-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ChwvAwq80rzBDlhzoozVH7DdZhTlObVECQ4t3KAQrfIG6zqkJM1Q583E3E6RGW13 kFgb1jZSv8NCXs58povfEA== 0000808220-99-000016.txt : 19990705 0000808220-99-000016.hdr.sgml : 19990705 ACCESSION NUMBER: 0000808220-99-000016 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990628 FILED AS OF DATE: 19990702 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SSE TELECOM INC CENTRAL INDEX KEY: 0000808220 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 521466297 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 000-16473 FILM NUMBER: 99658377 BUSINESS ADDRESS: STREET 1: 47823 WESTINGHOUSE DRIVE STREET 2: -- CITY: FREMONT STATE: CA ZIP: 94539 BUSINESS PHONE: (510) 657-7552 MAIL ADDRESS: STREET 1: 47823 WESTINGHOUSE DRIVE STREET 2: STE 710 CITY: FREMONT STATE: CA ZIP: 94539 11-K 1 ANNUAL REPORT SSE TELECOM,INC 401K PROFIT SHARING FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549 ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (X)Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 Commission file number 0-16473 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: SSE Telecom, Inc. 401(k) Profit Sharing Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: SSE Telecom, Inc. 47823 Westinghouse Drive Fremont, CA 94539 SIGNATURE 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. SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN Date: June 25, 1999 By /s/ James J. Commendatore ----------------------------- James J. Commendatore Chief Financial Officer SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN FINANCIAL STATEMENTS DECEMBER 31, 1998 AND 1997 SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN Financial Statements Years ended December 31, 1998 and 1997 Table of Contents Independent Accountants' Report...............................................4 Consent of Independent Accountants............................................5 Financial Statements: Statements of Net Assets Available for Plan Benefits..........................6 Statement of Changes in Net Assets Available for Plan Benefits, With Fund Information, for the Year Ended December 31, 1998................7 Statement of Changes in Net Assets Available for Plan Benefits, With Fund Information, for the Year Ended December 31, 1997...............10 Notes to Financial Statements................................................12 Consent of Independent Accountants...........................................18 To the Participants and Plan Administrator of the SSE Telecom, Inc. 401(k) Profit Sharing Plan INDEPENDENT ACCOUNTANTS' REPORT We have audited the financial statements of the SSE Telecom, Inc. 401(k) Profit Sharing Plan (the Plan) as of December 31, 1998 and 1997, 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 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 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 plan benefits of the Plan as of December 31, 1998 and 1997, and the changes in net assets available for plan 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 fund information in the statement of changes in net assets available for plan benefits is presented for purposes of additional analysis rather than to present the changes in net assets available for plan benefits for each fund. Fund information 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. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 25, 1999 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the use of our name on our report dated June 25, 1999, with respect to the financial statements of the SSE Telecom, Inc. 401(k) Profit Sharing Plan for the years ended December 31, 1998 and 1997, including the Annual Report on Form 11-K, which is filed electronically with the Securities and Exchange Commission. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 25, 1999 SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS December 31, ------------------------------------- 1998 1997 ----------------- ----------------- Investments, at fair value $5,648,934 $5,129,759 Investments, at contract value 317,491 205,458 ----------------- ----------------- Net assets available for plan benefits $5,966,425 $5,335,217 ================= ================= See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION For the year ended December 31, 1998 Net assets available Participants Withdrawals for plan benefit at Employer's contributions/ and December 31, 1997 contribution rollovers distributions T. Rowe Price: International Stock Fund ................ $ 174,486 $ 5,634 $ 26,832 ($ 12,405) Small-Cap Value Fund .................... 668,389 12,127 67,748 (235,636) Science and Technology Fund ............. 496,556 15,308 69,355 (52,118) Balanced Fund ........................... 272,672 6,301 27,912 (62,240) Spectrum Income Fund .................... 240,656 3,435 16,035 (4,754) Highmark Diversified Money Market Fund 176,992 10 31,396 (5,366) Union Bank Stable Value Fund ................ 