FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
(MARK ONE)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended October 31, 1999
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to _________________
Commission file number: 0-19056
-------
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
NORTHSTAR COMPUTER FORMS, 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:
Northstar Computer Forms, Inc.
7130 Northland Circle North
Brooklyn Park, Minnesota 55428
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
REPORT ON AUDITS OF FINANCIAL STATEMENTS AT
OCTOBER 31, 1999 AND 1998 AND FOR THE YEAR ENDED
OCTOBER 31, 1999 AND SUPPLEMENTAL SCHEDULES AT
AND FOR THE YEAR ENDED OCTOBER 31, 1999
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
INDEX TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
PAGE(S)
Report of Independent Accountants 2
Financial Statements:
Statements of Assets Available for Benefits at October 31, 1999 and 1998 3
Statement of Changes in Assets Available for Benefits for the year ended
October 31, 1999 4
Notes to Financial Statements 5-10
Supplemental Schedules:
Line 27a - Schedule of Assets Held for Investment Purposes at October 31, 1999 11
Line 27d - Schedule of Reportable Transactions for the year ended October 31, 1999 12-13
Line 27e - Schedule of Nonexempt Transactions for the year ended October 31, 1999 14
1
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
Northstar Computer Forms, Inc. 401(k) Profit Sharing Plan:
In our opinion, the accompanying Statements of Assets Available for Benefits and
the related Statement of Changes in Assets Available for Benefits present
fairly, in all material respects, the assets available for benefits of the
Northstar Computer Forms, Inc. 401(k) Profit Sharing Plan (the Plan) at October
31, 1999 and 1998, and the changes in assets available for benefits for the year
ended October 31, 1999, in conformity with accounting principles generally
accepted in the United States. 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 of these
statements in accordance with auditing standards generally accepted in the
United States, which 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, assessing the
accounting principles used and significant estimates made by the Plan's
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Assets Held
for Investment Purposes at October 31, 1999, and Reportable Transactions and
Nonexempt Transactions for the year ended October 31, 1999, are presented for
the purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules are the responsibility of the Plan's management. The supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/S/ PRICEWATERHOUSECOOPERS LLP
Minneapolis, Minnesota
April 7, 2000
2
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
STATEMENTS OF ASSETS AVAILABLE FOR BENEFITS
AT OCTOBER 31, 1999 AND 1998
- -------------------------------------------------------------------------------
ASSETS 1999 1998
Investments $7,227,611 $6,086,416
Participant loans 203,640 251,451
---------------- ----------------
Total investments 7,431,251 6,337,867
Receivables:
Employer profit sharing contributions 527,180 301,125
Employee contributions and rollovers 10,841 74,937
Interest and dividends - 12,398
---------------- ----------------
Assets available for benefits $7,969,272 $6,726,327
---------------- ----------------
---------------- ----------------
The accompanying notes are an integral part of the financial statements.
3
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
Additions (deductions):
Investment activities:
Net appreciation in fair value of investments $ 790,930
Interest 18,074
Dividends 79,098
Investment expenses (7,411)
----------------
Net investment income 880,691
Contributions:
Employer profit sharing contribution 527,180
Employee contributions and rollovers 562,021
----------------
Net additions 1,969,892
Other deductions:
Benefits paid to participants (726,947)
----------------
Net increase in assets available for benefits 1,242,945
Assets available for benefits, beginning of year 6,726,327
----------------
Assets available for benefits, end of year $7,969,272
----------------
----------------
The accompanying notes are an integral part of the financial statements.
4
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following is a general description of the Northstar Computer Forms,
Inc. 401(k) Profit Sharing Plan (the Plan). Participants should refer to
the Plan document for complete information regarding the Plan's
definitions, benefits, eligibility and other related matters.
GENERAL
The Plan is a contributory defined contribution plan covering
substantially all employees of Northstar Computer Forms, Inc. and its
wholly-owned subsidiary, General Financial Supply (collectively referred
to as the Company or Employer). The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974, as amended (ERISA)
and the Internal Revenue Code (IRC). In addition, these financial
statements have been prepared in compliance with ERISA.
