<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 11-K
(X) Annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934
or
( ) Transition Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934
For the Fiscal year Ended May 31, 2000
Commission file number 33-62357
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
TAB Products Co. Tax Deferred Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
TAB Products Co.
2130 Gold Street, P.O. Box 649061
San Jose, CA 95164-9061
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934,
the administrator has duly caused this annual report to be signed on its behalf
by the undersigned hereunto duly authorized.
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
Date: November 27, 2000 By /s/R. J. Sexton
------------------------------
R. J. Sexton, Treasurer and
Member of the Administrative
Committee for the Plan
Page 1
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
FINANCIAL STATEMENTS
MAY 31, 2000 AND 1999
Page 2
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
Financial Statements and
Supplemental Schedule
YEARS ENDED MAY 31, 2000 AND 1999
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Independent Accountants' Report...................................................................................4
Financial Statements:
Statements of Net Assets Available for Benefits...................................................................5
Statements of Changes in Net Assets Available for Benefits........................................................6
Notes to Financial Statements.....................................................................................7
Supplemental Schedule as of May 31, 2000.........................................................................15
Schedule of Assets Held for Investment Purposes at End of Year...................................................16
</TABLE>
Page 3
<PAGE>
To the Participants and
Plan Administrator of the
TAB Products Co.
Tax Deferred Savings Plan
INDEPENDENT ACCOUNTANTS' REPORT
We have audited the financial statements of the TAB Products Co. Tax
Deferred Savings Plan (the Plan) as of May 31, 2000 and 1999, and for the years
then ended, as listed in the accompanying table of contents. 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 audits 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 the
Plan's 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
Plan as of May 31, 2000 and 1999, and the changes in net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedule 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 Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. This supplemental schedule
is the responsibility of the Plan's management. The supplemental schedule 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 taken as a whole.
MOHLER, NIXON & WILLIAMS
Accountancy Corporation
Campbell, California
November 17, 2000
Page 4
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
May 31,
----------------------------------------
2000 1999
-------------- -------------
<S> <C> <C>
Investments, at fair value $17,466,056 $18,602,366
-------------- -------------
Assets held for investment purposes 17,466,056 18,602,366
Non interest bearing cash account 867,161
Employer's contribution receivable 19,435
Participants' contributions receivable 67,734
Accrued interest and dividends receivable 6,782
-------------- -------------
Net assets available for benefits $18,333,217 $18,696,317
============== =============
</TABLE>
See independent accountants' report and
accompanying notes to financial statements.
Page 5
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
For the years ended
May 31,
-------------------------------------
2000 1999
------------ ------------
<S> <C> <C>
Additions (deductions) to net assets attributed to:
Investment income:
Dividends and interest $ 130,985 $ 1,019,864
Net realized and unrealized appreciation
(depreciation) in fair value of investments 293,355 (5,011,816)
------------ ------------
424,340 (3,991,952)
------------ ------------
Contributions:
Participants' 1,997,553 1,765,896
Employer's 763,866 449,132
------------ ------------
2,761,419 2,215,028
------------ ------------
Total additions (deductions) 3,185,759 (1,776,924)
------------ ------------
Deductions from net assets attributed to:
Withdrawals and distributions 3,517,031 3,402,119
Administrative expenses 31,828
------------ ------------
Total deductions 3,548,859 3,402,119
------------ ------------
Net decrease (363,100) (5,179,043)
Net assets available for benefits:
Beginning of year 18,696,317 23,875,360
------------ ------------
End of year $18,333,217 $ 18,696,317
============ ============
</TABLE>
See independent accountants' report and
accompanying notes to financial statements.
Page 6
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2000 AND 1999
NOTE 1 - THE PLAN AND ITS SIGNIFICANT ACCOUNTING POLICIES:
The following description of the TAB Products Co. Tax Deferred Savings
Plan (the Plan) provides only general information. Participants should refer to
the Plan document for a more complete description of the Plan's provisions.
The Plan is a defined contribution plan that was adopted in 1956 by TAB
Products Co. (the Company) to provide benefits to eligible employees. The Plan
covers all employees of the Company except employees covered by a collective
bargaining agreement, independent contractors, and non-resident aliens.
Effective June 1, 1999, the Plan document was amended and restated to
increase the limit of the matching contribution from 2% to 3% of eligible
participants' compensation. In addition, the Company may make a discretionary
matching contribution as determined by the Board of Directors every year. This
discretionary matching contribution is in addition to the 50% match and the
incentive contribution. Also, the Plan was amended to provide for a special
matching contribution for Plan years beginning June 1, 1999 through June 1,
2001, to qualified employees based on years of service.
