<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________
to ____________ Commission file number _______________
-------------------------------
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
RETIREMENT SAVINGS PLAN
(Full title of the Plan)
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
1101 PENNSYLVANIA AVENUE, NW
WASHINGTON, D.C. 20004
(Name of issuer of the securities held pursuant to the Plan
and address of its principal executive office)
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
<PAGE>
Harman International
Industries, Incorporated
Retirement Savings Plan
Financial Statements and
Supplemental Schedules
June 26, 1997 and June 30, 1996
(With Independent Auditors' Report Thereon)
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Index to Financial Statements and Supplemental Schedules
<TABLE>
<CAPTION>
Page
<S> <C>
Independent Auditors' Report 1
Statement of Net Assets Available for Plan Benefits -
June 26, 1997 2
Statement of Net Assets Available for Plan Benefits -
June 30, 1996 3
Statement of Changes in Net Assets Available for Plan Benefits -
Period ended June 26, 1997 4
Statement of Changes in Net Assets Available for Plan Benefits -
Year ended June 30, 1996 5
Notes to Financial Statements 6
Schedule
Line 27a - Schedule of Investments Held at End of Plan Year -
June 26, 1997 1
Line 27d - Schedule of Reportable Transactions -
Period ended June 26, 1997 2
All other supplemental schedules omitted are not applicable or are
not required, based on disclosure requirements of the Employee
Retirement Income Security Act of 1974 and regulations issued by the
Department of Labor.
</TABLE>
<PAGE>
Independent Auditors' Report
The Administrative Committee of the Board of Directors
Harman International Industries, Incorporated:
We have audited the accompanying statements of net assets available
for Plan benefits of the Harman International Industries, Incorporated
Retirement Savings Plan (the Plan) as of June 26, 1997 and June 30, 1996
and the related statements of changes in net assets available for Plan
benefits for the period ended June 26, 1997 and year ended June 30, 1996.
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. 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 Plan benefits of the
Harman International Industries, Incorporated Retirement Savings Plan
as of June 26, 1997 and June 30, 1996 and the changes in net assets available
for Plan benefits for the period ended June 26, 1997 and year ended
June 30, 1996 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 information in
Schedules 1 and 2 is presented for the purpose 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 is not a
required part of the basic financial statements. The fund information in
the statements of net assets available for Plan benefits and the related
statements of changes in net assets available for Plan benefits is presented
for purposes of additional analysis rather than to present the net assets
available for Plan benefits and 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, when considered in relation to the basic financial
statements taken as a whole.
/s/ KPMG Peat Marwick LLP
November 14, 1997
1
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 26, 1997
<TABLE>
<CAPTION>
The Putnam
Fixed Fund for Company
Income Growth and Stock
Assets Fund Income Fund
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts $22,045,554 - -
Mutual funds - 19,792,594 -
Harman International Industries,
Incorporated common stock - - 9,284,984
Money market funds 163,883 - -
Pooled separate accounts - - -
Participant loans - - -
------------ ------------ ------------
22,209,437 19,792,594 9,284,984
Contributions receivable 1,042,518 806,479 582,660
------------ ------------ ------------
Total assets 23,251,955 20,599,073 9,867,644
Liabilities
Other liabilities 7,063 6,295 2,953
------------ ------------ ------------
Net assets available for
Plan benefits $23,244,892 20,592,778 9,864,691
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 26, 1997
<TABLE>
<CAPTION>
George
Putnam Putnam Putnam
Fund of Investors Voyager
Assets Boston Fund Fund
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts - - -
Mutual funds 6,360,375 414,961 11,877,940
Harman International Industries,
Incorporated common stock - - -
Money market funds - - -
Pooled separate accounts - - -
Participant loans - - -
------------ ------------ ------------
6,360,375 414,961 11,877,940
Contributions receivable 345,965 46,755 743,935
------------ ------------ ------------
Total assets 6,706,340 461,716 12,621,875
Liabilities
