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, 1999
OR
[ ] TRANSACTION REPORT PURSUANT TO SECTION 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition priod 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 SAVINGS AND PROTECTION 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 Savings and Protection 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, statement of net assets
available for plan benefits for the Plan of December 31, 1999 and 1998 and
the related statement of changes in net assets available for plan benefits for
the year ended December 31, 1999, 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 SAVINGS AND PROTECTION PLAN
By: Regal-Beloit Corporation Savings and Protection Plan Administrative
Committee
/S/ Kenneth F. Kaplan June 28, 2000
--------------------------
Kenneth F. Kaplan
/S/ Fritz Hollenbach June 28, 2000
--------------------------
Fritz Hollenbach
<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. 333-48789).
/S/ ARTHUR ANDERSEN LLP
---------------------------
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
June 26, 2000
<PAGE>
REGAL-BELOIT CORPORATION
------------------------
SAVINGS AND PROTECTION PLAN
---------------------------
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1999 AND 1998
-----------------------------------------------------
TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
------------------------------------------------------
<PAGE>
REGAL-BELOIT CORPORATION
------------------------
SAVINGS AND PROTECTION PLAN
---------------------------
FINANCIAL STATEMENTS
--------------------
DECEMBER 31, 1999 AND 1998
--------------------------
TABLE OF CONTENTS
-----------------
Report of Independent Public Accountants
Financial Statements
Statements of Net Assets Available For Plan Benefits as of
December 31, 1999 and 1998
Statements of Changes In Net Assets Available For Plan
Benefits For The Years Ended December 31, 1999 and 1998
Notes To Financial Statements
Supplemental Schedule Supporting Financial Statements
Schedule I: Schedule of Assets Held
For Investment Purposes--December 31, 1999
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Administrative Committee of the Regal-Beloit Corporation
Savings and Protection Plan:
We have audited the accompanying statements of net assets
available for plan benefits of the Regal-Beloit Corporation
Savings and Protection Plan as of December 31, 1999 and 1998 and
the related statements of changes in net assets available for
plan benefits for the years then ended. These financial
statements and the supplemental schedule referred to below is the
responsibility of the Plan administrator. Our responsibility is
to express an opinion on these financial statements and
supplemental schedule 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 financial status of
the Regal-Beloit Corporation Savings and Protection Plan as of
December 31, 1999 and 1998 and the changes in its financial
status 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 schedule as listed in the accompanying table of
contents is presented for the purpose of additional analysis and
is not a required part of the basic financial statements, but is
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
supplemental schedule has been subjected to the auditing
procedures applied in the audits of the basic financial
statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a
whole.
/S/ ARTHUR ANDERSEN LLP
------------------------
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
May 3, 2000
<PAGE>
REGAL-BELOIT CORPORATION SAVINGS AND PROTECTION PLAN
Statements of Net Assets Available for Plan Benefits
As of
December 31,
1999 1998
---------- ----------
Assets
------
Investments, at Fair Value:
Mutual Funds $4,149,916 $3,473,223
Investment in Master Trust 474,609 475,749
Participant Loans 188,108 159,146
Receivables:
Participants' Contributions 16,087 6,209
Employer Contributions 48,264 48,754
Accrued Interest and Dividends 9,948 9,645
---------- ----------
Total Receivables 74,299 64,608
---------- ----------
Total Assets 4,886,932 4,172,726
Liabilities
-----------
Due to Brokers 11,058 -
---------- ---------
Net Assets Available For Plan Benefits $4,875,874 $4,172,726
========== ==========
The accompanying notes to financial statements are an integral
part of these statements.
<PAGE>
REGAL-BELOIT CORPORATION SAVINGS AND PROTECTION PLAN
Statements of Changes in Net Assets Available for Plan Benefits
For the Years Ended
December 31,
-------------------------
1999 1998
----------- ----------
Additions To Net Assets Attributed To:
Employer Contribution $ 88,741 $ 90,159
Employee Contributions 414,693 496,958
Net Appreciation In Fair Value of Investments 347,820 114,142
Interest and Dividend Income 144,562 144,888
----------- ----------
Total Additions 995,816 846,147
Deductions From Net Assets Attributed To:
Benefits Paid To Participants 269,088 222,134
Administrative Fees 23,580 18,557
---------- ----------
Total Deductions 292,668 240,691
---------- ----------
Net Increase 703,148 605,456
Net Assets Available For Plan Benefits:
Beginning of Year 4,172,726 3,567,270
---------- ----------
End of Year $4,875,874 $4,172,726
========== ==========
The accompanying notes to financial statements are an integral
part of these statements.
