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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Commission file number 001-15007
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
DAVE & BUSTER'S EMPLOYEE 401(k) SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
DAVE & BUSTER'S, INC.
2481 MANANA DRIVE
DALLAS, TEXAS 75220
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SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act
of 1934, the 401(k) Benefits Management Committee for the Dave & Buster's
Employee 401(k) Savings Plan has duly caused this annual report to be signed on
its behalf by the undersigned hereunto duly authorized.
DAVE & BUSTER'S EMPLOYEE 401(k) SAVINGS PLAN
By 401(k) Benefits Management Committee
Appointed Pursuant to the Plan:
Date: June 23, 2000 By: /s/ NANCY J. DURICIC
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V.P., Human Resources, Committee Member
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
FINANCIAL STATEMENTS
WITH SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1999 AND 1998
AND
REPORT OF INDEPENDENT AUDITORS
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
FINANCIAL STATEMENTS WITH SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1999 AND 1998
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Pages
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<S> <C>
Report of Independent Auditors 1
Financial Statements:
Statements of Net Assets Available for Benefits 2
Statement of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4 - 9
Supplemental Schedules: 10
Schedule H, Item 4i - Schedule of Assets Held for Investment Purposes 11
Schedule G, Part III - Schedule of Nonexempt Transactions 12
</TABLE>
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[SUTTON FROST CARY LLP LETTERHEAD]
REPORT OF INDEPENDENT AUDITORS
To the Administrative Committee
DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
We have audited the accompanying statement of net assets available for benefits
of Dave & Buster's Employee 401(k) Savings Plan (the "Plan") as of December 31,
1999 and the related statement of changes in net assets available for benefits
for the year 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 audit. The financial statement as of December
31, 1998 was audited by other auditors whose report dated September 15, 1999
expressed a qualified opinion on the statement as permitted by 29 CFR Sections
2520.103-8 of the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974.
We conducted our audit 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 audit provides 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 as of December 31,
1999 and the changes in net assets available for the benefits for the year then
ended in conformity with the generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The supplemental schedules of assets held for
investment purposes and nonexempt 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 of Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedules are the
responsibility of the Plan's management. Such information has been subjected to
the auditing procedures applied in the audit of the basic financial statements
and, in our opinion, is fairly stated in all material respects in relation to
the basic financial statements as a whole.
/s/ SUTTON FROST CARY
A Limited Liability Partnership
June 1, 2000
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
ASSETS
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
Cash $ -- $ 591
Investments, at fair value:
Interest in common/collective trust -- 137,875
Interest in registered investment company funds 3,172,675 1,443,739
Investment in Dave & Busters, Inc. common stock 34,040 --
Loans to participants 121,737 49,434
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Total cash and investments 3,328,452 1,631,639
Accrued income 11 888
Receivables:
Employer's contributions 79,405 88,151
Participants' contributions 131,375 136,033
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Net assets available for benefits $3,539,243 $1,856,711
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</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE> 7
DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED TO DECEMBER 31, 1999
<TABLE>
<S> <C>
Additions to net assets attributed to:
Interest $ 86,920
Net appreciation in fair value of investments 757,713
Contributions:
Employer's 386,629
Participants' 896,344
Transfers 57,572
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Total additions 2,185,178
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Deductions from net assets attributed to:
Distributions to participants 475,725
Transfers 24,921
Loan fees 2,000
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Total deductions 502,646
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Net increase 1,682,532
Net assets available for benefits:
Beginning of year 1,856,711
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End of year $3,539,243
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</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE> 8
DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
1 - DESCRIPTION OF PLAN
GENERAL
The DAVE & BUSTER'S EMPLOYEE 401(k) SAVINGS PLAN (the "Plan") is a defined
contribution plan and is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"). The Plan was established on January 1,
1996 covering substantially all employees of Dave & Buster's, Inc. (the
"Company"). During 1999, the Company established a new plan under the American
Express prototype plan. This plan has provisions similar to those of the Plan
established on January 1, 1996. American Express serves as the plan's
recordkeeper and trustee. The following descriptions provide only general
information. Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
PARTICIPANT ACCOUNTS
All employees of the Company twenty-one years old or older are eligible for
participation after they have completed six months of employment. Subject to
certain limitations on annual additions, each participant's account is credited
with (1) employee contributions, (2) Company contributions, and (3) an
allocation of Plan earnings. The allocations are based on participants' account
balances, as defined.
