<PAGE> 1
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 (NO FEE REQUIRED, AS OF OCTOBER 7, 1996)
For the fiscal year ended December 31, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from __________________ to _____________________
Commission file number 0-9787
------
A. Full title of the plan and address of the plan, if different from that of
the issuer named below:
REPUBLIC INDUSTRIES, INC. RETIREMENT SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
REPUBLIC INDUSTRIES, INC.
110 S.E. 6th St.
Fort Lauderdale, Florida 33301
<PAGE> 2
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
TOGETHER WITH REPORT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
DECEMBER 31, 1997 AND 1996
<PAGE> 3
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
<TABLE>
<CAPTION>
Pages
-----
<S> <C>
Report of Independent Certified Public Accountants................. 1
Statements of Net Assets Available for Benefits as of
December 31, 1997 and 1996....................................... 2
Statement of Changes in Net Assets Available for Benefits for
the Year Ended December 31, 1997................................. 3
Notes to Financial Statements...................................... 4-6
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1997.......................................... 7
Item 27d - Schedule of Reportable Transactions for the Year Ended
December 31, 1997................................................ 8
Item 27e - Schedule of Nonexempt Transactions for the Year Ended
December 31, 1997................................................ 9
</TABLE>
<PAGE> 4
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Plan Administrator of
Republic Industries, Inc.
Retirement Savings Plan:
We have audited the accompanying statements of net assets available for benefits
of Republic Industries, Inc. Retirement Savings Plan as of December 31, 1997 and
1996, and the related statement of changes in net assets available for benefits
for the year ended December 31, 1997. These financial statements and the
schedules referred to below are the responsibility of the Plan's Administrator.
Our responsibility is to express an opinion on these financial statements and
schedules 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 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 as of
December 31, 1997 and 1996, and the changes in its net assets available for
benefits for the year ended December 31, 1997, in conformity with
generally accepted accounting principles.
Our audits were made 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, reportable transactions and nonexempt transactions are
presented for purposes 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. 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 the changes in net assets
available for plan benefits of each fund. The supplemental schedules and Fund
Information 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/ ARTHUR ANDERSEN LLP
Arthur Andersen LLP
Fort Lauderdale, Florida,
June 24, 1998.
1
<PAGE> 5
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1997 AND 1996
<TABLE>
<CAPTION>
1997 1996
---- ----
<S> <C> <C>
Investments, at fair market value:
Mutual Funds:
Cash Fund............................................................ $ 980,254 $ 123,633
Merrill Lynch Retirement Preservation Trust.......................... 3,500,350 495,537
Merrill Lynch Growth Fund............................................ 2,686,277 878,255
Merrill Lynch Global Allocation Fund................................. 949,049 423,371
Merrill Lynch Capital Fund........................................... 1,979,566 587,510
MFS Emerging Growth Fund............................................. 228,802 --
AIM Value Fund....................................................... 484,878 --
----------- ----------
Total Mutual Funds.............................................. 10,809,176 2,508,306
Republic Industries, Inc. Common Stock............................... 1,426,721 779,010
----------- ----------
Total Investments............................................... 12,235,897 3,287,316
Employee Contributions Receivable.................................... 263,455 136,906
----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS.................................... $12,499,352 $3,424,222
=========== ==========
</TABLE>
The accompanying notes to financial statements are an integral part
of these statements.
