SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For The Plan Year Ended DECEMBER 31, 1997
Commission File No. 1-13426
A. The Sports Authority 401(k) Savings and Profit Sharing Plan
B. The Sports Authority, Inc.
3383 N. State Road 7
Ft. Lauderdale, Florida 33319
(954) 735-1701
1
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, The Sports
Authority, Inc., as plan administrator, has duly caused this Annual Report to be
signed by the undersigned thereunto duly authorized.
THE SPORTS AUTHORITY , INC.
Date: June 24, 1998 By: /S/ ANTHONY F. CRUDELE
----------------------
Anthony F. Crudele
Senior Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
2
<PAGE>
<TABLE>
<CAPTION>
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
INDEX TO FORM 11-K
PAGE NUMBER
-----------
<S> <C>
Report of Independent Certified Public Accountants 4
Statement of Net Assets Available for Benefits with Fund information
at December 31, 1997 5
Statement of Net Assets Available for Benefits with Fund information
at December 31, 1996 6
Statement of Changes in Net Assets Available for Benefits with Fund
information for the year ended December 31, 1997 7
Statement of Changes in Net Assets Available for Benefits with Fund
information for the year ended December 31, 1996 8
Notes to Financial Statements 9-13
Schedule I - Schedule of Assets Held For Investment Purposes -
December 31, 1997 14
Schedule II - Schedule of Reportable Transactions for the year
ended December 31, 1997 15-16
Index to Exhibits 17
</TABLE>
3
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REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Participants and Administrator
of The Sports Authority 401(k) Savings
and Profit Sharing Plan
In our opinion, the accompanying statements of net assets available for benefits
with Fund information and the related statements of changes in net assets
available for benefits with Fund information present fairly, in all material
respects, the net assets available for benefits of The Sports Authority 401(k)
Savings and Profit Sharing Plan at December 31, 1997 and 1996, and the changes
in net assets available for benefits for the years then ended, in conformity
with generally accepted accounting principles. 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 of these statements in accordance with generally accepted auditing
standards which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
schedules I and II is presented for purposes of additional analysis and is not a
required part of the basic financial statements but is additional information
required by ERISA. The Fund information in the statements of net assets
available for benefits and the statements of changes in net assets available for
benefits is presented for purposes of additional analysis rather than to present
the net assets available for plan benefits and changes in net assets available
for benefits of each fund. Schedule I, II and the 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.
PRICE WATERHOUSE LLP
Fort Lauderdale, Florida
June 24, 1998
4
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<TABLE>
<CAPTION>
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1997
------------------------------------------------------------------------------
Managed Growth Balanced The Sports Authority
Income Equity Fund Equity Common Stock
Fund Fund Fund
------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Cash $ 64 $ 107 $ 71 $ 118
Investments, at Fair Value
The Sports Authority Common Stock - - - 3,297,510*
Kmart Corporation Common Stock - - - -
Short-term Investments 2,269 2,115 3,157 3,742
Managed Income Fund 2,901,641* - - -
Growth Equity Fund - 4,557,381* - -
Balanced Equity Fund - - 3,715,082* -
Participant Loans - - - -
------------------------------------------------------------------------------
Total Investments 2,903,910 4,559,496 3,718,239 3,301,252
------------------------------------------------------------------------------
Receivables:
Contributions from Plan Participants 50,523 89,082 73,217 63,666
Contributions from Employer 22,167 36,317 28,897 778,174
Other Receivables/(Payables) 3,450 6,316 6,069 276
------------------------------------------------------------------------------
Total Receivables 76,140 131,715 108,183 842,116
------------------------------------------------------------------------------
Total Assets 2,980,114 4,691,318 3,826,493 4,143,486
------------------------------------------------------------------------------
LIABILITIES
Operating Payables - - - -
------------------------------------------------------------------------------
Net Assets Available for Benefits $2,980,114 $4,691,318 $3,826,493 $4,143,486
==============================================================================
</TABLE>
*Investment represents 5% or more of net assets available for benefits.