205,458 6,525 35,724 (25,598) Strong Corporate Bond Fund .................. 136,176 4,870 43,567 (37,995) Vanguard Asset Allocation Fund .............. 345,313 13,213 106,655 (84,217) Highmark Value Momentum Fund ................ 404,747 10,919 71,231 (93,255) Vanguard Total Stock Market Fund ............ -- 1,434 12,307 (15,447) Vanguard Primecap Fund ...................... 770,221 33,745 238,765 (133,076) Dreyfus Appreciation Fund ................... 794,224 22,533 147,652 (352,085) Templeton World I Fund ...................... 432,730 12,147 63,730 (124,214) SSE Telecom, Inc. Common Stock Fund ......... 55,101 2,375 13,941 (9,510) Participant loans ........................... 161,496 -- -- (4,647) Totals .................................. $ 5,335,217 $ 150,576 $ 972,850 ($1,252,563) See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION For the year ended December 31, 1998 Net appreciation Dividends (depreciation) Administration and in fair value Net loan fees interest investments activities T. Rowe Price: International Stock Fund ................ -- -- $ 40,771 $ 499 Small-Cap Value Fund .................... -- -- (85,426) (2,938) Science and Technology Fund ............. -- -- 176,965 (470) Balanced Fund ........................... -- -- 35,864 346 Spectrum Income Fund .................... -- -- 15,099 (3,240) Highmark Diversified Money Market Fund ($16,888) $12,155 -- (2,606) Union Bank Stable Value Fund ................ -- -- 12,292 2,105 Strong Corporate Bond Fund .................. -- -- 12,669 (603) Vanguard Asset Allocation Fund .............. -- -- 91,299 (13,407) Highmark Value Momentum Fund ................ -- -- 27,237 (5,780) Vanguard Total Stock Market Fund ............ -- -- 31,292 (5,910) Vanguard Primecap Fund ...................... -- -- 200,103 (11,182) Dreyfus Appreciation Fund ................... -- -- 207,781 (6,941) Templeton World I Fund ...................... -- -- 20,122 (10,404) SSE Telecom, Inc. Common Stock Fund ......... -- 261 (39,798) 964 Participant loans ........................... -- 18,547 -- 59,567 Totals .................................. ($16,888) $30,963 $ 746,270 $ -- See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION For the year ended December 31, 1998 Increase Net assets available Transfers (decrease) for plan benefits at in (out) in net assets December 31, 1998 T. Rowe Price: International Stock Fund ................ ($223,475) ($162,144) $ 12,342 Small-Cap Value Fund .................... (40,003) (284,128) 384,261 Science and Technology Fund ............. (385,759) 110,797 Balanced Fund ........................... (268,926) (260,743) 11,929 Spectrum Income Fund .................... (74,400) (47,825) 192,831 Highmark Diversified Money Market Fund 27,360 46,061 223,053 Union Bank Stable Value Fund ................ 80,985 112,033 317,491 Strong Corporate Bond Fund .................. 29,431 51,939 188,115 Vanguard Asset Allocation Fund .............. 291,566 405,109 750,422 Highmark Value Momentum Fund ................ (40,772) (30,420) 374,327 Vanguard Total Stock Market Fund ............ 639,104 662,780 662,780 Vanguard Primecap Fund ...................... (81,929) 246,426 1,016,647 Dreyfus Appreciation Fund ................... 118,611 137,551 931,775 Templeton World I Fund ...................... 161,449 122,830 555,560 SSE Telecom, Inc. Common Stock Fund ......... (5,655) (37,422) 17,679 Participant loans ........................... (18,547) 54,920 216,416 Totals .................................. $ -- $ 631,208 $ 5,966,425 See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION For the year ended December 31, 1997 Net assets available Participants' Withdrawals Dividends for plan benefits Employer's contributions/ and and December 31, 1996 contribution rollovers distribution interest T. Rowe Price: International Stock Fund ......... $ 447,361 $ 8,877 $ 73,875 ($ 68,397) -- Small-Cap Value Fund ............. 935,640 14,888 131,465 (118,822) -- Science and Technology Fund ...... 1,293,727 26,269 205,263 (150,693) -- Balanced Fund .................... 677,835 12,131 96,992 (144,732) -- Spectrum Income Fund ............. 500,121 6,448 59,238 (66,362) -- Prime Reserve Fund ............... 420,749 975 45,575 (10,104) $ 10,969 International Bond Fund .......... 14,575 375 4,239 (1,111) -- Highmark Diversified Money Market Fund -- 8,387 15,281 (158,096) 7,908 Union Bank Stable Value Fund ......... -- 6,042 12,350 (3,088) -- Strong Corporate Bond Fund ........... -- 3,258 11,902 (1,376) -- Vanguard Asset Allocation Fund ....... -- 11,716 29,293 (1,804) -- Highmark Value Momentum Fund ......... -- 10,562 46,524 (1,380) -- Vanguard Primecap Fund ............... -- 28,507 104,760 (9,386) -- Dreyfus Appreciation Fund ............ -- 20,195 74,198 (39,995) -- Templeton World I Fund ............... -- 15,710 57,624 (12,560) -- SSE Telecom, Inc. Common Stock Fund .. -- 2,733 7,357 (8,069) -- Participant loans .................... 