<PAGE>
UNITED STATES
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 for the fiscal year ended December 31, 1998.
or
[ ] Transition report pursuant to Section 15(d) of the Securities Exchange Act
of 1934 for the transition period from _________________ to ____________.
Commission file number 1-12273
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below: Roper Industries, Inc. Employees' Retirement
Savings 003 Plan.
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office: Roper Industries, Inc., 160 Ben Burton
Rd., Bogart, GA 30622.
<PAGE>
Independent Auditors' Report
The Board of Directors
Roper Industries, Inc.:
We have audited the accompanying statements of net assets available for benefits
of Roper Industries, Inc. Employees' Retirement Savings 003 Plan (the "Plan") as
of December 31, 1998 and 1997 and the related statements of changes in net
assets available for benefits for the year ended December 31, 1998 and two
months ended December 31, 1997. 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 audits 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 presents fairly, in
all material respects, the net assets available for benefits of Roper
Industries, Inc. Employees' Retirement Savings 003 Plan as of December 31, 1998
and 1997, and the changes in net assets available for benefits for the year
ended December 31, 1998 and two months ended December 31, 1997 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 of assets held
for investment purposes and reportable transactions as of and for the year ended
December 31, 1998 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's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules are the responsibility of the Plan's
management. The Fund Information in the statements of net assets available for
benefits and changes in net assets available for benefits is presented for
purposes of additional analysis rather than to present the net assets available
for benefits and the changes in net assets available for benefits of each fund.
The supplemental schedules and Fund Information have been subjected to the
auditing procedures applied in the audit 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.
KPMG LLP
April 19, 1999
Atlanta, Georgia
2
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Statement of Net Assets Available for Benefits, with Fund Information
(in thousands)
December 31, 1998
<TABLE>
<CAPTION>
Fund Information
-------------------------------------------------------------------------------
Merrill Lynch
Roper Retirement Merrill Lynch MFS
Industries, Inc. Preservation Equity Index Emerging AIM Value
Total Common Stock Trust Trust Growth Fund Fund
------------- --------------- --------------- --------------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Cash $ 78 $ - $ - $ - $ - $ -
------------- --------------- --------------- --------------- ------------ -----------
Investments, at fair value:
Mutual funds 27,927 - - - 2,368 14,957
Common trust funds 14,803 - 12,718 2,085 - -
Common stock 6,317 6,317 - - - -
Participant loans receivable 802 - - - - -
------------- --------------- --------------- --------------- ------------ -----------
49,849 6,317 12,718 2,085 2,368 14,957
------------- --------------- --------------- --------------- ------------ -----------
Contributions receivable:
Employees 332 - - - - -
Employer 331 - - - - -
------------- --------------- --------------- --------------- ------------ -----------
663 - - - - -
------------- --------------- --------------- --------------- ------------ -----------
Net assets available
for benefits $ 50,590 $ 6,317 $ 12,718 $ 2,085 $ 2,368 $ 14,957
============= ============== =============== ============= ============ ===========
<CAPTION>
Fund Information
--------------------------------------------------------------------------
Templeton Merrill Lynch Merrill Lynch
Foreign Merrill Lynch Basic Value Corporate Participant
Fund Capital Fund Fund Bond Fund Loans Cash Unallocated
--------- ------------- ------------- ----------- ------------ ----- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Cash $ - $ - $ - $ - $ - $ 78 $ -
--------- ------------- ------------- ----------- ------------ ----- -----------
Investments, at fair value:
Mutual funds 1,043 6,385 2,017 1,157 - - -
Common trust funds - - - - - - -
Common stock - - - - - -
Participant loans receivable - - - - 802
--------- ------------- ------------- ----------- ------------ ----- -----------
1,043 6,385 2,017 1,157 802 - -
--------- ------------- ------------- ----------- ------------ ----- -----------
Contributions receivables:
Employees - - - - - - 332
Employer - - - - - - 331