Other liabilities 2,023 132 3,777
------------ ------------ ------------
Net assets available for
Plan benefits 6,704,317 461,584 12,618,098
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 26, 1997
<TABLE>
<CAPTION>
Putnam
Putnam Diversified Putnam
OTC Income and Overseas
Assets Fund Trust Fund Growth Fund
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts - - -
Mutual funds 276,642 325,440 382,745
Harman International Industries,
Incorporated common stock - - -
Money market funds - - -
Pooled separate accounts - - -
Participant loans - - -
------------ ------------ ------------
276,642 325,440 382,745
Contributions receivable 67,237 28,472 40,962
------------ ------------ ------------
Total assets 343,879 353,912 423,707
Liabilities
Other liabilities 88 103 122
------------ ------------ ------------
Net assets available for
Plan benefits 343,791 353,809 423,585
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 26, 1997
<TABLE>
<CAPTION>
New Participant
Opportunities Loan
Assets Fund Fund Total
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts - - 22,045,554
Mutual funds 3,832,944 - 43,263,641
Harman International Industries,
Incorporated common stock - - 9,284,984
Money market funds - - 163,833
Pooled separate accounts - - -
Participant loans - 21,643 21,643
------------ ------------ ------------
3,832,944 21,643 74,779,705
Contributions receivable 342,634 - 4,047,617
------------ ------------ ------------
Total assets 4,175,578 21,643 78,827,322
Liabilities
Other liabilities 1,219 - 23,775
------------ ------------ ------------
Net assets available for
Plan benefits 4,174,359 21,643 78,803,547
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
2
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 30, 1996
<TABLE>
<CAPTION>
The Putnam
Fixed Fund for Company
Income Growth and Stock
Assets Fund Income Fund
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts $21,508,663 - -
Mutual funds - 15,199,934 -
Harman International Industries,
Incorporated common stock - - 6,368,068
Money market funds 52,238 - -
Pooled separate accounts - - -
Participant loans - - -
------------ ------------ ------------
21,560,901 15,199,934 6,368,068
Contributions receivable 846,027 661,707 455,365
------------ ------------ ------------
Total assets 22,406,928 15,861,641 6,823,433
Liabilities
Other liabilities 9,158 6,455 2,704
------------ ------------ ------------
Net assets available for
Plan benefits $22,397,770 15,855,186 6,820,729
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 30, 1996
<TABLE>
<CAPTION>
George
Putnam Putnam New
Fund of Voyager Opportunities
Assets Boston Fund Fund
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts - - -
Mutual funds 3,846,337 11,830,731 3,324,378
Harman International Industries,
Incorporated common stock - - -
Money market funds - - -
Pooled separate accounts - - -
Participant loans - - -
------------ ------------ ------------
3,846,337 11,830,731 3,324,378
Contributions receivable 342,815 721,627 198,072
------------ ------------ ------------
Total assets 4,189,152 12,552,358 3,522,450
Liabilities
Other liabilities 1,633 5,024 1,412
------------ ------------ ------------
Net assets available for
Plan benefits 4,187,519 12,547,334 3,521,038
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Net Assets Available for Plan Benefits
June 30, 1996
<TABLE>
<CAPTION>
Participant
Loan Aetna
Assets Fund Fund Total
------------ ------------ ------------
<S> <C> <C> <C>
Investments:
Guaranteed investment contracts - 755,930 22,264,593
Mutual funds - - 34,201,380
Harman International Industries,
Incorporated common stock - - 6,368,068
Money market funds - - 52,238
Pooled separate accounts - 605,378 605,378
Participant loans 72,071 - 72,071
------------ ------------ ------------
72,071 1,361,308 63,563,728
Contributions receivable - - 3,225,613
------------ ------------ ------------
Total assets 72,071 1,361,308 66,789,341
Liabilities
Other liabilities - - 26,386
------------ ------------ ------------
Net assets available for
Plan benefits 72,071 1,361,308 66,762,955
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Period ended June 26, 1997
<TABLE>
<CAPTION>
The Putnam
Fixed Fund for Company
Income Growth and Stock
Fund Income Fund
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net $ 1,323,291 1,116,812 766,030
Employee contributions 1,087,768 1,261,015 808,026
Fund transfers, net 165,523 (85,908) 2,137,475
Other additions (deletions), net 81,921 13,073 8,361
------------ ------------ ------------
2,658,503 2,304,992 3,719,892
------------ ------------ ------------