2
<PAGE> 6
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Merrill Lynch Merrill Lynch
Retirement Global
Cash Preservation Merrill Lynch Allocation
Fund Trust Growth Fund Fund
-------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
NET ASSETS AVAILABLE
FOR BENEFITS AS OF DECEMBER 31, 1996.................... $ 123,633 $ 495,537 $ 878,255 $ 423,371
Additions:
Employee Contributions.................................. 227,418 349,660 711,118 271,266
Employee Rollover Contributions......................... -- 168,046 251,978 249,116
--------- ---------- ---------- ---------
Total Contributions................................... 227,418 517,706 963,096 520,382
Dividend Income......................................... 9,489 86,063 207,584 111,517
Net Appreciation (Depreciation) in Fair Market
Value of Investments.................................. -- -- 110,325 (52,635)
--------- ---------- ---------- ---------
Total Additions....................................... 236,907 603,769 1,281,005 579,264
Participant Distributions............................... -- (115,879) (208,085) (37,378)
Conversions of acquired company plans................... 622,839 2,543,551 677,397 601
Interfund Transfers, Net................................ (3,125) (26,628) 57,705 (16,809)
--------- ---------- ---------- ---------
NET ASSETS AVAILABLE
FOR BENEFITS AS OF DECEMBER 31, 1997.................... $ 980,254 $3,500,350 $2,686,277 $ 949,049
========= ========== ========== =========
</TABLE>
<TABLE>
<CAPTION>
Merrill MFS
Lynch Emerging AIM Republic Employee
Capital Growth Value Industries, Inc. Contributions
Fund Fund Fund Common Stock Receivable Total
-------- -------- --------- ---------------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS AVAILABLE
FOR BENEFITS AS OF DECEMBER 31, 1996... $ 587,510 $ -- $ -- $ 779,010 $ 136,906 $3,424,222
Additions:
Employee Contributions................. 315,550 78,896 40,129 705,823 126,549 2,826,409
Employee Rollover Contributions........ 247,070 137,057 169,113 392,503 -- 1,614,883
---------- -------- --------- ---------- ---------- -----------
Total Contributions.................. 562,620 215,953 209,242 1,098,326 126,549 4,441,292
Dividend Income........................ 142,944 2,409 44,600 7,831 -- 616,786
Net Appreciation (Depreciation) in
Fair Market Value of Investments...... 138,257 (942) (37,790) (365,634) -- (208,419)
---------- -------- --------- ---------- ---------- -----------
Total Additions...................... 843,821 217,420 216,052 740,523 126,549 4,840,170
Participant Distributions.............. (240,164) (83) (31,926) (135,233) -- (768,748)
Conversions of acquired company plans.. 857,006 -- 297,173 -- -- 4,998,568
Interfund Transfers, Net............... (68,608) 11,465 3,579 42,421 -- --
---------- -------- --------- ---------- ---------- -----------
NET ASSETS AVAILABLE
FOR BENEFITS AS OF DECEMBER 31, 1997... $1,979,566 $228,802 $ 484,878 $1,426,721 $ 263,455 $12,499,352
========== ======== ========= ========== ========== ===========
</TABLE>
The accompanying notes to financial statements are an
integral part of this statement.
3
<PAGE> 7
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
(1) DESCRIPTION OF PLAN:
(a) General
The following description of the Republic Industries, Inc. Retirement Savings
Plan (the "Plan") is provided for general information purposes only.
Participants should refer to the Plan document for a more complete description
of the Plan.
The Plan was established effective January 1, 1994 to provide benefits to all
eligible employees of Republic Industries, Inc. (the "Company"). The Plan, as
amended, is a defined contribution plan commonly known as an Internal Revenue
Code ("IRC") section 401(k) profit sharing plan and is subject to the Employee
Retirement Income Security Act of 1974 ("ERISA"), as amended. The Company is
the designated administrator of the Plan.
Although it has expressed no intention to do so, the Company retains the right,
if necessary, to terminate the Plan. In the event of Plan termination, all
amounts credited to participants' accounts become fully vested subject to the
requirements of ERISA. The Company also retains the right to amend the Plan.
Amendments subsequent to December 31, 1997 are reflected within these notes to
the financial statements.
(b) Eligibility
For all Company employees hired before February 29, 1996, the Plan is available
to employees not covered by a collective bargaining agreement who have
completed two months of service and have reached age 18. Enrollment provisions
allow for one of four entry dates throughout the year, as defined under the
Plan.
Effective March 1, 1996, the Plan was amended to increase the service
requirement to 1,000 hours of service within a consecutive twelve month period
to be eligible for participation. Additionally, enrollment provisions were
amended to allow for monthly entry dates by all eligible employees regardless
of date of hire. The amendment also included a provision to allow employees of
certain subsidiaries of the Company to be eligible for participation in the
Plan under these amended requirements.