<TABLE>
<CAPTION>
------------------------------------------------------------
Kmart Corporation
Common Stock
Fund Other Total
------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Cash $ 11 $ 9,911 $ 10,282
Investments, at Fair Value
The Sports Authority Common Stock - - 3,297,510
Kmart Corporation Common Stock 317,159 - 317,159
Short-term Investments 998 - 12,281
Managed Income Fund - - 2,901,641
Growth Equity Fund - - 4,557,381
Balanced Equity Fund - - 3,715,082
Participant Loans - 615,463 615,463
------------------------------------------ -----------------
Total Investments 318,157 615,463 15,416,517
------------------------------------------ -----------------
Receivables:
Contributions from Plan Participants - - 276,488
Contributions from Employer - - 865,555
Other Receivables - (6,594) 9,517
------------------------------------------------------------
Total Receivables - (6,594) 1,151,560
------------------------------------------------------------
Total Assets 318,168 618,780 16,578,359
------------------------------------------------------------
LIABILITIES
Operating Payables - - -
------------------------------------------------------------
Net Assets Available for Benefits $318,168 $618,780 $16,578,359
============================================================
</TABLE>
The accompanying notes are an integral part of these financial statements
5
<PAGE>
<TABLE>
<CAPTION>
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
December 31, 1996
---------------------------------------------------------------------------
Managed Growth Balanced The Sports Authority
Income Equity Fund Equity Common Stock
Fund Fund Fund
---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Cash $ 877 $ 59 $ 49 $ 131
Investments, at Fair Value
The Sports Authority Common Stock - - - 3,197,554*
Kmart Corporation Common Stock - - - -
Short-term Investments - - - 13
Managed Income Fund 2,253,725* - - -
Growth Equity Fund - 2,482,724* - -
Balanced Equity Fund - - 1,988,065* -
Participant Loans - - - -
---------------------------------------------------------------------------
Total Investments 2,253,725 2,482,724 1,988,065 3,197,567
---------------------------------------------------------------------------
Receivables:
Contributions from Plan Participants 37,184 56,319 41,135 53,233
Contributions from Employer 16,284 23,001 17,287 590,519
Other Receivables/(Payables) (6,108) (6,187) 4,992 1,166
---------------------------------------------------------------------------
Total Receivables 47,360 73,133 63,414 644,918
---------------------------------------------------------------------------
Total Assets 2,301,962 2,555,916 2,051,528 3,842,616
---------------------------------------------------------------------------
LIABILITIES
Operating Payables 826 - - -
---------------------------------------------------------------------------
Net Assets Available for Benefits $2,301,136 $2,555,916 $2,051,528 $3,842,616
===========================================================================
</TABLE>
* Investment represents 5% or more of net assets available for benefits.