Investment income:
Interest and dividends 1,206,528 1,501,104 35,684
Net appreciation (depreciation) 87 2,934,266 (202,987)
------------ ------------ ------------
Net investment income 1,206,615 4,435,370 (167,303)
------------ ------------ ------------
Benefit payments 2,980,224 1,975,033 485,749
Administrative expenses 37,722 27,737 22,878
------------ ------------ ------------
3,017,996 2,002,770 508,627
------------ ------------ ------------
Net increase (decrease) 847,122 4,737,592 3,043,962
Net assets at beginning of year 22,397,770 15,855,186 6,820,729
------------ ------------ ------------
Net assets at end of year $ 23,244,892 20,592,778 9,864,691
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Period ended June 26, 1997
<TABLE>
<CAPTION>
George
Putnam Putnam Putnam
Fund of Investors Voyager
Boston Fund Fund
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net 504,724 58,082 1,067,406
Employee contributions 576,688 39,568 1,329,279
Fund transfers, net 838,795 313,305 (2,510,668)
Other additions (deletions), net 4,184 (70) 16,900
------------ ------------ ------------
1,924,391 410,885 (97,083)
------------ ------------ ------------
Investment income:
Interest and dividends 435,479 13,476 821,996
Net appreciation (depreciation) 648,361 42,885 446,299
------------ ------------ ------------
Net investment income 1,083,840 56,361 1,268,295
------------ ------------ ------------
Benefit payments 482,184 5,180 1,082,440
Administrative expenses 9,249 482 18,008
------------ ------------ ------------
491,433 5,662 1,100,448
------------ ------------ ------------
Net increase (decrease) 2,516,798 461,584 70,764
Net assets at beginning of year 4,187,519 - 12,547,334
------------ ------------ ------------
Net assets at end of year 6,704,317 461,584 12,618,098
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Period ended June 26, 1997
<TABLE>
<CAPTION>
Putnam
Putnam Diversified Putnam
OTC Income and Overseas
Fund Trust Fund Growth Fund
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net 100,114 32,966 44,564
Employee contributions 84,709 23,737 37,813
Fund transfers, net 154,224 327,761 287,384
Other additions (deletions), net (21) 354 62
------------ ------------ ------------
339,026 384,818 369,823
------------ ------------ ------------
Investment income:
Interest and dividends 14,814 10,992 1,631
Net appreciation (deprecation) (8,712) (2,413) 53,024
------------ ------------ ------------
Net investment income 6,102 8,759 54,655
------------ ------------ ------------
Benefit payments 876 39,242 459
Administrative expenses 461 346 434
------------ ------------ ------------
1,337 39,588 893
------------ ------------ ------------
Net increase (decrease) 343,791 353,809 423,585
Net assets at beginning of year - - -
------------ ------------ ------------
Net assets at end of year 343,791 353,809 423,585
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Period ended June 26, 1997
<TABLE>
<CAPTION>
New
Opportunities Participant Aetna
Fund Loan Fund Fund Total
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Employer contributions, net 496,595 - 790 5,511,374
Employee contributions 635,610 - - 5,884,213
Fund transfers, net (352,236) - (1,275,655) -
Other additions (deletions), net 3,028 (53,679) - 74,113
------------ ------------ ------------ ------------
782,997 (53,679) (1,274,865) 11,469,700
------------ ------------ ------------ ------------
Investment income:
Interest and dividends 29,329 3,251 9,131 4,083,415
Net appreciation (deprecation) 59,011 - 58,839 4,028,660
------------ ------------ ------------ ------------
Net investment income 88,340 3,251 67,970 8,112,075
------------ ------------ ------------ ------------
Benefit payments 212,056 - 154,413 7,417,856
Administrative expenses 5,960 - - 123,327
------------ ------------ ------------ ------------
218,016 - 154,413 7,541,183
------------ ------------ ------------ ------------
Net increase (decrease) 653,321 (50,428) (1,361,308) 12,040,592
Net assets at beginning of year 3,521,038 72 ,071 1,361,308 66,762,955
------------ ------------ ------------ ------------
Net assets at end of year 4,174,359 21,643 - 78,803,547
------------ ------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Year ended June 30, 1996
<TABLE>
<CAPTION>
The Putnam
Fixed Fund for Company
Income Growth and Stock
Fund Income Fund
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net $ 1,155,799 999,796 667,097
Employee contributions 1,122,407 1,252,115 734,615
Fund transfers, net (1,827,314) 82,910 (2,409,595)
Transfer from related plans - - -