172,236 -- -- (23,195) 14,746 Contributions receivable ............. 52,636 (16,464) (36,172) -- -- Totals ........................... $4,514,880 $ 160,609 $ 939,764 ($ 819,170) $ 33,623 See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION For the year ended December 31, 1997 Net appreciation (depreciation) Increase Net assets available in fair value Net loan Transfers (decrease) for plan benefits at investments activities in (out) in net assets December 31, 1997 T. Rowe Price: International Stock Fund ......... $ 19,079 $ 1,270 ($ 307,579) ($ 272,875) $ 174,486 Small-Cap Value Fund ............. 191,032 (4,512) (481,302) (267,251) 668,389 Science and Technology Fund ...... 104,503 (9,473) (973,040) (797,171) 496,556 Balanced Fund .................... 104,391 (15,616) (458,329) (405,163) 272,672 Spectrum Income Fund ............. 44,357 4,151 (307,297) (259,465) 240,656 Prime Reserve Fund ............... -- 5,667 (473,831) (420,749) -- International Bond Fund .......... (265) 46 (17,859) (14,575) -- Highmark Diversified Money Market Fund -- (195) 303,707 176,992 176,992 Union Bank Stable Value Fund ......... 2,715 2,020 185,419 205,458 205,458 Strong Corporate Bond Fund ........... 5,198 (219) 117,413 136,176 136,176 Vanguard Asset Allocation Fund ....... 4,257 2,678 299,173 345,313 345,313 Highmark Value Momentum Fund ......... 28,844 (4,338) 324,535 404,747 404,747 Vanguard Primecap Fund ............... (20,289) 7,594 659,035 770,221 770,221 Dreyfus Appreciation Fund ............ 32,375 8,404 699,047 794,224 794,224 Templeton World I Fund ............... (7,574) 3,312 376,218 432,730 432,730 SSE Telecom, Inc. Common Stock Fund .. (3,112) 1,502 54,690 55,101 55,101 Participant loans .................... -- (2,291) -- (10,740) 161,496 Contributions receivable ............. -- -- -- (52,636) -- Totals ........................... $ 505,511 $ -- $ -- $ 820,337 $5,335,217 See independent accountants' report and accompanying notes to financial statements.
SSE TELECOM, INC. 401(k) PROFIT SHARING PLAN NOTES TO FINANCIAL STATEMENTS December 31, 1998 and 1997 Note 1 - The Plan and its significant accounting policies: The following description of the SSE Telecom, Inc. (the Company) 401(k) Profit Sharing 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 established in 1981 by the Company to provide benefits to eligible employees. On July 1, 1997, the Company amended and restated the Plan to remove the age and service requirements for eligibility. As amended, the Plan covers all employees of the Company who are not otherwise covered by a collective bargaining agreement. The amended and restated Plan also provides for accelerated vesting of participant accounts. 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 - In conjunction with the adoption of the amended and restated Plan, the Company designated Union Bank of California (Union Bank) trustee and custodian of Plan investments effective July 1997 and contracted with Union Bank to maintain the records of participant data. The Company has appointed an Administrative Committee (the Committee) to manage the operation and administration of the Plan. Substantially all expenses incurred for administering the Plan are paid by the Company. Investments - From January 1996 through June 1997, T. Rowe Price Services, Inc. (T. Rowe Price) was Plan custodian and assets were invested in seven funds sponsored by T. Rowe Price. In conjunction with the July 1997 change in custodian to Union Bank, T. Rowe Price transferred investments of the Plan to Union Bank. The Committee eliminated two T. Rowe Price mutual funds and added nine new investment funds in 1997, including the SSE Telecom, Inc. Stock Fund which is invested in shares of the Company's common stock. The Committee restricts participants' investments in the SSE Telecom, Inc. Stock Fund to a maximum of 10% of their total account value. One additional investment fund was added in 1998. Assets are invested based solely upon instructions received from participants. The Plan's investment in mutual funds and the Company's common stock are valued at fair value as of the last day of the Plan year, as measured by quoted market prices. The Union Bank Stable Value fund is a collective trust fund invested primarily in a diversified portfolio of guaranteed insurance contracts and is valued at contract value (purchase price plus interest) as of the last day of the Plan year as reported by Union Bank. The yield fluctuates daily and was 5.93% and 6.01% at December 31, 1998 and 1997, respectively. Vesting - Participants are immediately vested in their salary deferral, rollover contributions and related earnings. Effective July 1, 1997, participants vest in the Company matching contributions and profit sharing contributions allocated to their account as follows: Years of service Vested percentage One year 20% Two years 40% Three years 60% Four years 80% Five or more years 