The Plan was amended, effective December 1, 1998, to appoint U.S. Bank
National Association (the Trustee) as the Plan's trustee and recordkeeper
and to change investment options available to participants of the Plan.
All investments of the Plan existing prior to December 31, 1998,
excluding Northstar Computer Forms, Inc. common stock, were liquidated
and reinvested in the new investment funds of the Plan managed by First
American Asset Management or Fidelity Investments. Under the amended
Plan, Northstar Computer Forms, Inc. common stock is held in a separate
investment fund. The amended Plan provides participants the opportunity
to direct their profit sharing and 401(k) contributions into 13
investment funds, including the Northstar Computer Forms, Inc. common
stock fund.
ELIGIBILITY
Employees of the Company who have completed one year of service and have
worked at least 1,000 hours are eligible to participate in the Plan.
CONTRIBUTIONS
Participants may make deductible and nondeductible voluntary
contributions to the Plan subject to the Internal Revenue Service (IRS)
annual limitations. The Plan also allows rollovers of distributions from
other qualified plans.
Employer profit sharing contributions are determined based upon a
profitability formula subject to approval by and at the discretion of the
Company's Board of Directors for the Company's fiscal year, which
coincides with the Plan's fiscal year. The Company may also make
discretionary 401(k) contributions. For the year ended October 31, 1999,
no discretionary 401(k) contributions were made. Prior to December 1,
1998, Employer profit sharing contributions were allocated to the General
Fund, which invested primarily in stocks and bonds, and could not be
redirected by the participants. After December 1, 1998, Employer profit
sharing contributions are allocated based upon each participant's elected
investment allocations.
PARTICIPANT ACCOUNTS AND ALLOCATION
As of December 1998, the allocation of contributions to investment funds
and allocation of participants' accounts among these funds is directed by
the participant and may be changed daily.
5
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
Each participant's account is credited with the participant's
contributions and allocations of the Company's profit sharing
contribution and the Plan earnings. Allocations are based on participant
earnings or account balances, as defined. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account. Forfeitures of nonvested participant
accounts are first used to restore any forfeitures for rehired
participants, as defined in the Plan. Any remaining forfeitures are
allocated in the same manner as Employer profit sharing contributions.
VESTING
Vesting in Company profit sharing and 401(k) contributions and earnings
thereon occurs at the rate of 20% after three years of service, plus 20%
for each year of service thereafter, with 100% vesting occurring after
seven years. Participants are immediately vested in their voluntary
contributions and earnings thereon.
LOANS
Under provisions of the Plan, participants may borrow up to 50% of their
total vested account balance up to a maximum of $50,000. Loans bear
interest at a rate approximating the prime interest rate plus 1%,
determined at the time of loan origination. Loan repayments are made in
equal installments through payroll deductions generally over a term not
to exceed five years. The loan agreements require each participant's
outstanding loan balance to be paid in full prior to any distribution of
the participant's vested account balance. Interest rates on outstanding
loans as of October 31, 1999, ranged from 7.00% to 9.75%.
BENEFIT PAYMENTS
Upon termination from the Company due to death, disability or retirement,
a participant or beneficiary may elect to receive an amount equal to the
value of the participant's vested balance in his or her account as an
annuity contract or in a lump sum beginning at the later of the date
elected or the participant's normal retirement date.
ADMINISTRATIVE AND INVESTMENT COSTS
Administrative costs of the Plan are paid by the Company. Investment
expenses are paid by the Plan.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NEW ACCOUNTING STANDARD
In September 1999, the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants issued Statement of
Position 99-3, "Accounting for and Reporting of Certain Defined
Contribution Benefit Plan Investments and Other Disclosure Matters" (SOP
99-3). This statement simplifies the disclosure of certain investment
information of defined contribution plans and eliminates the requirement
for presentation of information by investment fund option. SOP 99-3 is
effective for financial statements for plan years ending after December
15, 1999, with earlier application encouraged. The Plan has elected to
adopt the provisions of this SOP for its plan year ended October 31,
1999.
6
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
BASIS OF ACCOUNTING
The financial statements of the Plan are prepared under the accrual
method of accounting.
