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 December 31, 1997
OR
[ ] TRANSACTION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission file number 1-7283
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
REGAL-BELOIT CORPORATION PERSONAL SAVINGS PLAN
B. Name of the issuer of the securities held pursuant to the plan and the
address of its principal executive office:
REGAL-BELOIT CORPORATION
200 STATE STREET
BELOIT, WI 53511
<PAGE>
REQUIRED INFORMATION
Regal-Beloit Corporation Personal Savings Plan ("Plan") is subject to the
Employee Retirement Income Security Act of 1974 ("ERISA"). Therefore, in
lieu of the requirements of Items 1-3 of Form 11-K, the financial statements
and schedules of the Plan for the two fiscal years ended December 31, 1996
and 1997, which have been prepared in accordance with the financial reporting
requirements of ERISA, are attached hereto as Appendix 1 and incorporated
herein by this reference.
SIGNATURES
The Plan. Pursuant to the requirements of the Securities and 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.
REGAL-BELOIT CORPORATION PERSONAL SAVINGS PLAN
By: Regal-Beloit Corporation Personal Savings Plan Administrative Committee
Kenneth F. Kaplan June 26, 1998
- --------------------------------
Kenneth F. Kaplan
Fritz Hollenbach June 26, 1998
- --------------------------------
Fritz Hollenbach
APPENDIX 1
REGAL-BELOIT CORPORATION PERSONAL SAVINGS PLAN
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED DECEMBER 31, 1996 AND
1997, SUPPLEMENTAL SCHEDULES AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1997
AND INDEPENDENT AUDITORS' REPORT.
<PAGE>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1997 AND 1996
-----------------------------------------------------
TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
------------------------------------------------------
<PAGE>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
FINANCIAL STATEMENTS
--------------------
DECEMBER 31, 1997 AND 1996
--------------------------
TABLE OF CONTENTS
-----------------
Page
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS 6-7
FINANCIAL STATEMENTS
Statements of Net Assets Available for Plan Benefits as of
December 31, 1997 and 1996 8-9
Statements of Changes in Net Assets Available for Plan Benefits
for the Years Ended December 31, 1997 and 1996 10-11
NOTES TO FINANCIAL STATEMENTS 12-16
SCHEDULES SUPPORTING FINANCIAL STATEMENTS
Schedule I: Item 27a Schedule of Assets Held for Investment
Purposes December 31, 1997 17
Schedule II: Item 27b Schedule of Loans or Fixed income
obligations December 31, 1997 18
Schedule III: Item 27d Schedule of Reportable Transactions for the
Year Ended December 31, 1997 19
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS 20
<PAGE>
ARTHUR ANDERSEN LLP
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of the
Regal-Beloit Corporation Personal Savings Plan:
We have audited the accompanying statements of net assets available for plan
benefits, with fund information, of Regal-Beloit Corporation Personal Savings
Plan as of December 31, 1997 and 1996, and the related statements of changes
in net assets available for plan benefits, with fund information, for the
years then ended. These financial statements and the supplemental schedules
referred to below are the responsibility of the plan's management. Our
responsibility is to express an opinion on these financial statements and
supplemental 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 plan benefits, with fund
information, of the plan as of December 31, 1997 and 1996, and the changes
in its net assets available for plan benefits, with fund information, for the
years then ended in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules as listed
in the accompanying table of contents are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department
of Labor Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974. The fund information in
the statement of net assets available for plan benefits and the statement
of changes in net assets available for plan benefits is presented for
purposes of additional analysis rather than to present the net assets
<PAGE>
available for plan benefits and 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.
ARTHUR ANDERSEN LLP
-----------------------------------------------
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin,
May 8, 1998.
