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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 (FEE REQUIRED)
For the fiscal year ended December 31, 1997
OR
( ) TRANSACTION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transaction period from to
Commission file number:
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
MEDICAL RESOURCES, INC.
401(k) RETIREMENT PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
MEDICAL RESOURCES, INC.
155 State Street
Hackensack, New Jersey 07601
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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 BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
MEDICAL RESOURCES, INC. 401(k) RETIREMENT PLAN
(Name of Plan)
Date: March 18, 1999 By: /s/ Christopher J.Joyce
Name:Christopher J. Joyce
Title: Trustee
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MEDICAL RESOURCES, INC.
INDEX
PAGE
1.1 INDEPENDENT AUDITORS' REPORT 2
STATEMENTS OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS 3
STATEMENTS OF CHANGES IN NET ASSETS
AVAILABLE FOR PLAN BENEFITS 4
NOTES TO FINANCIAL STATEMENTS 5-8
SUPPLEMENTARY INFORMATION -
ASSETS HELD FOR INVESTMENT -
SCHEDULE 1 10
REPORTABLE TRANSACTION - SCHEDULE 2 11<PAGE>
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1.1.1 INDEPENDENT AUDITOR'S REPORT
To The Trustees of Medical Resources, Inc.
401(K) Retirement Plan
We have audited the statements of the new assets available for plan
benefits of Medical Resources, Inc. 401(K) Retirement Plan as of December
31, 1997 and 1996 and the related statements of changes in net assets available
for plan benefits for the years 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 audits.
We conducted our audits in accordance with generally accepted
auditing standards. This standards require that we plan and perform the audits
to obtain reasonable assurance about whether the financial statements are free
of material misstatements. 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 principals 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 combined financial statements referred to above
present fairly, in all material respects, the net assets available for plan
benefits of Medical Resources, Inc. 401(K) Retirement Plan as of December 31,
1997 and 1996 and the changes in net assets available for plan benefits for the
years then ended inconformity 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
Medical Resources, Inc. 401(K) Retirement Plan are presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974 and
are not a required part of the basic financial statements. 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 tatements taken as a
whole.
/s/ Kempisty & Company
- -----------------------------------------------
Kempisty & Company
Certified Public Accountants PC
New York, New York
August 20, 1998<PAGE>
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
STATEMENT OF NET ASSETS FOR PLAN BENEFITS
December 31,
ASSETS 1997 1996
Investments at Fair Value
(Notes 1 and 2):
Shares of Registered Investment
Companies:
ML Growth Fund $1,242,843 $529,098
ML Global Allocation 580,115 264,848
ML Capital Fund 551,954 197,438
ML Corp Bond Inv Grade B 171,357 85,525
ML Pacific Fund 181,221 103,073
ML Retirement Reserve 233,471 80,847
Medical Resources, Inc. Common Stock 442,814 20,648
Participant Loans Receivable (Note 1g) 63,425 53,221
-----------------------------------
$3,467,200 1,334,698
Receivables:
Employer's Contribution 16,883 5, 211
Participants' Contributions 67,031 3,012
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83,914 16,223
Cash 74,617 ------
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TOTAL ASSETS $3,625,731 $1,342,921
1.1.2 LIABILITIES AND NET ASSETS AVAILABLE FOR PLAN
BENEFITS
LIABILITIES
Accounts Payable $ 74,617 5,621
Total Liabilities 74,617 5,621
---------------------------------
Net Assets
Available for
Plan Benefits $3,551,114 1,337,300
1.1.3 See Accompanying Notes to Financial Statements<PAGE>
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
<TABLE>
Year ended
December 31,
<S> <C> <C>
Additions to Net Assets Attributed to: 1997 1996
Investment Income:
Net Investment Gain From Registered
Investment Companies $11,141 $67,917
Net Investment Loss from Company Stock (104,672) -----
Dividends 245,238 92,818
Interest 4,800 -----
------------------------------
156,507 160,295
Contributions:
Employer's (Note 1b) 200,906 92,818
Participants' 949,112 309,104
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1,150,018 401,958
Transfers from merged plan 1,017,732 --------
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TOTAL ADDITIONS 2,324,257 562,253
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Payment for: Benefits Paid to Participants 110,443 109,792
Additions to liabilities for: Other --------- (7,040)
--------------------------------
-------- (7,040)
--------------------------------
TOTAL DEDUCTIONS 110,443 102,752
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NET INCREASE 2,213,814 459,501
Net Assets Available for Plan Benefits
Beginning of Year 1,337,300 877,799
--------------------------------
Net Assets Available for Plan Benefits
End of Year $3,551,114 1,337,300
</TABLE>
<TABLE>
1.1.4 See Accompanying Notes to Financial Statements<PAGE>
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1997
(a) Note 1 - DESCRIPTION OF THE PLAN
The following description of Medical Resources, Inc. 401(K)
Retirement Plan (the "Plan") provides only general information. Participants
should refer to the Plan Agreement for a more complete description of the
Plan's provisions.
