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                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-K

          [X]       ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 1997

          [ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                         Commission File Number 0-22702

                                  ROBERDS, INC.

An  Ohio Corporation                                     31-0801335
                                           (IRS Employer Identification Number)


                            1100 East Central Avenue
                             Dayton, Ohio 45449-1888
                                 (937) 859-5127

        Securities registered pursuant to Section 12(b) of the Act: None

           Securities registered pursuant to Section 12(g) of the Act:
                        Common Shares, without par value

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such requirements
for the past 90 days Yes  X   No
                        -----    ------

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ].

At the close of trading on January 31, 1998, 6,043,615 common shares, without
par value, were outstanding. Of these, 1,537,517 common shares, having an
aggregate market value (based upon the average of the high and low trading
prices on that date) of approximately $4,324,267 were held by non-affiliates of
the Registrant. Common shares held by each executive officer and director, and
by each person who owned five percent or more of the outstanding common shares,
were excluded, in that such persons may be deemed to be affiliates. However,
such calculation does not constitute an admission or determination that any such
officer or director or holder of more than five percent of the outstanding
common shares is in fact an affiliate of the Registrant.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's Proxy Statement for its 1998 annual meeting of
shareholders are incorporated into Part III herein by reference.


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                                     PART I

ITEM 1.     BUSINESS

GENERAL
-------

Roberds, Inc.(1) is a leading retailer of a broad range of home furnishing
products, including furniture, bedding, major appliances, and major consumer
electronics, in the greater Dayton, Ohio, Atlanta, Georgia, Tampa, Florida, and
Cincinnati, Ohio markets. At December 31, 1997, the Company operated 24
large-format stores, with six stores in the Dayton market, nine in the Atlanta
market, eight in the Tampa market, and one megastore in the Cincinnati, Ohio
market. The Company's product mix includes high quality, name-brand furniture,
bedding, major appliances, and consumer electronics products, at prices
guaranteed to be lower than those of its competitors.

In 1993, the Company completed an initial public offering of 2.7 million of its
common shares, without par value. The Company's common shares trade on the
Nasdaq National Market tier of The Nasdaq Stock Market, under the symbol "RBDS."

The Company was incorporated in 1971 under the laws of the State of Ohio. Its
executive offices are located at 1100 East Central Avenue, Dayton, Ohio
45449-1888, and its telephone number is (937) 859-5127.

FORWARD-LOOKING STATEMENTS
--------------------------

In the interest of providing the Company's shareholders and potential investors
with information concerning management's assessment of the outlook for the
Company, this report contains certain "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Readers should bear in
mind that statements relating to the Company's business prospects, as distinct
from historical facts, are forward-looking statements which, by their very
nature, involve numerous risks and uncertainties. For discussion of certain of
such risks and uncertainties, see "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Forward-Looking Statements."

OPERATING STRATEGY
------------------

The Company's objective is to be the leading retailer of furniture, bedding,
major appliances, and consumer electronics products in each of its markets. Key
elements of the Company's operating strategy include the following:

DISTINCTIVE PRODUCT MIX. The Company's product mix is a key element of its
operating strategy. Roberds' product mix is distinctive within the retailing
industry, and management believes it provides Roberds with several competitive
advantages over retailers offering only one or two of the Company's product
categories. The Company's major appliance and consumer electronics product lines
generate significant store traffic, sales volume, and gross profit dollars,
enabling Roberds to price its furniture products more aggressively than
competing furniture retailers. The Company's higher-margin furniture and bedding
products enable it to offer its appliance and consumer electronics products at
prices generally below other retailers of those products. The Company believes
that its mix of products provides a strategic advantage over certain of its
competitors.

Management believes that the Company's product mix generates significant
operating efficiencies. Such efficiencies result from the higher level of sales
per store generated by the Company's diverse product mix, providing Roberds with
significant leverage of its fixed costs, including distribution, warehousing,
store facilities, advertising, and general and 

--------------
     1    Roberds, Inc. is also referred to herein as "the Company,"
          "Registrant," and "Roberds."

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administrative expenses. The Company's product mix enables Roberds to offer
complementary products in a single package in a way in which many of its
competitors cannot, and offers cross-selling opportunities that do not exist for
many of the Company's competitors.

GUARANTEED LOWEST PRICES. The Company's pricing strategy is to offer its
merchandise at prices guaranteed to be lower than those of its competitors
throughout the year. Roberds shops its competition regularly and believes that
it sets its prices below those of its competitors. To reinforce its reputation
for value, it is the Company's advertised policy to offer the lowest competing
price in the market. The policy is backed up by the Company's DOUBLE THE
DIFFERENCE(R) price guarantee, which is prominently featured in its advertising.

At the time of sale, and for 30 days thereafter, the Company guarantees to its
customers that its prices are lower than those of its competitors. If a customer
demonstrates prior to a purchase that the same product can be purchased within
the market area for a price below that offered by the Company, it will offer
that item to the customer at a price lower than that of the competitor. If a
customer has purchased a product from the Company and within 30 days thereafter
(seven days on computer products) demonstrates that the same product can be
purchased within the market area at a lower price, the Company will refund
double the difference to the consumer.

BROAD SELECTION OF NAME-BRAND MERCHANDISE. The Company sells only name-brand
products generally recognized by consumers, including many higher quality
brands. The Company's stores, which average approximately 60,000 square feet in
size (excluding the Cincinnati megastore), are larger than the stores of many of
its competitors. This enables the Company to attractively display a wide variety
of products that appeal to a broad range of consumer tastes, incomes, and age
groups. As a result, Roberds can offer its customers "one-stop" shopping for
almost every home furnishing product, thereby facilitating the purchasing
process and reducing the need for comparison shopping. In 1996, the Company
opened Roberds Grand(R) in Cincinnati, Ohio. Roberds Grand features a single
250,000 square foot showroom, with an even larger selection than is offered in
the Company's other stores.

STORE CONCENTRATION AND EFFICIENCIES. Roberds operates in metropolitan areas of
at least one million people. In its Dayton, Atlanta, and Tampa markets, the
Company has concentrated multiple stores in each geographic market in order to
enhance name recognition, achieve market penetration, and gain economies of
scale in distribution, advertising, and management costs. The Company advertises
in newspapers, on television, and through direct mail, and is able to benefit
from the advertising efficiencies of locating multiple stores within those three
marketing areas. The Company's "hub and spoke" warehouse and delivery functions
also create operating leverage by serving multiple stores from a regional
facility. For its entry into the Cincinnati market, which is discussed more
fully below, the Company utilized a single 250,000 square foot "megastore"
concept.

CORPORATE COMMITMENT TO CUSTOMER SERVICE. The Company operates under the
philosophy that it will do "whatever it takes" to satisfy the customer. The
Company gives managers and sales associates full authority to respond to
customer issues. Unlike many of its competitors, Roberds employs commissioned,
trained, professional, sales associates, who are knowledgeable about the
products they sell, and almost all of whom are employed full time by the
Company. On in-stock merchandise, the Company offers delivery within two days,
for a reasonable charge, seven days per week. Roberds guarantees next-day
delivery service on selected merchandise. Roberds offers delivery on all
merchandise sold, and has a competitive policy on replacements and returns.
Roberds also removes the customer's old merchandise free of charge. In addition,
Roberds offers service contracts that provide additional warranty coverage
beyond that which is provided by the manufacturer.

EXPANSION STRATEGY
------------------

As part of the initial public offering of its common shares in 1993, the Company
embarked on a plan to add stores in its existing market areas, particularly in
Atlanta and Tampa; to remodel two of its highest volume stores; to relocate its
flagship store in the Tampa market; and to develop a fourth market area. The
Company developed this strategy in order to attempt to gain market share in the
large and growing Atlanta and Tampa markets, which the Company believed offered
significant expansion opportunities. Since the initial public offering, the
Company has increased its store count 


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in Dayton from five to six, in Atlanta from five to ten, in Tampa from five to
eight, and in total from 15 to 24 in its three original market areas. The store
renovation and relocation projects launched in 1993 have been completed. As
discussed elsewhere in this Report, on December 31, 1997, the Company closed its
Decatur, Georgia store, reducing its store count to nine in the Atlanta market
and its count in the three original markets to 23.

ENTRY INTO NEW MARKETS. In July 1996, the Company entered the Cincinnati, Ohio
market with a single 250,000 square foot megastore known as Roberds Grand. With
the development of the Roberds Grand(R) format, the Company has two formats with
which it can enter new markets--multiple 60,000 square foot stores within a
market or a single 250,000 square foot megastore. It is the Company's plan to
utilize the single 250,000 square foot model in all new markets; however, it can
utilize the multiple-store model where the Company believes it is appropriate.
The determination of whether to utilize a single store or multiple stores in new
markets depends on a variety of factors, including but not limited to retail
shopping patterns, traffic patterns, accessibility, and the availability of
sites.

Going forward, the Company will focus the majority of its resources on new
market areas. Criteria for expansion into new markets include the potential for
achieving a significant share of the market in each of the Company's product
categories, and the opportunity to achieve operating efficiencies in regional
advertising, warehousing, and administrative costs.

The Company has identified Columbus, Ohio as its next market area, utilizing the
Roberds Grand megastore approach. However, the Company does not intend to enter
the Columbus market, or any other new market, and take on the additional debt
obligations required to enter a new market, without additional equity. Thus, the
Company's further expansion into new markets is dependent on its ability to
raise additional equity capital prior to, or as part of, such new market
expansions. Although the Company currently expects to continue its expansion
beyond the Columbus, Ohio market, there can be no assurance that it will be able
to do so.

STORE RENOVATIONS. In April, 1997, the Company expanded its West Carrollton,
Ohio store into former warehouse space that was abandoned following the opening
of the new warehouse in Fairborn, Ohio. The expansion enables the Company to
sell some of the products it displays and inventories for the Cincinnati market,
in Dayton. As part of the expansion, there was minor renovation of the existing
West Carrollton store. The expanded store has 140,000 square feet of showroom
space.

During the third quarter of 1997, the Company completed an upgrade and facelift
to the front of the Clearwater, Florida store.

GENERAL. The Company's planned growth depends, in part, on its ability to expand
into new markets and, to a lesser extent, its ability to open new stores within
its existing market areas. There is no assurance that the Company will be able
to locate favorable store sites and arrange favorable leases for new stores;
open new stores in a timely manner; or hire, train, and integrate employees and
managers in those new stores; or that the Company will have access to sufficient
financial resources to permit further expansion. Similarly, there can be no
assurance that the Company can enter new markets successfully.

MERCHANDISING AND PRODUCT LINES
-------------------------------

DISTINCTIVE FORMAT. Roberds' merchandising format, combining furniture, bedding,
major appliances, and consumer electronics products in the same store, is an
important aspect of the Company's operations and a point of significant
differentiation from its competitors. The Company's traditional stores are
larger than the stores of most of its competitors, averaging approximately
60,000 square feet in size. These larger stores allow the Company to
attractively display a wide selection of products and allow flexibility in
expanding and contracting merchandise categories to meet changing consumer
tastes and to introduce new products. The Company's Roberds Grand facility, in
Cincinnati, Ohio, is one of the largest home furnishings stores in North
America. Roberds' stores are organized into specialized departments, each
offering a wide selection of merchandise. The breadth of merchandise within each
product line is designed to provide customers with a varied selection and to
reduce the need for customers to comparison shop.

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Roberds' furniture merchandise is priced to achieve gross margins that are
attractive for the Company, but below those of other furniture retailers.
Because it sells higher-margin furniture products, the Company can offer its
appliance and consumer electronics products at prices lower than can many of its
competitors in those categories. The Company's appliance and consumer
electronics businesses have lower margins, higher turnover, and tend to be
somewhat more seasonal and cyclical than furniture sales. However, the
competitively priced appliance and consumer electronics products generate
customer traffic for the higher margin furniture items and allow the Company to
spread its operating expenses over a larger base of sales. In addition,
management believes the Company's major appliance and consumer electronics
product offerings increase the frequency of customer visits and create consumer
loyalty, which leads customers to shop for furniture at Roberds.

FURNITURE PRODUCTS. Roberds carries a broad selection of name-brand furniture
products. In addition, the Company offers a broad range of special-order
products. Unlike many other retailers, Roberds uses the same pricing formula for
special-order merchandise as it does for in-stock merchandise. As a result,
Roberds enjoys a significant special-order business. Furniture sold by the
Company includes traditional, American country, eighteenth century, and
contemporary styles, and includes living room, dining room, and bedroom
furniture, tables, lamps, dinettes, reclining furniture, sleep sofas, desks, and
chairs. The Company offers extensive selections of both upholstered and leather
furniture, as well as casegoods. Roberds also sells furniture accessory items
including pictures, mirrors, vases, mantle pieces, wall hangings, figurines, and
related goods. Furniture brands carried by Roberds represent the middle to
upper-middle range of price, and include Action by Lane, Broyhill, Chromcraft,
Flexsteel, Kincaid, Natuzzi, and Pennsylvania House, among others. In the
Roberds Grand format, the Company offers an even broader and deeper selection of
furniture products, including many higher-end products such as Lexington, and
the Timberlake, Arnold Palmer, and Alexander Julian collections.

BEDDING PRODUCTS. The Company offers products from Sealy, Serta, and Simmons,
the three largest manufacturers of bedding sold in the United States, as well as
Stearns & Foster. Bedding products include wooden and brass bed frames,
mattresses, box springs, water beds, and futons. The brand names sold by the
Company cover the full range of bedding quality, except that the Company does
not compete at the very lowest end of the bedding quality range or in the
private-label segment.

