<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 HOURLY 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 HOURLY 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 HOURLY EMPLOYEES
Financial Statements
December 31, 1998
(With Independent Auditors' Report Thereon)
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Table of Contents
<TABLE>
<CAPTION>
Page
<S> <C>
Independent Auditors' Report 1
Financial Statements:
Statement of Net Assets Available for Benefits 2
as of December 31, 1998
Statement of Changes in Net Assets Available for Benefits
for the year ended December 31, 1998 3
Notes to Financial Statements
</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 Hourly Employees:
We have audited the accompanying statement of net assets available for 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 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.
September 10, 1999
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY 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 $ 122,536
Moderate Portfolio 224,519
Growth Portfolio 428,087
Aggressive Growth Portfolio 792,115
Fixed Income Fund 558,132
Large Cap Fund 434,283
Small Cap Fund 157,244
International Fund 57,796
Midas Stock Fund 349,032
Clearing Account 3,303
Participant Loans 139,102
--------------
3,266,149
--------------
Receivables:
Participant 8,074
Employer 2,065
--------------
10,139
--------------
Net assets available for benefits $ 3,276,288
==============
</TABLE>
See accompanying notes to financial statements.
2
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY 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 of net assets:
Net investment income from
Midas International Corporation
Defined Contribution Master Trust $ 613,519 15,578 31,635 68,831 139,028 30,472 90,561
Contributions receivable:
Participant 340,176 20,234 26,649 43,872 84,088 59,347 41,983
Employer 79,923 4,568 6,020 11,389 17,843 16,889 8,540
---------- ------------ ----------- --------- ---------- --------- ----------
420,099 24,802 32,669 55,261 101,931 76,236 50,523
---------- ------------ ----------- --------- ---------- --------- ----------
Transfer from Whitman Corp.
Retirement Savings Plan 2,602,978 112,096 188,814 337,029 576,890 511,503 294,643
Loan repayments 2,289 1,308 7,217 6,673 20,101 19,193 8,334
---------- ------------ ----------- --------- ---------- --------- ----------
Total additions 3,638,885 153,784 260,335 467,794 837,950 637,404 444,061
---------- ------------ ----------- --------- ---------- --------- ----------
Deductions:
Participants' withdrawals (356,080) (17,709) (33,199) (28,918) (84,739) (74,028) (47,580)
Administrative expenses (6,517) -- -- -- -- -- --
---------- ------------ ----------- --------- ---------- --------- ----------
Total deductions (362,597) (17,709) (33,199) (28,918) (84,739) (74,028) (47,580)
---------- ------------ ----------- --------- ---------- --------- ----------
Interfund transfers -- (13,539) (2,617) (10,789) 38,904 (5,244) 37,802
---------- ------------ ----------- --------- ---------- --------- ----------
Net assets available for benefits $3,276,288 122,536 224,519 428,087 792,115 558,132 434,283
========== ============ =========== ========= ========== ========= ==========
<CAPTION>
Participant directed - investment funds
---------------------------------------------------------------------------
Small Cap International Midas Stock Clearing Loan
Fund Fund Fund Account Fund Other
--------- ------------- ------------ --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Additions of net assets:
Net investment income from
Midas International Corporation
Defined Contribution Master Trust 11,658 10,794 198,105 -- 10,340 6,517
Contributions receivable:
Participant 16,420 10,000 29,509 -- -- 8,074
Employer 3,669 2,356 6,584 -- -- 2,065
--------- --------- ------------ --------- --------- --------
20,089 12,356 36,093 -- -- 10,139
--------- --------- ------------ --------- --------- --------
Transfer from Whitman Corp.
Retirement Savings Plan 138,870 54,191 246,561 -- 142,381 --
Loan repayments 7,174 1,503 7,407 -- (76,621) --
--------- --------- ------------ --------- --------- --------
Total additions 177,791 78,844 488,166 -- 76,100 16,656
--------- --------- ------------ --------- --------- --------
Deductions:
Participants' withdrawals (11,129) 13,073) (27,494) 3,303 (21,514) --
Administrative expenses -- -- -- -- -- (6,517)
--------- --------- ------------ --------- --------- --------
Total deductions (11,129) 13,073) (27,494) 3,303 (21,514) (6,517)
--------- --------- ------------ --------- --------- --------
Interfund transfers (9,418) (7,975) (111,640) -- 84,516 --
--------- --------- ------------ --------- --------- --------
Net assets available for benefits 157,244 57,796 349,032 3,303 139,102 10,139
========= ========= ============ ========= ========= ========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes to Financial Statements
December 31, 1998
(1) Description of Plan
The following brief description of the Midas International Corporation
Retirement Savings Plan for Hourly 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 pre-tax contributions by a Participant are subject to
current limitations in accordance to Section 402(g) of the Internal
Revenue Code.
Vesting and Forfeitures
A participant who was an employee on January 1, 1998 shall be fully
vested and have a non-forfeitable 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 non-forfeitable 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
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes 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 fifteen 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.