CONTRIBUTIONS
The Plan is funded through employee contributions and Company matching
contributions. A participant's salary deferrals may be between one percent and
fifteen percent, not to exceed Internal Revenue Service ("IRS") limitations each
year. The Company contributes an annual discretionary amount of up to six
percent of a participant's annual salary.
DISTRIBUTIONS TO PARTICIPANTS
Upon reaching normal retirement age, death, disability, or termination, a
participant's benefits are payable, at the election of the recipient, in a
lump-sum amount equal to 100% of the participant's salary deferrals and the
vested portion of the Company's matching contribution.
VESTING
Participants are immediately vested in their contributions plus actual earnings
thereon. Vesting in the Company's matching contribution portion of their account
plus actual earnings thereon is based on years of continuous service. The
participant is vested 25% per year beginning after one year of service and is
100% vested after four years of service or upon the first to occur of the
participant's retirement, death, or disability, as defined. The Company may use
forfeitures from nonvested participants to offset future Company contributions.
Unallocated forfeited nonvested account of $18,180 and $11,339 at December 31,
1999 and 1998, respectively, were available to reduce future contributions.
(Continued)
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
1 - DESCRIPTION OF PLAN (Continued)
PARTICIPANT LOANS
Loans are available for all participants. Participants are limited to a minimum
of $500 up to a maximum of the lesser of $50,000 or 50% of their vested account
balance, subject to certain restrictions as defined by the IRS. A one-time
orientation fee is charged at inception of the loan. The loans are secured by
the balance in the participant's account and bear interest based on the prime
rate reported in the Wall Street Journal plus 1% (8.75% to 9.5% for the year
ended December 31, 1999). The maximum repayment period is generally five years.
Repayments are made through payroll deductions and are reinvested in the
individual funds according to current investment elections.
ADMINISTRATIVE EXPENSES
The expenses incident to the operation of the Plan are paid by the Company.
PLAN TERMINATION
Although the Company expects to continue the Plan, it may be terminated by the
Company at any time subject to the provisions of ERISA. In the event the Plan is
terminated, each of the participants will have a nonforfeitable 100% vested
interest in his or her account balance, including all Company contributions,
subject to payment of liquidation costs and expenses.
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements have been prepared under the accrual method in
accordance with generally accepted accounting principles.
ESTIMATES AND ASSUMPTIONS
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of assets, liabilities and changes
therein, and the disclosure of contingent assets and liabilities. Actual results
could vary from the estimates used in preparing the accompanying financial
statements.
INVESTMENT VALUATION AND INCOME RECOGNITION
The fair value of the Plan's interest in registered investment company funds is
based on quoted market prices which represent the net asset value of shares held
by the Plan. Investments in common stock of the Company have been valued using
quoted market prices in active markets.
(Continued)
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
INVESTMENT VALUATION AND INCOME RECOGNITION (Continued)
Loans to participants are carried at the original loan principal balance, plus
accrued interest, less principal repayments, which approximates fair value. The
Plan presents the net change in fair value of registered investment company
funds and common stock of the Company, which consists of realized gains or
losses, unrealized appreciation (depreciation), and any income or capital gain
distributions from such investments, in the accompanying statement of changes in
net assets available for benefits.
Purchases and sale of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
The income earned on participants' accounts is allocated on a daily basis using
the previous day's ending account balance.
Items which have not been allocated to specific accounts as of year-end are
maintained in an unallocated account until they are passed to their respective
funds. These amounts principally relate to employee and employer matching
contributions.
BENEFITS
Benefits are recorded when paid.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options in mutual funds and other
investment securities. Investment securities are exposed to various risks, such
as interest rate, market and credit risks. Due to the level of risk associated
with certain investment securities, it is at least reasonably possible that
changes in the values of investment securities will occur in the near term and
that such changes could materially affect participants' account balance and the
amounts reported in the statement of net assets available for benefits.
