<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the Year Ended December 31, 1998
or
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from ____ to ____
Commission file number: Midas, Inc. 01-13409
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
MIDAS, INC.
1300 Arlington Heights Road
Itasca, Illinois 60143
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrative Committee has duly caused this Annual Report to be signed on its
behalf by the undersigned hereunto duly authorized.
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
By: /s/ Gerard M. Klaisle
-------------------------
Gerard M. Klaisle
Senior Vice President - Human Resources
Dated: November 4, 1999
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Financial Statements
December 31, 1998
(With Independent Auditors' Report Thereon)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Table of Contents
<TABLE>
<CAPTION>
Page
<S> <C>
Independent Auditors' Report 1
Financial Statements
Statement of Net Assets Available for Benefits
as of December 31, 1998 2
Statement of Changes in Net Assets Available for Benefits
for the year ended December 31, 1998 3
Notes to Financial Statements 4
</TABLE>
Exhibits:
Exhibit 23.1 - Consent of Independent Public Accountants
<PAGE>
Independent Auditors' Report
To the Administrative Committee of
Midas International Corporation
Retirement Savings Plan for Salaried Employees:
We have audited the accompanying statement of net assets available for benefits
of Midas International Corporation Retirement Savings Plan for Salaried
Employees as of December 31, 1998, 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.
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 of the Plan as of
December 31, 1998 and the changes in net assets available for benefits for the
year then ended in conformity with generally accepted accounting principles.
Our audit was 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 benefits is presented for purposes of
additional analysis rather than to present changes in net assets available for
plan benefits of each fund. The fund 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 taken as a whole.
KPMG LLP
September 10, 1999
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Statement of Net Assets Available for Benefits
December 31, 1998
<TABLE>
<S> <C>
Assets:
Plan interest in Midas International Corporation
Defined Contribution Master Trust:
Conservative Portfolio $ 2,548,252
Moderate Portfolio 5,318,949
Growth Portfolio 9,492,768
Aggressive Growth Portfolio 10,422,373
Fixed Income Fund 15,087,704
Large Cap Fund 10,672,989
Small Cap Fund 2,665,782
International Fund 1,603,807
Midas Stock Fund 12,174,463
Clearing Account 132,666
Participant loans 993,964
-------------
71,113,717
-------------
Receivables:
Participant 11,610
Employer 4,835
-------------
16,445
-------------
Net assets available for plan benefits $ 71,130,162
=============
</TABLE>
See accompanying notes to financial statements.
2
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Statement of Changes in Net Assets Available for Benefits
Year ended December 31, 1998
<TABLE>
<CAPTION>
Participant directed investment funds
-----------------------------------------------------------------------------
Aggressive Fixed
Conservative Moderate Growth Growth Income Large Cap
Total Portfolio Portfolio Portfolio Portfolio Fund Fund
------------ ------------ ----------- ----------- ----------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets:
Net investment income from
Midas International Corporation
Defined Master Trust $ 13,014,446 261,201 736,215 1,617,226 1,872,865 804,135 2,372,881
------------ ------------ ----------- ----------- ----------- ---------- ----------
Contribution:
Participant 1,905,058 69,036 168,988 379,586 454,927 280,025 248,215
Employer 1,439,705 16 879 1,057 759 1,242 490
Rollovers 682,890 -- -- 6,648 8,347 -- 110,301
------------ ------------ ----------- ----------- ----------- ---------- ----------
4,027,653 69,052 169,867 387,291 464,033 281,267 359,006
Transfer from Whitman Corp.