<TABLE>
<CAPTION>
-------------------------------------------------------
Kmart Corporation
Common Stock
Fund Other Total
-------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Cash $ 5 $ 702 $ 1,823
Investments, at Fair Value
The Sports Authority Common Stock - - 3,197,554
Kmart Corporation Common Stock 370,315 - 370,315
Short-term Investments 433 - 446
Managed Income Fund - - 2,253,725
Growth Equity Fund - - 2,482,724
Balanced Equity Fund - - 1,988,065
Participant Loans - 390,007 390,007
-------------------------------------------------------
Total Investments 370,748 390,007 10,682,836
-------------------------------------------------------
Receivables:
Contributions from Plan Participants - - 187,871
Contributions from Employer - - 647,091
Other Receivables/(Payables) (4,354) 18,481 7,990
-------------------------------------------------------
Total Receivables (4,354) 18,481 842,952
-------------------------------------------------------
Total Assets 366,399 409,190 11,527,611
-------------------------------------------------------
LIABILITIES
Operating Payables - - 826
-------------------------------------------------------
Net Assets Available for Benefits $366,399 $409,190 $11,526,785
=======================================================
</TABLE>
The accompanying notes are an integral part of these financial statements
6
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<TABLE>
<CAPTION>
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
For The Year Ended December 31, 1997
---------------- --------------- ---------------- ---------------------------
Managed Growth Balanced The Sports Authority
Income Equity Fund Equity Common Stock
Fund Fund Fund
---------------- --------------- ---------------- ---------------------------
<S> <C> <C> <C> <C>
Additions to Net Assets Attributed to:
Investment Income:
Interest Income $ - $ - $ - $ -
Realized/Unrealized Gain/(Loss) or
Appreciation/(Depreciation) 166,657 879,173 663,071 (1,353,242)
Contributions:
Contributions from Plan Participants 691,970 1,147,459 923,353 1,075,776
Contributions from Employer 277,054 441,319 354,180 1,181,368
---------------- --------------- ---------------- ---------------------------
Total Additions 1,135,681 2,467,951 1,940,604 903,902
Deductions from Net Assets
Attributed to:
Participant Withdrawals 282,680 415,788 297,161 375,628
Trustee Administrative Fees 8,941 - - -
---------------- --------------- ---------------- ---------------------------
Total Deductions 291,621 415,788 297,161 375,628
Net Increase (Decrease )prior to Interfund Transfers 844,060 2,052,163 1,643,443 528,274
Interfund Transfers (165,082) 83,239 131,522 (227,404)
Net Assets Available for Benefits
at Beginning of Period 2,301,136 2,555,916 2,051,528 3,842,616
---------------- --------------- ---------------- ---------------------------
Net Assets Available for Benefits
at End of Period $2,980,114 $4,691,318 $3,826,493 $4,143,486
================ =============== ================ ===========================
</TABLE>
<TABLE>
<CAPTION>
----------------------- ------------- -----------------
Kmart Corporation
Common Stock
Fund Other Total
----------------------- ------------- -----------------
<S> <C> <C> <C>
Additions to Net Assets Attributed to:
Investment Income:
Interest Income $ - $ 35,219 $ 35,219
Realized/Unrealized Gain/(Loss) or
Appreciation/(Depreciation) 45,209 - 400,868
Contributions:
Contributions from Plan Participants - (130) 3,838,428
Contributions from Employer - - 2,253,921
----------------------- ------------- -----------------
Total Additions 45,209 35,089 6,528,436
Deductions from Net Assets
Attributed to:
Participant Withdrawals 43,121 53,412 1,467,790
Trustee Administrative Fees - 131 9,072
----------------------- ------------- -----------------
Total Deductions 43,121 53,543 1,476,862
Net Increase (Decrease) prior to Interfund Transfers 2,088 (18,454) 5,051,574
Interfund Transfers (50,319) 228,044 -
Net Assets Available for Benefits
at Beginning of Period 366,399 409,190 11,526,785
----------------------- ------------- -----------------
Net Assets Available for Benefits
at End of Period $318,168 $618,780 $16,578,359
======================= ============= =================
</TABLE>
The accompanying notes are an integral part of these financial statements
7
<PAGE>
<TABLE>
<CAPTION>
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
For The Year Ended December 31, 1996
-----------------------------------------------------------------------------
Managed Growth Balanced The Sports Authority
Income Equity Fund Equity Common Stock
Fund Fund Fund
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Additions to Net Assets Attributed to:
