Note 2)
Money Market Funds $ 46,247 $ -- $ -- $ -- $ -- $ -- $ -- $ 46,247*
Mutual Funds:
Smith Barney Investment
Grade Bond Fund -- 28,139 -- -- -- -- -- 28,139*
Smith Barney Large Cap
Blend Fund -- -- 101,308 -- -- -- -- 101,308*
Smith Barney Appreciation Fund -- -- -- 114,505 -- -- -- 114,505*
Smith Barney World Fund -- -- -- -- 39,671 -- -- 39,671*
eGlobe, Inc. Common Stock -- -- -- -- -- 46,114 -- 46,114*
------------------------------------ ----------- ----------- ------------- ----------- ----------- ----------- -------- ---------
Total investments 46,247 28,139 101,308 114,505 39,671 46,114 -- 375,984
CONTRIBUTIONS RECEIVABLE -
Employee -- -- -- -- -- -- 21,861 21,861
Contribution payable -- -- -- -- -- -- (273) (273)
INTERFUND RECEIVABLE/PAYABLE (14,706) 1,531 5,308 7,736 175 (44) -- --
------------------------------------ ----------- ----------- ------------- ------------- ----------- ----------- -------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $ 31,541 $ 29,670 $106,616 $ 122,241 $ 39,846 $ 46,070 $21,588 $397,572
==================================== ========= ======== ======== =========== ========== ======== ======= ========
*Represents 5% or more of net assets available for benefits See accompanying notes to financial statements.
</TABLE>
F-3
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Money Investment Large Cap eGlobe, Inc.
Market Grade Bond Blend Appreciation World Common Participant
Year Ended December 31, 1999 Funds Fund Fund Fund Fund Stock Loans
---------------------------------- -------- ---------- -------- ------------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Employee contributions $ 23,108 $ 35,345 $ 45,626 $ 67,108 $ 11,621 $ 30,745 $ 911
Employee rollovers -- -- 44,173 40,984 28,072 7,500 --
Dividend income 2,201 -- -- -- -- -- --
Interest on participant loans -- -- -- -- -- -- 1,041
Net appreciation (depreciation)
in fair value of investments -- (4,684) 13,756 16,109 22,436 89,143 --
----------------------------------- ---------- -------- ------------- ------------ ---------- ---------- ------------
Total additions 25,309 30,661 103,555 124,201 62,129 127,388 1,952
DEDUCTIONS - Benefits paid
to participants 8,148 7,368 52,520 78,494 17,845 9,960 --
----------------------------------- ---------- -------- ------------- ------------ ---------- ---------- ------------
NET INCREASE PRIOR TO 17,161 23,293 51,035 45,707 44,284 117,428 1,952
INTERFUND TRANSFERS
INTERFUND TRANSFERS (16,493) 5,148 (7,462) 17,434 (14,056) (5,788) 42,805
----------------------------------- ---------- -------- ------------- ------------ ---------- ---------- ------------
NET INCREASE (DECREASE) 668 28,441 43,573 63,141 30,228 111,640 44,757
NET ASSETS AVAILABLE FOR BENEFITS,
beginning of year 31,541 29,670 106,616 122,241 39,846 46,070 --
---------------------------------- -------- -------- ---------- --------------- ------------ ---------- ------------
NET ASSETS AVAILABLE FOR BENEFITS,
end of year $ 32,209 $ 58,111 $ 150,189 $ 185,382 $ 70,074 $ 157,710 $44,757
----------------------------------- --------- ------------ ---------- --------------- ------------ ----------- ------------
</TABLE>
<TABLE>
<CAPTION>
Other Total
----- ---------
<S> <C> <C>
ADDITIONS:
Employee contributions $ 17,744 $ 232,208
Employee rollovers -- 120,729
Dividend income -- 2,201
Interest on participant loans -- 1,041
Net appreciation (depreciation)
in fair value of investments -- 136,760
----------------------------------- ------------- ---------
Total additions 17,744 492,939
DEDUCTIONS - Benefits paid
to participants -- 174,335
----------------------------------- ------------- ---------
NET INCREASE PRIOR TO 17,744 318,604
INTERFUND TRANSFERS
INTERFUND TRANSFERS (21,588) --
----------------------------------- ------------- ---------
NET INCREASE (DECREASE) (3,844) 318,604
NET ASSETS AVAILABLE FOR BENEFITS,
beginning of year 21,588 397,572
---------------------------------- ------------ ----------
NET ASSETS AVAILABLE FOR BENEFITS,
end of year $ 17,744 $ 716,176
----------------------------------- ---------- -------------
See accompanying notes to financial statements.