Other additions (deletions), net 5,788 14,021 9,584
------------ ------------ ------------
456,680 2,348,842 (998,299)
------------ ------------ ------------
Investment income:
Interest and dividends 1,311,957 894,051 287,109
Net appreciation - 2,030,216 1,732,126
------------ ------------ ------------
Net investment income 1,311,957 2,924,267 2,019,235
------------ ------------ ------------
Benefit payments 2,739,006 950,660 463,553
Administrative expenses 48,231 26,251 20,722
------------ ------------ ------------
2,787,237 976,911 484,275
------------ ------------ ------------
Net increase (decrease) (1,018,600) 4,296,198 536,661
Net assets at beginning of year 23,416,370 11,558,988 6,284,068
------------ ------------ ------------
Net assets at end of year $22,397,770 15,855,186 6,820,729
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Year ended June 30, 1996
<TABLE>
<CAPTION>
George
Putnam Putnam New
Fund of Voyager Opportunities
Boston Fund Fund
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net 531,832 1,103,563 225,185
Employee contributions 602,683 1,339,449 296,360
Fund transfers, net 169,609 1,073,179 2,911,211
Transfer from related plans - - -
Other additions (deletions), net 7,972 15,297 543
------------ ------------ ------------
1,312,096 3,531,488 3,433,299
------------ ------------ ------------
Investment income:
Interest and dividends 240,668 542,462 -
Net appreciation 286,309 2,058,463 119,137
------------ ------------ ------------
Net investment income 526,977 2,600,925 119,137
------------ ------------ ------------
Benefit payments 233,859 736,480 29,271
Administrative expenses 6,945 19,927 2,127
------------ ------------ ------------
240,804 756,407 31,398
------------ ------------ ------------
Net increase (decrease) 1,598,269 5,376,006 3,521,038
Net assets at beginning of year 2,589,250 7,171,328 -
------------ ------------ ------------
Net assets at end of year 4,187,519 12,547,334 3,521,038
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
Year ended June 30, 1996
<TABLE>
<CAPTION>
Participant
Loan Aetna
Fund Fund Total
------------ ------------ ------------
<S> <C> <C> <C>
Employer contributions, net - 4,588 4,687,860
Employee contributions - 9,070 5,356,699
Fund transfers, net - - -
Transfer from related plans - 711,506 711,506
Other additions (deletions), net (87,885) - (34,680)
------------ ------------ ------------
(87,885) 725,164 10,721,385
------------ ------------ ------------
Investment income:
Interest and dividends 6,417 22,610 3,305,274
Net appreciation - 87,569 6,313,820
------------ ------------ ------------
Net investment income 6,417 110,179 9,619,094
------------ ------------ ------------
Benefit payments - 413,654 5,566,483
Administrative expenses - - 124,203
------------ ------------ ------------
- 413,654 5,690,686
------------ ------------ ------------
Net increase (decrease) (81,468) 421,689 14,649,793
Net assets at beginning of year 153,539 939,619 52,113,162
------------ ------------ ------------
Net assets at end of year 72,071 1,361,308 66,762,955
------------ ------------ ------------
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Notes to Financial Statements
June 26, 1997 and June 30, 1996
(1) Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements of the Harman
International Industries, Incorporated Retirement Savings Plan
(the Plan) have been presented on an accrual basis and present
the net assets available for Plan benefits and changes in those net assets.
Investments
Investments in guaranteed investment contracts (GIC) are reported at
contract value as these contracts are fully benefit responsive. Contract
value represents contributions plus interest at the contract rate, less
funds used to pay withdrawals and administration expenses.
The Plan participates in mutual funds managed by Putnam Management
Company, Inc. on behalf of participating employee benefit plans. Each
participating employee benefit plan is allocated its proportionate share of
the net assets and the net investment income of the mutual funds. The
investments in mutual funds are reported at fair value, which is based
on quotations obtained from national securities exchanges.
The Plan also participates in a stock fund to purchase shares
of Harman International Industries, Incorporated (the Company)
common stock. The fair value of the Company stock is determined
based on quotations obtained from national securities exchanges.
The assets of the Participant Loan Fund represent loans to certain
participants (note 2) and are carried at outstanding loan balance, which
approximates market value.