MAJOR APPLIANCE PRODUCTS. Roberds' major appliance products include
refrigerators, freezers, ranges, washers, dryers, dishwashers, trash compactors,
disposals, room air conditioners, microwave ovens, dehumidifiers, and vacuum
cleaners. The Company also sells some specialty appliance products such as
under-counter refrigerators, built-in appliances, and cooktops. Roberds carries
the major appliance brands sold in the United States, ranging in price from
moderately low to very high. Major appliance brands carried by the Company
include Amana, Frigidaire, General Electric, JennAir, KitchenAid, Maytag,
SubZero, and Whirlpool, among others.

CONSUMER ELECTRONICS PRODUCTS. Consumer electronics products sold by the Company
include portable, console, and big screen televisions; VCRs; camcorders; stereo
systems and audio components; and satellite systems. The Company focuses its
efforts on large, big-ticket electronics products, rather than the small-ticket
items carried by many mass merchants. The Company offers personal computers and
related home-office products in its Dayton and Cincinnati markets. The Company
offers products from most of the major consumer electronics manufacturers,
ranging in price from lower-middle to high. Consumer electronics brands carried
by the Company include Bose, Compaq, Hitachi, IBM, JVC, Mitsubishi, Pioneer,
RCA, Sony, Toshiba, and Zenith, among others.

Roberds has dedicated "home theater" departments in its stores. This
merchandising concept blends stereo televisions with supplemental audio
equipment, to give the consumer a movie viewing experience comparable to that
enjoyed in theaters. Because of its ability to offer these products together
with complementary furniture products, particularly recliners and other "motion"
furniture, Roberds believes that it is well positioned to capitalize on the home
theater merchandising concept. The Company expects to add high-definition
television ("HDTV") to its product line in 1998, as that product becomes
available and as the first HDTV broadcasts, and related movie software, are
available to consumers.

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OTHER. Selected floor-covering products are offered in the Dayton and Cincinnati
stores. The Company does not sell draperies, wallpaper, or tabletop merchandise.

ADVERTISING AND PROMOTION
-------------------------

Roberds uses a mixed media approach in its advertising programs, employing a
combination of newspaper, broadcast, and direct mail advertisements. Roberds is
reimbursed by its suppliers for a significant portion of the costs associated
with advertising their products.

Newspaper advertisements typically account for the majority of gross advertising
expenditures, with broadcast, direct mail, and other forms of advertising
constituting the balance. The Company uses a combination of newspaper "run of
press" advertising, contained in the body of the newspaper, and "preprint"
advertising, which is "stuffed" into the newspaper. The Company advertises
continuously during the year, but most heavily during peak retailing seasons
such as Thanksgiving and Christmas and for other special promotional programs.
Roberds utilizes broadcast advertising primarily Wednesday through Sunday, in
newspapers primarily Friday through Sunday, and runs direct mail programs
periodically. Roberds runs a variety of promotional programs that range in
duration from one to fourteen days. A sales promotion is in progress virtually
every day of the year.

The Company has an in-house advertising department for the planning,
preparation, and production of advertising, and for coordinating advertising
with the Company's merchandising policies and programs. The Company employs an
advertising agency for the production of broadcast advertising and for
assistance in developing its overall advertising strategy. Advertising for all
market areas is developed around common themes and promotions, but product
prices are varied by market to meet each market's needs and to maintain Roberds'
guaranteed-lowest-price commitment.

CUSTOMER PROFILE
----------------

Roberds targets consumers who are 25 to 54 years of age, have annual household
incomes greater than $30,000, are married, and have owned their own homes for
less than five years. The Company believes such customers are typically
interested in purchasing high-quality merchandise at prices that provide good
value. Management also believes that Roberds has a high proportion of repeat
shoppers.

CUSTOMER SERVICE AND CONVENIENCE
--------------------------------

The Company stresses superior customer service and encourages every employee to
do "whatever it takes" to satisfy a customer. Store managers and assistant
managers have broad discretion to meet customers' needs. Roberds' stores are
open 362 days each year. The stores are open from 10:00 a.m. to 9:00 p.m.,
Monday through Saturday, and 11:00 a.m. to 7:00 p.m., Sundays, providing ample
opportunity for customers, including two-income families, to shop. Store hours
are extended during peak selling seasons. Roberds employs commissioned, trained,
professional sales associates who are knowledgeable about the products they
sell, and almost all of whom are employed full time by the Company. 

When a customer is interested in an item of merchandise that is carried in
stock, sales associates determine the item's availability from real-time
computer terminals located throughout the selling area. Similarly, if a customer
special-orders merchandise, the Company's computer system allows the customer to
know at any time the status of the order and the expected delivery date.
Customer inquiries after the sale are generally referred first to the
salesperson who made the sale, so as to maintain a friendly customer
relationship and encourage customer satisfaction and loyalty.

For furniture, major appliances, and consumer electronics products, Roberds
offers service contracts that provide additional warranty coverage beyond that
which is provided by the manufacturer. The terms of the extended warranty
contracts range from nine months to ten years. Roberds provides service for
everything it sells. Roberds performs its 

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own furniture and bedding repair service in all four markets. Appliance and
electronics repair services are provided with a combination of in-house staff
and outside providers with whom Roberds has working relationships.

HOME DELIVERY SYSTEM
--------------------

Roberds believes that its system for delivery of merchandise to its customers is
convenient for the customer and a strategic advantage. At the time of purchase,
customers can elect to take in-stock merchandise with them or schedule it for
delivery. Over 80 percent of the merchandise sold is delivered. If the customer
wants to arrange a delivery, it is scheduled at the time of sale, on the sales
floor, when the customer specifies a date for delivery. Full delivery service is
available 362 days during the year, including Sundays, to provide maximum
convenience for the customer. Typically, the customer can schedule deliveries of
in-stock merchandise within two days after the sale; however, the Company
guarantees next-day delivery on in-stock refrigeration equipment, big-screen
televisions, and bedding products.

Roberds operates a delivery fleet with distinctive trucks displaying the Roberds
logo. All delivery crews are Roberds employees wearing Company uniforms.
Delivery teams operate on a commissioned pay system. Management believes that,
as a result of the commission system, the Company's delivery personnel are
highly motivated to complete the delivery successfully on the first attempt and
to satisfy the customer.

PURCHASING AND VENDOR RELATIONS
-------------------------------

Roberds' buying operations are organized along its four major merchandise lines.
The merchandise lines are managed by senior corporate buyers, who are assisted
by merchandise managers in the local markets. The buyers review inventory and
sales reports on a daily basis and place orders based on analysis of past sales
and existing inventory levels in the geographic market areas. The buyers also
adjust product pricing and advertising to meet competitive needs in their
respective market areas.

Virtually all furniture and major appliances are purchased from North American
manufacturers. Consumer electronics products are purchased either from domestic
manufacturers or domestic suppliers representing European or Asian
manufacturers. Roberds is a member of NATM Buying Corp., the largest national
buying group in the United States, organized to purchase consumer electronics
and major appliances. Roberds believes its membership in NATM enables it to
obtain better product pricing, larger volume discounts, and more advertising
rebates than it could obtain independently.

Vendors provide the Company with substantial incentives in the form of cash
discounts, volume rebates, and cooperative advertising funds. The aggregate
amount of these incentives was approximately $16.7 million in 1997, $18.5
million in 1996, and $15.3 million in 1995. The decline in 1997, as compared to
1996, was principally due to a decrease in vendor incentives and cash discounts
as the Company reduced its volume of purchases to better match consumer demand
for its products. The increase in such incentives in 1996 over 1995 was
primarily due to increased purchases of products in order to support higher
levels of sales and the entry into the Cincinnati market and, to a lesser
extent, increased purchases from manufacturers providing incentives. There can
be no assurance that such vendor incentives will continue at such levels. A
reduction in, discontinuance of, or delay in receiving these vendor incentives
could have a material adverse effect on the Company.

Access to certain vendors and brand names is important to the Company's
continued success. The loss of a significant or well-known vendor, such as
General Electric or Broyhill, could have a material adverse effect on the
Company.


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DISTRIBUTION
------------

In 1996, the Company consolidated its two Dayton warehouses into a new 480,000
square foot facility, which it constructed in the Dayton suburb of Fairborn,
Ohio. The Fairborn facility services the Dayton and Cincinnati markets, and will
also service the Company's intended entry into the Columbus, Ohio market. The
Atlanta and Tampa markets each operate from single warehouse facilities.

All merchandise is initially received into, and controlled in, a central
warehouse in each market. Smaller merchandise items, such as small televisions
and VCRs, which can be picked up by the customer, are then redistributed to the
stores for customer pick-up. Each store maintains warehouse space to facilitate
such customer pick-ups. Management believes this "hub and spoke" arrangement
allows for prompt product delivery and efficient distribution.

The Company tags and barcodes all merchandise at the time of arrival in its
warehouse centers. The movement of merchandise through the warehouse is tracked
by the Company's barcode process. The Company cycle-counts inventory on a
scheduled basis and performs physical inventories periodically.

MANAGEMENT INFORMATION SYSTEMS
------------------------------

Roberds utilizes a fully integrated management information system for inventory,
merchandising, and certain accounting functions. The system was purchased from,
and is maintained by, the largest software provider to the furniture retailing
industry. The Company believes that the current system is adequate to support
its growth plans, by making hardware and software upgrades to accommodate
additional volume.

Each store is equipped with a system allowing Company sales personnel and buyers
to track merchandise inventories on a real-time basis. In addition, the
merchandising systems are designed to integrate fully the key retailing
functions of merchandise planning, purchase order management, merchandise
distribution, receiving, order entry, and inventory control.

Sales data is captured at the time of sale by the Company's sales personnel,
using point-of-sale terminals on the showroom floor, and is transmitted to the
Company's regional processing centers, where it is compiled to produce daily and
weekly management reports. The data is organized by department class, item,
style, and store, and enables management to regularly monitor the sales
performance of all products within each store and market. The system also
captures data regarding the customer, and maintains an on-line customer data
base with addresses and purchasing history for each customer.

CUSTOMER CREDIT PROGRAMS
------------------------

The Company offers qualified customers a private-label charge card administered
by Banc One Private Label Credit Services ("Banc One"). According to Banc One,
at December 31, 1997, the Company had over 330,000 private-label charge card
accounts that generated sales of approximately $138 million in 1997. Such sales
represent approximately 40 percent of the Company's net sales and service
revenues for 1997. The credit approval and servicing process is administered by
Banc One, which issues customer account cards embossed with the Roberds logo.
Roberds receives income from such accounts, based on the difference between: (i)
the interest rate charged to the customer, and (ii) Banc One's cost of funds
plus an administrative charge. As part of its arrangement with Banc One, Roberds
funds a reserve account designed to cover a portion of the bad debt losses
incurred by Banc One. All credit losses in excess of the reserve account are the
responsibility of Banc One. As a result of this arrangement, Roberds holds no
significant consumer receivables and bears no credit risk beyond the fixed
amount contributed to Banc One's bad debt reserve. Because a significant portion
of the Company's sales are financed by consumers, the lack of availability of
consumer credit programs, or a significant increase in the cost of such
programs, could have a material adverse effect on the Company.

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The Company also arranges financing through several other sources for customers
not qualifying for credit under the Banc One program. Under some of these
programs, the Company pays a fee to the providers for the use of the program;
under others, it earns a participation fee. However, under all of these other
programs, there is no recourse to Roberds for bad debts.

The Company utilizes several sources for extended financing programs; however,
the majority of such financing is provided by Banc One. The Company generally
pays a fee to the financing source for these programs. To the extent the Company
utilizes Banc One for programs other than its standard 90-days, same-as-cash
program, the Company pays a fee to Banc One for such programs. All extended
financing programs are without recourse to the Company.

Roberd Insurance Agency, Inc., a wholly owned subsidiary of the Company, is
qualified as an insurance agency under Ohio law. It earns a commission on credit
insurance sold by the Company to its customers.

COMPETITION
-----------

The retail sale of furniture, bedding, major appliances, and consumer
electronics products in the United States is highly competitive and, for
furniture and bedding products, is highly fragmented. There are large numbers of
local, regional, and national chains of department stores, specialty retailers,
and mass and catalog merchandisers, as well as mail-order merchandisers,
competing in each of the Company's product categories and within its geographic
markets. Many of these competitors are publicly held and have financial and
other resources substantially greater than those of the Company. Further, many
of the Company's competitors, particularly in the appliance and electronics
product categories, have suffered severe financial problems. From time to time,
this has caused the Company to have to compete against retailers that are
liquidating merchandise or operating under the protection of the bankruptcy
laws. In the major appliance and consumer electronics categories, there has been
significant expansion into the Company's markets by publicly held national
"superstore" chains, which has greatly increased the competitive environment in
those product categories. In general, these competitive conditions have led to
heavy advertising, severe price competition, and extensive use of "same-as-cash"
programs. The Company expects such competition to continue. As a result of these
highly competitive conditions, during 1996, the Company withdrew from the
personal computer and home-office categories in its Atlanta and Tampa markets.

One national retailer of appliance and electronics products entered the Dayton
market in 1997, and another entered the Tampa market in 1997. One national
furniture retailer has announced plans to enter the Dayton market in 1998.
Several national retailers present in the Company's markets have continued to
expand within those markets. Several national department store chains are
experimenting with freestanding furniture, appliance, and electronics formats,
and some of those retailers have entered the Company's markets. These
competitors may generate additional competition in the furniture segment.

The industry competes on the basis of price, merchandise selection and
availability, and service. The Company competes on price by constantly shopping
its competition within its geographic markets and maintaining a
guaranteed-lowest-price approach. Because of its distinctive product mix,
Roberds can price its merchandise on the sales floor below the competition every
day of the year. The Company believes it competes favorably on merchandise
selection because, at an average of 60,000 square feet of showroom size in its
traditional stores, its stores are larger than those of many of its competitors,
thus enabling Roberds to attractively display a broader range of merchandise in
each of its four product categories. Management believes Roberds' product
availability is good because of its strong vendor relations and its regional
distribution facilities, which are located near its stores. The Company believes
that it provides superior customer service through its full-time, commissioned
sales staff, effective delivery of merchandise, and effective handling of
special orders.

