UNITED STATES
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, 2000
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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COMMISSION FILE NUMBER: 0-31983
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
Garmin International, Inc. Savings and Profit Sharing Plan
c/o Garmin International, Inc.
1200 East 151st Street
Olathe, KS 66062
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Garmin Ltd.
P.O. Box 30464SMB
113 South Church Street
George Town
Grand Cayman, Cayman Islands
CONTENTS
Report of Independent Auditors................................................1
Financial Statements
Statements of Net Assets Available for Plan Benefits as of
December 31, 2000 and 1999....................................................2
Statement of Changes in Net Assets Available for Plan Benefits
for the Year Ended December 31, 2000 .........................................3
Notes to Financial Statements.................................................4
Supplemental Schedule
Schedule H, Line 4i - Schedule of Assets Held for Investment
Purposes at End of Year....................................................8
Signature Page................................................................9
Exhibit
Exhibit 23 - Consent of Independent Accountants..............................10
A schedule of party-in-interest transactions has not been presented because
there were no party-in-interest transactions, which are prohibited by ERISA
Section 406 and for which there is no statutory or administrative exemption.
Schedules of loans, fixed income obligations, and leases in default or
uncollectible are not presented, since such loans, fixed income obligations,
or leases are not present
Report of Independent Auditors
The Plan Administrator
Garmin International, Inc.
Savings and Profit Sharing Plan
We have audited the accompanying statements of net assets available for plan
benefits of Garmin International Inc. Savings and Profit Sharing Plan (the Plan)
as of December 31, 2000 and 1999, and the related statement of changes in net
assets available for plan benefits for the year ended December 31, 2000. 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 auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2000 and 1999, and the changes in its net assets available for
benefits for the year ended December 31, 2000 in conformity with accounting
principles generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the financial
statement taken as a whole. The accompanying supplemental schedule of assets
held for investment purposes at end of year as of December 31, 2000 is presented
for purposes of additional analysis and is not a required part of the 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 our audits of the financial
statements and, in our opinion, is fairly stated in all material respects in
relation to the financial statements taken as a whole.
Ernst & Young LLP
June 18, 2001
Garmin International, Inc.
Savings and Profit Sharing Plan
Statements of Net Assets
Available for Plan Benefits
DECEMBER 31
2000 1999
------------------------------------
ASSETS
Investments, at fair value $14,108,801 $12,067,574
Receivables:
Employer contributions 46,827 43,772
Employee contributions 62,221 56,743
------------------------------------
Total receivables 109,048 100,515
------------------------------------
Net assets available for plan benefits $14,217,849 $12,168,089
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SEE ACCOMPANYING NOTES.
Garmin International, Inc.
Savings and Profit Sharing Plan
Statement of Changes in Net Assets
Available for Plan Benefits
YEAR ENDED
DECEMBER 31,
2000
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ADDITIONS
Investment income:
Dividends $ 141,675
Interest 52,212
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193,887
Contributions:
Employee contributions 1,884,648
Employer contributions 1,101,803
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2,986,451
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Total additions 3,180,338
DEDUCTIONS
Distributions to participants (642,956)
Administrative expenses (87,235)
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(730,191)
Net decline in fair value of investments (NOTE 3) (400,387)
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Net increase 2,049,760
Net assets available for plan benefits at beginning of year 12,168,089
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Net assets available for plan benefits at end of year $14,217,849
===================
SEE ACCOMPANYING NOTES.
Garmin International, Inc.
Savings and Profit Sharing Plan
Notes to Financial Statements
1. DESCRIPTION OF THE PLAN
The Plan is a contributory defined contribution plan available to full-time
employees who are at least 21 years of age and have completed three months of
service with the Company. Participants are permitted to enter the Plan after
meeting eligibility requirements on either January 1 or July 1. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA). Eligible employees may contribute up to 15% of their annual
compensation subject to Internal Revenue Code maximum limitations. The Company
matches 75% of an employee's contributions up to 7.5% of the employee's
compensation. Certain other employer contributions to the Plan are at the sole
discretion of the Company's Board of Directors.
Under provisions of the Plan, participants may elect to have their allocation
invested in one or more of the investment accounts available.
Participants become fully vested in employer contributions to the Plan after
five years of continuous service. The vesting percentages are as follows: 0%
through one year of service, 20% after one year, 40% after two years, 60% after
three years, 80% after four years and 100% after five years of continuous
service. The non-vested portions of terminated participants' account balances
are forfeited, and such forfeitures serve to reduce future employer
contributions. There are no such forfeitures at December 31, 2000, and
unallocated forfeitures at December 31, 1999 totaled $36,605. Upon termination
of employment or at retirement age, a participant may receive either a lump-sum
amount equal to the value of the participant's vested account balance or the
Plan will purchase an annuity with the lump-sum amount.
Participants may borrow from the Plan in the form of a loan. The loan is limited
to the amount the participant may borrow without the loan being treated as a
taxable distribution. The loan and any outstanding loan balance may not be more
than 50% of the participant's vested account or $50,000, whichever is less. The
minimum loan is $500. The participant may be granted two loans during any
one-year period and only three loans may be outstanding at one time. The vested
account provides the security for the loan, and the participant's account may
not be used as security for a loan outside of the Plan. Additionally, loans must
be repaid with interest within five years from the date of the loan unless the
loan is used to buy the participant's principal residence. The loan may be
repaid before it is due.
Garmin International, Inc.