Retirement Savings Plan 60,108,475 2,035,868 4,527,585 9,195,844 8,314,868 14,260,451 7,802,183
Loan repayments 9,971 13,595 31,107 104,113 131,237 102,559 99,424
------------ ------------ ----------- ----------- ----------- ---------- ----------
Total additions 77,160,545 2,379,716 5,464,774 11,304,474 10,783,003 15,448,412 10,633,494
------------ ------------ ----------- ----------- ----------- ---------- ----------
Deductions from net assets:
Participants' withdrawals 5,873,969 161,161 336,529 828,926 636,679 2,037,429 924,708
Administrative expenses 156,414 -- -- -- -- -- --
------------ ------------ ----------- ----------- ----------- ---------- ----------
Total deductions 6,030,383 161,161 336,529 828,926 636,679 2,037,429 924,708
------------ ------------ ----------- ----------- ----------- ---------- ----------
Interfund transfers -- 329,697 190,704 (982,780) 276,049 1,676,721 964,203
------------ ------------ ----------- ----------- ----------- ---------- ----------
Net increase, representing
balance as of
December 31, 1998 $ 71,130,162 2,548,252 5,318,949 9,492,768 10,422,373 15,087,704 10,672,989
============ ============ =========== =========== =========== ========== ==========
<CAPTION>
-----------------------------------------------------------------
Midas
Small Cap International Stock Clearing Loan
Fund Fund Account Fund Fund Other
---------- ------------- ----------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets:
Net investment income from
Midas International Corporation
Defined Master Trust 237,740 296,722 4,586,760 -- 72,287 156,414
---------- ------------- ----------- ---------- ---------- ---------
Contribution:
Participant 110,627 52,888 318,315 -- -- (177,549)
Employer 274 259 1,240,735 -- -- 193,994
Rollovers 3,339 8,347 545,908 -- -- --
---------- ------------- ----------- ---------- ---------- ---------
114,240 61,494 2,104,958 -- -- 16,445
Transfer from Whitman Corp
Retirement Savings Plan 3,070,081 1,619,278 8,200,343 -- 1,081,974 --
Loan repayments 17,670 13,645 49,867 -- (553,246) --
---------- ------------- ----------- ---------- ---------- ---------
Total additions 3,439,731 1,991,139 14,941,928 -- 601,015 172,859
---------- ------------- ----------- ---------- ---------- ---------
Deductions from net assets:
Participants' withdrawals 264,728 66,000 668,314 (132,666) 82,161 --
Administrative expenses -- -- -- -- -- 156,414
---------- ------------- ----------- ---------- ---------- ---------
Total deductions 264,728 66,000 668,314 (132,666) 82,161 156,414
---------- ------------- ----------- ---------- ---------- ---------
Interfund transfers (509,221) (321,332) (2,099,151) -- 475,110 --
---------- ------------- ----------- ---------- ---------- ---------
Net increase, representing
balance as of
December 31, 1998 2,665,782 1,603,807 12,174,463 132,666 993,964 16,445
========== ============= =========== ========== ========== =========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Note to Financial Statements
December 31, 1998
(1) Description of Plan
The following brief description of the Midas International Corporation
Retirement Savings Plan for Salaried Employees (the Plan) provides only
general information. Participants should refer to the Plan document for a
more complete description of the Plan's provisions.
General
The Plan is a defined contribution plan, which covers eligible
employees of Midas International Corporation (Midas) and those of its
subsidiary companies which adopt the Plan, with any company having
adopted the Plan along with Midas being considered an employer. Any
salaried, sales, or clerical employee who has met limited employment
requirements and has elected to participate in the Plan is considered
a participant. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).
Contributions
Participant contributions are made to the Plan through periodic
payroll deductions in amounts ranging from 2% to 10% of total annual
cash compensation, in increments of 1%. Participants' contributions
made via periodic payroll deductions are matched in equal amounts by
employer contributions up to a 6% limit.
The total annual pretax contributions by a participant are subject to
current limitations in accordance with Section 402(g) of the Internal
Revenue Code (Code).
Vesting and Forfeitures
A participant who was an employee on January 1, 1998 shall be fully
vested and have a nonforfeitable right to their accrued benefit in all
accounts at all times. A participant who was not yet an employee on
January 1, 1998 shall have a vested and nonforfeitable right to their
accrued benefit in the manner determined under their Plan as it
existed on their termination of employment.
Plan Termination
Although it has not expressed any intent to do so, Midas has the right
under the Plan 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 100% vested in their
accounts.
Participant Accounts
Each participant's account is credited with the participant's
contribution, employer contributions, and an allocation of Plan
earnings. Allocations of earnings are based on participant account
balances. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's account.
4 (Continued)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Note to Financial Statements
December 31, 1998
Participant Notes Receivable
In accordance with Plan provisions, loans are made to participants in
amounts not to exceed the lesser of one-half of the participant's
vested account balance or $50,000. The loans bear interest at the
trustee's current prime rate in effect on Monday of the week the loan
is requested and are payable through participant payroll withholdings
under a reasonable repayment schedule of not more than five years.
Payment of Benefits
On termination of service, a participant may elect to receive the
value of their account in either a lump-sum payment, in annual
installments over a period of time up to a maximum of 15 years, in the
form of an immediate or deferred annuity, or disbursement amounts at
their discretion.