--------- ------------- ------------- ----------- ------------ ----- -----------
- - - - - - 663
--------- ------------- ------------- ----------- ------------ ----- -----------
Net assets available
for benefits $ 1,043 $ 6,385 $ 2,017 $ 1,157 $ 802 $ 78 $ 663
========= ============= ============= =========== ============ ====== ===========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Statement of Net Assets Available for Benefits, with Fund Information
(in thousands)
December 31, 1997
<TABLE>
<CAPTION>
Fund Information
------------------------------------------------------------------------------
Merrill Lynch
Roper Retirement Merrill Lynch MFS
Industries, Inc. Preservation Equity Index Emerging AIM Value
Total Common Stock Trust Trust Growth Fund Fund
-------- ------------- ------------ ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Cash $ 4 $ - $ - $ - $ - $ -
-------- ------------- ------------ ------------ ----------- -------------
Investments, at fair value:
Mutual funds 21,525 - - - 1,407 10,597
Common trust funds 12,459 - 11,598 861 - -
Common stock 7,588 7,588 - - - -
Participant loans receivable 631 - - - - -
-------- ------------- ------------ ------------ ----------- -------------
42,203 7,588 11,598 861 1,407 10,597
-------- ------------- ------------ ------------ -----------
Contributions receivable:
Employees 277 - - - - -
Employer 322 - - - - -
-------- ------------- ------------ ------------ ----------- -------------
599 - - - - -
-------- ------------- ------------ ------------ ----------- -------------
Net assets available
for benefits $ 42,806 $ 7,588 $ 11,598 $ 861 $ 1,407 $ 10,597
======== ============== ============ ============= =========== ==============
<CAPTION>
Fund Information
------------------------------------------------------------------------------
Templeton Merrill Lynch Merrill Lynch
Foreign Merrill Lynch Basic Value Corporate Participant
Fund Capital Fund Fund Bond Fund Loans Cash Unallocated
--------- ------------- ---------- --------------- --------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Cash $ - $ - $ - $ - $ - $ 4 $ -
--------- ------------- ------------- --------------- -------- -------- ------------
Investments, at fair value:
Mutual funds 1,043 6,185 1,258 1,035 - - -
Common trust funds - - - - - - -
Common stock - - - - - - -
Participant loans receivable - - - - 631 - -
--------- ------------- ------------- --------------- -------- -------- ------------
1,043 6,185 1,258 1,035 631 - -
--------- ------------- ------------- --------------- -------- -------- ------------
Contributions receivable:
Employees - - - - - - 277
Employer - - - - - - 322
--------- ------------- ------------- --------------- -------- -------- ------------
- - - - - - 599
--------- ------------- ------------- --------------- -------- -------- ------------
Net assets available
for benefits $ 1,043 $ 6,185 $ 1,258 $ 1,035 $ 631 $ 4 $ 599
========== ============= ============= =============== ============ ====== ===========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Statement of Changes in Net Assets Available for Benefits, with Fund Information
(in thousands)
Year ended December 31, 1998
<TABLE>
<CAPTION>
Fund Information
-------------------------------------------------------------------------------
Merrill Lynch
Roper Retirement Merrill Lynch MFS
Industries, Inc. Preservation Equity Index Emerging AIM Value
Total Common Stock Trust Trust Growth Fund Fund
---------- -------------- ------------ ------------ -------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Investment income:
Net appreciation (depreciation)
in fair value of investments $ 1,585 $ (1,801) $ - $ 393 $ 432 $ 2,719
Dividends 2,488 64 740 - 23 938
Interest 70 7 17 2 3 19
---------- -------------- ------------ ------------ -------------- ----------
4,143 (1,730) 757 395 458 3,676
---------- -------------- ------------ ------------ -------------- ----------
Contributions:
Employee rollovers 1,103 97 229 140 95 134
Employee withholdings 2,918 399 383 201 231 827
Employer matching 2,868 417 432 197 230 801
---------- -------------- ------------ ------------ -------------- ----------
6,889 913 1,044 538 556 1,762
---------- -------------- ------------ ------------ -------------- ----------
Total additions 11,032 (817) 1,801 933 1,014 5,438
---------- -------------- ------------ ------------ -------------- ----------
Deductions:
Benefits paid to participants 3,135 314 1,098 49 57 560
Administration expenses 3 - 2 - - 1
Other 110 8 85 (1) (1) 39
---------- -------------- ------------ ------------ -------------- ----------
Total deductions 3,248 322 1,185 48 56 600
---------- -------------- ------------ ------------ -------------- ----------