(c) Contributions and Funding Policy
Under the provisions of the Plan, participants may direct the Company to defer
a portion of their compensation to the Plan, subject to a maximum of 15% of
eligible compensation, as defined. Amounts contributed by participants are
fully vested when made. In 1997 each eligible participant could contribute up
to $9,500, subject to applicable IRC limitations. The Plan allows for rollovers
of vested contributions from previous employers' qualified plans.
Each year, the Company, at its option, may make a discretionary contribution to
the Plan. In order to be entitled to an allocation of the Company's
discretionary contribution, participants with 1,000 hours of service, as
defined under the Plan, must be employed on the last day of the Plan year.
4
<PAGE> 8
Effective March 1, 1996, the Plan was amended to limit the Company's
discretionary matching contribution to up to 100% of the first 6% of a
participant's contribution.
Participants who became eligible to participate in the Plan prior to February
29, 1996, vest in the Company's discretionary contribution in accordance with
the following schedule:
<TABLE>
<CAPTION>
Years of Service Vesting Percentage
---------------- ------------------
<S> <C>
Less than 1.................................. 0%
1............................................ 34%
2............................................ 67%
3 or more.................................... 100%
</TABLE>
The amended vesting provisions provide for the following vesting schedule for
participants who became eligible after February 29, 1996:
<TABLE>
<CAPTION>
Years of Service Vesting Percentage
---------------- ------------------
<S> <C>
Less than 2.................................. 0%
2............................................ 20%
3............................................ 40%
4............................................ 60%
5............................................ 80%
6 or more.................................... 100%
</TABLE>
Additionally, allocated amounts become fully vested upon normal retirement age,
as defined, death or termination of employment as a result of a total or
permanent disability. Nonvested amounts forfeited upon any participant's
withdrawal are used to offset any Company discretionary contributions.
The Company did not make any discretionary contributions to the Plan during
1996 or 1997.
(d) Investments
The Company has entered into an agreement whereby Merrill Lynch Trust Company
(the "Trustee") has been appointed the Trustee of the Plan's assets. Under the
terms of the agreement, the Trustee holds and invests the funds of the Plan
subject to the direction of a designated investment committee.
The Plan provides seven distinct investment alternatives for participants.
Participants have the option of directing their accounts quarterly, in
increments of 5%, to the following investment options:
Merrill Lynch Retirement Preservation Trust -- A mutual fund in
which amounts are invested in U.S. Government Agency Securities and
Guaranteed Investment Contracts.
Merrill Lynch Growth Fund -- A mutual fund in which amounts are
invested primarily in common stocks which are believed to be
undervalued by the fund's manager and therefore have growth potential.
Merrill Lynch Global Allocation Fund -- A mutual fund in which amounts
are invested in a portfolio comprised of U.S. and foreign securities.
Merrill Lynch Capital Fund -- A mutual fund seeking current income and
capital growth through investments in equity, debt and convertible
securities.
MFS Emerging Growth Fund -- A mutual fund seeking long-term growth of
capital through investments in emerging growth companies, early in their
life cycles, that display the potential to become major enterprises.
AIM Value Fund -- A mutual fund seeking long-term growth of capital by
investng primarily in stocks of companies that are undervalued relative
to the stock market as a whole.
Republic Industries, Inc. Common Stock -- In 1996, the Plan was amended
to allow up to 50% of a participant's total contribution to be invested
in the Company's Common Stock.
The Cash Fund is a short-term investment vehicle utilized by the Trustee to
invest cash on a temporary basis.
5
<PAGE> 9
(2) SIGNIFICANT ACCOUNTING POLICIES:
(a) Basis of Accounting
The accompanying financial statements are prepared under the accrual method of
accounting. In order to maintain consistency and comparability between periods
presented, certain amounts have been reclassified from the previously reported
financial statements in order to conform with the financial statement
presentation of the current period.
(b) Investment Valuation and Income Recognition
The Plan's investments are stated at fair market value. Purchases and sales of
investments are recorded on a trade-date basis. The Company records dividends on
the ex-dividend date.