Investment Income:
Interest Income $ - $ - $ - $ -
Realized/Unrealized Gain/(Loss) or
Appreciation/(Depreciation) 129,520 283,954 242,033 765,707
Contributions:
Contributions from Plan Participants 593,812 827,137 614,082 805,892
Contributions from Employer 244,094 324,919 220,361 889,442
-----------------------------------------------------------------------------
Total Additions 967,426 1,436,010 1,076,476 2,461,041
Deductions from Net Assets
Attributed to:
Participant Withdrawals 348,560 291,584 177,737 306,323
Trustee Administrative Fees 9,065 - - -
-----------------------------------------------------------------------------
Total Deductions 357,625 291,584 177,737 306,323
Net Increase prior to Interfund Transfers 609,801 1,144,426 898,739 2,154,718
Interfund Transfers (138,513) (129,578) 1,693 177,809
Net Assets Available for Benefits
at Beginning of Period 1,829,848 1,541,068 1,151,096 1,510,089
-----------------------------------------------------------------------------
Net Assets Available for Benefits
at End of Period $2,301,136 $2,555,916 $2,051,528 $3,842,616
=============================================================================
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------------------------
Kmart Corporation
Common Stock
Fund Other Total
-------------------------------------------------------
<S> <C> <C> <C>
Additions to Net Assets Attributed to:
Investment Income:
Interest Income $ - $ 14,679 $ 14,679
Realized/Unrealized Gain/(Loss) or
Appreciation/(Depreciation) 162,946 - 1,584,160
Contributions:
Contributions from Plan Participants - - 2,840,923
Contributions from Employer - - 1,678,816
-------------------------------------------------------
Total Additions 162,946 14,679 6,118,578
Deductions from Net Assets
Attributed to:
Participant Withdrawals 68,072 11,033 1,203,309
Trustee Administrative Fees - - 9,065
-------------------------------------------------------
Total Deductions 68,072 11,033 1,212,374
Net Increase prior to Interfund Transfers 94,874 3,646 4,906,204
Interfund Transfers (213,943) 302,532 -
Net Assets Available for Benefits
at Beginning of Period 485,468 103,012 6,620,581
-------------------------------------------------------
Net Assets Available for Benefits
at End of Period $366,399 $409,190 $11,526,785
=======================================================
</TABLE>
The accompanying notes are an integral part of these financial statements
8
<PAGE>
THE SPORTS AUTHORITY 401(K) SAVINGS
AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ACCOUNTING POLICIES
The accompanying financial statements of The Sports Authority 401(k) Savings and
Profit Sharing Plan (the "Plan") are prepared on the accrual basis of
accounting.
The Sports Authority, Inc. (the "Company") prepares its Plan financial
statements in conformity with generally accepted accounting principles. These
principles require management to make estimates and assumptions that affect the
reported amounts of net assets available for benefits, and report amounts of
changes in net assets available for benefits during the reporting period, such
as those regarding fair value. Actual results could differ from those estimates.
Plan investments, other than the Managed Income Fund, are stated at fair value.
The Sports Authority Common Stock Fund and Kmart Corporation Common Stock Fund
are valued at their quoted market prices. Mutual fund investments are valued at
net asset value representing the value at which shares of the fund may be
purchased or redeemed. The Managed Income Fund is valued at contract value which
approximates fair value. Participant notes receivable are valued at cost which
approximates market value. Realized and unrealized gains and losses are
determined utilizing the average cost method. Unrealized gains or losses
resulting from changes in market prices are included in the Statements of
Changes in Net Assets Available for Benefits with Fund information. Benefits
are recorded when paid.
Expenses of administering the Plan may be paid by the Employer or may be paid
from the funds; provided, however, that brokerage fees, transfer taxes and other
expenses incident to
the operation of a fund are charged against that fund. For the years ended
December 31, 1997 and 1996, the Employer paid the fee associated with the
recordkeeper and trustee, except for the Managed Income Fund, in which
administrative expenses are paid from fund assets. Taxes, if any, on any assets
held or income received by any fund are charged against that fund.
NOTE 2 - PLAN DESCRIPTION
GENERAL
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.