VALUATION AND NET APPRECIATION (DEPRECIATION) IN THE FAIR VALUE OF
INVESTMENTS
Fair value of investments is determined by quoted market prices as
reported by the Trustee. Participant loans are recorded at estimated
fair value, consisting of outstanding principal and any related
accrued interest. The Plan presents in the Statement of Changes in
Assets Available for Benefits the net appreciation (depreciation) in
the fair value of its investments which consists of the realized gains
or losses and the unrealized appreciation (depreciation) on those
investments.
INVESTMENT INCOME
Interest on investments is recorded as income in the period in which it
is earned. Dividends are recorded on the ex dividend date.
BENEFITS PAID TO PARTICIPANTS
Benefits paid to participants are recorded as a reduction of assets
available for benefits when paid.
USE OF ESTIMATES
The preparation of the Plan's financial statements in conformity with
accounting principles generally accepted in the United States requires
the Plan to make significant estimates and assumptions that affect the
reported amounts of assets available for benefits at the date of the
financial statements and the changes in assets available for benefits
during the reporting period and, when applicable, disclosures of
contingent assets and liabilities at the date of the financial
statements. Actual results could differ from those estimates.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options in any combination of
investments and investment funds. Investments and investment funds are
exposed to various risks, such as interest rate, market and credit risk.
Due to the level of risk associated with certain investment securities,
it is at least reasonably possible that changes in the values of
investments will occur in the near term and that such changes could
materially affect participants' account balances and the amount reported
in the Statement of Assets Available for Benefits.
7
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
3. INVESTMENTS
The Plan's investments, at fair value, at October 31, 1999 and 1998, were
comprised of the following:
1999
First American Asset Management:
Stable Value Fund $ 349,032
Fixed Income Fund 167,441
Equity Index Fund 950,065
Large CAP Growth 160,027
MID CAP Value Fund 355,201
Small CAP Value Fund 174,314
International Fund 225,048
Strategy Income Fund 44,260
Strategy Growth & Income Fund 496,114
Strategy Growth Fund 2,882,450
Strategy Aggressive Growth Fund 61,021
Fidelity Investments Growth Opportunities Fund 472,484
Northstar Computer Forms, Inc. Common Stock Fund 890,154
----------------
$7,227,611
----------------
----------------
1998
-------------------------------------------------------------
Profit Sharing
----------------------------- Participant
Segregated Directed
General Investment 401(k)
Trust Fund Fund Funds Total
Interest-bearing cash and cash equivalents:
Kemper Securities $ 2,609,295 $ 45,503 $ 2,654,798
Other 170,739 20,094 190,833
Common stocks:
Northstar Computer Forms, Inc. 400,806 119,728 520,534
Other 286,029 462,635 748,664
Preferred stocks 26,400 201,048 227,448
Corporate bonds 54,972 91,605 146,577
Partnership interest 1,337 1,337
Mutual funds:
Minnesota Mutual Life Insurance
Company:
General Fund $ 184,695 184,695
Managed Fund 452,571 452,571
Growth I Fund 550,603 550,603
Fidelity Investments:
Growth IV Fund 408,356 408,356
-------------- ------------- -------------- --------------
Total investments $ 3,549,578 $ 940,613 $ 1,596,225 $ 6,086,416
-------------- ------------- -------------- --------------
-------------- ------------- -------------- --------------
8
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
During 1999, the Plan's investments (including the Plan's interest in
registered investment companies and investments bought, sold, or held
during the year) appreciated (depreciated) in value by $790,930 as
follows:
Mutual funds $ 831,052
Common stocks (32,183)
Preferred stocks (4,623)
Corporate bonds (3,316)
---------------
$ 790,930
---------------
---------------
4. PLAN TERMINATION
Although the Company has not expressed any intent to do so, it has the
right to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan
termination, participants will become fully vested in their accounts.
5. INCOME TAX STATUS
The Plan obtained its latest determination letter dated December 3, 1999,
in which the IRS stated that the Plan, as then designed, was in
compliance with the applicable requirements of the IRC. Therefore, no
provision for income taxes has been included in the Plan's financial
statements.