100% Forfeitures of terminated participants non-vested account balances are first used to pay Plan administrative expenses and then to reduce Company matching contributions. Income taxes - The Plan has applied for and received a favorable determination letter dated October 23, 1998. The Committee intends that the Plan qualifies under the applicable requirements of the Internal Revenue Code and related state statutes and 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 investment options in any combination from among 15 different funds including the Company stock fund. Investment securities 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 plan benefits and the statements of changes in net assets available for plan benefits. Note 2 - Participation and benefits: Employee contributions - Participants may elect to have the Company contribute a percentage, from 1% to 20%, of their eligible pre-tax compensation up to the amount allowable under current income tax regulations. 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 is allowed to make matching contributions as defined in the Plan and as approved by the Board of Directors. The Company matched 50% of each eligible participant's contribution up to a maximum of 6% of the participant's compensation, not to exceed $1,000 in 1998 and 1997. The Plan also allows for a discretionary profit sharing contribution. No discretionary contribution has been made for the years ended December 31, 1998 and 1997. Participant accounts - Each participant's account is credited with the participant's contribution, Plan earnings or losses and an allocation of the Company's contribution. 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. 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 the available market financing rates 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 may be extended. The specific terms and conditions of such loans are established by the Committee. Note 3 - Plan obligations: Included in net assets available for plan benefits at December 31, 1998, 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 $88,000. Note 4 - Party in interest transactions: As allowed by the Plan, participants may elect to invest a portion of their accounts in the common stock of the Company. The aggregate investment in Company common stock at December 31, 1998 and 1997 was as follows: Number of Shares Fair Value Cost 1998 12,263 $16,173 $52,013 Cash in stock liquidity fund 1,506 1,506 ----------- ----------- $17,679 $53,519 ======= ======= 1997 11,246 $53,418 $56,670 Cash in stock liquidity fund 1,683 1,683 ----------- ----------- $55,101 $58,353 ======= =======
Note 5 - 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. Note 6 - Investments The following table includes the contract or fair values of investments and investment funds that represent 5% or more of the Plan's net assets at December 31: 1998 1997 ---- ---- T. Rowe Price: International Stock Fund $ 12,342 $ 174,486 Small-Cap Value Fund 384,261 668,389 Science and Technology Fund 110,797 496,556 Balanced Fund 11,929 272,672 Spectrum Income Fund 192,831 240,656 Highmark Diversified Money Market Fund 223,053 176,992 United Bank Stable Value Fund 317,491 205,458 Strong Corporate Bond Fund 188,115 136,176 Vanguard Total Stock Market Fund 662,780 Vanguard Asset Allocation Fund 750,422 345,313 Highmark Value Momentum Fund 374,327 404,747 Vanguard Primecap Fund 1,016,647 770,221 Dreyfus Appreciation Fund 931,775 794,224 Templeton World I Fund 555,560 432,730 SSE Telecom, Inc. Common Stock Fund 17,679 55,101 Participant Loans 216,416 161,496 -------------- -------------- Assets held for investment purposes $5,966,425 $5,335,217 ========== ==========
Note 7 - Year 2000 compliance (unaudited): The Plan, as with most users of computer software, may be required to modify significant portions of its internally used software to enable it to function properly in the year 2000. In addition, the Plan must also insure that its service providers are in compliance with the year 2000 issue. Since the Plan uses mainly third-party service providers, it does not anticipate a problem in resolving the year 2000 issue in a timely manner. Note 8 - Subsequent event: Due to a reduction in force of approximately 54 employees in 1999, the Plan experienced a partial termination. The Company intends to amend the Plan to provide that all affected participants be 100% vested in their accounts as of June 25, 1999. Exhibit 1 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the Registration Statements (Form S-8) pertaining to the SSE Telecom, Inc. 401(k) Profit Sharing Plan of our report dated June 25, 1999, with respect to the financial statements of the SSE Telecom, Inc. 401(k) Profit Sharing Plan included in the Annual Report (Form 11-K) for the year ended December 31, 1998. MOHLER, NIXON & WILLIAMS Accountancy Corporation Campbell, California June 25, 1999 -----END PRIVACY-ENHANCED MESSAGE-----