Interfund transfers, net - (132) 504 339 3 (478)
---------- -------------- ------------ ------------ -------------- ----------
Net increase (decrease) 7,784 (1,271) 1,120 1,224 961 4,360
Net assets available for benefits:
Beginning of year 42,806 7,588 11,598 861 1,407 10,597
---------- -------------- ------------ ------------ ------------- ----------
End of year $ 50,590 $ 6,317 $ 12,718 $ 2,085 $ 2,368 $ 14,957
========== ============== ============ ============ ============= ==========
<CAPTION>
Fund Information
-----------------------------------------------------------------------
Templeton Merrill Lynch Merrill Lynch
Foreign Merrill Lynch Basic Value Corporate Participant
Fund Capital Fund Fund Bond Fund Loans Cash Unallocated
---------- ------------ ----------- ----------- ----------- ----- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions:
Investment income:
Net appreciation (depreciation)
in fair value of investments $ (155) $ (24) $ 12 $ 9 $ - $ - $ -
Dividends 106 402 145 70 - - -
Interest 1 10 2 2 - 7 -
------------- ------------ ------------- ------------ ----------- ------ ----------
(48) 388 159 81 - 7 -
------------- ------------ ------------- ------------ ----------- ------ ----------
Contributions:
Employee rollovers 15 150 196 47 - - -
Employee withholdings 112 385 194 131 - - 55
Employer matching 89 395 171 127 - - 9
------------- ------------ ------------- ------------ ----------- ------ ----------
216 930 561 305 - - 64
------------- ------------ ------------- ------------ ----------- ------ ----------
Total additions 168 1,318 720 386 - 7 64
------------- ------------ ------------- ------------ ----------- ------ ----------
Deductions:
Benefits paid to participants 63 732 138 142 49 (67) -
Administration expenses - - - - - - -
Other - (4) - - (16) - -
------------- ------------ ------------- ------------ ----------- ------ ----------
Total deductions 63 728 138 142 33 (67) -
------------- ------------ ------------- ------------ ----------- ------ ----------
Interfund transfers, net (105) (390) 177 (122) 204 - -
------------- ------------ ------------- ------------ ----------- ------ ----------
Net increase (decrease) - 200 759 122 171 74 64
Net assets available for benefits:
Beginning of year 1,043 6,185 1,258 1,035 631 4 599
------------- ------------ ------------- ------------ ----------- ------ ----------
End of year $ 1,043 $ 6,385 $ 2,017 $ 1,157 $ 802 $ 78 $ 663
============= ============ ============= ============ =========== ====== ==========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Statement of Changes in Net Assets Available for Benefits, with Fund Information
(in thousands)
Two months ended December 31, 1997
<TABLE>
<CAPTION>
Fund Information
-----------------------------------------------------------------------------------
Merrill Lynch
Roper Retirement Merrill Lynch MFS Templeton
Industries, Inc. Preservation Equity Index Emerging AIM Value Foreign
Total Common Stock Trust Trust Growth Fund Fund Fund
-------- ------------ ------- ------- ----------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions:
Investment income:
Net appreciation (depreciation)
in fair value of investments $ (526) $ 397 $ - $ 52 $ (39) $ (847) $ (35)
Dividends 1,523 - 119 - 13 1,056 25
Interest 10 1 2 - 1 3 -
-------- ------------ ------- ------- ----------- -------- --------
1,007 398 121 52 (25) 212 (10)
-------- ------------ ------- ------- ----------- -------- --------
Contributions:
Employee rollovers 136 99 - 2 - - -
Employee withholdings 467 53 56 13 21 105 13
Employer matching 524 50 70 15 23 119 14
-------- ------------ ------- ------- ----------- -------- --------
1,127 202 126 30 44 224 27
-------- ------------ ------- ------- ----------- -------- --------
Total additions 2,134 600 247 82 19 436 17
-------- ------------ ------- ------- ----------- -------- --------
Deductions:
Benefits paid to participants 551 32 155 - 1 285 1
-------- ------------ ------- ------- ----------- -------- --------
Interfund transfers, net - 73 (153) (57) (19) 120 (83)
-------- ------------ ------- ------- ----------- -------- --------
Net increase (decrease) 1,583 641 (61) 25 (1) 271 (67)
Net assets available for benefits:
Beginning of period 41,223 6,947 11,659 836 1,408 10,326 1,110
-------- ------------ ------- ------- ----------- -------- --------
End of period $ 42,806 $ 7,588 $11,598 $ 861 $ 1,407 $ 10,597 $ 1,043
======== ============ ======= ======= =========== ======== ========
<CAPTION>
Fund Information
-----------------------------------------------------------------
Merrill Lynch Merrill Lynch
Merrill Lynch Basic Value Corporate Participant
Capital Fund Fund Bond Fund Loans Cash Unallocated