6. RELATED PARTY, PARTY-IN-INTEREST AND PROHIBITED TRANSACTIONS
The Plan held Northstar Computer Forms, Inc. common stock with fair
values of $890,154 and $520,534 at October 31, 1999 and 1998,
respectively. At October 31, 1999, 65,051 shares of common stock are
included in the Northstar Computer Forms, Inc. Common Stock Fund. At
October 31, 1998, the Plan held 75,714 shares of common stock. The
Company paid dividends of $.15 per share in fiscal year 1999. During
1999, the Plan made 45 sales and 51 purchases of these securities
totaling $125,238 and $208,479, respectively.
As discussed in Note 1, the Plan was amended effective December 1, 1998,
to appoint U.S. Bank National Association as trustee and recordkeeper.
Prior to the amendment, the investment managers of the Plan were
authorized under contract provisions or by ERISA regulations providing an
administrative or statutory exemption, to invest in securities under
their control. All investments existing prior to December 31, 1998, were
sold or distributed, except for the Northstar Computer Forms, Inc. common
stock. Cash was redirected by the Trustee to the investment elections
selected by the participants at that time.
9
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
During October 1999, the Company deducted, via payroll withholdings, an
aggregate of $10,841 from participants' gross wages. The Company
instructed the Trustee to transfer this amount to the Plan on a timely
basis, but the Trustee did not transfer the amount to the Plan within the
maximum period allowed by Department of Labor regulations. This amount is
reflected as an employee contribution receivable as of October 31, 1999.
The Employer will make an additional contribution of approximately $50,
which will be allocated to the affected participants' accounts for
estimated lost earnings resulting from the failure to remit this
contribution to the Plan on a timely basis.
7. SUBSEQUENT EVENT
On February 21, 2000, the Company announced that it has entered into a
definitive merger agreement with Ennis Business Forms to acquire all of
the stock of Northstar Computer Forms, Inc. This acquisition is subject
to customary terms and conditions and stockholder approval. The impact of
this potential transaction on the Plan has not been determined. Should
the transaction occur as planned, the Northstar Computer Forms, Inc.
Common Stock Fund would cease to exist. Each participant's share of the
fund assets would be reinvested in the Stable Value Fund.
10
SUPPLEMENTAL SCHEDULES
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AT OCTOBER 31, 1999
- --------------------------------------------------------------------------------
(c)
(b) DESCRIPTION OF INVESTMENT, INCLUDING (e)
IDENTITY OF ISSUE, BORROWER, MATURITY DATE, RATE OF INTEREST, (d) CURRENT
(a) LESSOR OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE COST VALUE
First American Asset Management Stable Value Fund $ 335,228 $ 349,032
First American Asset Management Fixed Income Fund 175,382 167,441
First American Asset Management Equity Index Fund 858,160 950,065
Fidelity Investments Growth Opportunities Fund 467,690 472,484
First American Asset Management Large CAP Growth Fund 143,626 160,027
First American Asset Management MID CAP Value Fund 385,219 355,201
First American Asset Management Small CAP Value Fund 175,222 174,314
First American Asset Management International Fund 180,241 225,048
First American Asset Management Strategy Income Fund 45,403 44,260
First American Asset Management Strategy Growth & Income Fund 469,731 496,114
First American Asset Management Strategy Growth Fund 2,643,739 2,882,450
First American Asset Management Strategy Aggressive Growth Fund 57,140 61,021
* U.S. Bank National Association Northstar Computer Forms, Inc.