3 - INVESTMENT OPTIONS
Effective October 1, 1999, participants may direct contributions in any of the
following investment options:
o American Express Trust Income Fund II - seeks to provide preservation
of principal and income while maximizing current income;
(Continued)
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
3 - INVESTMENT OPTIONS (Continued)
o AXP Bond Fund - seeks a high level of current income consistent with
the investment policies of the portfolio and with prudent investment
management;
o American Century Income & Growth Fund - seeks dividend growth, current
income and capital appreciation by investing in common stocks;
o American Express Trust Long-Term Horizon Fund - seeks high total
investment return consistent with prudent risk;
o American Express Trust Short-Term Horizon Fund - seeks to create a
diversified portfolio with a conservative risk profile appropriate for
individuals with short-term time horizons;
o American Express Trust Medium-Term Horizon Fund - seeks to create a
diversified portfolio with a conservative risk profile appropriate for
individuals with medium-term time horizons;
o AXP New Dimensions Fund - seeks to provide shareholders with long-term
growth of capital by primarily investing in common stocks showing
potential for significant growth due to superiority in technology,
marketing, or management;
o AXP Small Company Index Fund - seeks to achieve long-term capital
appreciation by investing in all or a representative group of stocks of
small companies comprising the S&P Small Cap 600 Index;
o Dave & Buster's Stock Pool - seeks to achieve long-term growth of
capital by investing in common stock of Dave & Buster's Co., Inc.;
o Janus Aspen Series International Growth Fund - seeks to provide
long-term capital growth, primarily through investment in equity
securities of foreign issuers of any size; and,
o Janus Aspen Series Aggressive Growth Portfolio - seeks long-term
capital growth by investing in common stocks of companies that display
the potential to become major enterprises.
Participants may modify investment elections, transfer existing account
balances, and obtain information regarding the investments on a daily basis.
(Continued)
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
3 - INVESTMENT OPTIONS (Continued)
Investments representing five percent or more of the fair value of assets
available for benefits at December 31, 1999 and 1998 are as follows:
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
American Express Trust Income Fund II $ 262,134 $ --
American Express Long-Term Horizon Fund 263,510 --
American Century Income & Growth Fund 1,077,639 --
Janus Aspen Series International Growth Fund 436,919 --
Janus Aspen Series Aggressive Growth Fund 952,802 --
ML Retirement Preservation Trust -- 137,875
MFS Emerging Growth Fund -- 319,604
ML Global Allocation Fund -- 147,199
Ivy International Fund -- 157,134
ML Basic Value Fund -- 721,060
ML Corporate Bond Fund -- 98,742
</TABLE>
4 - VESTED BENEFITS OF SEPARATED PARTICIPANTS
At December 31, 1999, $564,605 of vested benefits for separated participants
were included in net assets available for benefits.
5 - TAX STATUS OF THE PLAN
The Company adopted a prototype non-standardized target benefit plan developed
by American Express, which received a favorable determination letter from the
Internal Revenue Service ("IRS") on December 7, 1993. The Plan has been amended
since receiving the determination letter. However, the Plan's administrative
committee and the Plan's tax counsel believe that the Plan is currently designed
and being operated in compliance with the applicable requirement of the Internal
Revenue Code. Therefore, no provision for income taxes has been included in the
Plan's financial statements.
6 - PARTY IN INTEREST TRANSACTIONS
At December 31, 1999, the Plan held as an investment 4,671 shares of Company
common stock with a market value of $34,040.
(Continued)
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DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
(Continued)
7 - FORM 5500 INFORMATION
Amounts reported in the accompanying financial statements are different than the
amounts reported in the Plan's 1999 Form 5500 as follows:
<TABLE>
<CAPTION>
Financial Form
Statements 5500
---------- ----------
<S> <C> <C>
Receivables:
Employer's contributions $ 79,405 $ --
Participants' contributions 131,375 --
Contributions:
Employer's 386,629 443,257
Participants' 896,344 853,120
</TABLE>
These differences are due to the Form 5500 being prepared under a modified cash
basis and the financial statements being prepared under the accrual method in
accordance with generally accepted accounting principles.