<PAGE>
<TABLE>
<CAPTION>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
---------------------------------------------------
AS OF DECEMBER 31, 1997
-----------------------
Fund Information
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stable Intermediate
Principal Stock Company Stock Bond Balanced Opportunity Loan Combined
ASSETS Fund Fund Fund Fund Fund Fund Fund Plan Total
------ ---------- ---------- ------------- ------------ ---------- ----------- --------- ----------
INVESTMENTS AT FAIR VALUE:
Cash $ 156 $ - $ - $ - $ - $ - $ - $ 156
M&I Employee Benefit Stable
Principal Fund 4,461,214 - - - - - - 4,461,214
Marshall Stock Fund - 2,172,587 - - - - - 2,172,587
Investment in Master Trust - - 8,235,387 - - - - 8,235,387
Marshall Intermediate
Bond Fund - - - 776,799 - - - 776,799
Fidelity Balanced Fund - - - - 1,397,957 - - 1,397,957
Strong Opportunity Fund - - - - - 3,262,335 - 3,262,335
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
4,461,370 2,172,587 8,235,387 776,799 1,397,957 3,262,335 20,306,435
RECEIVABLES:
Employee contributions 3,735 3,302 7,801 1,957 3,491 7,496 - 27,782
Accrued interest and
dividends 23,608 - - 3,980 - - - 27,588
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
27,343 3,302 7,801 5,937 3,491 7,496 - 55,370
LOANS TO PARTICIPANTS - - - - - - 752,699 752,699
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
Total assets 4,488,713 2,175,889 8,243,188 782,736 1,401,448 3,269,831 752,699 21,114,504
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
LIABILITIES
DUE TO BROKERS 2,499 - - - - - - 2,499
ACCRUED ADMINISTRATIVE FEES 813 315 1,003 124 215 478 152 3,100
---------- ---------- ---------- ------- ---------- ---------- -------- -----------
NET ASSETS AVAILABLE
FOR PLAN BENEFITS $4,485,401 $2,175,574 $8,242,185 $782,612 $1,401,233 $3,269,353 $752,547 $21,108,905
========== ========== ========== ======== ========== ========== ======== ===========
<FN>
The accompanying notes are an integral part of this statement
</FN>
</TABLE>
</PAGE>
<TABLE>
<CAPTION>
REGAL-BELOIT CORPORATION
-----------------------
PERSONAL SAVINGS PLAN
---------------------
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
---------------------------------------------------
AS OF DECEMBER 31, 1996
-----------------------
Fund Information
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Inter-
Stable mediate
Principal Stock Company Stock Bond Balanced Opportunity Loan Combined
ASSETS Fund Fund Fund Fund Fund Fund Fund Plan Total
------ ----------- ---------- ------------- ------------ --------- ----------- ------- ----------
INVESTMENTS AT FAIR VALUE:
Cash $ 15,582 $ - $ - $ - $ - $ - $ - $ 15,582
M&I Employee Benefit Stable
Principal Fund 4,164,108 - - - - - - 4,164,108
Marshall Stock Fund - 1,613,715 - - - - - 1,613,715
Regal-Beloit Corporation
Common Stock - - 5,141,276 - - - - 5,141,276
Marshall Intermediate
Bond Fund - - - 634,175 - - - 634,175
Fidelity Balanced Fund - - - - 1,104,055 - - 1,104,055
Strong Opportunity Fund - - - - - 2,452,865 - 2,452,865
---------- ---------- ---------- -------- ---------- ---------- ------- ----------
4,179,690 1,613,715 5,141,276 634,175 1,104,055 2,452,865 - 15,125,776
RECEIVABLES:
Employee contributions 3,763 2,141 6,236 1,831 2,519 5,366 - 21,856
Accrued interest and
dividends 21,070 - - 3,193 - - - 24,263
---------- ---------- ---------- -------- ---------- ---------- ------- ----------
24,833 2,141 6,236 5,024 2,519 5,366 - 46,119
LOANS TO PARTICIPANTS - - - - - - 800,087 800,087
---------- ---------- ---------- -------- ---------- ---------- ------- ----------
Total assets 4,204,523 1,615,856 5,147,512 639,199 1,106,574 2,458,231 800,087 15,971,982
---------- ---------- ---------- -------- ---------- ---------- ------- ----------
LIABILITIES
-----------
DUE TO (FROM) BROKERS 5,664 3,111 (3,399) 2,829 3,286 19,910 - 31,401