<PAGE>
REGAL-BELOIT CORPORATION SAVINGS AND PROTECTION PLAN
Notes To Financial Statements
December 31, 1999 and 1998
(1) Description of the Plan-
-----------------------
The following description of the Regal-Beloit Corporation
Savings and Protection 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 and covers
substantially all bargaining unit employees of the Foote-
Jones/Illinois Gear and Velvet Drive Transmission Divisions of
the Regal-Beloit Corporation (the "Company") who complete at
least 500 hours of service in a year. The Plan is subject to
the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA").
Plan Administration-
-------------------
Prior to February 1, 1998, Frontier Trust was the trustee and
Equitable was the custodian of the Plan. Effective February
1, 1998, Marshall & Ilsley Trust Company (the "Trustee")
became trustee and custodian of the Plan. The Plan is
administered by the administrative committee which is
appointed by the Board of Directors of the Company.
Contributions-
-------------
Company contributions were $440 and $430 for 1999 and 1998,
respectively, for each Foote-Jones/Illinois Gear union
participant who had completed a full year of credited service
as of July 31st of each year. A contribution of $220 and $215
for 1999 and 1998, respectively, was made for each Foote-
Jones/Illinois Gear union employee who completed at least one-
half year of credited service but less than one full year of
credited service. Participants must be employed as of the
date of the contribution to receive the amount into their
account balance.
The Company's annual contribution is fixed by the collective
bargaining agreement between Local 1199, International Union
of Electronic, Electrical, Salaried, Machine and Furniture
Workers, AFL-CIO and the Company. The contribution is
recorded as an increase in participants' equity on an accrual
basis based on service performed during the Plan year. Annual
amounts are contributed to the Plan on or about August 1.
The Company contributed $350 and $300 on or about February 1
for each Velvet Drive Transmission employee provided they had
been an employee of the Company for the past 12 months as of
December 31, 1999 and 1998, respectively. Participants must
be employed as of the date of the contribution to receive the
amount into their account balance.
The Plan allows participants to make voluntary contributions
via pretax payroll deductions ranging from 1% to 20% of total
compensation.
Participant Accounts-
--------------------
Individual participant accounts are maintained to receive
Company and participant contributions. The Plan earnings, net
of Trustee expenses, are allocated to each participant on each
business day based on the proportion of the individual
participant's account to the total of all participants'
accounts.
<PAGE>
Vesting-
-------
Participants at all times have a fully vested interest in
their individual accounts. Distribution of participants'
accounts can be made upon normal retirement from the Company
and following termination of service with the Company for any
reason. Benefits paid consist of the participants' account
balance plus any voluntary contributions together with all
earnings.
Investment Options-
------------------
Participants were able to direct their contributions in 10%
increments into any of the following investment options
through January 31, 1998:
Equitable Guaranteed Interest Account Fund-
------------------------------------------
The Guaranteed Interest Account provides an investment
option in which the value of the principal will not
fluctuate. The amount allocated to the Guaranteed Interest
Account earns interest at the current guaranteed interest
rate which is an annual effective rate. After interest is
credited, certain charges and fees are deducted. The value
of an employer plan's investment in the Guaranteed Interest
Account is, at any time, the total contributions allocated
to the Guaranteed Interest Account, plus the interest
earned, less (i) employer plan benefit payments, (ii) other
employer plan withdrawals (including loans) and (iii)
charges and fees.
Equitable Common Stock Fund-
---------------------------
This fund invests in stock issues of high quality, large
capitalization companies. Its objective is growth of
capital through quality stock issues.
Equitable Balanced Fund-
-----------------------
This fund invests in common stocks, publicly traded bonds
and money market investments. Its objective is increasing
income and capital appreciation.
Equitable Aggressive Stock Fund-
-------------------------------
This fund invests in medium and small companies with growth
potential. It involves risk.
The following new investment options were made available to
Plan participants as of February 1, 1998:
M&I Stable Principal Fund-
-------------------------
Amounts are invested in the M&I Stable Principal Fund, a
mutual fund whose objective is to maintain safety of
principal while generating a level of current income
generally exceeding that of a money market fund. The fund
primarily invests in traditional and synthetic investment
contracts issued by insurance companies or banks.
Marshall Large-Cap Growth and Income Fund-
-----------------------------------------
Amounts allocated to this fund are invested in the Marshall
Large-Cap Growth and Income Fund, a mutual fund with the
goal of providing capital appreciation and income. The fund
invests in a diversified portfolio of common stocks of large-
sized companies whose market capitalizations exceed $10
billion and have a history of stable earnings and/or growing
dividends.