------------ -------- --------- --------- -------- -----------
<S> <C> <C> <C> <C> <C> <C>
Additions:
Investment income:
Net appreciation (depreciation)
in fair value of investments $ (60) $ 6 $ - $ - $ - $ -
Dividends 256 42 12 - - -
Interest 2 - - - 1 -
------------ -------- --------- --------- -------- -----------
198 48 12 - 1 -
------------ -------- --------- --------- -------- -----------
Contributions:
Employee rollovers - - - 35 - -
Employee withholdings 47 11 16 - - 132
Employer matching 57 12 17 - - 147
------------ -------- --------- --------- -------- -----------
104 23 33 35 - 279
------------ -------- --------- --------- -------- -----------
Total additions 302 71 45 35 1 279
------------ -------- --------- --------- -------- -----------
Deductions:
Benefits paid to participants 9 1 1 21 45 -
------------ -------- --------- --------- -------- -----------
Interfund transfers, net 36 74 5 8 (4) -
------------ -------- --------- --------- -------- -----------
Net increase (decrease) 329 144 49 22 (48) 279
Net assets available for benefits:
Beginning of period 5,856 1,114 986 609 52 320
------------ -------- --------- --------- -------- -----------
End of period $ 6,185 $ 1 ,258 $ 1,035 $ 631 $ 4 $ 599
============ ======== ========= ========= ======== ===========
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Notes to Financial Statements
1. THE PLAN
The Roper Industries, Inc. (the "Company") Employees' Retirement Savings
003 Plan (the "Plan") is a defined contribution retirement savings plan
subject to certain provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA"). All assets of the Plan are held, administered and
invested by its trustee, Merrill Lynch Trust Company. The following
description of 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
-----------
Employees of certain of the Company's subsidiaries become eligible to
participate in the Plan after six months of continuous service
provided the employee has attained 18 years of age. A Plan amendment
adopted May 22, 1996 provides for crediting service for eligibility
and vesting purposes in connection with certain mergers and
acquisitions.
(b) Employee Contributions
----------------------
Plan participants may make contributions in 1% increments of their
compensation, within the range of 3% to 6%, for each payroll period in
the form of (i) thrift contributions (after-tax), (ii) 401(k)
contributions (before-tax) or (iii) a combination of thrift and 401(k)
contributions. Total employee contributions during the Plan's fiscal
year may not exceed the ceiling established by the Internal Revenue
Service ($10,000 for 1998). A participant may withdraw all or part of
thrift contributions after filing a written application.
(c) Employer Contributions
----------------------
The Company contributes an amount equal to 3% of each participant's
compensation. The Company also 100% matches the first 3% of a
participant's compensation contributed to the Plan and 50% matches the
next 3% of participant compensation contributed to the Plan. Employer
contributions are also limited by guidelines established by the
Internal Revenue Service. Employer contributions can only be based on
the first $150,000 of participant compensation in 1998.
(d) Participant Accounts
--------------------
The Plan's trust consists of contributions by the participants and the
Company and net earnings from investments. Investment appreciation
and/or depreciation and investment earnings are credited to or
deducted from participant accounts based on the ratio of each
participant's account to the aggregate of all participant accounts
within each fund on a daily basis.
(e) Investment Options
------------------
Each participant in the Plan must elect to have contributions invested
in any one or a combination of the investment funds offered by the
Plan. Throughout 1998, the following investment funds were available:
Roper Industries, Inc. Common Stock: This fund invests solely in Roper
------------------------------------
Industries, Inc. common stock. At December 31, 1998 and 1997, 515 and
483 participants were invested in this fund, respectively.
7
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Notes to Financial Statements
Merrill Lynch Retirement Preservation Trust: The Trust seeks to provide
--------------------------------------------
preservation of capital, liquidity and current income that is typically
higher than money market funds. The Trust invests primarily in a broadly
diversified portfolio of guaranteed investment contracts and U.S.
government and U.S. government agency securities. At December 31, 1998 and
1997, 444 and 453 participants were invested in this Trust, respectively.