ACCRUED ADMINISTRATIVE FEES 813 315 1,003 124 215 478 152 3,100
---------- ---------- ---------- ------- ---------- ---------- ------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $4,198,046 $1,612,430 $5,149,908 $636,246 $1,103,073 $2,437,843 $799,935 $15,937,481
========== ========== ========== ======== ========== ========== ======== ===========
<FN>
The accompanying notes are an integral part of this statement.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
--------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------
Fund Information
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stable Intermediate
Principal Stock Company Stock Bond Balanced Opportunity Loan Combined
Fund Fund Fund Fund Fund Fund Fund Plan Total
----------- ---------- ------------- ------------ ---------- ----------- ------- -----------
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Employee contributions $ 616,913 $ 196,766 $ 644,976 $ 86,147 $ 155,606 $ 409,137 $ - $ 2,109,545
Employee rollovers 18,254 8,776 22,026 75 4,320 12,629 - 66,080
Investment income-
Interest and dividends 264,028 13,225 - 42,292 43,238 7,720 72,818 443,321
Net appreciation in
fair market value of
investments - 412,200 2,694,626 5,441 207,017 579,611 - 3,898,895
---------- ---------- ---------- --------- ---------- ----------- -------- ----------
Total additions 899,195 630,967 3,361,628 133,955 410,181 1,009,097 72,818 6,517,841
DEDUCTIONS FROM NET ASSETS
ATTRIBUTED TO:
Administrative fees 30,632 13,875 29,861 4,849 5,229 15,128 - 99,574
Benefits paid to
participants 404,844 144,243 304,506 25,846 63,565 199,715 104,124 1,246,843
---------- ---------- ---------- --------- ---------- ----------- -------- ----------
Total deductions 435,476 158,118 334,367 30,695 68,794 214,843 104,124 1,346,417
---------- ---------- ---------- --------- ---------- ----------- -------- ----------
TRANSFERS BETWEEN FUNDS (176,364) 90,295 65,016 43,106 (43,227) 37,256 (16,082) -
NET ASSETS AVAILABLE FOR
PLAN BENEFITS:
Beginning of year 4,198,046 1,612,430 5,149,908 636,246 1,103,073 2,437,843 799,935 15,937,481
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
End of year $4,485,401 $2,175,574 $8,242,185 $782,612 $1,401,233 $3,269,353 $752,547 $21,108,905
========== ========== ========== ======== ========== ========== ======== ===========
<FN>
The accompanying notes are an integral part of this statement.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
-----------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1996
------------------------------------
Fund Information
------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
Inter-
Stable mediate
Principal Stock Company Stock Bond Balanced Opportunity Loan Combined
Fund Fund Fund Fund Fund Fund Fund Plan Total
------------ ---------- ------------ -------- ---------- ----------- -------- -----------
ADDITIONS TO NET ASSETS
ATTRIBUTED TO:
Employee contributions $ 592,494 $ 176,998 $ 579,689 $ 79,647 $ 143,344 $ 348,830 $ - $ 1,921,002
Employee rollovers 9,707 11,434 102,943 560 3,859 18,359 - 146,862
Investment income-
Interest and dividends 240,364 24,193 1 38,204 48,213 15,163 66,883 433,021
Net appreciation
(depreciation)in
fair market value
of investments - 190,946 (369,552) (21,633) 47,269 339,055 - 186,085
---------- ---------- ----------- --------- ---------- ---------- -------- -----------
Total additions 842,565 403,571 313,081 96,778 242,685 721,407 66,883 2,686,970
---------- ---------- ----------- --------- ---------- ---------- -------- -----------
DEDUCTIONS FROM NET ASSETS
ATTRIBUTED TO:
Administrative fees 17,191 16,404 3,428 6,730 4,259 10,814 152 58,978
Benefits paid to
participants 376,859 154,926 216,522 35,211 44,913 85,546 34,736 948,713
---------- ---------- ---------- --------- ---------- ---------- -------- -----------
Total deductions 394,050 171,330 219,950 41,941 49,172 96,360 34,888 1,007,691