Expenses
External administrative expenses for the preparation and maintenance
of the Plan financial records and participant statements, and service
fees on insurance contracts are paid from Plan assets. Trustee, legal,
and all other external expenses are also paid from Plan assets to the
extent that the Plan sponsor does not pay those expenses of the Plan.
Investment Options
Participants in the Plan have the right to direct that their
contributions and account balance are invested in one or more funds
designated by the Plan's Administrative Committee as available for
investment purposes. As of December 31, 1998, contributions may be
invested in the following funds:
. Fixed Income Fund
. Company Stock Fund
. Large Company Fund
. Small Company Fund
. International Fund
. Conservative Portfolio
. Moderate Portfolio
. Growth Portfolio
. Aggressive Growth Portfolio
Earnings on investments in each of the investment funds are reinvested
in the respective funds.
(2) Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements are prepared on the accrual
basis of accounting.
5 (Continued)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Note to Financial Statements
December 31, 1998
Investment Valuation and Income Recognition
The Trust's investments are stated at fair value. The fair values of
marketable securities are based on quotations obtained from national
securities exchanges. Where marketable securities are not listed on an
exchange, quotations are obtained from brokerage firms.
The Trust records investment transactions on a trade date basis.
Benefits Paid to Participants
Benefits are recorded when paid.
Use of Estimates
The financial statements have been prepared in accordance with
generally accepted accounting principles and necessarily include
amounts based on estimates and assumptions by management. Actual
results could differ from those estimates.
(3) Interest in Midas International Corporation Defined Contribution Master
Trust
Certain assets of the Plan are in the Midas International Corporation
Defined Contribution Master Trust (the Trust) which was established for the
investment of assets of the plan and another Midas International
Corporation sponsored retirement plan. Each plan has an undivided interest
in the Trust. The assets of the Trust are held by the Northern Trust
Company (the Trustee). The Plan's interest in the net assets of the Trust
is based on the individual plan participants' investment balances.
Investment income is allocated on a daily basis through a valuation
performed by the Trustee. Administrative expenses relating to the Trust are
allocated to the individual funds based upon average monthly balances
invested by each plan. At December 31, 1998, the Plan's interest in the net
assets of the Trust was approximately 95%.
6 (Continued)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Note to Financial Statements
December 31, 1998
The Trust held the following classifications of investments as of
December 31, 1998:
Fair value
------------
Common stock $ 51,677,610
Corporate bonds 20,475,076
Participants note receivable 1,164,604
------------
$ 73,317,290
============
As of December 31, 1998, the net assets of the Trust include the above
investments and other miscellaneous net assets totaling $74,499,759.
The Plan's allocated share of the Master Trust's net appreciation in the
fair value of investments during the year ended December 31, 1998 was as
follows:
Conservative Portfolio Fund $ 261,200
Moderate Portfolio Fund 736,215
Growth Portfolio Fund 1,617,226
Aggressive Growth Fund 1,872,865
Fixed Income Fund 804,135
Large Cap Fund 2,372,881
Small Cap Fund 237,740
International Fund 296,722
Midas Stock Fund 6,207,368
------------
Net appreciation in fair value
of investments $ 14,406,352
============
7 (Continued)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Notes to Financial Statements
December 31, 1998
Information regarding the change in net assets available for benefits by
investment fund in the Master Trust for the year ended December 31, 1998 is as
follows:
<TABLE>
<CAPTION>
Participant directed investment funds
---------------------------------------------------------------------------------
Aggressive Fixed
Conservative Moderate Growth Growth Income Large Cap
Total Portfolio Portfolio Portfolio Portfolio Fund Fund
------------- ------------- ------------ ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets:
Net investment income from
Midas International Corporation
Defined Master Trust $ 13,367,415 277,117 789,417 1,759,742 2,110,507 828,058 2,537,367
------------- ------------- ------------ ----------- ----------- ------------ ------------
Contribution:
Participant 2,254,222 83,060 185,104 399,645 502,739 319,605 272,432
Employer 1,523,213 4,218 6,429 11,749 17,066 17,121 8,602
Rollovers 970,997 (513) -- 6,648 8,348 169,172 108,382
------------- ------------- ------------ ----------- ----------- ------------ ------------
4,748,432 86,765 191,533 418,042 528,153 505,898 389,416
Transfer from Whitman Corp.