Securities transactions are recorded on the trade-date basis. Net
appreciation or depreciation resulting from revaluation of investments
to fair value is reflected in the statements of changes in net assets
available for Plan benefits and includes investments bought, sold,
as well as held during the year. Dividend income is recorded on the
ex-dividend date. Investments are principally managed by the Plan's
trustee, Putnam Fiduciary Trust Company.
Administrative Expenses
Administrative expenses of the Plan are principally paid by the Plan.
Use of Estimates
Management of the Company has made a number of estimates
and assumptions relating to the reporting of assets and liabilities
and the disclosure of contingent assets and liabilities to prepare
these financial statements in conformity with generally accepted
accounting principles. Actual results could differ from these estimates.
Reclassifications
Certain reclassifications have been made to the 1996 financial
statements to conform to the 1997 presentation.
6
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Notes to Financial Statements, Continued
(2) Plan Description
The Plan agreement dated July 1, 1989, amends and restates five
preexisting defined contribution and savings plan agreements for
plans which were merged into the Plan and extends coverage
to all eligible nonunion domestic employees of Harman
International Industries, Incorporated. Effective July 1, 1995,
the Plan also extends coverage to hourly collective bargaining unit
employees of Harman Motive, Inc. The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 (ERISA).
The Plan is a defined contribution, savings and profit sharing plan
sponsored by the Company. The Plan covers all eligible employees,
as defined by the Plan, provided they have completed six months
of consecutive service, have worked 500 hours and are at least 21
years of age. Plan participants should refer to the Plan agreement
for more complete information.
Plan Changes and Amendments
The Plan year-end was changed to June 26, 1997. Future plan years
will commence June 27 and end June 26.
Effective December 24, 1996, investments of the former AKG Acoustics, Inc.
Salary Savings Plan and TRS Madrigal Audio Labs, Inc. Employee
Savings Plan which were managed by Aetna Life Insurance and
Annuity Co. were transferred to and reflected with the appropriate
Putnam Plan funds. Previously, such investments were not merged into
the available investment funds of the Putnam Plan due to high surrender charges.
Contributions
Participants in the Plan may contribute on a tax-deferred basis from 1% to 12%
of their compensation, as defined by the Plan. Participants may change
their deferral percentage as of the first payroll period following the
quarterly valuation date. The Company has made annual basic
contributions equal to 2% of the compensation paid to all eligible participants
active at the end of the Plan year and a matching contribution equal to
50% of the eligible participant's tax-deferred contribution percentage for each
payroll period up to a maximum election of 6% per payroll period. In addition,
the Company may make discretionary profit sharing contributions to the
Plan, in an amount determined by the Company's Board of Directors.
Company profit sharing contributions are limited to 15% of the participants'
compensation, less the participants' tax-deferred contributions, the Company
basic contribution and the Company matching contribution. Total Company
and participant contributions may not exceed 15% of total participants' taxable
compensation. Total annual additions to a participant's account, exclusive of
adjustments to the fair market value of the participants' fund account, may
not exceed the lesser of $30,000 or 25% of the participant's taxable
compensation.
Vesting
Participants are 100% vested in their salary deferral contribution, employer's
basic contribution and rollover contribution accounts, and become vested in
profit sharing and matching contributions at the rate of 25% per year after
the completion of three years of service, or 100% after reaching age 65,
death or disability.
7
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Notes to Financial Statements, Continued
Investment Options
Upon enrollment in the Plan, a participant may direct contributions in any
increment in any of ten investment options:
The Stable Value Fund - Invests in high quality guaranteed
investment contracts.
The Putnam Growth & Income Fund - Invests in common stocks with
appreciation potential as well as current dividend payouts.
The Harman Stock Fund - Invests solely in the stock of Harman
International Industries.
The George Putnam Fund of Boston - Invests in stock and bonds to
balance current return with long-term growth potential.
The Putnam Investors Fund - Invests primarily in the stocks of
well established companies that provide opportunity for growth over time.
The Putnam Voyager Fund - Invests primarily in the stocks of smaller,
higher growth companies with capital appreciation potential rather
than those that pay current dividends.
The Putnam OTC Fund - Invests primarily in over-the-counter stocks of
small to medium sized emerging growth companies.
The Putnam Diversified Income & Trust Fund - Invests in a combination of
US government, high yield and international bonds.
The Putnam Overseas Growth Fund - Invests in a diversified portfolio of
stocks of companies located outside North America.