---------- ---------- ---------- --------- ---------- ---------- -------- -----------
TRANSFERS BETWEEN FUNDS (150,957) (12,536) 37,436 (42,061) (19,695) (46,482) 234,295 -
NET ASSETS AVAILABLE FOR
PLAN BENEFITS:
Beginning of year 3,900,488 1,392,725 5,019,341 623,470 929,255 1,859,278 533,645 14,258,202
---------- ---------- ---------- -------- ---------- ---------- -------- -----------
End of year $4,198,046 $1,612,430 $5,149,908 $636,246 $1,103,073 $2,437,843 $799,935 $15,937,481
========== ========== ========== ======== ========== ========== ======== ===========
<FN>
The accompanying notes are an integral part of this statement.
</FN>
</TABLE>
<PAGE>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
DECEMBER 31, 1997 AND 1996
--------------------------
(1) Description of the Plan-
-----------------------
The following description of the Regal-Beloit Corporation Personal Savings
Plan (the "Plan") is provided for general information purposes only. More
complete information regarding the Plan's provisions may be found in the
Plan document.
General-
-------
The Plan is a defined contribution plan established on July 1, 1988, to
allow eligible employees to defer compensation as permitted under Section
401(k) of the Internal Revenue Code. The Plan covers substantially all
employees of Regal-Beloit Corporation (the "Company") with at least six
months of service with the Company and who are not covered under separate
plans. The Plan is subject to the U.S. Employee Retirement Income Security
Act of 1974 ("ERISA").
Participant accounts-
--------------------
Participants at all times have a fully vested interest in their individual
and Company contribution accounts. Distributions of participants' accounts
can be made in lump-sum amounts upon normal retirement from the Company, upon
the death of the participant and upon termination of employment. Withdrawals
for financial hardship can be made in accordance with certain governmental
regulations.
Earnings on the investments of the Plan are allocated to the participants'
accounts based on the proportion of the participant's account to the total
of all participants' accounts at the end of each business day.
Investment options-
------------------
Participants of the Plan may direct their contributions into the following
funds held by Marshall & Ilsley Trust Company (the "Trustee"):
<PAGE>
(a) Stable Principal-
----------------
Amounts allocated to the Stable Principal Fund are invested in a mutual
fund with securities and obligations which produce a fixed rate of investment
return, including but not limited to, United States government securities,
corporate bonds, notes, debentures or any fixed income trust fund or funds
maintained by the Trustee or its affiliates or other banks, or any contracts
issued by insurance companies or other financial institutions.
(b) Stock Fund-
----------
Amounts allocated to the Stock Fund are invested in a mutual fund with
equity type securities, without regard to whether such investments pay
dividends or other forms of return, including but not limited to, common
stock or other securities or obligations convertible or exercisable into
equity securities or any mutual fund or equity common trust fund or funds
maintained by the Trustee or its affiliate or other banks.
(c) Investment in Master Trust-
--------------------------
Amounts allocated to the Investment in Master Trust are invested in the Regal-
Beloit Corporation Master Trust, which invests solely in Regal-Beloit
Corporation common stock. Investments in, sales of, and reinvestment in
Company stock are made on the open market, from the Company or its
affiliates or in negotiated transactions with independent parties pursuant to
the direction of the Plan Administrator. The Master Trust was implemented
effective November 1, 1997 (See Note (5)).