Merrill Lynch Equity Index Trust: The Trust seeks to approximate the total
---------------------------------
return of the Standard & Poor's 500 Composite Stock Price Index. This
Index is a means to measure the performance of a broad base of large U.S.
corporations. The Trust invests primarily in a portfolio of equity
securities designed to substantially equal the performance of this Index.
The percentage of the Trust's interest in each stock will generally be the
same as the percentage that a particular stock represents in the Index.
However, certain factors may make the purchase of some stocks impracticable
or unnecessary. At December 31, 1998 and 1997, 231 and 140 participants
were invested in this Trust, respectively.
MFS Emerging Growth Fund: The Fund seeks long-term growth of capital. The
-------------------------
Fund invests primarily in common stock of small- and medium-sized companies
that are early in their life cycles and have the potential to become major
enterprises. The Fund may also invest in more established companies whose
rates of earnings growth are expected, by Fund management, to accelerate
because of special factors such as new management, new products or changes
in consumer demand. The Fund may invest up to 25% of its total assets in
foreign securities. At December 31, 1998 and 1997, 261 and 203
participants were invested in this Fund, respectively.
AIM Value Fund: The Fund seeks long-term growth of capital by investing
---------------
primarily in stocks of companies that are undervalued relative to the stock
market as a whole due to underperformance, but show tangible evidence of a
turnaround. The Fund seeks undervalued securities believed to offer growth
potential in four categories: 1) out-of-favor cyclical growth companies, 2)
established growth companies that are undervalued compared to historical
relative valuations, 3) companies with tangible evidence of improving
prospects not yet reflected in the price of the stock and 4) equity
securities selling at prices that do not reflect the current market value
of their assets. The Fund may invest up to 25% of its total assets in
foreign securities. At December 31, 1998 and 1997, 588 and 575
participants were invested in this Fund, respectively.
Templeton Foreign Fund: The Fund seeks long-term capital growth. The Fund
-----------------------
seeks to obtain its objective through a flexible policy of investing in
stocks and debt obligations of companies and governments outside the U.S.
The Fund may also invest in preferred stock and certain debt securities,
rated or unrated, such as convertible bonds and bonds selling at a
discount. The Fund has the right to purchase securities in any foreign
country, developed or developing. At December 31, 1998 and 1997, 314 and
134 participants were invested in this Fund, respectively.
Merrill Lynch Capital Fund: The Fund seeks the highest total investment
---------------------------
return consistent with prudent risk. Total investment return is the
aggregate of income and capital value changes. The Fund has a fully managed
investment policy utilizing equity, debt and convertible securities. This
permits Fund management to shift emphasis based on its evaluation of
changes in economic and market trends. Consistent with this policy, the
Fund's portfolio may, at any given time, be invested substantially in
equity securities, corporate bonds or money market securities. It is the
expectation of Fund management that, over longer periods, a major portion
of the Fund's portfolio will consist of equity securities of larger market
capitalization companies. Dividends are declared and reinvested
semiannually. The Fund may invest up to 25% of its total assets in foreign
securities. At December 31, 1998 and 1997, 434 and 416 participants were
invested in this Fund, respectively.
8
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Notes to Financial Statements
Merrill Lynch Basic Value Fund: The Fund seeks capital appreciation and,
-------------------------------
secondarily, income by investing in securities, primarily equities, that
Fund management believes are undervalued. The Fund seeks to invest in
stocks that possess one or more of the following characteristics: (i)
selling at a discount either from book value or historical price-earnings
ratios or (ii) seem capable of recovering from situations that caused the
company to become temporarily out of favor. Particular emphasis is placed
on securities that provide an above-average dividend return and sell at a
below-average price-earnings ratio. The Fund may invest up to 25% of its
total assets in foreign securities. At December 31, 1998 and 1997, 228 and
142 participants were invested in this Fund, respectively.