Common Stock Fund 625,248 890,154
* Loans to participants Maturities from January 2000 to
September 2004 with interest
from 7.00% to 9.75% - 203,640
-------------- --------------
$ 6,562,029 $ 7,431,251
-------------- --------------
-------------- --------------
* Denotes party-in-interest
11
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
(a) (c) (d) (g)
IDENTITY OF (b) PURCHASE SELLING COST
PARTY INVOLVED DESCRIPTION OF ASSET PRICE PRICE OF ASSET
First American Asset Management Stable Value Fund
Purchases $ 408,026 $ 408,026
Sales $ 74,224 71,717
First American Asset Management Fixed Income Fund
Purchases 309,034 309,034
Sales 131,065 134,907
First American Asset Management Equity Index Fund
Purchases 992,616 992,616
Sales 143,990 127,576
Fidelity Investments Growth Opportunities
Purchases 523,251 523,251
Sales 54,725 54,059
First American Asset Management MID CAP Value Fund
Purchases 610,567 610,567
Sales 206,999 218,275
First American Asset Management Strategy Growth & Income Fund
Purchases 579,589 579,589
Sales 112,949 108,210
First American Asset Management Strategy Growth Fund
Purchases 3,640,300 3,640,300
Sales 1,042,701 995,740
(h)
(a) CURRENT VALUE (i)
IDENTITY OF OF ASSETS ON NET GAIN
PARTY INVOLVED TRANSACTION DATE OR (LOSS)
First American Asset Management
$ 408,026
74,224 $ 2,507
First American Asset Management
309,034
131,065 (3,842)
First American Asset Management
992,616
143,990 16,414
Fidelity Investments
523,251
54,725 666
First American Asset Management
610,567
206,999 (11,276)
First American Asset Management
579,589
112,949 4,739
First American Asset Management
3,640,300
1,042,701 46,961
Columns (e) and (f) are excluded as they are not applicable.
12
(a) (c) (d) (g)
IDENTITY OF (b) PURCHASE SELLING COST
PARTY INVOLVED DESCRIPTION OF ASSET PRICE PRICE OF ASSET
U.S. Bank National Association Northstar Computer Forms, Inc.
Common Stock Fund
Purchases $ 208,479 $ 208,479
Sales $ 125,238 102,950
Kemper Securities Money Market Fund
Sales 2,669,070 2,669,070
Minnesota Mutual Life Insurance Managed Fund
Company Sales 479,248 293,354
Minnesota Mutual Life Insurance Growth I Fund
Company Sales 595,319 353,253
Fidelity Investments Growth IV Fund
Sales 441,416 317,728
(h)
(a) CURRENT VALUE (i)
IDENTITY OF OF ASSETS ON NET GAIN
PARTY INVOLVED TRANSACTION DATE OR (LOSS)
U.S. Bank National Association
$ 208,479
125,238 $ 22,288
Kemper Securities
2,669,070
Minnesota Mutual Life Insurance
Company 479,248 185,894
Minnesota Mutual Life Insurance
Company 595,319 242,066
Fidelity Investments
441,416 123,688
Columns (e) and (f) are excluded as they are not applicable.
13
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
LINE 27e -SCHEDULE OF NONEXEMPT TRANSACTIONS
FOR THE YEAR ENDED OCTOBER 31, 1999
- -------------------------------------------------------------------------------
(b) (c)
RELATIONSHIP TO PLAN, DESCRIPTION OF TRANSACTIONS INCLUDING
(a) EMPLOYER OR OTHER MATURITY DATE, RATE OF INTEREST, COLLATERAL,
IDENTITY OF PARTY INVOLVED PARTY-IN-INTEREST PAR OR MATURITY VALUE
Northstar Computer Forms, Inc. Plan sponsor The Employer instructed the Trustee to
transfer participant contributions of
$10,841 into the trust on a timely basis.
The Trustee failed to transfer this
amount within the maximum period
allowed by Department of Labor
regulations. The Employer will make an
additional contribution of approximately
$50, which will be allocated to the
affected participants' accounts for
estimated lost earnings resulting from
the failure to remit this contribution to
the Plan on a timely basis.
Note: Columns (d), (e), (f), (g), (h), (i) and (j) are excluded as they are not
applicable.
14
NORTHSTAR COMPUTER FORMS, INC.
401(K) PROFIT SHARING PLAN
EXHIBITS
The following documents are filed as exhibits to this Report.
Exhibit No. Document
------------- ----------
23.1 Consent of Independent Accountants
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
NORTHSTAR COMPUTER FORMS, INC.
401(k) PROFIT SHARING PLAN
Date: April 28, 2000 By: /s/ Mary Ann Morin
--------------------------
Mary Ann Morin, Treasurer
and Chief Financial Officer
Northstar Computer Forms, Inc.
EXHIBIT INDEX
Exhibit No. Document Method of Filing
- ----------- -------- ----------------
23.1 Consent of Independent Accountants Filed herewith
electronically
15