                                       9
<PAGE>   10

SEASONALITY
-----------

The Company typically experiences an increase in its overall sales and
profitability in the fourth quarter. This increase is driven by an increase in
the sales of consumer electronics and furniture products associated with the
holiday season. At the same time, major appliance sales typically decline in the
fourth quarter. Operating results for the full year are highly dependent upon
the success of the Company's operations in the fourth quarter.

CYCLICALITY
-----------

The market for furniture, bedding, major appliances, and consumer electronics
products has historically been cyclical, fluctuating significantly with general
economic cycles. During economic downturns, these product lines tend to
experience longer periods of recession and greater declines than the general
economy. The Company believes that the industry is significantly influenced by
economic conditions generally and particularly by the level of housing activity,
interest rates, consumer confidence, personal discretionary spending, and credit
availability. There can be no assurance that a prolonged economic downturn would
not have a material adverse effect on the Company.

BACKLOG
-------

The Company's backlog of sales (sales orders written but not yet delivered) was
approximately $9.5 million at December 31, 1997 as compared to $8.3 million at
December 31, 1996.

EMPLOYEES
---------

At January 31, 1998, the Company had approximately 2,100 employees,
substantially all of whom were full time, including approximately 720 in sales
and sales management, 570 in office and administrative capacities, and 810 in
warehouse, service, and delivery functions. The Company has never experienced a
work stoppage due to labor difficulties and is not a party to any collective
bargaining arrangements. The Company considers its relations with its employees
to be good.

MERGERS; SUBSIDIARIES
---------------------

As part of the Company's initial public offering in 1993, two of the Company's
Initial Shareholders(2) contributed all of their shares in Roberd Insurance
Agency, Inc. and Roberds Service Company to the Company. In 1994, Roberds
Service Company was merged into Roberds, Inc. Roberd Insurance Agency, Inc. is a
licensed insurance agency under Ohio law and earns a commission on credit
insurance sold by the Company.

--------------------
     2  The Company's Initial Shareholders are Messrs. Kenneth W. Fletcher,
Donald C. Wright, and Howard W. Smith, who held all of the Company's outstanding
common shares immediately prior to the initial public offering in 1993. See also
Item 12 of this Report, Security Ownership of Certain Beneficial Owners and
Management.

                                       10
<PAGE>   11

TRADEMARKS AND LICENSES
-----------------------

The trademarks ROBERDS(7), AMERICA'S NAME BRAND HEADQUARTERS(7), THE BIG ONE(7),
EMPLOYEE PRICE SALE(7), and BACK DOOR SALE(7), ROBERDS GRAND FURNITURE
APPLIANCES ELECTRONICS(R), BOTTOM LINE . . . IT COSTS LESS AT ROBERDS(R), and
DOUBLE THE DIFFERENCE(R) are registered by the Company with the United States
Patent and Trademark Office. Roberds does not license any intellectual property
to other parties. Roberds does not license any intellectual property from
others, except for computer software, principally for use in the Company's
management information system described elsewhere in this Report, and the
trademarks of certain of its vendors that permit Roberds to utilize their
trademarks in connection with the promotion and sale of the vendors' products.























                                       11
<PAGE>   12



ITEM 2.     PROPERTIES

Roberds' facilities are all located on major thoroughfares and many are near
interstate highways. Many stores are free-standing facilities, and all have
ample parking. The stores are of modern construction, resulting in relatively
low maintenance costs. The following table sets forth information regarding the
Company's stores and warehouses in each of its markets, at December 31, 1997:

<TABLE>
<CAPTION>
                                                                      SHOWROOM       WAREHOUSE
                                                                       SIZE IN        SIZE IN       OWNED/
REGION/LOCATION                        DATE OPENED                     SQ. FT.        SQ. FT.       LEASED
---------------                        -----------                     -------        -------       ------
<S>                                    <C>                             <C>              <C>         <C>
DAYTON, OHIO
------------
West Carrollton, Ohio(1)               June 1971                       145,000          15,000      Leased(2)
West Carrollton, Ohio(1)(6)            June 1974                                        20,000      Leased(2)
Piqua, Ohio(3)                         March 1983                       56,000           4,000      Leased(2)
Springfield, Ohio                      May 1985                         50,000          16,000      Leased(2)
Richmond, Indiana                      March 1988                       55,000           4,000      Leased(2)
Vandalia, Ohio(7)                      July 1989                       139,000          20,000      Owned
Beavercreek, Ohio                      April 1995                       63,000           5,000      Owned
Fairborn, Ohio                         January 1996                                    480,000      Owned

ATLANTA, GEORGIA
----------------
Norcross, Georgia(4)                   March 1979                       60,000          28,000      Leased
Marietta, Georgia(8)                   July 1984                        59,000           4,000      Leased(2)
Forest Park, Georgia(8)                October 1987                     57,000           4,000      Leased(2)
Roswell, Georgia                       September 1990                   56,000           4,000      Leased
Doraville, Georgia                     January 1994                                    217,000      Leased
Gainesville, Georgia                   September 1994                   71,000          10,000      Leased
Douglasville, Georgia(9)               November 1994                    59,000          10,000      Owned
Athens, Georgia                        August 1995                      62,000           4,000      Owned
Fayetteville, Georgia                  September 1995                   62,000           4,000      Owned
Atlanta (Buckhead), Georgia            November 1996                    70,000           6,000      Owned

TAMPA, FLORIDA
--------------
Tampa, Florida(5)                      March 1985                       73,000           9,000      Owned
Bradenton, Florida                     June 1986                        53,000           4,000      Leased
Clearwater, Florida                    September 1986                   52,000           4,000      Leased
North Tampa, Florida                   March 1990                       50,000           5,000      Owned
Brandon, Florida                       November 1990                    49,000           5,000      Leased
Seminole, Florida                      November 1993                    81,000           6,000      Leased
Brandon, Florida                       May 1994                                        159,000      Leased
Sarasota, Florida                      July 1994                        50,000           5,000      Leased
Port Richey, Florida                   March 1995                       60,000           6,000      Owned

CINCINNATI, OHIO
----------------
Springdale, Ohio                       July 1996                       250,000          64,000      Leased
                                                                    ----------     -----------

         Total                                                       1,782,000       1,122,000
                                                                    ==========      ==========
</TABLE>

                                       12
<PAGE>   13




(1)      Original store was relocated to a 60,000 square foot showroom/warehouse
         in 1974 and was relocated again to the current facility in 1978, which
         was remodeled and expanded in 1994 and again in 1997.

(2)      Facilities leased from entities controlled by one or more of the
         Initial Shareholders. See Item 13 of this Report, Certain Relationships
         and Related Transactions.

(3)      Original 18,000 square foot store opened in 1983, and was relocated and
         expanded to the present facility in 1988.

(4)      Remodeled and expanded in 1994.

(5)      Relocated and expanded in February 1995.

(6)      Approximately 20,000 square feet in the former West Carrollton, Ohio
         showroom/warehouse is used as a warehouse for the carpet division, and
         the remaining 40,000 square feet for corporate offices.

(7)      Expanded in August 1996.

(8)      The Marietta and Forest Park, Georgia facilities include approximately
         14,000 and 60,000 square feet, respectively, not included in the table
         above, portions of which are currently leased to third party commercial
         and retail tenants, and other portions of which are available for lease
         to third parties.

(9)      The Douglasville, Georgia store includes approximately 17,000 square
         feet not included in the table above, which is leased to third parties.


In April 1997, the Company expanded the West Carrollton, Ohio store to 140,000
square feet of showroom space, into former warehouse space that had been
abandoned following the Company's relocation and consolidation of its
Dayton-area warehouses in 1996.

The Company's lease on the Decatur store expired on January 31, 1998. The
Company ceased retailing operations in Decatur at the close of business on
December 31, 1997. Although the Decatur store operated during all of 1997, it
has been excluded from the year-end store and square footage information
throughout this Report. The Decatur, Georgia facility included approximately
25,000 square feet subleased to a national retail chain. The sub-lease expired
in November 1997, and that space was returned by the Company to the landlord.

The stores leased from unaffiliated third parties generally involve a base lease
term of ten to fifteen years, followed by a series of options to extend. While
most of these leased stores have rent escalation clauses, the majority have no
percentage-rent clauses.

As indicated in the table above, the Company leases seven of its properties from
the Initial Shareholders or entities controlled by one or more of them. These
properties include many of the Company's highest volume stores. The leases on
these properties expire in the years 2004 through 2017. Upon the expiration of
these leases, there can be no assurance that the Company can reach agreement
with the Initial Shareholders on the terms for the renewal of the leases or that
the Initial Shareholders will be willing to renew the leases.



                                       13
<PAGE>   14




ITEM 3.     LEGAL PROCEEDINGS

GENERAL
-------

In February 1994, the Company announced its earnings for the fourth quarter and
year ended December 31, 1993. Following that announcement, the Company's stock
price declined substantially. Four lawsuits were filed against the Company,
certain of its directors, certain of its officers, and its co-managing
underwriters, in U.S. District Court for the Southern District of Ohio, case
numbers C-3-94-86, 99, 100, and 127. The suits were consolidated into a single
suit, In re Roberds Securities Litigation. In December 1996, the Company reached
an agreement to settle the class-action securities litigation and such agreement
was approved by the court in 1997. A total of $1.6 million was paid into an
escrow account to satisfy the plaintiffs' legal expenses and claims for damages
to the class. In 1997, Roberds paid $342,500 into escrow as its share of the
settlement, and the insurance carrier for its officers and directors paid
$1,257,500. No portion of the funds paid into escrow can revert to the Company.

The Ohio Bureau of Workers' Compensation Fund has issued an assessment against
the Company for approximately $871,000 in connection with an audit of the
Company's workers' compensation tax returns. In the fourth quarter of 1996, the
Company accrued $2.6 million to cover its estimated liability resulting from the
State's assessment. Such assessment is discussed more fully in the Notes to the
Consolidated Financial Statements, which are included elsewhere in this Report.

In 1996, a former employee of the Company filed suit in the Court of Commons
Pleas for Montgomery County, Ohio, Rouch, et. al. vs. Roberds Furniture &
Appliances, et. al., case number 96-1512. The complaint alleged that the Company
permitted certain unsafe conditions to exist in one of its Ohio warehouses,
which allegedly led to certain personal injuries sustained by the plaintiff. The
suit sought $825,000 in compensatory damages and $800,000 in punitive damages
from the Company. In January 1997, the plaintiffs voluntarily dismissed the
complaint, without explanation. In January 1998, the suit was re-filed as case
number 1998-CV-00125, making the same allegations that were made in the initial
complaint. The Company has again referred the matter to its insurance carrier.

In May 1997, one of the Company's former Market Presidents filed suit in United
States District Court, Middle District of Florida, Bernucca v. Roberds, Inc.,
Case No. 97-1311-CIV-T-24B, alleging, among other things, that the Company
violated the Age Discrimination in Employment act of 1964 and the Florida Civil
Rights Act in connection with its termination of plaintiff. In November 1997,
the Company settled the suit by paying an amount to plaintiff which the parties
have agreed to keep confidential, but which the Company believes is not material
to its operations or financial condition.

In the ordinary course of its business, the Company is from time to time a party
in certain legal proceedings. In the opinion of management, the Company is not
party to any litigation, other than those described in this Item 3, that would
have a material adverse effect on its operations or financial condition if the
proceeding was determined adversely to the Company.

ENVIRONMENTAL
-------------

In 1985, a partnership between Kenneth W. Fletcher and Donald C. Wright (two of
the Company's Initial Shareholders), acquired a 21-acre parcel of land in
Springfield, Ohio ("Parcel") from an unaffiliated party. The Parcel included a
building and parking area previously operated by an unaffiliated party as a
retail store. In 1985, the Company remodeled the building and leased the Parcel
from the partnership as the location of its Springfield, Ohio store.

In 1990, the partnership was informed by the United States Environmental
Protection Agency ("EPA") that the Parcel had been operated by a previous owner
as an industrial landfill and that the EPA intended to investigate the Parcel.
In 1990, a contractor for the EPA examined the Parcel and took surface and
shallow soil samples but, contrary to the work 


                                       14
<PAGE>   15

plan that had been prepared by EPA, did not take groundwater samples. Testing of
the soil samples revealed elevated concentrations of certain semi-volatile
organic compounds. The Ohio EPA subsequently criticized the contractor's soil
testing methods and its failure to take groundwater samples.

In 1993, the Company and the partnership engaged an environmental consultant to
conduct certain tests of the Parcel to attempt to determine the location of the
landfill, its proximity to the Company's store, and certain other information.
The consultant issued its report in April 1994. Among other things, it concluded
that the building in which the store operates is not located on, or immediately
adjacent to, the site of the former landfill.

In 1994, Messrs. Fletcher and Wright withdrew the Springfield property from the
Fletcher-Wright partnership and contributed it to Springfield Properties, Inc.,
an Ohio corporation owned by Messrs. Fletcher and Wright. The lease between
Roberds, Inc. and Fletcher-Wright was assigned to, and assumed by, Springfield
Properties, Inc.

In 1995, Springfield Properties, Inc. was contacted by a consultant to the EPA
and informed that the consultant had been engaged by the EPA to "re-score" the
Parcel for purposes of determining its priority for potential clean-up. In 1996,
the Company obtained a copy of the consultant's report. That report summarized
the history of the Parcel and the work of the various environmental consultants
to date. It concluded that the Parcel poses certain risks of contamination, but
did not recommend any further action with respect to the Parcel. The Company has
not yet obtained the new "score" for the Parcel.