(d) Intermediate Bond Fund-
----------------------
Amounts allocated to the Intermediate Bond Fund are invested in a mutual fund
which holds government and corporate bonds to generate a high level of current
income while minimizing market volatility.
(e) Balanced Fund-
-------------
Amounts allocated to the Balanced Fund seek income, consistent with
preservation of capital. The Fund invests in a mutual fund with a
diversified portfolio of high yielding securities, including common and
preferred stocks, and bonds. At least 25% of its assets will always be
invested in fixed income securities.
(f) Opportunity Fund-
----------------
Amounts allocated to the Opportunity Fund are invested in a mutual fund which
seeks to provide capital appreciation by investing in growth and aggressive
growth stocks. At least 70% of the fund's assets will always be invested in
the common stocks of growth companies, generally described as small to
mid-size.
Investments in the Stock Fund, Stable Principal Fund, Balanced Fund and
Opportunity Fund are effected in the open market or through collective
investment funds of the Trustee.
<PAGE>
(g) Loan fund-
---------
This fund permits a participant to borrow from their individual account an
amount limited to 50% of their account balance to a maximum of $50,000.
Interest at prevailing market rates (ranging from 8% to 11% as of
December 31, 1997) is charged on the loan, but is credited as income to
the individual participant's account. Only one loan is allowed at any one
time, and the maximum term is five years, unless the loan is used for the
acquisition of the participant's primary residence, for which the term of the
loan may be extended beyond the five year period.
Plan termination-
----------------
The Company may terminate the Plan at any time. In the event of termination,
or complete discontinuance of contributions, participants shall become fully
vested in their account balances. Distribution upon termination or complete
discontinuance of contributions will be made in a manner selected by the
Trustee. Presently, the Company has no intention to terminate the Plan.
(2) Significant Accounting Policies-
-------------------------------
Basis of accounting-
The financial statements have been prepared on the accrual basis of accounting.
Use of accounting estimates-
---------------------------
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Plan's management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
at the date of the financial statements and reported amounts of revenues and
expenses during the reporting periods. Actual results could differ from
these estimates.
Administrative expenses-
-----------------------
The Plan pays all administrative expenses.
(3) Funding Policy-
--------------
The Plan provides for discretionary Company contributions subject to the Board
of Director's authorization to be allocated to the individual participant's
account based on the proportion of a participant's compensation to the total
compensation of all participants. The Board did not authorize a discretionary
contribution in 1997 or 1996.
All other contributions have been made on a voluntary basis by employees.
Participants who contribute may elect to have their contributions invested in
increments of 10% among any combination of the funds. This election can be
changed on any business day, but only once per calendar quarter.
(4) Investments-
-----------
Investments are stated at fair market value as determined by the Trustee by
reference to published market data.
Net realized and unrealized appreciation (depreciation) is recorded in the
accompanying statements of changes in net assets as net appreciation
(depreciation) in fair market value of investments.
(5) Master Trust -
------------
Effective November 1, 1997, the Plan's investment in Company stock was
commingled with the investment in Company stock of another Company benefit
plan into the Regal-Beloit Corporation Master Trust (the "Master Trust").
Investments of the Master Trust are carried at current market value as
determined by the Trustee through reference to published data. Earnings,
market adjustments, fees and expenses relating to investment transactions
are allocated by the Trustee to the participating plans based on each plan's
share of trust assets.