Effective June 1, 1999, each eligible employee who had not completed an
enrollment election form was automatically enrolled in the Plan. All eligible
employees hired after June 1, 1999 who do not complete an enrollment election
form will automatically be enrolled in the Plan on the first payroll period
following his or her date of hire. Any participant who is automatically enrolled
in the Plan will have a deferral contribution made on his or her behalf equal to
1% of his or her eligible compensation that will be invested in the Plan's
investment options as determined by the Administrative Committee (the
Committee).
The Company sold its Field Service Group to Bell & Howell effective
June 1, 1999. Employees of the Field Service Group have the option to rollover
their funds to the Bell & Howell's 401(k) plan, leave their funds in the Plan or
withdraw their funds.
Page 7
<PAGE>
The Plan administrator believes that the Plan is currently designed and
operated in compliance with the applicable requirements of the Internal Revenue
Code and the provisions of the Employee Retirement Income Security Act of 1974
(ERISA).
ADMINISTRATION -
The Company has appointed the Committee to manage the operation and
administration of the Plan. A third-party administrator processes and maintains
the records of participant data. On June 1, 1999, the Company contracted with
Charles Schwab Trust Company (Charles Schwab) to act as the custodian and
trustee in place of Merrill Lynch Trust Company (Merrill Lynch). Substantially
all expenses incurred for administering the Plan are paid by the Company;
however, beginning in fiscal 2000, in connection with the change in
administrators, the cost of the third-party administrator is paid by the Plan.
BASIS OF ACCOUNTING -
The financial statements of the Plan are prepared on the accrual method
of accounting. Participant and Company matching contributions are recorded in
the period during which the Company withholds payroll deductions from
participants' earnings. Company discretionary contributions are recorded in the
period to which they relate.
Benefits are recorded when paid.
FORFEITED ACCOUNTS -
At May 31, 2000, forfeited nonvested accounts totaled approximately
$45,000. These accounts will be used to reduce future employer contributions.
Also in fiscal year 2000, employer contributions were reduced by approximately
$51,000 from forfeited nonvested accounts.
INVESTMENTS -
Participant contributions to the Plan were held by Charles Schwab and
Merrill Lynch and invested based solely upon instructions received from
participants. Company matching contributions to the Plan are non-participant
directed and are invested in shares of the Company's common stock.
The Plan's investments in mutual funds and Company common stock are
valued at fair value as of the last day of the Plan year, as measured by quoted
market prices. Participant loans are valued at cost, which approximates fair
value.
Page 8
<PAGE>
INCOME TAXES -
The Plan has been amended since receiving its latest favorable
determination letter dated March 29, 1996. However, the Company believes that
the Plan is operated in accordance with, and continues to qualify under, the
applicable requirements of the Internal Revenue Code and related state statutes,
and that the trust, which forms a part of the Plan, is exempt from federal
income and state franchise taxes.
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
changes therein, and disclosure of contingent assets and liabilities. Actual
results could differ from those estimates.
RISKS AND UNCERTAINTIES -
The Plan provides for various mutual fund investment options and
investment in Company common stock. These investments are exposed to various
risks, such as interest rate, market fluctuations and credit risks. Due to the
level of risk associated with certain investment securities, it is at least
reasonably possible that changes in risks in the near term would materially
affect participants' account balances and the amounts reported in the statements
of net assets available for benefits and the statements of changes in net assets
available for benefits.
NOTE 2 - RELATED PARTY TRANSACTIONS:
Certain Plan investments were shares of mutual funds managed by Charles
Schwab and Merrill Lynch. Any purchases and sales of these funds are open market
transactions at fair market value. Such transactions, while considered
party-in-interest transactions under ERISA regulations, are permitted under the
provisions of the Plan and are specifically exempt from the prohibition of
party-in-interest transactions under ERISA.
Page 9
<PAGE>
NOTE 3 - PARTICIPATION AND BENEFITS:
PARTICIPANT CONTRIBUTIONS -
Participants may elect to have the Company contribute a percentage,
from 1% to 15%, of their eligible pre-tax compensation up to the amount
allowable under the Internal Revenue Code. Participants who elect to have the
Company contribute a portion of their compensation to the Plan agree to accept
an equivalent reduction in taxable compensation. Contributions withheld are
invested in accordance with the participant's direction and are allocated to
funds in 1% increments.
Participants are also allowed to make rollover contributions of amounts
received from other tax-qualified employer-sponsored retirement plans. Such
contributions are deposited in the appropriate investment funds in accordance
with the participant's direction and the Plan's provisions.