It is not possible to predict whether the EPA will take further action, whether
remediation will be required, or the costs of remediation if required. The EPA
takes the position that a tenant can be liable for remediation costs, even if
the tenant did not contribute to the contamination of a site. However, the
Company is not aware of any circumstances in which a court has found a tenant
liable for remediation costs when the tenant did not contribute to the
contamination or fail to report contamination known to the tenant. At this
point, neither the Company, the partnership, nor Springfield Properties, Inc.
plans to take any further action with respect to the environmental issues
associated with the Parcel, unless the EPA initiates additional activity.

Certain other properties leased by the Company may contain, or have contained,
asbestos materials or petroleum underground storage tanks, but the Company does
not believe that any such circumstances are likely to have a material adverse
effect on the Company, and there are no active EPA investigations of these
facilities. The Company has removed asbestos and underground storage tanks in
connection with its acquisition and renovation of certain of its properties. To
the best of the Company's knowledge, such work has been done in compliance with
applicable environmental regulations and protocols.

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year ended December 31, 1997.



                                       15
<PAGE>   16


                        EXECUTIVE OFFICERS OF REGISTRANT

The following information concerning executive officers of the Company is
provided pursuant to Instruction 3(b) of item 401 of Regulation S-K. The
following table sets forth certain information regarding the Company's executive
officers at January 31, 1998. The Company is not aware of any family
relationship between any executive officers or directors of the Company.
Executive officers serve at the discretion of the Board of Directors.

NAME                     AGE      POSITION
----                     ---      --------

Kenneth W. Fletcher      65       Chairman of the Board

Donald C. Wright         61       Vice Chairman of the Board

James F. Robeson         61       Chief Executive Officer and President

Billy D. Benton          46       Executive Vice President-Operations

Brent D. Scharff         54       President-Ohio Markets

Stephen Giordano         38       President-Atlanta Market

Michael E. Ray           37       President-Tampa Market

Michael Van Autreve      50       Vice President-Bedding

Charles H. Palko         46       Vice President-Appliances and Electronics

Robert M. Wilson         45       Executive Vice  President,  Chief Financial 
                                  Officer,  General Counsel, Secretary, and 
                                  Director

Michael A. Bruns         35       Vice President, Controller, and Chief 
                                  Accounting Officer

Wayne B. Hawkins         44       Treasurer and Assistant Secretary


KENNETH W. FLETCHER is co-founder of the Company and has served as it Chairman
of the Board since June 1993. From June 1993 through November 1997, he was Chief
Executive Officer of the Company. He served as its President from the founding
of the Company in 1971 through November 1997.

DONALD C. WRIGHT is co-founder of the Company. He was elected Vice Chairman of
the Board in June 1993, prior to which time he served as Treasurer and Secretary
since 1971. He has served as a director of the Company since 1971. Mr. Wright
served as Assistant Secretary from June 1993 through May 1997. He owns and
operates Don Wright Realty, Dayton, Ohio, a firm providing real estate brokerage
services to the public.

JAMES F. ROBESON was elected Chief Executive Officer and President of the
Company in November 1997. He has also served as a Director of the Company since
November 1993, and chaired the Audit Committee of the Board of Directors from
November 1993 through December 1997. Mr. Robeson was Interim Director, Miami
University Art Museum, Oxford, Ohio, from July 1996 through December 1997. He
was Herbert E. Markley Visiting Scholar in Business, Miami University, from
August 1995 through May 1997. From July 1993 to the present, Mr. Robeson has
served as an independent consultant on marketing, logistics, and general
business matters, including services rendered through 


                                       16
<PAGE>   17

the firm of Coopers & Lybrand L.L.P. From 1988 through June 1993, Mr. Robeson
was Dean, Richard T. Farmer School of Business Administration, Miami University.
He currently serves as a director of Gummer Wholesale, a regional distributor of
grocery, candy, and tobacco products, Newark, Ohio, Huffy Corporation, a
diversified manufacturer and supplier of services to retailers, Dayton, Ohio,
and DesignForum, a national retail store planning and design firm, Dayton, Ohio

BILLY D. BENTON was elected Executive Vice President-Operations in May 1997.
Prior thereto, from October 1996 through May 1997, he consulted with several
business and explored a number of business opportunities. Prior thereto, he was
employed in a variety of positions with Levitz Furniture Corporation, Boca
Raton, Florida. From January through October 1996, Mr. Benton was National
Director of Retail Marketing for Levitz. From August 1995 through January 1996,
he was Eastern Division President. From 1992 through August 1995, he was Vice
President-General Manager, Southeast Region. Levitz filed for protection under
Chapter 11 of the bankruptcy laws in September 1997.

BRENT D. SCHARFF was elected President-Ohio Markets in January 1998. Prior
thereto, he served as President-Dayton Market from April 1996 through January
1998. Prior thereto, he managed the Company's Beavercreek, Ohio store from April
1995 through April 1996. Prior thereto, he managed the Company's Richmond,
Indiana store from 1989 through April 1995. Prior thereto, he served in sales
and management positions since joining the Company in 1987.

STEPHEN GIORDANO was elected President-Atlanta Market in June 1997. Prior
thereto, he was associated with Levitz Furniture Corporation, Boca Raton,
Florida, in a variety of positions. From January through June 1997, he was
General Manager-Mid-Atlantic. From January 1996 through January 1997, he was
General Manager-Southeast. From July 1995 through January 1996, he was Division
Vice President, Operations. From March 1993 through July 1995, he was Southeast
Regional Operations Manager. From January through March 1993, he was an Area
General Manager. Levitz filed for protection under Chapter 11 of the bankruptcy
laws in September 1997.

MICHAEL E. RAY was elected President-Tampa Market in August 1996. Prior thereto,
from 1991 through August 1996, he was Vice President, Director of Stores, Kane's
Furniture, Pinellas Park, Florida.

MICHAEL VAN AUTREVE has been Vice President-Bedding since 1988.

CHARLES H. PALKO was elected Vice President-Appliances and Electronics in
January 1998. Prior thereto, he served as Vice President-Appliances from March
1996 through January 1998. From December 1993 through March 1996, Mr. Palko was
Vice President-Merchandising, Fretter, Inc., Brighton, Michigan. Fretter, Inc.
filed for protection under the United States Bankruptcy laws in October 1996.
From 1989 through December 1993, Mr. Palko was General Manager of Luskins, Inc.,
Columbia, Maryland.

ROBERT M. WILSON was elected General Counsel, Secretary, and a director in June
1993. He has also served as Executive Vice President and Chief Financial Officer
of Roberds since 1988. He served as Treasurer from June 1993 through May 1995,
and Assistant Treasurer from May 1995 through May 1997.

MICHAEL A. BRUNS joined Roberds in April 1994 as Manager of Financial Reporting
and Analysis, and was elected Vice President, Controller, and Chief Accounting
Officer in August 1994. From 1984 through April 1994, he was associated with
Deloitte & Touche (now Deloitte & Touche LLP) in various capacities, most
recently as Audit Senior Manager in the Dayton, Ohio office.

WAYNE B. HAWKINS was elected Treasurer in May 1995, and Assistant Secretary in
May 1997. Prior thereto, he was Assistant Treasurer since February 1994. Prior
thereto, he was Vice President, PNC Bank, Ohio, NA, since 1992.

The Company's future performance will depend to a significant extent upon the
efforts and abilities of certain members of senior management. The loss of the
services of any member of senior management could have a material adverse effect
on the Company.

                                       17
<PAGE>   18

At January 31, 1998, the Initial Shareholders, and their spouses, owned
approximately 52 percent of the Company's outstanding shares. They are therefore
in a position to control the election of the entire Board of Directors of the
Company and to control the outcome of all actions requiring shareholder
approval, thereby insuring their ability to control the future direction and
management of the Company.

The Company's Amended Articles of Incorporation and Regulations contain certain
provisions that may discourage acquisition bids for the Company and could limit
the price that certain investors might be willing to pay for the Company's
common shares. Among others, these provisions include the classification of the
Board of Directors, certain restrictions on shareholders' ability to remove
directors, certain "fair price" provisions adopted by the Company under Ohio
law, and the Company's adoption of certain restrictions on shareholders' ability
to bring matters before meetings of shareholders. In addition, the Company has
the ability to issue preferred shares, which could serve to discourage
acquisition bids for the Company's common shares.

The common shares held by the Initial Shareholders are not registered for sale
under the Securities Act of 1933; however, such shares can be sold under SEC
Rule 144 and other provisions of the securities laws. In addition, shares that
may be acquired by directors and executive officers of the Company through
certain benefit plans are registered for resale by such directors and executive
officers. Sales of substantial numbers of shares by the Company, the Initial
Shareholders, or other officers or directors, or the perception that such sales
could occur, could adversely affect the market price of the Company's stock.



                                       18
<PAGE>   19



                                     PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER 
            MATTERS

Trading in the common shares of Roberds, Inc. commenced in 1993, following an
initial public offering at $13.00 per share. The shares trade on the Nasdaq
National Market tier of The Nasdaq Stock Market, under the symbol "RBDS." The
following table sets forth the high, low, and closing prices for trading in the
Company's common shares, as reported on The Nasdaq Stock Market, for each
quarter in fiscal 1997 and 1996.
<TABLE>
<CAPTION>

                 First          Second              Third           Fourth
                Quarter         Quarter            Quarter          Quarter

1997
----

<S>              <C>              <C>               <C>              <C>  
High             $9.00            $7.25             $5.50            $5.13

Low               7.00             3.00              3.19             2.50

Close             7.06             5.25              3.50             3.00

<CAPTION>

1996
----

<S>             <C>              <C>               <C>              <C>   
High            $11.38           $11.25            $11.75           $10.38

Low               8.00             9.75              7.75             8.00

Close            10.75            10.63              8.50             8.25
</TABLE>


Such quotations include inter-dealer prices, without retail mark-up, mark-down,
or commission, and may not necessarily reflect actual transactions. At the close
of trading on January 31, 1998, the Company had approximately 219 shareholders
of record. Based upon the quantity of shareholder materials provided to
brokerage houses and individual shareholders requesting such materials, the
Company estimates that the total number of record and beneficial shareholders at
January 31, 1998 was approximately 2,000.

Prior to the initial public offering of its common shares, the Company paid
dividends from time to time. As part of the initial public offering in 1993, the
Company paid an $11.3 million dividend to Messrs. Kenneth W. Fletcher, Howard W.
Smith, and Donald C. Wright, who owned all of the Company's common shares prior
to the initial public offering ("Initial Shareholders"). In the fourth quarter
of 1994, the Company reimbursed the Initial Shareholders for $193,000, pursuant
to the Tax Indemnification Agreement entered into by the Company and the Initial
Shareholders at the time of the initial public offering. Such reimbursement has
been reflected in the Company's financial statements as a distribution of
retained earnings. Other than the distributions and reimbursement described
above, the Company has declared no dividends since the initial public offering
of its common shares and no dividends are being contemplated by the Board of
Directors.

The Company's revolving bank line of credit contains certain covenants and
restrictions that limit its ability to pay dividends. See Notes to the
Consolidated Financial Statements, which are included elsewhere in this Report,
for additional information concerning restrictions on the Company's ability to
pay dividends. Under the most restrictive debt covenants, no retained earnings
were available for dividends at December 31, 1997.



                                       19
<PAGE>   20




ITEM 6.     SELECTED FINANCIAL DATA

(All amounts in thousands, except per share data, percentages, and inventory
turnover)

The operations statement data and the balance sheet data presented below have
been derived from the Company's consolidated financial statements and should be
read in conjunction with Management's Discussion and Analysis of Financial
Condition and Results of Operations and the Consolidated Financial Statements
and Notes thereto, included elsewhere herein. Certain reclassifications have
been made in the prior years' selected financial data to conform to the
classifications used in 1997. These reclassifications had no effect on the net
(loss) earnings or shareholders' equity as previously reported.