The assets of the Plan are commingled and are not segregated in the accounts
of the Trust. The market value of the assets held in the Trust as certified by
the Trustee as of December 31, 1997 is as follows:
Regal-Beloit Corporation Stock $16,240,894
Allocations of assets of the Master Trust to participating plans as of
December 31, 1997 are as follows:
<TABLE>
<CAPTION>
Amount Percent
------ -------
<S> <C> <C>
Regal-Beloit Corporation Personal Savings Plan $ 8,235,387 50.71%
Regal-Beloit Corporation Profit Sharing Plan 8,005,507 49.29%
----------- -------
Total assets of the Master Trust $16,240,894 100.00%
----------- -------
</TABLE>
A summary of changes in net assets of the Master Trust for the two months ended
December 31, 1997 is as follows:
<TABLE>
<CAPTION>
<S> <C>
ADDITIONS:
Investment income-
Interest $ 2,047
Dividends 64,237
Net appreciation 1,437,570
-----------
Total investment income 1,503,854
Contributions 109,142
Loan repayments 19,019
Miscellaneous 4,233
-----------
Total additions 1,636,248
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
DEDUCTIONS:
Benefits paid to participants 126,058
Loan issuance 14,866
Fees 7,415
-----------
Total deductions 148,339
NET TRANSFERS FROM PARTICIPATING
REGAL-BELOIT CORPORATION BENEFIT PLANS 14,752,985
-----------
NET CHANGE 16,240,894
NET ASSETS AVAILABLE FOR PLAN BENEFITS:
Beginning of year -
-----------
End of year $16,240,894
-----------
</TABLE>
(6) Income Tax Status-
-----------------
The Plan has received a favorable tax determination letter dated February 4,
1997, indicating that the Plan is a qualified plan under Sections 401(a)
and 401(k) of the Internal Revenue Code and is exempt from Federal income
taxes under Section 501(a) of the Code. There have been no Plan amendments
adopted since the last tax determination letter. In the opinion of the
Company's management, the Plan remains tax-exempt.
(7) Related Party Transactions-
--------------------------
Plan assets are invested in common funds of the Trustee. In addition, the
Plan invests in securities of the Company. These transactions are not
considered prohibitive transactions by statutory exemption under ERISA
regulations.
(8) Subsequent Event -
----------------
Effective April 1, 1998, the Company Stock Fund of the Regal-Beloit
Corporation Savings and Protection Plan was added to the Regal-Beloit
Corporation Master Trust.
SCHEDULE I
<TABLE>
<CAPTION>
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
ITEM 27a SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
--------------------------------------------------------
DECEMBER 31, 1997
-----------------
Number
of Market
Shares Description of Security Cost Value
- ---------- ----------------------------------------- ---------- -----------
<S> <C> <C> <C>
- Cash and cash equivalents $ 156 $ 156
277,797 Regal-Beloit Corporation Common Stock (*) 5,691,841 8,235,387
159,397 Marshall Stock Fund (*) 2,000,696 2,172,587
4,461,214 M&I Employee Benefit Stable
Principal Fund (*) 4,461,214 4,461,214
81,682 Marshall Intermediate Bond Fund (*) 791,734 776,799
91,549 Fidelity Balanced Fund 1,278,611 1,397,957
87,205 Strong Opportunity Fund 3,132,775 3,262,335
----------- -----------
Total Investments $17,357,027 $20,306,435
=========== ===========
752,699 Loans to Participants
(Interest Rates: 8% - 11%)(*) $ 752,699 $ 752,699
=========== ===========
<FN>
(*) Represents a party-in-interest
The accompanying notes are an integral part of this schedule.