a. Eligibility
The Plan is a defined contribution plan covering all employees of
Medical Resources, Inc. (the "Plan Sponsor") and (the "Company") who are at
least twenty-one years of age and have completed one year of service. The Plan
is subject to the Employee Retirement Income Security Act of 1974 ("ERISA").
Employer Contribution
The Company will contribute for each Plan year an amount in
accordance with the participants' compensation reduction election as described
in the Plan Agreement, plus an additional 50% of such amount not to exceed 2%
of the participant's compensation.
The amounts contributed to the Plan each Plan year as a result of the
participants' election to have their earnings reduced may not exceed the lesser
of $9,500 for 1997 and 1996 or 15% of their compensation, as described in the
Plan Agreement.
Participant Accounts
Each participant's account is credited with the participant's
contribution and allocations of (a) the Company's matching contribution and,
(b) Plan earnings. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's vested account.
Vesting
Participants are vested according to the following schedule:
YEARS OF SERVICE VESTED PERCENTAGE
33.3%
66.6%
100.0%
Participants are always 100% vested in their Salary Deferral Contributions.<PAGE>
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1997
Note 1 - DESCRIPTION OF THE PLAN (continued)
e. Investment Options
Upon enrollment in the Plan, a participant may direct employee and
employer contributions in any of eight investment options:
Seven Merrill Lynch Mutual Funds - Funds are invested in shares of
any one or a combination of seven registered investment companies that invest in
common stocks, corporate bonds, U.S. Government Securities and short term money
market instrument or a combination thereof.
Medical Resources, Inc. Company Stock - Funds are invested in common stock of
Medical Resources, Inc.
Participants may change their investment options in accordance with Plan
procedures.
f. Termination of Participation
A participant whose employment ends for any reason other than death,
disability or retirement will be entitled to receive only that portion of
benefits in which they are vested. Any non-vested benefit will be forfeited and
used to reduce future employer contributions to the Plan. Participants become
fully vested upon death, disability, normal retirement age (59 1/2) or early
retirement age (55) and completion of 20 years of service.
g. Loans
A Participant may borrow from his account subject to proper
approvals. The loan and subsequent repayment of principal and interest shall be
credited directly to the participant's account and shall not be treated as
income of the Trust Fund. The outstanding loans to a participant shall not
exceed the lesser of $50,000 or 50% of the value of the participant's account as
of the most recent valuation date. Generally, loans shall be repaid in regular
installments of interest and principal, and not less frequently than quarterly,
over a period not to exceed five years. Upon termination of the participants'
employment with the Company the loan balance will be immediately due.
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1997
Note 1 - DESCRIPTION OF THE PLAN (continued)
h. Administrative Expenses
Administrative expenses of the Plan may be paid in part or in total by the
Company. For the years ended December 31, 1997 and 1996 the expenses of the Plan
have been paid by the Company.
Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Basis of Accounting
The Financial Statements of the Plan are prepared under the accrual
method of accounting.
In January 1997, NMR of America, Inc. 401(K) Plan (NMR Plan) was
merged into Medical Resources, Inc. 401(K) Retirement Plan. Assets with a market
value of $1,017,732 were transferred from NMR Plan into Medical Resources, Inc.