F-4
</TABLE>
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Money Investment eGlobe, Inc.
Market Grade Bond Large Cap Appreciation Common
Nine Months Ended December 31, 1998 Funds Fund Blend Fund Fund World Fund Stock Other Total
------------------------------------- --------- ----------- ----------- ---------- ---------- --------- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Employee contributions $14,852 $ 14,031 $ 37,185 $ 37,725 $12,790 $32,230 $ 21,588 $ 170,401
Employee rollovers 1,863 503 1,138 1,138 1,641 635 -- 6,918
Dividend income 1,077 -- -- -- -- -- -- 1,077
Net appreciation (depreciation)
in fair value
of investments -- 1,295 4,001 10,018 (1,785) (36,373) -- (22,844)
------------------------------------ -------- ------------ -------- ---------- --------- --------- --------- ----------
Total additions 17,792 15,829 42,324 48,881 12,646 (3,508) 21,588 155,552
DEDUCTIONS - Benefits paid
to participants 11,561 14,735 32,823 12,104 6,824 796 -- 78,843
------------------------------------ -------- ------------ -------- ---------- -------- -------- ---------- ---------
NET INCREASE (DECREASE) PRIOR TO
INTERFUND TRANSFERS 6,231 1,094 9,501 36,777 5,822 (4,304) 21,588 76,709
INTERFUND TRANSFERS 1,190 4,289 4,451 1,964 1,607 1,815 (15,316) --
------------------------------------ -------- ------------ -------- ---------- -------- -------- ---------- ---------
NET INCREASE (DECREASE) 7,421 5,383 13,952 38,741 7,429 (2,489) 6,272 76,709
NET ASSETS AVAILABLE FOR BENEFITS,
beginning of year 24,120 24,287 92,664 83,500 32,417 48,559 15,316 320,863
------------------------------------ -------- ----------- --------- ---------- -------- --------- -------- ---------
NET ASSETS AVAILABLE FOR BENEFITS,
end of year $31,541 $ 29,670 $ 106,616 $122,241 $39,846 $ 46,070 $ 21,588 $ 397,572
=================================== ======= ========= ========= ======== ======= ========= ======== =========
See accompanying notes to financial statements.
F-5
</TABLE>
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1. PLAN DESCRIPTION
The following description of the eGlobe, Inc. 401(k) Profit Sharing Plan
(formerly the Executive TeleCard, Ltd. 401(k) Profit Sharing Plan) (the "Plan"),
provides only general information. Participants should refer to the plan
agreement for a more complete description of the Plan's provisions.
GENERAL
The Plan is a defined contribution profit-sharing plan, which covers
substantially all employees of eGlobe, Inc. (the "Company"). Effective April 1,
1998, the Plan changed its year-end from March 31 to December 31. The Plan is
maintained for the exclusive benefit of eligible employees of the Company and
their beneficiaries to provide a means to accumulate retirement savings, to
provide retirement funds and to provide benefits in the event of the death or
disability. The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
ELIGIBILITY
All employees of the Company who have obtained the age of 21 and completed three
months of service (as defined) are eligible to participate in the elective
contributions. An employee must complete one year of service (as defined) to
participate in any employer matching or profit sharing contributions in the
Plan.
CONTRIBUTIONS
Each participant may elect to make salary reduction contributions from 1% of
his/her annual compensation to a maximum of the highest deferral allowed by the
nondiscrimination rules of the Internal Revenue Code. Participant salary
deferrals cannot exceed a maximum dollar amount determined by the Federal
Government each year. The pre-tax contribution limit is indexed annually for
inflation. The amount was $10,000 for 1999 and 1998. The Company may also make,
on an annual basis, a matching contribution equal to a percentage of each
participant's discretionary contribution.
F-6
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
Additionally, the Company may make, on an annual basis, a discretionary profit
sharing contribution to the Plan. The Company has not made any employer
contributions since the inception of the Plan.
PARTICIPANT ACCOUNTS
Earnings, net gains and losses are allocated among those participating in the
fund based on the ratio of each participant's average account balance to the
total of all participants' average account balances related to that fund.
Currently, the Plan offers a money market, four mutual funds, and eGlobe Inc.
common stock as investment options for participants. Participants may change
their investment options at anytime.