The Plan is a voluntary, defined contribution plan which commenced December 1,
1994. Employees are eligible to participate in the Plan on the first day of the
month following attainment of age 21 and performance of 1,000 hours of service
within a twelve month period. Employees that were participants in the Kmart
Corporation Employee Savings Plan (the "Kmart Plan") on November 30, 1994 are
eligible as of the effective date. Employees as of December 1,
9
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1994, that were not yet eligible under the Kmart Plan, received credit under the
Plan for service hours earned under the Kmart Plan.
ADMINISTRATION
The Trustee of the Plan is Wachovia Bank of Georgia, N.A. The record keeper for
the Plan is W. M. Mercer, Inc. The Plan's Committee is appointed by the
Company's Board of Directors, and is responsible for the administration of the
Funds during 1997.
CONTRIBUTIONS AND VESTING
Except as may be limited by applicable Internal Revenue Code regulations, a
participant may elect before-tax or after-tax contributions to the Plan through
payroll deductions ranging from 1% to 16% of compensation. For any amount the
participant contributes up to 6% of compensation, the Company will contribute an
amount equal to 50% thereof. All participants are automatically vested in the
Company's matching contributions to the Plan.
Participants may elect to have their contributions invested in four funds: A
Managed Income Fund, a Growth Equity Fund, a Balanced Equity Fund and The Sports
Authority Common Stock Fund. The primary objective of the Managed Income Fund is
to preserve principal and income while maximizing current income through a
portfolio balanced between fixed income securities, investment contracts, and
money market investments. This Fund invests solely in American Express Trust
Company-Income Fund I. The Growth Equity Fund invests in larger established
companies. This Fund invests solely in the American Century Twentieth-Growth
Fund. The Balanced Equity Fund has three objectives; current income, capital
growth and conservation of principal. This Fund invests solely in the American
Mutual Fund, Inc. The Sports Authority Common Stock Fund invests in the
Company's Common Stock ("Company Common Stock"). Excess cash is temporarily
invested in a money market fund, Wachovia/Biltmore Prime Cash Management Fund.
The participant's percentage allocation to each fund must be either 10% or an
exact multiple of 10%. Contributions previously invested in the Kmart Plan were
transferred to the Plan in March 1995. The Plan's investment funds were set up
to offer the same fund types as the Kmart Plan, including a Kmart Corporation
Common Stock Fund. Balances in the Kmart Plan were transferred to the
corresponding funds in the Plan. No additional contributions can be made to the
Kmart Corporation Common Stock Fund.
Effective as of the first day of the following month, a participant may elect to
change the amount or form of contributions made to the Plan. The participant may
change the percentage allocated to each fund on the existing value as well as
future contributions. The participant is also able to change the amount of
future contributions made to the Plan.
A participant may elect to discontinue before-tax or after-tax contributions
immediately with proper notification. A participant, after previously suspending
contributions, may resume contributions without penalty. A participant is
permitted to withdraw all or a part of his before-tax contributions only after
the withdrawal of any after-tax contributions and either the participant (i) has
attained the age of 59 1/2 or (ii) has met the hardship rules as defined in the
Plan. In the event of such a withdrawal, all before-tax contributions and
employer matching
10
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contributions will be suspended for six months. A participant may elect to
withdraw all or a part of his after-tax contributions without penalty.
A participant may elect to request a loan of his employee contributions. The
loan is subject to certain conditions including a minimum loan of $1,000 and a
maximum loan not to exceed the lesser of $50,000 or 50% of the participant's
vested balance. No more than one loan may be outstanding to any participant at
any time. The term of any loan shall range from one year to five years for loans
not for the purpose of purchasing a primary residence. Participant loans bear
interest at the prime rate.
The Plan also includes a Profit Sharing portion, whereby each participant will
receive employer contributions equal to at least one percent of his compensation
for each year. The contribution to the Profit Sharing Plan for the Plan years
ended December 31, 1997 and 1996 in the amounts of $753,652 and $567,523 were
made in April 1998 and April 1997, respectively.