401(K) Plan.
b. Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. Shares of registered
investment companies are valued at quoted market prices which represent the net asset
value of shares held by the Plan at year-end. The Company stock is valued at its quoted
market price. Participant notes receivable are valued at cost which approximates fair
market value. Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on an accrual basis. Dividends are recorded on the ex-
dividend date.
c. Payment of Benefits
Benefits are recorded when paid.<PAGE>
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MEDICAL RESOURCES, INC.
401(K) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1997
(b) Note 3 - PLAN TERMINATIONS
The Company has the right under the Plan to terminate the Plan at any
time subject to the provisions of ERISA. In the event of Plan termination, participants
will be 100% vested, and the Trustee will continue to administer the Trust and pay
benefits in accordance with the Plan Agreement.
Note 4 - INCOME TAX STATUS
The Trust established under the Plan to hold the Plan's net assets is qualified
pursuant to Section 501(c) 9 of the Internal Revenue Code, and, accordingly,
the Trust's net investment income is exempt from income taxes. The Sponsor has
obtained a favorable tax determination letter form the Internal Revenue Service
and the Sponsor believes that the Plan, as amended, continues to qualify and to
operate as designed.
Note 5 - INVESTMENTS
Investments that represent five percent or more of the Plan net assets are
separately identified as follows:
December 31, 1997
<S> <C> <C> <C>
Registered Investment Number of Fair Percent of
Companies Shares Value Plan
Assets
ML Growth Fund 47,041.74 $1,242,843 35.00%
ML Global Allocation 41,615.13 $580,115 16.34%
ML Capital Fund 16,334.82 $551,954 15.54%
ML Pacific Fund 11,248.99 $181,221 5.10%
ML Retirement Reserve 233,471.44 $233,471 6.57%
Medical Resources, Inc.
Common Stock 47,233.49 $442,814 12.47%
</TABLE>
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1.1.5 SUPPLEMENTARY INFORMATION
MEDICAL RESOURCES, INC. 401(K) RETIREMENT PLAN
ITEM 27a - SCHEDULE OF INVESTMENTS
YEAR ENDED DECEMBER 31, 1997
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SCHEDULE 1
1.1.6 SUPPLEMENTARY INFORMATION
MEDICAL RESOURCES, INC. 401(K) RETIREMENT PLAN
ITEM 27a - SCHEDULE OF INVESTMENTS
YEAR ENDED DECEMBER 31, 1997
<TABLE>
<S> <C> <C>
NUMBER MARKET
REGISTERED INVESTMENT COMPANIES OF SHARES VALUE
ML GROWTH 47,041.74 $1,242,843
ML GLOBAL ALLOCATION 41,615.13 580,115
ML CAPITAL FUND 16,334.82 551,954
ML PACIFIC FUND 11,248.99 181,221
ML CORP BOND INV GRADE B 14,926.58 171,357
ML RETIREMENT RESERVES 233,471.44 233,471
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TOTAL REGISTERED INVESTMENT COMPANIES $2,960,961
MEDICAL RESOURCES, INC
COMMON STOCK 47,233.49 422,814
PARTICIPANT LOANS 63,425
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</TABLE>
TOTAL INVESTMENTS $3,476,200
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SCHEDULE 2
1.1.7 SUPPLEMENTARY INFORMATION
MEDICAL RESOURCES, INC. 401(K) RETIREMENT PLAN
ITEM 27d- Schedule of Reportable Transactions
Year ended December 31, 1997
<TABLE>
<S> <C> <C> <C>
PURCHASE SELLING NET
DESCRIPTION PRICE PRICE GAIN
Purchases
ML Capital Fund $ 331,435 -- --
ML Global Allocation $ 359,473 -- --
ML Growth Fund $ 734,789 -- --
ML Pacific Fund $ 133,835 -- --
ML Retirement Reserve $ 167,355 -- --
Sales
ML Conversion Fund $ 576,644 $ 583,307 $ 6,663
</TABLE>
136517
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