Merrill Lynch Corporate Bond Fund - Intermediate Term Portfolio: The Fund
----------------------------------------------------------------
seeks a high level of current income by investing primarily in investment
grade corporate fixed-income securities. Secondarily, the Fund seeks
capital appreciation when consistent with its primary objective. The Fund
invests primarily in bonds rated in the four highest rating categories with
a maximum remaining maturity of 10 years. Under normal circumstances, the
average remaining maturity will be between five and seven years. In
addition, the Fund may invest up to 25% of its total assets in foreign
securities. At December 31, 1998 and 1997, 201 and 187 participants were
invested in this Fund, respectively.
(f) Benefit Payments
----------------
Upon separation of service, participants may generally elect to receive
their vested account balances in either a lump sum payment or several forms
of periodic installments. Separated participants with vested account
balances totaling less than $5,000 must be distributed their vested
balances in the form of a lump sum distribution.
(g) Vesting
-------
Participants are immediately vested in their voluntary contributions plus
investment performance thereon. Employer contributions become vested to
participants 20% after the first year of participation and an additional
20% after each additional year of participation, up to 100%.
(h) Termination
-----------
The Company may terminate, or partially terminate, the Plan or discontinue
Company contributions to the Plan at any time, in which case all employer
contributions and allocated earnings to each participant's account would
become fully vested and nonforfeitable.
(i) Forfeitures
-----------
All forfeitures by participants, as defined by the Plan, are retained in
the Plan and used to pay Plan expenses and reduce employer contributions.
The Plan applied forfeited non-vested amounts of $103,000 and $0 against
employer contributions during the year ended December 31, 1998 and two
months ended December 31, 1997, respectively.
(j) Participant Loans
-----------------
The Plan allows participants to borrow up to the lesser of 50% of their
vested account balance or $50,000. Generally, loans must be repaid within
five years. The interest rate on such loans is 1 1/2 percentage points
higher than the prime interest rate.
9
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Notes to Financial Statements
(k) Related Party Transactions
--------------------------
Certain Plan investments are shares of mutual funds managed by Merill
Lynch Trust Company. Merrill Lynch Trust Company is the trustee as
defined by the Plan, and therefore, these transactions qualify as
party-in-interest.
Certain Plan investments are shares of common stock of Roper
Industries, Inc. and Roper Industries, Inc. is the sponsor of the
Plan.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Presentation
---------------------
The accompanying statements of net assets available for benefits and
changes in net assets available for benefits have been prepared on the
accrual basis of accounting. Certain reclassifications have been made
to the financial statements at December 31, 1997 to be consistent with
the presentation adopted at December 31, 1998.
(b) Investments
-----------
Investments are stated at fair value. Fair values for investments in
mutual funds, common trust funds and Roper Industries, Inc. common
stock were determined using the closing prices as published by
financial sources believed to be reliable. Loans to participants are
stated at the unpaid balances on individual participant accounts which
approximates fair value. Unrealized appreciation (depreciation) in
fair value of investments is computed by comparing the fair value of
an investment to its cost for investments purchased during the year.
For investments held an entire year, it is the change in fair value
during the year. Purchases and sales of investments are recorded on a
trade-date basis.
(c) Use of Estimates
----------------
The administrator of the Plan 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.
(d) Expenses
--------
The Company pays substantially all administrative expenses of the
Plan.
(e) Change in Fiscal Year
---------------------
Effective November 1, 1997, the Plan changed its fiscal year to end on
December 31 instead of October 31.
10
<PAGE>
ROPER INDUSTRIES, INC.
EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Notes to Financial Statements
3. INVESTMENTS
Investments that represent at least 5% of the Plan's net assets available
for benefits at December 31, 1998 or 1997 are as follows (in 000s):
<TABLE>
<CAPTION>
1998 1997
------- -------
<S> <C> <C>
AIM Value Fund $14,957 $10,597
Merrill Lynch Retirement Preservation Trust 12,718 11,598
Merrill Lynch Capital Fund 6,385 6,185
Roper Industries, Inc. common stock 6,317 7,588
</TABLE>
4. INCOME TAX STATUS
The latest determination letter applied to the Plan related to an amendment
dated October 29, 1987, in which the Internal Revenue Service stated that
the Plan, as then designed, was in compliance with the applicable
requirements of the Internal Revenue Code for qualified plans. The Plan has
been amended since receiving the aforementioned determination letter.