Profit Sharing contributions are invested in The Sports Authority Common Stock
Fund until a participant is 100% vested. A participant's vesting in the Profit
Sharing contributions requires five years of Plan participation and includes
participation in the Kmart Plan. Fully vested participants may direct or
transfer their contributions to the various investment funds. Forfeitures of
assets in the Profit Sharing portion of the Plan are used to reduce future
profit sharing contributions. Forfeitures for the Plan years ended December 31,
1997 and 1996 were $56,807 and $77,627, respectively.
TERMINATION
Participation in the Plan automatically terminates when a participant is no
longer an employee and his or her account balance is distributed, except the
value of a participant's account exceeds $3,500, participation may continue
until age 70 1/2 unless the participant sooner requests distribution or dies.
During continuation of participation after employment terminates, no additional
employee or employer contributions, loans or partial withdrawals are permitted.
Upon termination of participation, a full distribution is made of the
participant's account. Withdrawals and distributions are paid in cash, except
participants who elect to take the distribution in stock to the extent that the
participant's account consists of shares of Kmart Corporation Common Stock
and/or shares of Company Common Stock.
NOTE 3 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets per the financial statements to
the Form 5500:
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
1997 1996
--------------------- --------------------
<S> <C> <C>
Net assets per the financial statements $ 16,578,359 $ 11,526,785
Benefits approved but unpaid (371,570) (59,985)
--------------------- --------------------
Net assets per the Form 5500 $ 16,206,789 $ 11,466,800
===================== ====================
</TABLE>
11
<PAGE>
The following is a reconciliation of the benefits paid per the financial
statements to the Form 5500:
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
1997
--------------------
<S> <C>
Benefits paid per the financial statements $ 1,467,790
Benefits paid in 1997 but approved in 1996 (59,985)
Benefits approved but unpaid at
December 31, 1997 371,570
--------------------
Benefits paid per the Form 5500 $ 1,779,375
====================
</TABLE>
NOTE 4 - TAX STATUS
The Internal Revenue Service has determined and informed the Company by letter
dated February 6, 1996, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC). The Plan
administrator and the Plan's tax counsel believe that the Plan is designed and
is currently being operated in compliance with the applicable provisions of the
IRC.
NOTE 5 - TRANSACTIONS WITH PARTIES-IN-INTEREST
For the Plan year ended December 31, 1997, the Plan purchased 115,240 shares and
sold 34,993 shares of Company Common Stock for $2,186,178 and $661,770,
respectively. For the Plan year ended December 31, 1996, the Plan purchased
75,343 shares and sold 15,641 shares of Company Common Stock for $1,947,478 and
$410,099, respectively. Distributions to Plan participants consisted of 3,701
shares and 1,625 shares of Company Common Stock, and the market value of such
shares at date of distribution was $70,274 and $37,169 for the Plan years ended
December 31, 1997 and 1996, respectively. The Plan did not pay any fees to the
Trustee, Wachovia Bank of Georgia, as all trustee fees were paid directly by the
Company. The Company paid $26,481 and $27,713 in trustee fees for the Plan years
ended December 31, 1997 and 1996, respectively.
NOTE 6 - SUBSEQUENT EVENT
On May 7, 1998, The Sports Authority, Inc. (the "Company") and Woolworth
Corporation announced that they had signed a definitive agreement to combine,
whereby the Company would become a wholly-owned subsidiary of Woolworth
Corporation. The transaction is expected to be accounted for as a pooling of
interests and is subject to customary closing conditions, including the approval
of the Company's stockholders and required regulatory approvals, as well as a
provision for minimum merger consideration. A copy of the Merger Agreement was
filed as an exhibit to the Company's Form 8-K dated May 8, 1998.