Savings and Profit Sharing Plan
Notes to Financial Statements (Continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
Although the Company has not expressed any intent to do so, it has the right
under the plan provisions to terminate the Plan subject to the provisions of
ERISA. In the event of plan termination, participants will become fully vested
in their benefits. Additional information about the Plan and its vesting and
withdrawal provisions is contained in the Summary Plan Description, GARMIN
INTERNATIONAL, INC. SAVINGS AND PROFIT SHARING PLAN. Copies of the Summary Plan
Description are available from the plan administrator.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies of the Garmin
International, Inc. (the Company) Savings and Profit Sharing Plan (the Plan).
VALUATION OF INVESTMENTS
The fair value of the investments owned by the Plan in the mutual funds is based
on quoted redemption values on the last business day of the plan year. Loans to
participants are valued based on outstanding principal amounts owed on the last
business day of the plan year as reported to the Plan by the trustee.
The Guaranteed Interest Account is valued at estimated fair value, determined by
Principal Life Insurance Company, based on discounted cash flows using current
market interest rates with an estimated fair value equal to contributions made
plus interest earnings. The interest rates on the securities in the Guaranteed
Interest Accounts ranged from 5.03% to 6.38% and 5.03% to 6.02% during 2000 and
1999, respectively.
CONTRIBUTIONS
Contributions from the Company are accrued and paid in the period in which they
become obligations of the Company.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Garmin International, Inc.
Savings and Profit Sharing Plan
Notes to Financial Statements (Continued)
3. INVESTMENTS
The Plan's investments are held by Principal Life Insurance Company. During
2000, the Plan's investments (including investments bought and sold, as well as
held, during the year) depreciated in fair value by $348,175 as presented in the
following table:
Mutual funds $(409,711)
Guaranteed interest account 9,324
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$(400,387)
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The fair value of individual investments that represent 5% or more of the Plan's
net assets is as follows:
DECEMBER 31
2000 1999
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Fair value as determined by quoted market price:
Vanguard Wellington Fund $1,527,981 $1,984,135
Vanguard Windsor II Fund 2,383,078 2,617,591
Vanguard Star Fund 1,003,588 1,030,832
Principal Money Market Account 1,006,292 725,746
Principal Bond and Mortgage Account 877,118 607,672
Principal Large Cap Stock Index Account 2,335,043 3,375,446
Principal International Stock Account 956,157 959,930
T. Rowe Price Science and Technology Account 822,007 80,598
Loans to participants 729,266 333,175
4. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated June 29, 1999, stating that the Plan is qualified under Section 401(a) of
the Internal Revenue Code (the Code) and, therefore the related trust is exempt
from taxation. Once qualified, the Plan is required to operate in conformity
with the Code to maintain its qualification. The Plan was amended subsequent to
the IRS determination letter. The Plan Administrator believes the Plan is being
operated in compliance with the applicable requirements of the Code and ,
therefore, believes that the Plan is qualified and the related trust is tax
exempt.
Garmin International, Inc.
Savings and Profit Sharing Plan
Notes to Financial Statements (Continued)
5. TRANSACTIONS WITH PARTIES-IN-INTEREST
The Company pays certain administrative costs and provides certain accounting
and administrative services to the Plan for which no fees are charged.
6. SUBSEQUENT EVENT
On January 1, 2001, the Plan adopted an amendment allowing participants to elect
to have their allocation invested in the common stock of the Company.
Garmin International, Inc.
Savings and Profit Sharing Plan
Schedule H, Line 4i - Schedule of Assets Held for
Investment Purposes as of December 31, 2000
NUMBER
OF SHARES
IDENTITY OF ISSUER OR UNITS CURRENT VALUE
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Principal Life Insurance Company*:
Vanguard Wellington Fund 54,165 $ 1,527,981
Vanguard Windsor II Fund 87,613 2,383,078
Vanguard Star Fund 56,350 1,003,588
Principal Money Market Account 24,463 1,006,292
Principal Bond and Mortgage Account 1,598 877,118
Principal Large Cap Stock Index Account 49,985 2,335,043
Principal International Stock Account 24,912 956,197
Principal Guaranteed Interest Account - 462,404
Principal Large Company Growth Account 6,703 179,807
Principal Medium Company Growth Account 18,604 470,842
Principal Mid Cap Stock Index Account 18,379 240,004
Principal Small Capital Stock Index Account 4,852 59,912
American Century Ultra Account 16,312 528,012
Invesco Small Company Growth Account 20,775 318,894
T. Rowe Price Mid-Cap Growth Account 5,236 208,356
T. Rowe Price Science and Technology Account 23,110 822,007
Loans to participants (rates range from 8.25%
to 10.5%) - 729,266
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$14,108,801
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*Indicates party-in-interest to the Plan.
SIGNATURE
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
thereunto duly authorized.
GARMIN INTERNATIONAL, INC. SAVINGS AND
PROFIT SHARING PLAN
By /s/ Kevin Rauckman
--------------------------------------
Kevin Rauckman
Trustee
Dated: June 26, 2001
EXHIBIT 23
Consent of Independent Accountants
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333-52766) pertaining to the Savings and Profit Sharing Plan of
Garmin International, Inc. of our report dated June 18, 2001, with respect to
the financial statements and schedule of the Garmin International, Inc. Savings
and Profit Sharing Plan included in this Annual Report (Form 11-K) for the year
ended December 31, 2000.
/s/ Ernst & Young LLP
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Ernst & Young LLP
Kansas City, Missouri
June 25, 2001