Retirement Savings Plan 62,727,943 2,153,911 4,707,466 9,483,771 8,816,574 14,668,727 7,936,749
Loan repayments 31,495 14,231 36,410 105,971 143,984 116,619 102,208
------------- ------------- ------------ ----------- ----------- ------------ ------------
Total additions 80,875,285 2,532,024 5,724,826 11,767,526 11,599,218 16,119,302 10,965,740
------------- ------------- ------------ ----------- ----------- ------------ ------------
Deductions from net assets:
Participants' withdrawals (6,212,596) (198,579) (403,105) (900,205) (858,196) (2,204,533) (1,089,340)
Administrative expenses (162,930) (5,783) (12,675) (24,523) (23,701) (59,578) (19,708)
------------- ------------- ------------ ----------- ----------- ------------ ------------
Total deductions (6,375,526) (204,362) (415,780) (924,728) (881,897) (2,264,111) (1,109,048)
------------- ------------- ------------ ----------- ----------- ------------ ------------
Interfund transfers -- 335,868 224,182 (948,797) 457,610 1,764,970 1,226,834
------------- ------------- ------------ ----------- ----------- ------------ ------------
Net increase, representing
balance as of
December 31, 1998 $ 74,499,759 2,663,530 5,533,228 9,894,001 11,174,931 15,620,161 11,083,526
============= ============= ============ =========== =========== ============ ============
<CAPTION>
-------------------------------------------------------------------
Midas
Small Cap International Stock Clearing Loan
Fund Fund Account Account Fund
------------ --------------- ------------ ---------- ----------
<S> <C> <C> <C> <C> <C>
Additions to net assets:
Net investment income from
Midas International Corporation
Defined Master Trust 302,248 327,505 4,351,302 4,954 79,198
------------ --------------- ------------ ---------- ----------
Contribution:
Participant 119,913 59,426 151,001 161,297 --
Employer 3,782 2,468 1,341,040 110,738 --
Rollovers 3,339 113,275 548,631 13,715 --
------------ --------------- ------------ ---------- ----------
127,034 175,169 2,040,672 285,750 --
Transfer from Whitman Corp.
Retirement Savings Plan 3,164,558 1,660,777 8,893,851 1,620 1,239,939
Loan repayments 23,615 14,442 54,339 33,669 (613,993)
------------ --------------- ------------ ---------- ----------
Total additions 3,617,455 2,177,893 15,340,164 325,993 705,144
------------ --------------- ------------ ---------- ----------
Deductions from net assets:
Participants' withdrawals (295,847) (91,664) (769,072) 138,485 459,460
Administrative expenses (8,482) (4,465) (16,251) 12,236 --
------------ --------------- ------------ ---------- ----------
Total deductions (304,329) (96,129) (785,323) 150,721 459,460
------------ --------------- ------------ ---------- ----------
Interfund transfers (498,648) (424,492) (2,137,527) -- --
------------ --------------- ------------ ---------- ----------
Net increase, representing
balance as of
December 31, 1998 2,814,478 1,657,272 12,417,314 476,714 1,164,604
============ =============== ============ ========== ==========
</TABLE>
8 (Continued)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
Note to Financial Statements
December 31, 1998
Total Master Trust Investment income consists of $318,563 interest income,
$638,142 dividend income, $1,828,529 realized gains, and $10,582,180
unrealized gains.
(4) Reconciliation to Form 5500
The financial information provided in the Plan's Form 5500 includes an
accrual for benefits payable to participants. This accrual was $133,166 at
December 31, 1998.
(5) Tax Status
The Company has submitted the Plan and related trust to the Internal
Revenue Service for consideration of the Plan's tax status. As of year end,
the Company has not obtained a determination letter from the Internal
Revenue Service. However, the Plan administrator believes that the Plan is
designed and is currently being operated in compliance with the applicable
requirements of the IRC. The Plan administrator believes that the Plan will
qualify and the related trust is tax-exempt as of December 31, 1998.
9
<PAGE>
EXHIBIT 23.1
The Administrative Committee of Midas International
Corporation Retirement Savings Plan for Hourly Employees:
We consent to incorporation by reference in Registration Statement No. 333-44625
on Form S-8 of Midas, Inc. of our report dated September 10, 1999, relating to
the statement of net asset available for plan benefits of Midas International
Corporation Retirement Savings Plan for Hourly Employees as of December 31,
1998, and the related statement of changes in net assets available for plan
benefits for the year then ended, which report appears in the December 31, 1998
annual report on Form 11-K of Midas International Corporation Retirement Savings
Plan for Hourly Employees.
Chicago, Illinois
October 29, 1999