</FN>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE II
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
ITEM 27(b)-SCHEDULE OF LOANS OR FIXED INCOME OBLIGATIONS
--------------------------------------------------------
AS OF DECEMBER 31, 1997
-----------------------
Original Amount Received During Unpaid
Identity and Address Amount Reporting Year Balance at Amount Overdue
of Obligor Of Loan Principal Interest End of Year Detailed Description of Loan Principal Interest
- ----------------------- -------- --------- -------- ----------- ---------------------------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Charles Graham $ 1,000 $ 44.29 $ 17.35 $ 950.21 401(k) loan-account balance $ 160.67 $ 18.21
105 W. 6th Street used as collateral, issued
Tabor City, NC 28463 4/11/97, 10.25% interest, last
payment 6/13/97 - repaid 2/98
(distribution)
Larry London 3,000 - - 1,590.93 401(k) loan-account balance used 726.51 114.39
RR1 Box 146 as collateral, issued 3/31/94,
Clinton, WI 53525 8% interest, last payment
11/1/96-repaid 2/98
(distribution)
Anthony Palermo 2,200 - - 1,517.12 401(k) loan-account balance used 1,401.76 115.36
1022 Moore Street as collateral, issued 12/31/94,
Beloit, WI 53511 10.5% interest, last payment
8/15/95-repaid 2/98
(distribution)
Larry Berndt 3,000 - - 965.79 401(k) loan-account balance used 927.84 37.94
108 N. Wisconsin as collateral, issued 3/31/92,
Burlington, WI 53105 8.5% interest, last payment
5/13/94 -repaid 2/98
(distribution)
John Torres 1,800 270.45 26.96 449.73 401(k) loan-account balance used 437.22 12.51
620 11th Avenue as collateral, issued 9/30/95,
Union Grove, WI 53182 10.75% interest, last payment
4/11/97-repaid 2/98 (distribution)
Michael Richards 4,600 - - 1,916.09 401(k) loan-account balance used 1,769.39 146.40
7778 Singing Bird Close as collateral, issued 3/1/92,
Roscoe, IL 61073 8.5% interest, last payment
4/15/95-repaid 1/98
(personal check)
Darlene Fridley 12,000 619.87 760.23 9,853.26 401(k) loan-account balance used 246.87 275.33
12958 Duncan Lane as collateral, issued 12/31/94,
Rockton, IL 61072 10.5% interest, last payment
brought current 1/98
Wendell Riley 2,300 - - 2,242.63 401(k) loan-account balance used 1,776.64 465.99
2940 W. Lincoln #D as collateral, issued 9/30/92,
Anaheim, CA 92801 8% interest, last payment
11/27/92-repaid 2/98
(distribution)
Sandra Knudson 1,000 - - 573.45 401(k) loan-account balance used 537.24 36.21
P.O. Box 305 as collateral, issued 12/31/93,
Aberdeen, SD 57402 10.5% interest, last payment
11/27/94-repaid 2/98 (distribution)
Walter Maple 1,400 82.20 22.20 1,072.36 401(k) loan-account balance used 427.92 88.56
730 W. Morris Street as collateral, issued 5/24/96,
Orleans, IN 47452 10.25% interest, pay frequency
change in 1997 required new
payment amount-corrected 6/98
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE III
REGAL-BELOIT CORPORATION
------------------------
PERSONAL SAVINGS PLAN
---------------------
ITEM 27d SCHEDULE OF REPORTABLE TRANSACTIONS
----------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1997
------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Number Number Net
Identity of Party Involved/ of Purchase of Selling Cost of Gain/
Description of Asset Purchases Price Sales Price Asset Sold (Loss)
- --------------------------- --------- ---------- ------ -------- ---------- --------
Marshall Stock Fund 120 $ 602,587 78 $284,484 $259,201 $ 25,283
Regal-Beloit Corporation Common Stock(*) 104 $ 913,688 74 $548,173 $429,117 $119,056
M&I Employee Benefit Stable Principal Fund (*) 117 $1,173,684 98 $876,578 $876,578 -
Strong Opportunity Fund 141 $1,116,377 85 $451,768 $419,359 $ 32,409
(*) Represents a party-in-interest
<FN>
The accompanying notes are an integral part of this schedule.
</FN>
</TABLE>
<PAGE>
Consent of Independent Public Accountants
-----------------------------------------
As independent public accountants, we hereby consent to the incorporation of
our report included in this form 11-K into the previously filed Form S-8
Registration Statement of Regal-Beloit Corporation (File No. 1-7283).
ARTHUR ANDERSEN LLP
-------------------------------------------
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin,
June 26, 1998.