(3) BENEFIT DISTRIBUTIONS
Amounts allocated to withdrawing participants for benefit claims that have been
processed and approved for payment but have not yet been paid totaled $49,973 at
December 31, 1997. Such amount is included in net assets available for benefits
at December 31, 1997 in accordance with American Institute of Certified Public
Accountants ("AICPA") guidelines. However, the Plan's Form 5500 reflects such
amount as a liability of the Plan in accordance with IRC guidelines.
(4) CONVERSIONS
During 1997, the 401(k) plans of certain companies acquired by Republic were
converted to the Plan, with the related employees becoming participants. All of
the assets of these plans were converted at fair value and invested in the Plan
based upon the employees' elections. Such amounts are reflected as Conversions
of acquired company plans in the accompanying statement of changes in net assets
available for benefits.
(5) PARTY-IN-INTEREST TRANSACTIONS
Certain plan investments are shares of mutual funds managed by Merrill Lynch
Asset Management Company, an affiliate of the Trustee. Therefore, these
investments represent a party-in-interest to the Plan. The Company pays all fees
and expenses of the Plan, which primarily consist of legal, accounting and other
administrative services and totaled $195,278 in 1997.
(6) INCOME TAX STATUS
The Internal Revenue Service has determined, and informed the Company by a
letter dated July 18, 1995, that the Plan and related trust are designed in
accordance with applicable sections of the IRC. The Plan has been amended since
receiving this determination letter. However, the Plan administrator believes
that the Plan is designed and is currently being operated in compliance with the
applicable requirements of the IRC.
(7) FORMER PARTICIPANT BALANCES
In October 1997, the Company sold its electronic security services division. The
employees of that division are no longer eligible to participate in the Plan.
However, as of December 31, 1997, approximately $588,224 of total plan assets
relate to such former participant balances. These former participants have the
option to rollover such plan assets into a qualified plan of their current
employer.
(8) SUBSEQUENT EVENTS
During 1998, the 401(k) plans of certain companies acquired by Republic were
converted to the Plan, with the related employees becoming participants with
assets totaling $52,502,351. All of the assets of these five plans were
converted at fair value and invested in the Plan based upon the employee's
elections.
Effective January 1, 1998, the Company adopted an Amended and Restated Republic
Rewards 401(k) Plan (the "Amended and Restated Plan") replacing the Plan. The
Amended and Restated Plan changes the eligibility requirements to 90 days after
employment.
During 1998, an employer matching contribution of $.25 for each $1.00 of
contribution up to 6% of the employee's salary to be made to the Plan by the
Company was approved by the Board of Directors for the 1998 Plan year. The
employer match is to be made in shares of the Company's common stock par value
$.01 per share and becomes fully vested after the participant has been employed
for three calendar years.
6
<PAGE> 10
Schedule I
E.I.N.: 75-1105145
Plan #: 001
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
ITEM 27a-SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1997
<TABLE>
<CAPTION>
DESCRIPTION SHARES COST MARKET
----------- ------ -------- --------
<S> <C> <C> <C>
Cash Fund*.................... 980,254 $ 980,254 $ 980,254
Merrill Lynch Retirement
Preservation Trust*.......... 3,500,350 3,500,350 3,500,350
Merrill Lynch Growth Fund*.... 101,668 2,577,855 2,686,277
Merrill Lynch Global
Allocation Fund*............. 68,081 1,014,490 949,049
Merrill Lynch Capital Fund*... 58,584 1,871,313 1,979,566
MFS Emerging Growth Fund...... 6,324 229,731 228,802
AIM Value Fund................ 14,956 522,729 484,878
Republic Industries, Inc.
Common Stock*................ 61,201 1,622,718 1,426,721
------------ -----------
Total.................. $ 12,319,440 $12,235,897
============ ===========
</TABLE>
* Represents a party-in-interest to the Plan.