OPERATIONS  STATEMENT DATA:
---------------------------
<TABLE>
<CAPTION>

                                                                    YEAR ENDED DECEMBER 31
     
                                            1997         1996          1995          1994          1993

<S>                                     <C>           <C>           <C>           <C>           <C>      
Net revenues                            $ 341,703     $ 342,102     $ 301,324     $ 259,159     $ 217,673
Cost of sales                             230,754       238,645       209,320       180,947       152,104
                                        ---------     ---------     ---------     ---------     ---------
Gross profit                              110,949       103,457        92,004        78,212        65,569
Selling, delivery, and
 administrative expenses                  111,642       102,043        81,187        71,089        61,549
Interest expense (net)                      7,545         5,681         3,500         1,636         1,261
Litigation                                                3,314
Finance participation
  income                                   (3,217)       (2,451)       (2,489)       (2,908)       (3,330)
Other income, net                          (3,495)       (3,690)       (3,440)       (2,123)         (328)
                                        ---------     ---------     ---------     ---------     ---------
Earnings (loss) before
  income taxes (benefit)                   (1,526)       (1,440)       13,246        10,518         6,417
Income taxes (benefit)                       (425)         (530)        5,225         3,925        (1,478)(1)
                                        ---------     ---------     ---------     ---------     ---------
Net earnings  (loss)                    $  (1,101)    $    (910)    $   8,021     $   6,593     $   7,895 (1)
                                        =========     =========     =========     =========     =========

Basic and diluted
  earnings (loss) per share             $   (0.18)    $   (0.15)    $    1.36     $    1.12
                                        =========     =========     =========     =========
Weighted average shares outstanding:

  Basic                                     5,979         5,934         5,898         5,871
                                        =========     =========     =========     =========
  Diluted                                   5,979         5,934         5,919         5,872
                                        =========     =========     =========     =========

PRO FORMA DATA:(1)

Pro forma net earnings                                                                          $   3,850
                                                                                                =========
Pro forma net earnings per share-basic and diluted                                              $    0.91
                                                                                                =========
Pro forma weighted average shares outstanding-basic and diluted                                     4,245
                                                                                                =========
</TABLE>



                                       20
<PAGE>   21



<TABLE>
<CAPTION>

BALANCE SHEET DATA (AT PERIOD END):

                                                            DECEMBER 31

                               1997             1996             1995             1994               1993

<S>                          <C>              <C>               <C>              <C>               <C>    
Working capital              $21,698          $34,952           $23,060          $15,764           $22,338
Merchandise inventories      $51,173          $62,998           $41,377          $37,247           $31,061
Property and equipment,
  net                        $99,364         $104,953           $81,310          $55,791           $29,188
Total assets                $172,691         $192,208          $142,049         $105,556           $99,607
Long-term debt,
  including capital leases,
  less current maturities    $73,309          $90,365           $54,448          $29,168           $18,454
Deferred warranty revenue     $8,727          $11,627            $9,546           $6,925            $4,199
Total shareholders'
  equity                     $45,769          $46,570           $47,199          $38,965           $32,470


SELECTED OPERATING DATA:
Stores open at end
 of period                        24               25                23               19                16
Total selling square
  footage at end
  of period (2)                1,782            1,784             1,394            1,133               931
Percentage increase
  (decrease) in comparable
  store net sales (3)          (11.0)            (8.1)             (0.9)            10.0              12.3
Inventory turnover (4)           4.0              4.6               5.3              5.3               5.2
<FN>



1)   Prior to the initial public offering of common shares in 1993, the entities
     that made up the Company had either elected S Corporation status or were a
     partnership. Accordingly, federal income taxes were the responsibility of
     the shareholders and partners. The pro forma information has been computed
     as if the Company had been subject to corporate income taxes for all
     periods presented, based on the tax laws in effect during the period.
     Concurrently with the initial public offering, the Company became taxable
     as a corporation under the Internal Revenue Code. Accordingly, the Company
     adopted SFAS 109, Accounting for Income Taxes.

2)   Total selling square footage includes selling and office space within each
     store, but excludes warehouse space.

3)   Comparable store sales are computed monthly for each period presented by
     comparing the sales results in a month (for those stores that were open for
     the entire month in the current year and the entire comparable month in the
     prior year) with the sales results for the comparable month in the prior
     year.

4)   Inventory turnover is calculated by dividing cost of sales for the period
     by the average of the beginning and ending inventory balances for the
     period.


</TABLE>


                                       21

<PAGE>   22



ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
            RESULTS OF OPERATIONS
(All dollar amounts in thousands, except per share data)

RESULTS OF OPERATIONS
---------------------

The following table sets forth the results of operations as a percentage of
sales for the last three years:
<TABLE>
<CAPTION>

                                               YEAR ENDED DECEMBER 31
                                           1997          1996         1995

<S>                                       <C>           <C>           <C>   
Net sales and service revenues            100.0%        100.0%        100.0%
Cost of sales                              67.5          69.8          69.5
                                          -----         -----         -----
Gross profit                               32.5          30.2          30.5
Selling, delivery and
  administrative expenses                  32.7          29.8          26.9
Interest expense, net                       2.2           1.6           1.2
Litigation                                                1.0
Finance participation income               (1.0)         (0.7)         (0.8)
Other income, net                          (1.0)         (1.1)         (1.2)
                                          -----         -----         -----
(Loss) earnings before income
  taxes (benefit)                          (0.4)        (0.4)           4.4
Income taxes (benefit)                     (0.1)        (0.1)           1.7
                                          ------        -----         -----
Net (loss) earnings                        (0.3)%       (0.3)%          2.7%
                                          ======        =====         =====
</TABLE>


Sales by major product category as a percentage of total sales for each of the
last three years follows:

                                                   YEAR ENDED DECEMBER 31
                                                 1997       1996       1995

Furniture .....................................   37%        38%        36%

Bedding .......................................   13         12         12

Major appliances ..............................   25         25         26

Consumer electronics ..........................   19         21         21

Extended warranty contracts and other .........    6          4          5
                                                 ---        ---        ---

                                                 100%       100%       100%
                                                 ===        ===        ===

1997 COMPARED TO 1996. Sales in 1997 decreased to $341,703 from $342,102 in
1996, a 0.1% decrease. Comparable store sales in 1997 decreased by 11.0%. The
decline in total sales for 1997, compared to 1996, is partially the result of
the comparison of sales in the Cincinnati market in 1997 to the very successful
grand opening of that market in the third quarter of 1996. The Company believes
that a highly competitive retail environment for big ticket goods, combined with
an industry wide softness in consumer electronics and high consumer debt, also
contributed to the decrease in comparable store sales. Additionally, during
1997, the Company focused on improving its gross margin percentage versus the
very price-promotional approach utilized during 1996.

                                       22
<PAGE>   23

For 1997, the percentage decreases in sales in the Company's three established
market areas (excluding Cincinnati) were as follows:

                         TOTAL              COMPARABLE
                        STORES                STORES

Dayton                    (4)%                 (4)%

Atlanta                   (5)                 (12)

Tampa                    (10)                 (10)

The Cincinnati market became a comparable store in August 1997. Comparable store
sales for the Cincinnati market for the months of August through December 1997
decreased by 30 percent, due to the comparison against the very successful grand
opening period in the third and fourth quarters of 1996.

Sales of furniture product as a percentage of total sales declined in 1997. This
decline is the result of a decrease in total sales in the Cincinnati market, as
compared to its very successful grand opening in the third quarter of 1996, when
the Cincinnati market generated a disproportionately high percentage of the
Company's furniture sales. Sales of consumer electronics products have declined
as a percentage of total Company sales due to rapidly declining retail prices in
that product category, continued industry softness, a highly competitive
retailing environment, continuing technological advances, and the lack of new
products, at higher prices, to offset the effect of mature products with
declining prices. The Company expects retail price declines in the electronics
category to continue for the foreseeable future.

In March 1997, the Company entered into an agreement to sell third-party
extended warranty contracts. Revenues and the related costs of the contracts
entered into after the effective date of the agreement are being recognized at
the time the third-party contracts are sold. Revenues and selling costs related
to contracts sold prior to the effective date of the agreement will be
recognized over the remaining lives of the contracts, and the expenses related
to service costs will be recognized as incurred. Total sales were positively
affected by this new agreement by approximately 1.8 percent in 1997. As a result
of the change in the extended warranty arrangement, extended warranty contract
revenue increased as a percentage of total sales in 1997. The Company expects
this trend to continue through the first quarter of 1998.

Gross profit for 1997 was $110,949, or 32.5% of sales, compared to $103,457, or
30.2% of sales, for 1996. Sales of third-party extended warranty contracts
favorably affected gross margins as a percentage of sales by approximately 0.7
percent in 1997.

Gross margin percentages for 1997 by category were approximately 39 percent for
furniture, 45 percent for bedding, 22 percent for major appliances, and 17
percent for consumer electronics. The gross margin percentages for 1997
increased for furniture, bedding, and consumer electronics as compared to 1996,
while margins for major appliances held relatively steady. The increase in the
furniture gross margin percentage reflects less aggressive pricing in this
category in all market areas, but particularly in the Cincinnati market where
the furniture category was heavily discounted during the grand opening of that
market in 1996. The gross margin percentage increase for consumer electronics
reflects a reduction in the use of the price-promotional approach during 1997 as
compared to 1996. Product prices and margins in consumer electronics and
appliances are likely to continue to be under pressure during 1998, as a result
of intense competitive conditions in these categories.

Selling, delivery, and administrative expenses increased to $111,642, or 32.7%
of sales, in 1997 compared to $102,043, or 29.8% of sales, in 1996. The increase
as a percentage of sales in 1997 is primarily attributed to: (a) increased sales
commissions as a result of a higher percentage of revenue associated with
warranty contracts and increased product gross margins; (b) increased
advertising expenses; (c) the effect of fixed occupancy costs in light of the
Company's declining comparable store sales; (d) increased professional fees, as
the result of the engagement of a national management consulting firm for
services described below; and (e) increased workers' compensation costs. These
increases were offset in part by a decrease in costs that were incurred in 1996
in conjunction with the grand opening of the Cincinnati 


                                       23
<PAGE>   24

market and the consolidation of warehouse operations in Dayton.

Interest expense, net of interest income, increased to $7,545 for 1997, as
compared to $5,681 in 1996. Interest expense increased in 1997 primarily as the
result of additional indebtedness incurred to finance the Cincinnati megastore
and the Buckhead showroom, and increased merchandise inventory levels during the
first half of 1997. Net interest expense was partially offset by the
capitalization of $38 during 1997, compared to $685 in 1996.

Finance participation income, which consists of income from the Company's
private-label credit card program, increased to $3,217, or 1.0% of sales, in
1997, compared to $2,451, or 0.7% of sales, in 1996. Finance participation
increased in 1997 over 1996 because finance participation was unfavorably
impacted in 1996 by the initial influx of non-interest-bearing accounts into the
private-label credit card program as part of the Cincinnati market entry.
Additionally, finance participation increased in 1997 as a result of the
Company's emphasis on its core and shorter-period finance programs during the
first half of 1997, as compared to 1996 when it relied heavily on twelve-months
programs.

Other income, net, which consists primarily of cash discounts and rental income
from tenants, was $3,495, or 1.0% of sales, in 1997, compared to $3,690, or 1.1%
of sales, for 1996. Cash discounts decreased in total and as a percentage of
sales in 1997 as the Company reduced its appliance and consumer electronics
inventories to better match the consumer demand for these products.

Loss before income tax benefit increased to $(1,526) in 1997, from $(1,440) in
1996. Income tax benefit for 1997 was $425, or approximately 28% of the loss
before taxes, as compared $530, or 37% of loss before taxes, in 1996. The
disproportionate provision for income taxes in 1997 reflects minimum taxes
imposed by certain jurisdictions, and a valuation reserve for certain state
operating loss carryforwards because the Company has determined that it is more
likely than not that such carryforwards will not yield a benefit to the Company
in the future.

1996 COMPARED TO 1995. Sales in 1996 increased to $342,102 from $301,324 in
1995, a 13.5% increase. Sales in 1996 were positively affected by the opening of
the new Cincinnati megastore in July 1996 and, to a lesser extent, the opening
of the Buckhead, Georgia store in November 1996. Additional volume from four new
showrooms opened during 1995 also contributed to the increase in sales for 1996.
Comparable store sales in 1996 decreased by 8.1%. A highly promotional and
competitive retail environment for big ticket goods that began in the fourth
quarter of 1995 and continued throughout 1996 contributed to the decrease in
comparable store sales.

For 1996, the percentage decreases in sales in the Company's three established
market areas (excluding Cincinnati) were as follows:

                               TOTAL             COMPARABLE
                              STORES               STORES

Dayton                         (4)%                 (8)%

Atlanta                        (1)                 (11)

Tampa                          (1)                  (4)

Sales in the Dayton and Atlanta market areas were adversely affected by the
severe winter weather experienced during the early part of 1996. The
Beavercreek, Ohio store, which opened in April 1995, and the Fayetteville,
Georgia store, which opened in September 1995, appear to have taken some sales
from the other Dayton and Atlanta area stores, and adversely affected the
comparable store sales during 1996. In addition to the highly competitive retail
environment for big-ticket goods mentioned above, comparable store sales in the
Atlanta market appear to have been disrupted by the Olympics during 1996.
Comparable store sales in Atlanta and Tampa were affected by the Company's
withdrawal from the sale of home-office products in those markets in the second
half of 1996. Comparable store sales in the Tampa market area were better than
the Company's comparable store sales in its other established markets; however,
the average store sales in Tampa remained below the Company's average.

                                       24
<PAGE>   25

Gross profit for 1996 was $103,457, or 30.2% of sales, compared to $92,004, or
30.5% of sales, for 1995. The gross margin percentage for 1996 held relatively
steady despite a highly promotional and competitive retail environment. Gross
margin was affected favorably by a larger portion of total sales from the
furniture and bedding categories, primarily as a result of a higher percentage
of such sales in the new Cincinnati megastore. There was downward pressure on
gross profit margins from the Company's emphasis on a heavily price-promotional
merchandising strategy, in an attempt to attract additional store traffic during
the first half of 1996, and the Company's response to competitive conditions,
particularly in the consumer electronics and appliance categories.

Gross margin percentages for 1996 by category were approximately 38 percent for
furniture, 44 percent for bedding, 22 percent for major appliances, and 15
percent for consumer electronics. Gross margins for 1996, as compared to 1995,
increased slightly for bedding, remained relatively constant for appliances, and
decreased for furniture and electronics. The decrease in the furniture gross
margin percentage reflects more aggressive product prices in this category,
particularly in the Cincinnati market, while the decrease in the electronics
gross margin percentage reflects the highly competitive and promotional market
conditions experienced in this category.

Selling, delivery, and administrative expenses increased to $102,043, or 29.8%
of sales, in 1996 compared to $81,187, or 26.9% of sales, in 1995. The increase
in selling, delivery, and administrative expenses as a percentage of sales in
1996 was primarily attributable to: (i) an increase in finance charges for
extended financing programs offered to customers; (ii) increased advertising and
promotion expenses; (iii) pre-opening costs associated with the entry into the
Cincinnati market; (iv) additional wages and operating expenses incurred in the
warehouse and delivery functions to support the start-up of the Cincinnati
market; (v) costs associated with the new warehouse in Fairborn, Ohio, that were
absorbed by the Dayton market until additional volume was generated by the entry
into the Cincinnati market during the second half of 1996; and (vi) expenses
related to the consolidation of warehouse operations in the Dayton market during
the first quarter of 1996.