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SUPPLEMENTAL SCHEDULES
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THE DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
ID #52-2082392
PLAN #001
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1999
<TABLE>
<CAPTION>
(b) (c) (d) (e)
Identity of issuer, Description of investment including
borrower, lessor, or similar maturity date, rate of interest, collateral,
party par or maturity value Number of Shares Cost Current Value
---------------------------- --------------------------------------------- ---------------- -------- -------------
<S> <C> <C> <C> <C>
* American Express Common stock - Dave & Busters, Inc. 4,671 $ 33,089 $ 34,040
Investments in Registered Investment Company funds:
* American Express American Express Trust Income Fund II 13,435 258,951 262,134
* American Express AXP Bond Fund 32,466 155,399 154,539
* American Express American Express Short-Term Horizon Fund 35 575 587
* American Express American Express Medium-Term Horizon Fund 18 375 381
* American Express American Express Long-Term Fund 9,995 222,215 263,510
* American Express American Century Income & Growth Fund 31,649 952,619 1,077,155
* American Express Janus Aspen Series International Growth Fund 11,334 284,061 436,919
* American Express AXP New Dimensions Fund 483 16,870 17,292
* American Express Janus Aspen Series Aggressive Growth Fund 16,174 608,702 952,802
* American Express AXP Small Company Index Fund 1,128 7,245 7,356
Participant loans with interest rates
at 8.75% to 9.5%, generally due
through 2004 -- -- 121,737
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$ 2,540,101 $3,328,452
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</TABLE>
* A party in interest as defined by ERISA
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THE DAVE & BUSTER'S
EMPLOYEE 401(k) SAVINGS PLAN
ID #52-2082392
PLAN #001
SCHEDULE G, PART III - SCHEDULE OF NONEXEMPT TRANSACTIONS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
Description of transactions
Relationship to the Plan, including maturity date,
Employer, or other party-in rate of interest, collateral,
Identity of Party Involved interest par or maturity value Purchase Price Selling Price
-------------------------- --------------------------- ----------------------------- -------------- -------------
<S> <C> <C> <C> <C>
Dave & Busters, Inc. Sponsor Employee contributions
for weekly pay period
ended August 29, 1999
were remitted to the
Plan on February 9,
2000 $ 48,936 N/A
Dave & Busters, Inc. Sponsor Employee contributions
for the month of July
1999 were remitted to
the Plan on August 26,
1999 $ 97,605 N/A
<CAPTION>
Description of transactions Expenses
Relationship to the Plan, including maturity date, incurred in
Employer, or other party-in rate of interest, collateral, connection with
Identity of Party Involved interest par or maturity value Lease Rental transaction
-------------------------- --------------------------- ----------------------------- ------------ ---------------
<S> <C> <C> <C> <C>
Dave & Busters, Inc. Sponsor Employee contributions
for weekly pay period
ended August 29, 1999
were remitted to the
Plan on February 9,
2000 N/A N/A
Dave & Busters, Inc. Sponsor Employee contributions
for the month of July
1999 were remitted to
the Plan on August 26,
1999 N/A N/A
<CAPTION>
Description of transactions
Relationship to the Plan, including maturity date,
Employer, or other party-in rate of interest, collateral, Current Value
Identity of Party Involved interest par or maturity value Cost of Asset of Asset
-------------------------- --------------------------- ----------------------------- ------------- --------------
<S> <C> <C> <C> <C>
Dave & Busters, Inc. Sponsor Employee contributions
for weekly pay period
ended August 29, 1999
were remitted to the
Plan on February 9,
2000 N/A $ 48,936
Dave & Busters, Inc. Sponsor Employee contributions
for the month of July
1999 were remitted to
the Plan on August 26,
1999 N/A $ 97,605
</TABLE>
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
23 Consent of Independent Auditors
</TABLE>