However, the Company believes that the Plan is currently designed and
administered in compliance with applicable requirements of the Internal
Revenue Code. Therefore, the Company believes that the Plan was qualified
and the related trust was tax-exempt as of December 31, 1998 and continues
to be tax-exempt.
11
<PAGE>
Schedule 1
ROPER INDUSTRIES, INC. EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Line 27(a) - Schedule of Assets Held for Investment Purposes
(in thousands)
December 31, 1998
<TABLE>
<CAPTION>
Shares / Current
Identity of issue, borrower, lessor or similar party units Cost value
---------------------------------------------------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
Common trust funds:
* Merrill Lynch Retirement Preservation Trust 12,718 $ 12,718 $ 12,718
* Merrill Lynch Equity Index Trust 25 1,756 2,085
Mutual funds:
MFS Emerging Growth Fund 53 1,982 2,368
AIM Value Fund 372 12,430 14,957
Templeton Foreign Fund 124 1,198 1,043
* Merrill Lynch Capital Fund 186 6,422 6,385
* Merrill Lynch Basic Value Fund 53 2,046 2,017
* Merrill Lynch Corporate Bond Fund -
Intermediate Term Portfolio 99 1,149 1,157
* Roper Industries, Inc. common stock 310 8,022 6,317
Participant loans 802 802 802
</TABLE>
* Merrill Lynch and Roper Industries, Inc. are parties-in-interest to the
Plan.
See accompanying independent auditors' report.
12
<PAGE>
Schedule 2
ROPER INDUSTRIES, INC. EMPLOYEES' RETIREMENT SAVINGS 003 PLAN
Line 27(d) - Schedule of Reportable Transactions
(in thousands)
Year ended December 31, 1998
<TABLE>
<CAPTION>
Current
Expenses value of
incurred asset on
Purchase Selling with Cost of transaction Net gain
Identity of party involved Description of asset price price transaction asset date or (loss)
-------------------------- ------------------------- -------- -------- ----------- -------- ------------ ---------
<S> <C> <C> <C> <C> <C> <C> <C>
*Roper Industries, Inc. Common stock $ 3,223 $ - $ - $ 3,223 $ 3,223 $ -
*Roper Industries, Inc. Common stock - 2,677 - 2,774 2,677 (97)
*Merrill Lynch Retirement Preservation Trust 5,878 5,878 - 5,878 5,878 -
*Merrill Lynch Retirement Preservation Trust - 4,758 - 4,758 4,758 -
*Merrill Lynch Equity Index Trust 1,634 - - 1,634 1,634 -
*Merrill Lynch Equity Index Trust - 802 - 739 802 63
AIM Value Fund 3,593 - - 3,593 3,593 -
AIM Value Fund - 1,905 - 1,713 1,905 192
*Merrill Lynch Capital Fund Class A 1,497 - - 1,497 1,497 -
*Merrill Lynch Capital Fund Class A - 1,269 - 1,256 1,269 13
*Merrill Lynch Basic Value Fund 1,843 - - 1,843 1,843 -
*Merrill Lynch Basic Value Fund - 1,096 - 1,055 1,096 41
</TABLE>
* Merrill Lynch and Roper Industries, Inc. are parties-in-interest to the Plan.
See accompanying independent auditors' report.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administrator has duly caused this Annual Report to be signed on its behalf by
the undersigned hereunto duly authorized.
Roper Industries, Inc. Employees' Retirement Savings 003 Plan
-------------------------------------------------------------
(Name of Plan)
By: Roper Industries, Inc., Plan Administrator
By: /s/ Martin S. Headley
--------------------------------------------------------
(Signature)
Martin S. Headley May 28, 1999
Vice President and Chief Financial Officer
14
<PAGE>
Independent Auditors' Consent
The Board of Directors
Roper Industries, Inc.:
We consent to incorporation by reference in the registration statement (No. 33-
71094) on Form S-8 of Roper Industries, Inc. of our report dated April 19, 1999
relating to the statements of net assets available for benefits of the Roper
Industries, Inc. Employees' Retirement Savings 003 Plan as of December 31, 1998
and 1997, and the related statements of changes in net assets available for
benefits for the year ended December 31, 1998 and two months ended December 31,
1997, which report appears in the December 31, 1998 report on Form 11-K of Roper
Industries, Inc.
KPMG LLP
Atlanta, Georgia
May 28, 1999
15