Interest expense, net of interest income, increased to $5,681 for 1996, as
compared to $3,500 in 1995. Interest expense increased in 1996 primarily as the
result of additional indebtedness incurred to finance new stores, including the
Cincinnati megastore, and the new regional warehouse located in Fairborn, Ohio,
and the increase in merchandise inventory levels, primarily related to the
Cincinnati market entry. The increase in net expense was partially offset by the
capitalization of $685 of interest during 1996, compared to $994 in 1995.

Litigation for 1996 includes the Company's portion of the payment to settle the
class action shareholders' suit of $343; related legal expenses of $371; and a
$2,600 accrual for a dispute with the Ohio Bureau of Workers Compensation.
Details regarding litigation are discussed more fully in the Notes to the
Consolidated Financial Statements, which are included elsewhere in this Report.

Finance participation income, which consists of income from the Company's
private-label credit card program, decreased to $2,451, or 0.7% of sales, in
1996, compared to $2,489, or 0.8% of sales, in 1995. The reduction in
participation resulted from the initial influx of non-interest-bearing accounts
into the private-label credit card program generated from the Cincinnati market
entry, coupled with continued increases in the use of extended-payment financing
programs offered to customers, which do not yield income during the extended
period. The balances on the accounts related to the Cincinnati entry result in
costs to the Company but do not yield participation to the Company during an
initial interest-free period, resulting in a decrease in the Company's
participation during the second half of 1996.

Other income, net, which consists primarily of cash discounts and rental income
from tenants, was $3,690, or 1.1% of sales, in 1996, compared to $3,440, or 1.2%
of sales, for 1995. Other income, net in 1996 included losses on the disposal of
fixed assets of approximately $97. Other income, net in 1995 included gains from
the sales of assets of $142, primarily related to the sale of excess land
surrounding the Beavercreek, Ohio and Tampa, Florida locations.

(Loss) earnings before income taxes (benefit) decreased to a loss of $(1,440) in
1996, from earnings of $13,246 in 1995. Income tax benefit for 1996 was $530, or
approximately 37% of the loss before taxes, as compared to an income tax expense
of $5,225, or 39% of earnings before taxes, in 1995. The lower effective tax
rate in 1996 reflects minimum taxes imposed by certain jurisdictions and the
effect of items which are not deductible for income tax purposes.

                                       25
<PAGE>   26

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

Cash declined to $2,494 at December 31, 1997, compared to $2,794 at December 31,
1996. The Company generated $20,854 of cash from operating activities during
1997. Cash of $11,825 was provided from a reduction in merchandise inventories,
primarily in the appliance and consumer electronics product categories, to
better match consumer demand for these products. Additionally, customer and
vendor receivables were reduced by $2,388, primarily as a result of fewer
outstanding balances from second-source financing providers and from vendors for
year-end incentives. A portion of the cash generated from operations was
utilized to reduce the balance outstanding under the Company's revolving bank
line of credit.

During 1997, the Company's capital expenditures totaled $3,413. These
expenditures related primarily to the expansion of the West Carrollton, Ohio
store into space that was formerly used for warehousing. The Company has no
significant expansion or capital expenditure plans for 1998 other than normal
replacement, repair, and upgrade projects, and existing store refurbishment.

A number of existing computer programs use only two digits to identify a year in
the date field and were not designed and developed to consider the upcoming
change in the century ("Year 2000 Issue"). The Company's primary management
information and credit-card processing systems are provided by outside software
vendors. The Company has reviewed these systems with the vendors, and, based
upon the reviews to date, it appears that these systems are, or will be, Year
2000 compliant. The Company is continuing to review its secondary information
systems for Year 2000 Issues. Based on the Company's reviews to date, it does
not appear that the expense required to ensure compliance with the Year 2000
Issue will be material to the Company's financial statements or that the changes
necessary to make the systems compliant will be materially disruptive to the
Company's operations. The Company is unable to assess whether any of its
principal suppliers may be affected by the Year 2000 issue, but it has no reason
to believe that any relationship with a principal supplier will be adversely
affected.

In July 1997, the Company amended its revolving bank line of credit agreement
which expires in January 2000. The amendment relaxed certain covenants in order
for the Company to remain in compliance with those covenants. Additionally, the
maximum amount available under the line was reduced since the facility was no
longer needed to finance capital expenditures. The amount available under the
line is limited to the lesser of: (a) $35,000, or (b) an amount based upon a
percentage of eligible accounts receivable and inventory and certain previously
incurred leasehold improvements. The agreement also provides that an additional
amount is available for any expenditures for leasehold improvements and store
expansion for which the Company has commitments for permanent financing. At
December 31, 1997, $34,408 was available under the line, of which $15,000 was
outstanding. In February 1998, the Company utilized $2,800 of the amount
available under the line of credit to repay the balance outstanding under its
term loan.

The line of credit includes certain restrictive covenants including, among
others, limitations on capital expenditures and the payment of dividends,
maintenance of minimum current, fixed-charge-coverage, funded-debt-to-earnings,
and debt-to-tangible-net-worth ratios. Certain of the covenants contained in the
Company's revolving credit agreement become increasingly restrictive over time.
In order to remain in compliance with those amended covenants, the Company's
operations and cash flow will have to improve during the second half of 1998
over the actual results experienced during the comparable period in 1997. If
such improvements are not achieved, the Company will have to renegotiate the
covenants in order to remain in compliance; however, based on its past working
relationship with its primary lender, the Company expects that such approvals
will be obtained if they are necessary.

In April 1997, the Company closed a $8,080 mortgage loan to finance the
expenditures associated with the acquisition and renovation of its showroom in
the Buckhead area of Atlanta, Georgia. The loan requires monthly principal
payments of $45 with the balance due at the end of the fifth year. The loan
bears interest at 9.03%. Proceeds from the loan were used to reduce the
outstanding balance on the Company's revolving line of credit.

                                       26
<PAGE>   27

In February 1998, the Company refinanced the mortgage on its Vandalia, Ohio
store. The refinanced amount requires monthly principal and interest payments of
$29 over a 15 year period, and bears interest at 7.64%.

The Company's lease on its Decatur, Georgia store expired in January 1998. The
area surrounding the store, and the shopping center in which it is located, have
deteriorated since the store opened in 1989. As a result, the Company abandoned
the store after the 1997 holiday selling season. While the Decatur store
operated throughout 1997, it has been removed from the year-end store count and
square footage calculations contained in this Report.

The Company has announced plans to enter the Columbus, Ohio market with a
facility similar in design to the Cincinnati store. Management does not believe
that the Company should take on the additional debt obligations necessary to
enter the Columbus market without additional equity. As a result, the Company
does not plan to move forward with the Columbus entry until it has identified a
source for that additional equity.

OUTLOOK
-------

In the fall of 1997, the Company engaged one of the national management
consulting firms to review its operations and identify opportunities for
performance improvement. The firm delivered its report in November 1997. Since
then, the Company has devoted considerable time and attention to the
recommendations put forth in the report.

Since there are no expansion plans for the coming year, the Company will focus
on improving business operations. Areas on which the Company intends to focus
include improving the management of inventory, improving warehouse operations
and reducing expenses, improving asset utilization, reducing store operating
expenses, and turning around comparable store sales. At the same time, several
initiatives are under way to improve customer service. All of these efforts are
being prioritized, and they will extend throughout 1998. The Company believes
these initiatives will yield significant improvement in the Company's operations
and profitability. They will, however, take time to implement and may require
capital and operating expenditures to implement.

The Company's financial performance is influenced by consumer confidence,
interest rates, consumer debt, the general level of housing activity, and the
general level of economic activity in the United States. Consumer demand for
big-ticket goods has continued to be sluggish, and retailers have continued the
use of price, same-as-cash, and other promotions, in an effort to generate sales
volume. This competitive situation is expected to continue to put pressure on
comparable store sales, product prices and margins, and operating results.

INFLATION
---------

The Company does not believe that inflation had any significant impact on its
operations in 1997, 1996, or 1995.

SEASONALITY
-----------

The Company typically experiences an increase in its overall sales in the fourth
quarter. This increase is driven by an increase in the sales of consumer
electronics and furniture products associated with the holiday season. At the
same time, major appliance sales typically decline in the fourth quarter. As a
result, operating results for the full year are highly dependent upon the
success of the Company's operations in the fourth quarter.

                                       27
<PAGE>   28

The following tables show the Company's quarterly sales, gross profit, net
(loss) earnings, and (loss) earnings per common share for the last two years.

<TABLE>
<CAPTION>
                                                                1997
                                     ----------------------------------------------------------
                                     FIRST            SECOND            THIRD          FOURTH
                                    QUARTER           QUARTER          QUARTER         QUARTER
<S>                                <C>              <C>              <C>             <C>      
Net sales and
  service revenues                 $  83,152        $  80,235        $  83,928       $  94,388

Gross profit                          26,641           26,606           27,744          29,958

Net (loss) earnings                     (145)          (1,313)              59             298

Basic and diluted (loss)
  earnings per share                    (.02)            (.22)             .01             .05

<CAPTION>


                                                                1996
                                     ----------------------------------------------------------

                                     FIRST            SECOND            THIRD          FOURTH
                                    QUARTER           QUARTER          QUARTER         QUARTER

<S>                                <C>              <C>              <C>             <C>      
Net sales and
  service revenues                 $  70,664        $  73,205        $  94,471       $ 103,762

Gross profit                          20,914           22,082           29,099          31,362

Net (loss) earnings                     (207)            (719)             885            (869)(1)

Basic and diluted (loss)
  earnings per share                    (.03)            (.12)             .15            (.15)(1)

<FN>

(1)      Net loss for the fourth quarter of 1996 includes a total of $3,154
         ($.32 per share) of litigation expenses, including the Company's share
         of the payment to settle the class action shareholders' suit of $343;
         the related legal expenses of $211; and a $2,600 accrual for a dispute
         with the Ohio Bureau of Workers' Compensation. Details regarding the
         litigation expense are discussed more fully in the Notes to the
         Consolidated Financial Statements, which are included elsewhere in this
         Report.
</TABLE>

FORWARD LOOKING STATEMENTS
--------------------------

In the interest of providing the Company's shareholders and potential investors
with information concerning management's assessment of the outlook for the
Company, this report contains certain "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Readers should bear in
mind that statements relating to the Company's business prospects, as distinct
from historical facts, are forward-looking statements which, by their very
nature, involve numerous risks and uncertainties. Factors that could cause the
Company's actual results to differ materially from management's expectations
include, but are not limited to:

A.   Changes in economic conditions in the United States, including but not
limited to the general level of economic activity, levels of housing activity,
interest rates, the availability of consumer credit, consumer confidence, and
inflation.

                                       28
<PAGE>   29

B.   Changes in the economic conditions in the market areas in which the Company
operates, such as a strike or shutdown of a major employer or industry.

C.   Unusual weather patterns, such as unusually hot or cool summers, which
can affect the sale of refrigeration products, or unusually cold winters, which
can affect consumers' desire and ability to shop for the Company's products.
Acts of God, such as floods, hurricanes, or tornadoes, that interrupt the
Company's ability to sell or deliver merchandise, interrupt consumers' ability
to shop, or destroy a major Company facility, in particular a warehouse or
computer facility.

D.   Changes in the competitive environment in the Company's market areas,
including the bankruptcy or liquidation of existing competitors.

E.   The entry into the Company's lines of business and market areas by new,
larger, well-financed competitors, which may have the ability to withstand
intense price competition over extended periods of time.

F.   The availability and cost of adequate, appropriate newspaper,
television, and pre-printed advertising. A strike or work stoppage affecting the
Company's media outlets.

G.   Adverse results in litigation matters.

H.   Difficulties in hiring, training, and retaining a capable work force at
reasonable levels of compensation, in both existing market areas and in
expansion locations. Difficulties in hiring and retaining an effective senior
management group, particularly as the Company expands. An attempt to organize a
significant portion of the Company's work force.

I.   The availability of appropriate sites for expansion, on favorable terms,
and the long-term receptivity of consumers to new store formats and locations.

J.   Access to bank lines of credit and real estate mortgage financing
sources at favorable rates of interest, terms, and conditions.

K.   Access to additional equity capital to fund the Company's long-term
expansion.

L.   Access to extended-payment financing sources (e.g., "twelve months same
as cash") at a favorable cost to the Company and with favorable rates of
approval by the financing source. Access to private-label financing sources
(e.g., "Roberds charge card") that provide favorable rates of interest to the
customer, favorable rates of return to the Company, and favorable rates of
approval by the financing source.

M.   Rapid changes in products, particularly electronics products, such that
the Company bears the risk of obsolescence or the consumer withdraws from the
market until such time as the product category has stabilized.

N.   Shifts in the mix of the Company's sales between its higher-margin
products (bedding and furniture) and its lower-margin products (electronics and
appliances), which may result from changes in consumer priorities, competitive
factors, or other factors.

O.   The absence of new products in the Company's product categories that
would drive additional consumer interest and purchases.

P.   Adverse changes in the cost or availability of the products the Company
sells. Rapid increases in the price of the Company's products, which cannot be
passed on to consumers as the result of competitive pressures.

Q.   The loss, or significant reduction in the availability, of certain key
name-brand products. Decisions by vendors to curtail the availability of certain
product presently sold by the Company, or to make products that are presently
sold 

                                       29
<PAGE>   30

by the Company available to certain competitors that do not presently have
access to such products. Changes in import duties or restrictions affecting the
Company's ability to import certain products.

R.   Changes in income tax rates or structures that may affect the Company's
tax burden or consumers' ability to purchase or finance big-ticket goods or new
housing. Significant increases in real estate tax rates affecting the Company's
properties.

S.   Changes in government regulations affecting the Company, its products,
its advertising, or its work force, including changes in the minimum wage.
Changes in government regulations affecting the Company's employee benefit plans
or workers' compensation arrangements.