The Putnam New Opportunities Fund - Invests primarily in the stocks
of certain emerging industry groups that offer above-average
long-term growth potential.
Participant Account Balances
Separate accounts are maintained for each participant's salary deferral,
rollover, employer profit sharing, basic and matching contribution balances.
Earnings or losses of the Plan are allocated to the participant account
balances by investment fund on a daily basis according to the number of shares
in the participant account balances. Company profit sharing and basic
contributions are allocated based on participant compensation. Company
matching contributions are allocated based upon each participant's
tax-deferred contribution percentage.
Participant Loans
The Plan does not allow for any participant loans. The loans discussed
in note 1 arose from the mergers of related plans and no further loans
will be granted after their repayment is completed.
Benefits
Upon separation from service, retirement at age 65, disability retirement
or death, participants or their beneficiaries are entitled to receive their
vested balances in a lump sum distribution. However, participants from
prior merged plans, whose plans allowed distributions of plan benefits to be
made in forms other than lump sum, may elect payment of benefit balances
which were available prior to the mergers. Contributions made subsequent
to the merger may only be distributed in a lump sum payment.
8
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Notes to Financial Statements, Continued
Forfeitures
Any amount forfeited by any employee terminating from the Plan before
he/she is fully vested remains in the Plan until the end of the Plan quarter.
Amounts forfeited by Plan participants are applied to reduce the employer
contributions. Forfeitures were $260,003 and $225,819 for the period ended
June 26, 1997 and year ended June 30, 1996, respectively.
(3) Investments
Investments in any single entity which represent 5% or more of the fair value
of net assets available for benefits at June 26, 1997 and June 30, 1996 are as
follows:
<TABLE>
<CAPTION>
Description Cost Fair value
<S> <C> <C>
1997:
The Putnam Fund for Growth and Income $14,895,666 19,792,594
Putnam Voyager Fund 9,597,666 11,877,940
George Putnam Fund of Boston 5,457,797 6,360,375
Putnam Stable Value Fund, in contracts
with various companies,
maturity dates ranging from
January 6, 1997 through May 20, 2002,
and interest rates ranging from 4.4% to 8.4% 20,989,217 20,989,217
Harman International Industries,
Incorporated common stock (222,395 shares) 7,487,293 9,284,984
1996:
The Putnam Fund for Growth and Income $12,617,831 15,199,934
Putnam Voyager Fund 9,407,500 11,830,731
George Putnam Fund of Boston 3,466,447 3,846,337
Putnam Stable Value Fund, in contracts
with various companies, maturity dates
ranging from March 28, 1996 through
May 1, 2001, and interest rates ranging
from 4.4% to 8.4% 20,507,901 20,507,901
Harman International Industries,
Incorporated common stock (129,301 shares) 3,634,556 6,368,068
</TABLE>
(4) Federal Income Taxes
In August 1996, the Plan received a favorable determination letter
from the Internal Revenue Service (IRS). However, an internal
audit determined that certain operational defects had occurred.
These defects were corrected and a filing was made with the IRS
under the Voluntary Compliance Resolution (VCR) Program. The
Company believes that the VCR filing, along with the new determination
letter filing, will enable the Plan to continue to constitute a qualified Plan
under Sections 401(a) and 401(k) of the Internal Revenue Code (IRC) and
the Trust will continue to be exempt from income tax under Section 501(a) of
the IRC.
9
<PAGE>
Harman International Industries, Incorporated
Retirement Savings Plan
Notes to Financial Statements, Continued
(5) Plan Termination
Although it has not expressed any intent to do so, the Company has the
right to terminate the Plan subject to the provisions of the Employee Retirement
Income Security Act of 1974. Upon Plan termination, all participant accounts
immediately become 100% vested.
(6) Commitments and Reconciliation to Form 5500
Included in net assets available for Plan benefits in the accompanying
financial statements is $3,548,200 and $1,077,559 at June 26, 1997 and June 30,
1996, respectively, of amounts related to Plan participants and participants
who have terminated their service with the Company as of the end of the Plan
year. These amounts are shown as liabilities on the Form 5500, Annual
Return/Report of Employee Benefit Plans, which is filed with the Internal
Revenue Service.