EMPLOYER CONTRIBUTIONS -
The Company makes matching contributions equal to 50% of each eligible
participant's contribution up to a maximum of 3% of the participant's
compensation (2% prior to June 1, 1999). In addition, the Company may make a
special matching contribution for the Plan years beginning June 1, 1999 through
June 1, 2001. Also, the Company is allowed to make discretionary matching
contributions as determined each year by the board of directors. The Company may
also make an incentive contribution equal to a percentage of the matching
contribution for each participant if the Company's net profits (as defined in
the Plan) exceed 5% of the Company's revenues for the Plan year. The Company
made a special matching contribution of approximately $111,000 for fiscal 2000.
No discretionary or incentive contributions have been made for the years ended
May 31, 2000 and 1999. The Company's contributions are invested in the Company's
common stock and may be made in the form of cash or common stock of the Company.
Cash contributions are used to purchase shares of the Company's common stock on
the open market (at the then prevailing market price), directly from the
Company, or from other persons in private transactions. During fiscal 2000 and
1999, all Company contributions were made in cash. The Company's actual
contribution may be reduced by certain available forfeitures, if any, during the
Plan year.
VESTING -
Participants are immediately vested in their salary deferral
contributions, rollover contributions and related earnings. Participants begin
to vest after two years of service and are fully vested in the employer's
matching contributions and incentive contributions allocated to their account
after five years of credited service.
Page 10
<PAGE>
PARTICIPANT ACCOUNTS -
Each participant's account is credited with the participant's
contribution, the Company's matching contribution, special matching
contribution, discretionary matching contribution and incentive contribution, if
any, along with the participant's allocable shares of the Plan's earnings or
losses. Allocation of the Company's contribution is based on participant
contributions.
PAYMENT OF BENEFITS -
Upon termination, the participant or beneficiary will receive the
benefits in a lump sum amount equal to the value of the participant's vested
interest in his or her account. Distributions are in cash, except the
participant may elect to have his or her investment in Company common stock
distributed in whole shares of Company common stock. The Plan allows for
automatic lump sum distribution of participant vested account balances that do
not exceed $5,000.
LOANS TO PARTICIPANTS -
The Plan allows participants to borrow not less than $1,000 and up to
the lesser of $50,000 or 50% of their vested account balance. The loans are
secured by the participant's vested balance. Such loans bear interest at 1%
above the prime rate as published in the Wall Street Journal and must be repaid
to the Plan within a five-year period, unless the loan is used for the purchase
of a residence in which case the maximum repayment period is 15 years. The
specific terms and conditions of such loans are established by the Committee. At
May 31, 2000, outstanding loans to participants carried interest rates that
ranged from 8.75% to 10.0%.
NOTE 4 - PLAN OBLIGATIONS:
Included in net assets available for benefits at May 31, 2000, are
benefits due to withdrawing participants for benefit claims which have been
processed and approved for payment prior to year-end, but not yet paid, of
approximately $755,000. This amount is reflected as a liability in the Form 5500
filing with the Department of Labor.
Page 11
<PAGE>
NOTE 5 - INVESTMENTS:
The following table includes the fair values of investments that
represent 5% or more of the Plan's net assets at May 31:
<TABLE>
<CAPTION>
2000 1999
---- ----
<S> <C> <C>
Charles Schwab:
Scudder Growth and Income Fund $ 133,164
Managers Special Equity Fund 214,125
Managers International Equity Fund 438,745
Dreyfus S & P 500 Index Fund 770,065
Morley Stable Value Fund 1,988,141
Dreyfus Midcap Index Fund 219,777
Russell Equity Aggressive Strategy
Income Fund 7,484,437
Russell Conservation Strategy 3,212
Russell Moderate Strategy Fund 21,278
Russell Balanced Strategy Fund 1,380,179
Russell Aggressive Strategy Fund 440,393
Schwab Money Market Fund 72,709
Schwab Government Money
Market Fund 14,773
Schwab Total Bond Market Index Fund 1,261,307
Merrill Lynch:
Retirement Preservation Trust $ 2,843,036
Growth Fund Class A 2,528,126
Global Allocation Fund Class A 336,457
AIM Equity Constellation Fund 1,744,446