T.   New competition from alternative sales media and channels of
distribution, such as catalog mail order, telemarketing, television shopping
services, and online media.

U.   Changes in highway or street configurations such that the Company's
stores become less accessible to consumers. Changes in consumer use or ownership
of "second homes," particularly in the Tampa, Florida market.

V.   Changes in the cost or availability of liability, property, and health
insurance.

ACCOUNTING PRONOUNCEMENTS
-------------------------

In June 1997, the FASB issued SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information," which will be effective for the Company
beginning January 1, 1998. SFAS No. 131 redefines how operating segments are
determined and requires disclosure of certain financial and descriptive
information about a company's operating segments. The Company has not yet
completed its analysis of its operating segments.

ITEM 7A.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.     
             Not applicable.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Company's Consolidated Financial Statements for the three years ended
December 31, 1997, the Notes thereto, and the Independent Auditors' Report
thereon are as follows:



                                       30
<PAGE>   31




INDEPENDENT AUDITORS' REPORT
----------------------------

Board of Directors
Roberds, Inc.
Dayton, Ohio

We have audited the accompanying consolidated balance sheets of Roberds, Inc.
and subsidiary as of December 31, 1997 and 1996 and the related consolidated
statements of operations, shareholders' equity and cash flows for each of the
three years in the period ended December 31, 1997. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Roberds, Inc. and subsidiary at
December 31, 1997 and 1996, and the results of their operations and their cash
flows for each of the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Dayton, Ohio
February 17, 1998



                                       31
<PAGE>   32



ROBERDS, INC. AND SUBSIDIARY
----------------------------

CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
----------------------------------------
<TABLE>
<CAPTION>

                                                                     YEAR ENDED DECEMBER 31
                                                                1997         1996         1995

<S>                                                          <C>          <C>          <C>     
NET SALES AND SERVICE REVENUES                               $341,703     $342,102     $301,324

COST OF SALES                                                 230,754      238,645      209,320
                                                           -----------  -----------  -----------
     Gross profit                                             110,949      103,457       92,004

SELLING, DELIVERY AND ADMINISTRATIVE EXPENSES                 111,642      102,043       81,187
INTEREST EXPENSE, NET                                           7,545        5,681        3,500
LITIGATION (NOTE I)                                                          3,314
FINANCE PARTICIPATION INCOME (NOTE F)                         (3,217)      (2,451)      (2,489)
OTHER INCOME, NET                                             (3,495)      (3,690)      (3,440)
                                                           -----------  -----------  -----------

(LOSS) EARNINGS BEFORE INCOME TAXES (BENEFIT)                 (1,526)      (1,440)       13,246

INCOME TAXES (BENEFIT) (NOTE G)                                 (425)        (530)        5,225
                                                           -----------  -----------  -----------

NET (LOSS) EARNINGS                                          ($1,101)       ($910)       $8,021
                                                           ===========  ===========  ===========

BASIC AND DILUTED NET (LOSS)

  EARNINGS PER COMMON SHARE                                   ($0.18)      ($0.15)        $1.36
                                                           ===========  ===========  ===========


WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:

  BASIC                                                         5,979        5,934        5,898
                                                           ===========  ===========  ===========
  DILUTED                                                       5,979        5,934        5,919
                                                           ===========  ===========  ===========
</TABLE>



See notes to consolidated financial statements.



                                       32
<PAGE>   33

<TABLE>
<CAPTION>


ROBERDS, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
--------------

                                                                                        DECEMBER 31

ASSETS (NOTE C)                                                                      1997          1996
---------------                                                                                        

<S>                                                                               <C>           <C>   
CURRENT ASSETS:
  Cash and cash equivalents                                                         $2,494        $2,794
  Receivables:
    Customers (less allowance of $75                                                 1,311         2,364
      in 1997 and $80 in 1996)
    Vendors and other (Note B)                                                       2,693         4,028
  Merchandise inventories (Note A)                                                  51,173        62,998
  Refundable income taxes                                                            2,025
  Prepaid expenses and other                                                         1,792         1,857
  Deferred tax assets (Note G)                                                       3,375         2,916
                                                                                 ----------    ----------
          Total current assets                                                      64,863        76,957

PROPERTY AND EQUIPMENT - AT COST (NOTES A AND D):
  Land                                                                              15,539        15,534
  Buildings and improvements                                                        65,206        63,032
  Leasehold improvements                                                            33,020        34,542
  Furniture, fixtures and office equipment                                           5,961         5,257
  Computer equipment                                                                 5,792         5,671
  Warehouse equipment and vehicles                                                   3,227         3,065
  Construction in progress                                                                         1,089
                                                                                 ----------    ----------
                                                                                   128,745       128,190
  Less accumulated depreciation and amortization                                    29,381        23,237
                                                                                 ----------    ----------
                                                                                    99,364       104,953

DEFERRED TAX ASSETS (NOTE G)                                                         4,381         6,350

CERTIFICATES OF DEPOSIT - RESTRICTED (NOTE A)                                        2,541         2,293

OTHER ASSETS                                                                         1,542         1,655
                                                                                 ----------    ----------
                                                                                  $172,691      $192,208
                                                                                 ==========    ==========
</TABLE>



See notes to consolidated financial statements.



                                       33
<PAGE>   34
<TABLE>
<CAPTION>




ROBERDS, INC. AND SUBSIDIARY
----------------------------
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
-------------------------------------

                                                                                              DECEMBER 31

LIABILITIES AND SHAREHOLDERS' EQUITY                                                      1997         1996
------------------------------------                                                                       
<S>                                                                                    <C>           <C>    
CURRENT LIABILITIES:
  Accounts payable                                                                      $16,871       $17,640
  Accrued payroll and payroll taxes                                                       3,650         3,658
  Accrued sales taxes                                                                     2,165         2,265
  Other accrued expenses                                                                  1,640         2,196
  Customer deposits                                                                      11,686         8,787
  Litigation (Note I)                                                                     2,992         2,943
  Accrued self-insured workers' compensation                                              1,430         1,125
  Current maturities of long-term debt (Note C)                                           2,731         3,391
                                                                                      ----------   -----------
          Total current liabilities                                                      43,165        42,005


LONG-TERM LIABILITIES:

  Long-term debt including capital leases (Notes C and D)                                73,309        90,365
  Deferred rent (Note D)                                                                  1,721         1,641
  Deferred warranty revenue (Note A)                                                      8,727        11,627
                                                                                      ----------   -----------
          Total long-term liabilities                                                    83,757       103,633



SHAREHOLDERS' EQUITY (NOTE E)
  Preferred stock - authorized 5,000 shares,
    none issued or outstanding
  Common stock - authorized 15,000 shares,
    no par value; issued and outstanding, 6,006
    and 5,946 respectively, stated at $.10 per share                                        601           595
  Additional paid-in capital                                                             32,091        31,797
  Retained earnings                                                                      13,077        14,178
                                                                                      ----------   -----------
         Total shareholders' equity                                                      45,769        46,570
                                                                                      ==========   ===========
                                                                                       $172,691      $192,208
                                                                                      ==========   ===========
</TABLE>



See notes to consolidated financial statements.



                                       34
<PAGE>   35





ROBERDS, INC. AND SUBSIDIARY
----------------------------

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(IN THOUSANDS)
--------------
<TABLE>
<CAPTION>

                                                                                   ADDITIONAL
                                                              COMMON STOCK            PAID-IN       RETAINED
                                                          SHARES       AMOUNT         CAPITAL       EARNINGS

<S>                                                  <C>           <C>          <C>             <C>   
BALANCE - December 31, 1994                                5,877         $588         $31,310         $7,067

  Issuance of common shares (Note E)                          32            3             210
  Net earnings                                                                                         8,021
                                                      -----------  -----------   -------------   ------------

BALANCE - December 31, 1995                                5,909          591          31,520         15,088

  Issuance of common shares (Note E)                          37            4             277
  Net loss                                                                                             (910)
                                                      -----------  -----------   -------------   ------------

BALANCE - December 31, 1996                                5,946          595          31,797         14,178

  Issuance of common shares (Note E)                          60            6             294
  Net loss                                                                                           (1,101)
                                                      -----------  -----------   -------------   ------------

BALANCE - December 31, 1997                                6,006         $601         $32,091        $13,077
                                                      ===========  ===========   =============   ============
</TABLE>


See notes to consolidated financial statements.



                                       35
<PAGE>   36


ROBERDS, INC. AND SUBSIDIARY
----------------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995
(IN THOUSANDS)
--------------

<TABLE>
<CAPTION>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                        YEARS ENDED DECEMBER 31

                                                                                1997             1996              1995
<S>                                                                          <C>              <C>              <C>     
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net (loss) earnings                                                        ($ 1,101)        ($   910)        $  8,021
  Adjustments to reconcile net (loss) earnings to net
    cash provided by (used in) operating activities:
      Depreciation and amortization                                             9,025            7,516            5,622
      Loss (gain) on sales of fixed assets                                         87               97             (142)
      Deferred income taxes                                                     1,510           (3,526)          (1,840)
  Changes in assets and liabilities:
    Receivables                                                                 2,388             (936)          (1,781)
    Merchandise inventories                                                    11,825          (21,621)          (4,130)
    Refundable income taxes                                                    (2,025)
    Prepaid expenses and other                                                     65             (225)            (461)
    Accounts payable                                                             (769)           4,394             (702)
    Customer deposits                                                           2,899            2,433              711
    Accrued payroll and payroll taxes                                             769            1,170              594
    Accrued expenses                                                             (999)           4,349               96
    Deferred rent                                                                  80              660               46
    Deferred warranty revenue                                                  (2,900)           2,081            2,621
                                                                             --------         --------         --------
      Net cash provided by (used in) operating activities                      20,854           (4,518)           8,655
CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures                                                         (3,413)         (32,179)         (33,042)
  Proceeds from sales of fixed assets                                              54              163            1,088
  (Increase) decrease in certificates of deposit - restricted                    (248)             273               (1)
  Other assets                                                                     94             (131)              52
                                                                             --------         --------         --------
      Net cash (used in) investing activities                                  (3,513)         (31,874)         (31,903)
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from long-term debt                                                  8,080           39,700           28,325
  Payments on long-term debt                                                  (25,796)          (3,139)          (2,228)
  Net proceeds from issuance of common shares                                     220              281              213
  Debt issuance costs                                                            (145)             (66)            (762)
                                                                             --------         --------         --------
      Net cash (used in) provided by financing activities                     (17,641)          36,776           25,548
                                                                             --------         --------         --------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                             (300)             384            2,300
CASH AND CASH EQUIVALENTS - Beginning of year                                   2,794            2,410              110
                                                                             --------         --------         --------
CASH AND CASH EQUIVALENTS - End of year                                      $  2,494         $  2,794         $  2,410
                                                                             ========         ========         ========
CASH PAID FOR:

  Interest, net of capitalized amounts of $38, $685
    and $994 in 1997, 1996 and 1995, respectively                            $  7,621         $  5,600         $  3,624
                                                                             ========         ========         ========
  Income taxes                                                               $    826         $  2,566         $  7,229
                                                                             ========         ========         ========
NON-CASH TRANSACTIONS - Issuance of common shares to Roberds, Inc. 
   Employee Profit Sharing and Savings Plan                                  $     80
                                                                             ========

</TABLE>


                                       36

<PAGE>   37




ROBERDS, INC. AND SUBSIDIARY
----------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995 
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
-----------------------------------------------

A.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation
---------------------------

The accompanying consolidated financial statements include the accounts of
Roberds, Inc. and its wholly-owned subsidiary, Roberd Insurance Agency, Inc.
(the Company). All significant intercompany transactions and balances have been
eliminated.

Operations
----------

The Company operates retail stores selling furniture, bedding, appliances and
electronics. At December 31, 1997, the Company operated 24 large-format stores,
with six in the Dayton, Ohio market, nine in the Atlanta, Georgia market, eight
in the Tampa, Florida market, and one megastore in the Cincinnati, Ohio market.

Cash and Cash Equivalents
-------------------------

Cash equivalents include all highly liquid investments with a maturity of three
months or less when purchased. The State of Florida requires the Company to
maintain deposits to partially fund its extended warranty and product
maintenance contracts and its self insured liability for workers' compensation.
Such deposits are included in certificates of deposit - restricted.

Merchandise Inventories
-----------------------

Merchandise inventories are valued at the lower of cost or market. Cost is
determined by the last-in, first-out (LIFO) method, except for electronics which
represented approximately 24% of merchandise inventories at December 31, 1997
and 30% at December 31, 1996, which are valued using the first-in, first-out
(FIFO) method. If the FIFO method had been used for all inventory, inventory
values would have been approximately $2,106 higher at December 31, 1997 and
$2,345 higher at December 31, 1996.

Pre-Opening Costs
-----------------

Costs incurred in the opening of new stores are expensed as incurred.

Property and Equipment
----------------------

Property, equipment and improvements, including capital leases, are depreciated
or amortized over their estimated useful lives or the lease term using the
straight-line method. The lives, by category, generally are as follows:

         Buildings and improvements                           10 to 40 years
         Leasehold improvements                               10 years
         Furniture, fixtures and office equipment             3 to 5 years
         Computer equipment                                   3 to 8 years
         Warehouse equipment and vehicles                     3 to 10 years

                                       37
<PAGE>   38


Extended Warranty and Product Maintenance Contracts
---------------------------------------------------

Contracts with terms from nine months to ten years are sold to supplement or
extend manufacturers' warranties on appliances, electronics and furniture
products. In March 1997, the Company entered into an agreement to sell
third-party extended warranty contracts. Revenues and the related costs of the
contracts entered into after the effective date of the agreement are being
recognized at the time the third-party contracts are sold. Deferred warranty
revenue and selling costs related to contracts sold prior to the effective date
of the agreement will be recognized over the remaining lives of the contracts,
and the expenses related to service costs will be recognized as incurred.