10
<PAGE>
Schedule 1
Harman International Industries, Incorporated
Retirement Savings Plan
Line 27a - Schedule of Investments Held at End of Plan Year
June 26, 1997
<TABLE>
<CAPTION>
Description of investment,
Identity of issuer, including maturity date, rate of Current
borrower or similar party interest, par or maturity value Cost value
<S> <C> <C> <C>
*Putnam Fiduciary Trust
Company GIC Fund $1,056,337 in contracts with
Metropolitan Life Insurance Co.,
and Unum Life Insurance Co.
(2) maturing on December 31, 1998,
December 31, 1997 and December 31,
1998 with interest of 6.3%, 8.0% and
6.5%, respectively, and the Boston Co.
STIF account with interest of 5.6% $ 1,056,337 1,056,337
*Putnam Stable Value Fund $20,989,217 in contracts with various
companies, maturity dates ranging from
January 6, 1997 through May 20, 2002
and interest rates ranging from 4.4%
to 8.4% 20,989,217 20,989,217
*George Putnam Fund of
Boston 352,180 units at $18.06 per unit 5,457,797 6,360,375
*Putnam Voyager Fund 662,832 units at $17.92 per unit 9,597,666 11,877,940
*The Putnam Fund for
Growth and Income 960,339 units at $20.61 per unit 14,895,666 19,792,594
*Putnam Investors Fund 37,965 units at $10.93 per unit 371,759 414,961
*Putnam OTC Fund 18,922 units at $14.62 per unit 282,419 276,642
*Putnam Diversified Income
and Trust Fund 26,309 units at $12.37 per unit 325,777 325,440
*Putnam Overseas Growth
Fund 21,551 units at $17.76 per unit 329,360 382,745
*Harman International
Industries, Incorporated
common stock 222,395 shares at $41.75 per share 7,487,293 9,284,984
*New Opportunities Fund 86,954 units at $44.08 per unit 3,562,435 3,832,944
*Putnam Money Market
Fund 141,062 units at $1.00 per unit 141,062 141,062
Participant loans Interest rates ranging from 6.5%
to 8.5% - 21,643
*Pending Account - 22,821
---------- ----------
$64,496,788 74,779,705
---------- ----------
</TABLE>
* Party-in-interest investment.
See accompanying independent auditors' report.
<PAGE>
Schedule 2
Harman International Industries, Incorporated
Retirement Savings Plan
Line 27d - Schedule of Reportable Transactions
Period ended June 30, 1997
<TABLE>
<CAPTION>
Description of Purchase Selling
Description of asset transactions price price
<S> <C> <C> <C>
The Putnam Fund for
Growth and Income Purchases $5,326,232 -
Sales - 4,125,304
Putnam Voyager Fund Purchases 4,907,353 -
Sales - 5,306,444
Putnam GIC Funds Purchases 17,285,994 -
Sales - 17,456,578
Investment in Company Stock Purchases 7,691,718 -
Sales - 4,571,812
</TABLE>
See accompanying independent auditors' report.
<PAGE>
Schedule 2
Harman International Industries, Incorporated
Retirement Savings Plan
Line 27d - Schedule of Reportable Transactions
Period ended June 30, 1997
<TABLE>
<CAPTION>
Expense
incurred
Description of Cost of with
Description of asset transactions asset transaction
<S> <C> <C> <C>
The Putnam Fund for
Growth and Income Purchases 5,326,232 -
Sales 3,505,858 -
Putnam Voyager Fund Purchases 4,907,353 -
Sales 4,717,187 -
Putnam GIC Funds Purchases 17,285,994 -
Sales 17,456,578 -
Investment in Company Stock Purchases 7,691,718 -
Sales 3,838,952 -
</TABLE>
See accompanying independent auditors' report.
<PAGE>
Schedule 2
Harman International Industries, Incorporated
Retirement Savings Plan
Line 27d - Schedule of Reportable Transactions
Period ended June 30, 1997
<TABLE>
<CAPTION>
Current
value of
asset on
Description of transaction Net
Description of asset transactions date gain
<S> <C> <C> <C>
The Putnam Fund for
Growth and Income Purchases 5,326,232 -
Sales 4,125,304 619,446
Putnam Voyager Fund Purchases 4,907,353 -
Sales 5,306,444 589,257
Putnam GIC Funds Purchases 17,285,994 -
Sales 17,456,578 -
Investment in Company Stock Purchases 7,691,718 -
Sales 4,571,812 732,860
</TABLE>
See accompanying independent auditors' report.