<PAGE>
Regal-Beloit Company Stock Fund-
-------------------------------
Amounts allocated to the Regal-Beloit Company Stock Fund 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.
Marshall Intermediate Bond Fund-
-------------------------------
Amounts allocated to this fund are invested in the Marshall
Intermediate Bond Fund, a mutual fund with the goal of
maximizing total return consistent with current income. The
fund invests in intermediate-term investment grade bonds and
notes including corporate, asset-backed, mortgage-backed and
U.S. Government securities.
Fidelity Balanced Fund-
----------------------
Amounts allocated to this fund are invested in the Fidelity
Balanced Fund, a mutual fund whose objective is to generate
high income with preservation of capital. The fund invests
in a broadly 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.
Strong Opportunity Fund-
-----------------------
Amounts allocated to this fund are invested in the Strong
Opportunity Fund, a mutual fund which seeks to provide
capital growth. At least 70% of the fund's assets will
always be invested in the common stocks of growth companies,
generally described as small to medium-sized.
Investments in the Marshall Large-Cap Growth and Income Fund,
Marshall Intermediate Bond Fund, Stable Principal Fund,
Fidelity Balanced Fund and Strong Opportunity Fund are
effected in the open market or through collective investment
funds of the Trustee.
Effective February 1, 1998, Plan participants transferred all
fund balances from pre-January 31, 1998 investment options
into the post-February 1, 1998 investment options.
Participant Loans-
-----------------
The Plan permits a participant to borrow up to 50% of his or
her account balance up to a maximum of $50,000. These loans
bear interest at the prevailing market rate (ranging from
7.25% to 10.5% as of December 31, 1999) and generally must be
repaid within five years.
(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 Plan assets and liabilities and reported
amounts of investment income and expenses during the reporting
periods. Actual results could differ from these estimates.
<PAGE>
Net Appreciation (Depreciation) In Fair Value of Investments-
------------------------------------------------------------
Net realized and unrealized appreciation (depreciation) is
recorded in the accompanying statement of changes in net
assets available for Plan benefits as net appreciation
(depreciation) in fair value of investments.
Administrative Expenses-
-----------------------
The Plan pays all administrative expenses and loan processing
fees.
New Accounting Standard-
-----------------------
Effective for the year ended December 31, 1999, the Plan
adopted Statement of Position 99-3, "Accounting for and
Reporting of Certain Defined Contribution Plan Investments and
Other Disclosure Matters" ("SOP 99-3"). SOP 99-3 eliminates
the requirement for a defined contribution plan to present
participant directed plan investments by general type in the
statement of net assets available for plan benefits. Prior
year financial statements have been restated to conform with
SOP 99-3.
(3) Investments-
-----------
Investments are stated at fair market value as determined by
the Trustee by reference to published market data. The M&I
Stable Principal Fund primarily invests in guaranteed
investment contracts which are fully benefit-responsive.
These investment contracts are valued at amortized cost, which
represents fair market value. Under the terms of the
investment contracts, the crediting interest rates are fixed
for the life of the contracts or are reset at least quarterly.
The aggregate average yield of the investment contracts for
the years ended December 31, 1999 and 1998 were 5.99% and
6.2%, respectively. The crediting interest rate for the
investment contracts as of December 31, 1999 and 1998 was
6.05% and 5.93%, respectively. There are no limitations or
guarantees on the contracts.
The following presents investments that represent five percent
or more of the Plan's net assets. All investments are
participant directed.
December 31,
1999 1998
---------- ----------
M&I Stable Principal Fund, 1,899,647 and $1,899,647 $1,728,324
1,728,324 shares, respectively
Strong Opportunity Fund, 17,910 and 12,767 800,408 493,077
shares, respectively
Marshall Large-Cap Growth and Income Fund, 673,014 615,819
36,938 and 37,688 shares, respectively
Fidelity Balanced Fund, 42,603 and 31,974 654,380 523,091
shares, respectively
Regal-Beloit Company, Company Stock Fund, 474,609 475,749
21,911 and 20,171 shares, respectively
During 1999 and 1998, the Plan's investments (including
investments bought, sold and held during the year) appreciated
(depreciated) in value as follows:
1999 1998
--------- ---------
Net Appreciation (Depreciation) in Fair
Market Value of Investments-
Mutual Funds $360,229 $219,053
Master Trust (12,409) (104,911)
--------- ---------
Net Appreciation in Fair Market Value of $347,820 $114,142
Investments
--------- ---------
<PAGE>
(4) Master Trust-
------------
Effective November 1, 1997, the Plan's investment in Company
stock was commingled with the investment in Company stock of
another Company plan into the Regal-Beloit Corporation Master
Trust (the "Master Trust"). Effective April 1, 1998, the
investment in Company stock of three other Company plans were
commingled into 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 Master Trust assets.