12
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE I
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
ITEM 27(A) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1997
- --------------------------------------------------------------------------------------------------------------------------------
Identity of Issue, Borrower, Par Value Description of Investment Including
Lessor or Similar Party or No. of Maturity Date, Rate of Interest, Current
Shares Collateral, Par or Maturity Value Cost Value
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
General Investments:
American Express Trust Company- 64,147 Mutual Fund $ 2,710,773 $ 2,901,641
Income Fund I
Kmart Corporation Common 27,579 Kmart Corporation, Common Stock 413,798 317,159
Stock Fund Par Value $1
The Sports Authority Common 223,560 The Sports Authority, Inc. Common 4,101,323 3,297,510
Stock Fund* Stock Par Value $.01
Participant Loans* 225 Participant Loans - 615,463
(High and Low interest rates are
9.00% and 8.25%, respectively)**
Registered Investment Companies:
American Mutual Fund, Inc. 127,185 Mutual Fund 3,306,948 3,715,082
Wachovia/Biltmore Prime Cash 12,281 Money Market Fund 12,281 12,281
Management Fund
American Century Twentieth-Growth Fund 189,811 Mutual Fund 4,288,340 4,557,381
------------------
Total Assets Held For Investment Purposes $15,416,517
==================
</TABLE>
*Denotes a party-in-interest to the Plan.
** Maturity dates range from January 1998 to August 2012.
13
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<TABLE>
<CAPTION>
SCHEDULE II
THE SPORTS AUTHORITY 401(K) SAVINGS AND PROFIT SHARING PLAN
ITEM 27(D) - SCHEDULE OF REPORTABLE TRANSACTIONS
For The Year Ended December 31, 1997
- ----------------------------------------------------------------------------------------------------------------------------------
Description of Assets
and Transactions Current Value
(including Interest Rate of Assets on
Identity of Party and Maturity in case of a Purchase Selling Cost of Transaction Net Gain
Involved Loan) Price Price Expenses Assets Date (Loss)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
I) A single
transaction in excess
of 5% of the current
value of plan assets:
Smith Barney The Sports Authority
Common Stock* $575,064 - $1,833 $576,897 $575,064 -
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Description of Assets
and Transactions Current Value
(including Interest Rate of Assets on
Identity of Party and Maturity in case of a Purchase Selling Cost of Transaction Net Gain
Involved Loan) Price Price Expenses Assets Date (Loss)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
II) A series of
transactions in
excess of 5% of the
current value of plan
assets:
The Sports Authority The Sports Authority-
Common Stock Common Stock*
Fund* 21 purchases $2,177,570 $8,608 $2,186,178 $2,177,570
45 sales $732,217 $2,822 $701,886 $732,217 $27,509
American Express Mutual Fund
Trust Company- 17 purchases
Income Fund I 33 sales $988,280 $988,280 $988,280
$506,163 - $451,453 $506,163 $54,710
American Mutual Mutual Fund
Fund, Inc. 31 purchases $1,766,344 $1,766,344 $1,766,344
20 sales $338,114 - $287,135 $338,114 $50,979
American Century Mutual Fund
Twentieth-Growth Fund 21 purchases $2,421,671 $2,421,671 $2,421,671
18 sales $527,525 - $415,807 $527,525 $111,718
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Description of Assets
and Transactions Current Value
(including Interest Rate of Assets on
Identity of Party and Maturity in case of a Purchase Selling Cost of Transaction Net Gain
Involved Loan) Price Price Expenses Assets Date (Loss)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Wachovia/Biltmore Money Market Fund
Prime Cash Management 168 purchases $3,638,081 $3,638,081 $3,638,081
Fund 141 sales $3,546,133 - $3,546,133 $3,546,133 -
</TABLE>
* Denotes a party-in-interest to the Plan.
16
<PAGE>
INDEX TO EXHIBITS
SEQUENTIAL
EXHIBITS PAGE NUMBER
- -------- -----------
23.1 Consent of Price Waterhouse LLP
17
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 33-94224) of The Sports Authority 401(k) Savings
and Profit Sharing Plan of our report dated June 24, 1998 appearing in this
Form 11-K.
Price Waterhouse LLP
Fort Lauderdale, Florida
June 24, 1998