Templeton Foreign Fund 441,293
Basic Value Fund Class A 5,250,554
Corporate Bond Fund Investment
Grade Class A 1,653,912
TAB Products Co. Common Stock 2,608,396* 3,249,024*
Participant loans 415,355 555,518
----------------- ----------------
Assets held for investment
purposes $ 17,466,056 $ 18,602,366
================= ================
</TABLE>
*Includes participant and non-participant directed amounts
Page 12
<PAGE>
The Plan's investments (including gains and losses on investments
bought and sold, as well as held during the year) appreciated (depreciated) in
value as follows:
<TABLE>
<CAPTION>
Years ended May 31,
2000 1999
---- ----
<S> <C> <C>
Common stock $ (921,093) $ (3,836,015)
Mutual funds 1,214,448 (1,175,801)
----------------- ----------------
$ 293,355 $ (5,011,816)
================= ================
</TABLE>
NOTE 6 - NONPARTICIPANT-DIRECTED INVESTMENTS
As discussed in Note 3, the Company's matching contributions are
invested in Company common stock and cannot be transferred to other investment
funds. As a result, the portion of the Company common stock that relates to
employer contributions is a nonparticipant-directed investment. The net assets
and significant components of the changes in net assets relating to Company
common stock (which includes participant and nonparticipant-directed
investments) are as follows:
<TABLE>
<CAPTION>
May 31,
2000 1999
---- ----
Net Assets:
Common stock $ 2,608,396 $ 3,249,024
================= ================
<S> <C> <C>
Changes in Net Assets:
Employer contributions $ 802,455 $ 439,420
Employee contributions 51,983 111,022
Dividends received 75,638 95,418
Net realized and unrealized
depreciation in fair value of
investments (921,093) (3,836,015)
Withdrawals and distributions (572,598) (589,778)
Net transfers from (to) participant-directed
investments (77,013) 66,310
----------------- ----------------
Net decrease (640,628) (3,713,623)
Net assets beginning of year 3,249,024 6,962,647
----------------- ----------------
Net assets end of year $ 2,608,396 $ 3,249,024
================= ================
</TABLE>
Page 13
<PAGE>
NOTE 7 - INVESTMENT IN COMPANY COMMON STOCK:
As allowed by the Plan, participants may elect to invest a portion of
their accounts in Company common stock. All Company contributions may be made in
Company common stock or cash, which is used to purchase Company common stock in
the open market. Aggregate investment in Company common stock at May 31, 2000
and 1999 was as follows:
<TABLE>
<CAPTION>
MAY 31, NUMBER OF SHARES FAIR VALUE COST
------- ---------------- ---------- ----
<S> <C> <C> <C>
2000 545,195 $2,608,396 $3,008,549
1999 499,850 $3,249,024 $2,660,176
</TABLE>
NOTE 8 - PLAN TERMINATION AND/OR MODIFICATION:
The Company intends to continue the Plan indefinitely for the benefit
of its employees; however, it reserves the right to terminate and/or modify the
Plan at any time by resolution of its Board of Directors and subject to the
provisions of ERISA. In the event the Plan is terminated in the future,
participants would become fully vested in their accounts.
Page 14
<PAGE>
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
SUPPLEMENTAL SCHEDULE
MAY 31, 2000
Page 15
<PAGE>
<TABLE>
<CAPTION>
EIN: 94-1190862
Plan # : 001
TAB PRODUCTS CO.
TAX DEFERRED SAVINGS PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
MAY 31, 2000
(a) (b) (c) (e)
Description of investment including
Identity of issue, borrower, maturity date, rate of interest, Current
lessor or similar party collateral, par or maturity value. value
------ -------------------------------------------------------- ----------------------------------------- ------------------
<S> <C> <C>
* Schwab Government Money Market Fund Cash fund $ 14,773
* Schwab Money Market Fund Cash fund 72,709
Dreyfus Midcap Index Fund Mutual fund 219,777
Dreyfus S & P 500 Index Fund Mutual fund 770,065
Managers International Equity Fund Mutual fund 438,745
Managers Special Equity Fund Mutual fund 214,125
Morley Stable Value Fund Mutual fund 1,988,141
Russell Aggressive Strategy Fund Class E Mutual fund 440,393
Russell Balanced Strategy Fund Class E Mutual fund 1,380,179
Russell Conservation Strategy Fund Class E Mutual fund 3,212
Russell Equity Aggressive Strategy Income Fund Mutual fund 7,484,437
Russell Moderate Strategy Fund Class E Mutual fund 21,278
* Schwab Total Bond Market Index Fund Mutual fund 1,261,307
* Scudder Growth and Income Fund Mutual fund 133,164
* Tab Products Co. Common Stock 2,608,396
* Participant loans Interest rates: 8.75% to 10.0% 415,355
------------------
$17,466,056
==================
</TABLE>
* Parties in interest
Page 16