FORFEITURES AND PLAN EXPENSES
The amount of any nonvested forfeitures attributed to a participant's break in
service, as specified by the plan agreement, is generally used to offset plan
expenses and/or reduce future employer contributions for the next plan year.
VESTING
All participants' contributions are fully vested. A participant has a
nonforfeitable right to a percentage of the balance in his/her Company
contribution account commencing after one year of service (as defined) of 20%
and increasing to 100% after five years of service. Upon death, total
disability, reaching retirement age or termination of the Plan, a participant's
account becomes fully vested.
F-7
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
PARTICIPANT LOANS
An employee, with the consent of the plan administrator, may borrow up to
50% of their account balance, however, not less than $500 and not to exceed
$50,000. The loan bears interest at the prevailing rate charged by lenders for a
loan of similar type and must be repaid within five years, unless such loan is
for a participant's primary residence, in which case, the loan must be repaid
within thirty years. The loans bear interest at 10% to 10.50% at December 31,
1999. Principal and interest is paid ratably through monthly payroll deductions.
PAYMENT OF BENEFITS
Upon termination of service due to death, disability, retirement, or upon
reaching age 59-1/2, a participant may elect to receive either a lump-sum amount
equal to the value of the participant's vested interest in his or her account or
installment payments as defined by the plan agreement.
ADMINISTRATIVE EXPENSES
The Company pays administrative expenses of the Plan without reimbursement.
PLAN AMENDMENT AND TERMINATION
Although it has not expressed any intent to do so, the Company has the right to
discontinue contributions at any time and terminate the Plan, subject to the
provisions of ERISA. In the event the Plan is terminated, the accounts of all
participants would become fully vested, and the assets would be distributed
among the participants in accordance with the terms set forth in the Plan.
F-8
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Plan's financial statements have been prepared in accordance with the
financial reporting requirements of ERISA.
BASIS OF ACCOUNTING
The accompanying financial statements have been prepared on the accrual basis of
accounting.
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 amount of additions and deductions during the reporting period.
Actual results could differ from those estimates.
VALUATION OF INVESTMENTS
Investments are stated at fair value based upon current quoted market prices.
Participant loans are stated at cost, which approximates fair value. Purchases
and sales of securities are recorded as of the trade date. Interest income is
recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
F-9
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
RECLASSIFICATIONS
Certain reclassifications have been made to the 1998 financial statements in
order for them to conform to the 1999 presentation.
3. INCOME TAX STATUS
The Plan has obtained its latest determination letter on September 30, 1998, in
which the Internal Revenue Service has stated that the Plan is qualified and the
related trust is tax exempt.
F-10
<PAGE>
SUPPLEMENTAL SCHEDULE
--------------------------------------------------------------------------------
<PAGE>
eGLOBE, INC.
401(K) PROFIT SHARING PLAN
SCHEDULE H, LINE 4i - SCHEDULE OF ASSETS HELD FOR INVESTMENT
PURPOSES AT END OF YEAR
--------------------------------------------------------------------------------
EIN: 84-1346369
Plan Number 001
December 31, 1999
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e)
Number of Current
Identity of Issue Shares Cost Value
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
* Smith Barney Exchange Reserve Money
Market Portfolio 1,879 a $ 1,879
* Smith Barney Money Funds Cash Portfolio 69,008 a 69,008
* Smith Barney Investment Grade Bond Fund 5,046 a 56,570
* Smith Barney Large Cap Blend Fund 7,813 a 130,559
* Smith Barney Appreciation Fund 11,037 a 172,835
* Smith Barney World Funds 1,852 a 59,905
* eGlobe, Inc. Common Stock 36,710 a 162,919
Participant Loans, 10% - 10.50% 44,757
---------------------------------------------------------------------------------------------------------------------
$ 698,432
---------------------------------------------------------------------------------------------------------------------
See accompanying report of independent certified public accountants.
</TABLE>
* There were no non-exempt party-in-interest transactions.
a - The cost of participant-directed investments is not required to be
disclosed.
F-11
<PAGE>
SIGNATURE
Pursuant to the requirements of Securities Exchange Act of 1934, the Plan
Administrator has duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: July 13, 2000
eGlobe, Inc.
By:/s/ Anne Haas
-----------------------------
Anne Haas
Controller, Treasurer
(Principal Accounting Officer)