7
<PAGE> 11
Schedule II
E.I.N.: 75-1105145
Plan #: 001
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
ITEM 27d-SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Purchase Selling Asset Net
Investment Description Shares Price Price Cost Gain (Loss)
- ---------------------- ------ -------- ------- ----- -----------
<S> <C> <C> <C> <C> <C>
Purchases:
Merrill Lynch Retirement
Preservation Trust*.......... 3,156,534 $ 3,156,534 N/A $ 3,156,534 N/A
Merrill Lynch Growth Fund*..... 73,931 1,923,408 N/A 1,923,408 N/A
Merrill Lynch Global
Allocation Fund*............. 42,314 634,469 N/A 634,469 N/A
Merrill Lynch Capital Fund*.... 48,585 1,564,243 N/A 1,564,243 N/A
MFS Emerging Growth Fund....... 6,342 230,414 N/A 230,414 N/A
AIM Value Fund................. 15,849 554,717 N/A 554,717 N/A
Republic Industries, Inc.
Common Stock*............... 42,270 1,176,760 N/A 1,176,760 N/A
Sales:
Merrill Lynch Retirement
Preservation Trust*.......... 151,720 $ 151,720 $ 151,720 $ 151,720 $ --
Merrill Lynch Growth Fund*..... 8,481 207,082 227,538 207,082 20,456
Merrill Lynch Global
Allocation Fund*............. 3,702 55,127 55,953 55,127 826
Merrill Lynch Capital Fund*.... 9,283 288,037 310,491 288,037 22,454
MFS Emerging Growth Fund....... 18 683 670 683 (13)
AIM Value Fund................. 893 31,988 32,048 31,988 60
Republic Industries, Inc.
Common Stock*................ 5,850 157,955 157,595 157,955 (360)
</TABLE>
Notes:
* Represents a party-in-interest to the Plan.
(1) Transactions included herein represent transactions, or a series of
transactions, in securities of the same issue, or with respect to the same
issuer, of 5% of the quoted market value of Plan assets at the beginning
of the Plan year.
(2) This schedule incorporates all disclosures required by the Department of
Labor for assets purchased and sold within the Plan year.
8
<PAGE> 12
Schedule III
E.I.N.:75-1105145
Plan #:001
REPUBLIC INDUSTRIES, INC.
RETIREMENT SAVINGS PLAN
ITEM 27e-SCHEDULE OF NONEXEMPT TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Relationship to Description of Transactions,
Plan, Employer, Including Maturity Date, Interest
Identity of Party or Other Party Rate of Interest, Collateral, and Amount Incurred
Involved in Interest Par or Maturity Value Loaned on Loan
- -------------------- --------------------- ----------------------------------------- --------------------- ----------------
<S> <C> <C> <C> <C>
Republic Sponsor Lending of moneys from the Plan to the
Industries, Inc. employer (contributions not timely
remitted to the Plan), as follows:
Deemed loan dated March 22, 1997,
maturity March 27, 1997, with
interest at 8% per annum $ 7,802 $10
Deemed loan dated May 22, 1997,
maturity May 23, 1997, with
interest at 8% per annum $ 2,139 $ 1
Deemed loan dated August 22, 1997,
maturity September 5, 1997, with
interest at 8% per annum $ 3,512 $13
Deemed loan dated October 22, 1997,
maturity October 24, 1997, with
interest at 8% per annum $ 51 $--
Deemed loan dated November 22, 1997,
maturity November 24, 1997, with
interest at 8% per annum $10,587 $ 7
Deemed loan dated December 20, 1997,
maturity December 31, 1997, with
interest at 8% per annum $ 4,039 $10
Deemed loan dated January 21, 1998,
maturity February 4, 1998, with
interest at 8% per annum $23,388 $72
Deemed loan dated January 22, 1998,
maturity March 31, 1998, with
interest at 8% per annum $ 239 $ 3
</TABLE>
9
<PAGE> 13
SIGNATURES
THE PLAN. 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.
Republic Industries, Inc.
Retirement Savings Plan
-----------------------------------
(Name of Plan)
Date: June 30, 1998 By: /s/ Kathleen Hyle
------------------- -------------------------------
Title: Chairperson of the
Administrative Committee of the
Republic Industries, Inc.
Retirement Savings Plan
<PAGE> 1
EXHIBIT 1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation of our report included in this Form 11-K, into the Company's
previously filed Registration Statement on Form S-8 (No. 333-42891).
Fort Lauderdale, Florida,
June 30, 1998.