5
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes to Financial Statements
December 31, 1998
(2) Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements are prepared on the accrual basis
of accounting.
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 5%.
6
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes to Financial Statements
December 31, 1998
The Trust held the following classifications of investments as of December
31, 1998:
<TABLE>
<CAPTION>
Fair value
--------------
<S> <C>
Common stock $ 51,677,610
Corporate bonds 20,475,076
Participant note receivable 1,164,604
--------------
$ 73,317,290
==============
</TABLE>
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:
<TABLE>
<S> <C>
Conservative Portfolio Fund $ 15,578
Moderate Portfolio Fund 31,635
Growth Portfolio Fund 68,831
Aggressive Growth Fund 139,028
Fixed Income Fund 30,472
Large Cup Fund 90,561
Small Cup Fund 11,658
International Fund 10,794
Midas Stock Fund 198,105
--------------
Net appreciation in fair value of investments $ 596,662
==============
</TABLE>
7
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY 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>
--------------------------------------------------------
Aggressive
Conservative Moderate Growth Growth
Total Portfolio Portfolio Portfolio Portfolio
------------ ------------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Additions of net assets:
Net investment income from
Midas International Corporation
Defined Contribution Master Trust $ 13,367,415 277,117 789,417 1,759,742 2,110,507
Contributions:
Participant 2,254,222 83,060 185,104 399,645 502,739
Employer, net of forfeitures 1,523,213 4,218 6,429 11,749 17,066
Rollovers 970,997 (513) -- 6,648 8,348
------------ ------------- ---------- ----------- ----------
4,748,432 86,765 191,533 418,042 528,153
------------ ------------- ---------- ----------- ----------
Transfer from Whitman Corp.
Retirement Savings Plan 62,727,943 2,153,911 4,707,466 9,483,771 8,816,574
Loan repayments 31,495 14,231 36,410 105,971 143,984
------------ ------------- ---------- ----------- ----------
Total additions 80,875,285 2,532,024 5,724,826 11,767,526 11,599,218
------------ ------------- ---------- ----------- ----------
Deductions from net assets:
Participants' withdrawals (6,212,596) (198,579) (403,105) (900,205) (858,196)
Administrative expenses (162,930) (5,783) (12,675) (24,523) (23,701)
------------ ------------- ---------- ----------- ----------
Total deductions (6,375,526) (204,362) (415,780) (924,728) (881,897)
------------ ------------- ---------- ----------- ----------
Interfund transfers -- 335,868 224,182 (948,797) 457,610
------------ ------------- ---------- ----------- ----------
Net increase, representing
balance as of
December 31, 1998 $ 74,499,759 2,663,530 5,533,228 9,894,001 11,174,931
============ ============= ========== =========== ==========
</TABLE>
8
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes to Financial Statements
December 31, 1998
<TABLE>
<CAPTION>
Participant directed - investment funds
- ----------------------------------------------------------------------------------------------------------
Fixed
Income Large Cap Small Cap International Midas Stock Clearing Loan
Fund Fund Fund Fund Fund Account Fund
---------- ----------- --------- ------------- ------------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
828,058 2,537,367 302,248 327,505 4,351,302 4,954 79,198
319,605 272,432 119,913 59,426 151,001 161,297 --
17,121 8,602 3,782 2,468 1,341,040 110,738 --
169,172 108,382 3,339 113,275 548,631 13,715 --
---------- ----------- --------- ----------- ------------- -------- ---------
505,898 389,416 127,034 175,169 2,040,672 285,750 --
---------- ----------- --------- ----------- ------------- -------- ---------
14,668,727 7,936,749 3,164,558 1,660,777 8,893,851 1,620 1,239,939
116,619 102,208 23,615 14,442 54,339 33,669 (613,993)
---------- ----------- --------- ----------- ------------- -------- ---------
16,119,302 10,965,740 3,617,455 2,177,893 15,340,164 325,993 705,144
---------- ----------- --------- ----------- ------------- -------- ---------
(2,204,533) (1,089,340) (295,847) (91,664) (769,072) 138,485 459,460
(59,578) (19,708) (8,482) (4,465) (16,251) 12,236 --
---------- ----------- --------- ------------ ------------- -------- ---------
(2,264,111) (1,109,048) (304,329) (96,129) (785,323) 150,721 459,460
---------- ----------- --------- ------------ ------------- -------- ---------
1,764,970 1,226,834 (498,648) (424,492) (2,137,527) -- --
---------- ----------- --------- ------------ ------------- -------- ---------
15,620,161 11,083,526 2,814,478 1,657,272 12,417,314 476,714 1,164,604
========== =========== ========= ============ ============= ======== =========
</TABLE>
9
<PAGE>
MIDAS INTERNATIONAL CORPORATION
RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
Notes 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 $3,303 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. Therefore, the Plan administrator believes that the Plan will
qualify and the related trust is tax-exempt as of the financial statement
dates.
10
<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