The assets of the Plan are commingled and are not segregated
in the accounts of the Master Trust. The market value of the
assets held in the Master Trust as of December 31, 1999 and
1998 is as follows:
1999 1998
----------- -----------
Regal-Beloit Corporation Stock $13,009,033 $14,374,579
Marshall Money Market Fund 115,702 154,077
Accrued Income 75,700 74,145
Pending Trades 92,205 -
----------- -----------
Total Assets of The Master Trust $13,292,640 $14,602,801
=========== ===========
Allocations of assets of the Master Trust to participating
plans as of December 31, 1999 and 1998 are as follows:
<TABLE>
<CAPTION>
1999 1998
---------------------- -----------------------
Amount Percent Amount Percent
----------- ------- ----------- --------
<S> <C> <C> <C> <C>
Regal-Beloit Corporation $ 6,230,849 46.87% $ 6,805,476 46.60%
Personal Savings Plan
Regal-Beloit Corporation 5,788,543 43.55 6,568,489 44.98
Profit Sharing Plan
Regal-Beloit Corporation 474,609 3.57 475,749 3.26
Savings and Protection Plan
Marathon Electric Salaried 649,478 4.89 635,779 4.36
Employees' 401(k) Savings Plan
Marathon Electric Hourly 149,161 1.12 117,308 0.80
401(k) Savings Plan
----------- ------- ----------- -------
Total Assets of the Master Trust $13,292,640 100.00% $14,602,801 100.00%
=========== ======= =========== =======
</TABLE>
Master Trust loss for the years ended December 31, 1999 and
1998 is as follows:
1999 1998
------------ ------------
Investment Income-
Interest $ 11,261 $ 23,602
Dividends 309,644 280,725
Net Depreciation in Fair Market Value of
Regal-Beloit Corporation Common Stock (1,358,911) (3,979,555)
------------ ------------
Total Master Trust Loss $(1,038,006) $(3,675,228)
============ ============
(5) Related Party Transactions-
--------------------------
Plan assets are invested in mutual funds of the Trustee.
In addition, the Plan's Master Trust invests in securities of the
Company. These transactions are not considered prohibited
transactions by statutory exemption under ERISA regulations.
<PAGE>
(6) Income Tax Status-
-----------------
The Plan has obtained a determination letter from the Internal
Revenue Service dated January 20, 1993, approving the Plan as
qualified for tax-exempt status. The Plan has been amended
since receiving the determination letter. However, the Plan
administrator and Plan's tax counsel believe the Plan is
currently designed and is being operated in compliance with
the applicable requirements of the Internal Revenue Code.
Therefore, no provision for income taxes has been included in
the Plan's financial statements.
(7) Plan Termination-
----------------
The Plan is defined by the collective bargaining agreement
between Local Union 1199, International Union of Electronic,
Electrical, Salaried, Machine and Furniture Workers, AFL-CIO
and the Company dated December 1, 1989, and may not be
materially modified or terminated by the Company without
negotiation with the Union.
<PAGE>
REGAL-BELOIT CORPORATION
SAVINGS & PROTECTION PLAN
Plan's EIN 39-0875718 Plan #007
Schedule I -- Schedule of Assets Held for Investment Purposes
As of December 31, 1999
<TABLE>
<CAPTION>
Description of Investment Including
Identity of Issue, Borrower Maturity Date, Rate of Interest Current
Lessor, or Similar Party Collateral, Par, or Maturity Value Cost Value
--------------------------- ----------------------------------- --------- ------------
<S> <C> <C> <C>
Fidelity Funds Fidelity Balanced Fund $678,111 $ 654,380
Strong Funds Opportunity Fund 721,446 800,408
Marshall & Ilsley* Intermediate Bond Fund 127,647 122,467
Marshall & Ilsley* Large Cap Growth & Income 563,318 673,014
Marshall & Ilsley* M&I Stable Principal Fund 1,899,647 1,899,647
Loans to participants Loans 188,108 188,108
Regal-Beloit Stock Fund* Regal-Beloit Stock 584,212 474,609
*Party-in-interest
<FN>
The accompanying notes to financial statements are an integral part of
this schedule.
</FN>
</TABLE>