Revenue Recognition
-------------------

Merchandise inventory sales are recognized when the goods are delivered to the
customer.

Advertising
-----------

Advertising production costs, primarily those associated with television
advertising, are expensed the first time the related advertising is utilized.

Early Payment Discounts
-----------------------

Discounts received from vendors for early payment have been classified as other
income in the consolidated statements of operations.

Use of Estimates
----------------

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, and disclosure of
contingent assets and liabilities, at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

Net (Loss) Earnings Per Common Share
------------------------------------

As of December 31, 1997, the Company adopted Statement of Financial Accounting
Standards (SFAS) No.128, "Earnings Per Share." Under this statement, the Company
restated prior-period earnings per share data to comply with SFAS 128, including
interim periods. Basic net (loss) earnings per share data is the same as
previously reported (loss) earnings per share data. Diluted per share data for
1995 includes 21 shares for stock options outstanding under the Company's
stock-based incentive plans.

Stock Options
-------------

The Company measures cost for stock options issued to employees using the method
of accounting prescribed by APB Opinion No. 25, "Accounting for Stock Issued to
Employees." In 1996, the Company adopted SFAS 123, "Accounting for Stock-Based
Compensation." Pursuant to the new standard, companies are encouraged, but not
required, to adopt the fair value method of accounting for stock options and
similar equity instruments. The Company elected to continue measuring
compensation cost in accordance with APB Opinion No. 25.

Reclassifications
-----------------

Certain reclassifications have been made in the 1996 and 1995 financial
statements to conform to the classifications used in 1997. These
reclassifications had no effect on the results of operations or shareholders'
equity as previously reported.

                                       38
<PAGE>   39

B.  ACCOUNTS RECEIVABLE FROM VENDORS AND OTHER

Accounts receivable from vendors and other consist primarily of amounts due from
vendors for various rebate and cooperative advertising programs and for
merchandise inventory returns.

C.  LONG-TERM DEBT
<TABLE>
<CAPTION>

                                                                                 DECEMBER 31
                                                                              1997         1996

<S>                                                                         <C>          <C>    
Revolving line of credit                                                    $15,000      $37,000
Mortgage note payable, due in monthly payments of $123,
   including interest at 7.875%, to February 2011                            12,104       12,609
Mortgage notes payable, due in monthly payments of $45,
   plus interest at 9.03%, to April 2004                                      7,676
Mortgage notes payable, due in monthly payments of $77,
   plus interest at 9.675%, to June 2010                                      6,709        6,976
Mortgage notes payable, due in monthly payments of $62,
  including interest at 8.00%, to December 2010                               6,037        6,294
Mortgage note payable, due in monthly payments of $49,
  including interest at 9.00%, to July 2010                                   4,459        4,642
Mortgage note payable, due in monthly payments of $35,
  including interest at 10.375%, to September 2000                            3,357        3,420
Mortgage note payable, due in monthly payments of $29,
  including interest at 7.64%, to January 2013                                3,123        3,222
Mortgage note payable, due in monthly payments of $33
  including interest at 9.59%, to February 2010                               2,843        2,961
Term loan agreement repaid under the revolving line of
  credit in February 1998                                                     2,800        4,200
Capital lease obligations                                                    11,932       12,432
                                                                         -----------  -----------
                                                                             76,040       93,756

Less current maturities                                                       2,731        3,391
                                                                         -----------  -----------
                                                                            $73,309      $90,365
                                                                         ===========  ===========
</TABLE>

The revolving bank line of credit, which was amended in July 1997, expires in
January 2000. The amount available under the line is limited to the lesser of:
(a) $35,000 or (b) an amount based upon a percentage of eligible accounts
receivable and inventory and certain previously incurred leasehold improvements.
The agreement also provides that an additional amount is available for any
expenditures for leasehold improvements and store expansion for which the
Company has commitments for permanent financing. At December 31, 1997, $34,408
was available under the line of which $15,000 was outstanding. In February 1998,
the Company utilized $2,800 of the amount available under the line of credit to
repay the balance outstanding under the term loan. As a result, the outstanding
balance under the term loan at December 31, 1997 has been classified as long
term. The interest rate under the line of credit is set monthly at the option of
the Company at either the prime rate (8.50% at December 31, 1997) or one of
various LIBOR rates plus 1.55% (7.55% at December 31, 1997).

The line of credit includes certain restrictive covenants including, among
others, limitations on capital expenditures and the payment of dividends,
maintenance of minimum current, fixed-charge-coverage, funded-debt-to-earnings,
and debt-to-tangible-net-worth ratios. Under the most restrictive debt
covenants, no retained earnings were available for dividends at December 31,
1997.

                                       39
<PAGE>   40

Essentially all of the Company's assets are pledged as collateral for the above
indebtedness. The mortgage note payable for $3,357 is guaranteed by two of the
Company's initial shareholders.
<TABLE>
<CAPTION>

Maturities of long-term debt are:

<S>                                                          <C>
  1998                                                            $2,731
  1999                                                             2,945
  2000                                                            24,103
  2001                                                             3,344
  2002                                                             3,619
  Thereafter                                                      39,298
                                                             -----------
                                                                 $76,040
                                                             ===========
</TABLE>

The fair value of the Company's long-term debt based on current rates offered to
the Company for debt of similar maturities, excluding capital leases, was
$66,312 at December 31, 1997, and the related carrying value was $64,108.

D.  LEASING ACTIVITIES

The Company leases the majority of its retail locations, including some from
entities controlled by one or more of the initial shareholders. Most leases
include renewal options. In addition, the Company leases the majority of its
vehicles from third parties under operating leases. These vehicle leases
generally include contingent rentals based upon mileage.

Rent expense for all operating leases was approximately $8,391, $7,921, and
$6,687 for the years ended December 31, 1997, 1996 and 1995, respectively, which
included approximately $721, $731, and $1,271 for the years ended December 31,
1997, 1996 and 1995, respectively, to related parties. Rent expense also
included $262, $246, and $200 of contingent rentals based upon mileage for the
years ended December 31, 1997, 1996 and 1995, respectively.

Minimum lease commitments for leases with remaining lease terms in excess of one
year are as follows:
<TABLE>
<CAPTION>

                                                                                    

                                                                                     CAPITAL
                                                              OPERATING LEASES       LEASES-

                                                             RELATED                  RELATED
YEAR ENDING DECEMBER 31                                      PARTIES      OTHER       PARTIES

<C>                                                         <C>          <C>          <C>   
1998                                                           $721       $6,746       $1,919
1999                                                            721        6,616        1,919
2000                                                            721        5,998        1,919
2001                                                            721        5,737        1,919
2002                                                            721        5,129        1,919
2003 and later                                                6,748       20,778       14,080
                                                         -----------   ----------   ----------
Total                                                       $10,353      $51,004       23,675
                                                         ===========   ==========
Less amount representing interest                                                      11,743
                                                                                    ----------
Capital lease obligations                                                             $11,932
                                                                                    ==========
</TABLE>

                                       40
<PAGE>   41




Included in buildings and improvements at December 31, 1997 and 1996 are capital
leases totaling $13,641. Accumulated amortization related to the capitalized
leases is $3,594 at December 31, 1997 and $2,713 at December 31, 1996.

Certain leases include scheduled rent increases that have been recognized on a
straight-line basis over the term of the leases. The accumulated difference
between rent expense and cash payments is included in liabilities as deferred
rent.

E.   SHAREHOLDERS' EQUITY

The Company's stock-based compensation plans are described below.

Employee Stock Purchase Plan.
-----------------------------

The Company's employee stock purchase plan is qualified under the Internal
Revenue Code and permits employees to purchase shares at a price equal to 85% of
the lower of: (i) the fair market value of the shares at the commencement date
of each six-month option period or (ii) the fair market value of the shares at
the close of the option period. A maximum of 500,000 shares may be issued under
the plan. With certain exceptions, all employees of the Company may participate
in the plan and pay for their options through payroll deductions.

The Company issued 18,221 shares at $7.23 per share and 19,517 shares at $4.52
per share under the plan during 1997, 37,110 shares at $7.44 during 1996, and
32,374 shares at $6.59 per share during 1995. In January 1998, the Company
issued 37,574 shares at $2.39 per share under the plan.

1993 Outside Director Stock Option Plan.
----------------------------------------

The Company has established a directors stock option plan which has reserved up
to 10,000 common shares to be offered to outside directors of the Company.
Grants are made at the market price of the stock at the date of grant. During
1993, the Company granted options on 6,000 common shares, at $13.00 per share.
During 1995, the Company granted an option on 2,000 common shares, at $9.25 per
share. All of the outstanding options were exercisable at December 31, 1997;
however, none have been exercised. At December 31, 1997, 2,000 options were
available under this plan for future grants.

1993 Stock Incentive Plan.
--------------------------

The Company's stock incentive plan provides that options on up to 1,300,000
shares may be granted to employees of the Company. Grants are made at the market
price of the stock at the date of grant. One-fourth of the options become
exercisable on each anniversary of the grant. Any options which are not
exercisable by an employee at the termination of employment are canceled.




                                       41

                                       
<PAGE>   42

A summary of option transactions under the stock incentive plan is as follows:

<TABLE>
<CAPTION>
                                                               WEIGHTED AVERAGE
                                                  SHARES        EXERCISE PRICE
<S>                                            <C>                  <C>
Outstanding December 31, 1994                      296,500          $10.43

  Canceled                                        (47,000)           9.86
                                                -----------
Outstanding December 31, 1995                      249,500           10.54

  Granted                                           35,000           9.64
  Exercised                                          (500)           8.88
  Canceled                                        (44,500)           10.29
                                                -----------
Outstanding December 31, 1996                      239,500           10.46

  Granted                                          151,000           5.10
  Canceled                                        (39,500)           10.49
                                                -----------
Outstanding December 31, 1997                      351,000           8.15
                                                ===========
</TABLE>


The following table shows various information about stock options outstanding at
December 31, 1997:
<TABLE>
<CAPTION>

                                         OPTIONS OUTSTANDING                        OPTIONS EXERCISABLE
                         ---------------------------------------------------   ---------------------------------
                                              WEIGHTED-
                                               AVERAGE
                             NUMBER           REMAINING         WEIGHTED-           NUMBER           WEIGHTED
                           OUTSTANDING AT    CONTRACTUAL         AVERAGE        EXERCISABLE AT        AVERAGE
        RANGE OF          DECEMBER 31,        LIFE (IN           EXERCISE        DECEMBER 31,        EXERCISE
    EXERCISE PRICES           1997             YEARS)             PRICE              1997              PRICE

     <S>                 <C>                     <C>              <C>           <C>                    <C>                  
      $3.82 - 5.44           151,000             9.5              $5.10                -                 -
          8.50                96,500             7.0               8.50             72,375             $8.50
      9.50 - 11.75            25,000             8.0              10.03              8,750             10.20
         13.00                78,500             5.9              13.00             78,500             13.00
                         --------------                                        ----------------  
      3.82- 13.00            351,000             7.7               8.15             159,625            10.81
                         ==============                                        ================  
</TABLE>



At December 31, 1997, 949,000 shares were available for future grants under the
stock incentive plan.

The Company applies APB Opinion 25 and related Interpretations in accounting for
its plans. Accordingly, no compensation cost has been recognized for its stock
option plans and its employee stock purchase plan. Had compensation cost for the
Company's stock-based compensation plans been determined based on the fair value
at the grant dates for the awards under those plans consistent with the method
of FASB Statement 123, the effect on the Company's net earnings (loss) and
earnings (loss) per share would have been reduced as follows:

                                       42
<PAGE>   43
<TABLE>
<CAPTION>

                                                 YEAR ENDED DECEMBER 31
                                             1997            1996           1995

Net earnings (loss)

<S>                                        <C>             <C>             <C>   
   As reported                             ($1,101)         ($910)         $8,021
   Pro forma                               ($1,199)          (985)          7,968
Net earnings (loss) per share
   As reported                              ($0.18)        ($0.15)          $1.36
   Pro forma                                ($0.20)         (0.17)           1.35
</TABLE>

The majority of the additional expense in the pro forma net (loss) earnings in
the table above is the result of shares issued under the Employee Stock Purchase
Plan.

F.  FINANCE PARTICIPATION

The Company earns a finance participation fee on credit sales placed through a
private-label revolving credit plan with a bank. Receivables from this plan are
held by the bank without recourse to the Company. Sales under the private label
plan represented approximately 40, 46, and 43 percent of consolidated net sales
for the years ended December 31, 1997, 1996, and 1995, respectively. Because a
significant portion of the Company's sales are financed by consumers, the lack
of availability of consumer credit programs, or a significant increase in the
cost of such programs, could have a material adverse effect on the Company.

G.  INCOME TAXES

Deferred taxes reflect the effects of temporary differences between carrying
amounts of assets and liabilities for financial reporting purposes and the
amounts used for income tax purposes. The principal current and non-current
deferred income tax assets are as follows:
<TABLE>
<CAPTION>

                                                              DECEMBER 31
                                                           1997         1996

<S>                                                    <C>          <C>   
Deferred tax assets:
  Deferred warranty revenue                                $3,403       $4,534
  Merchandise inventories                                   1,177        1,094
  Capital lease obligations                                   735          587
  Depreciation                                                162        1,057
  Workers' compensation accrual                             1,725        1,453
  Vacation accrual                                            295          290
  Other                                                       414          251
  Valuation allowance                                       (155)
                                                       -----------  -----------
Net deferred tax asset                                     $7,756       $9,266
                                                       ===========  ===========

Included in the balance sheet:
  Current                                                  $3,375       $2,916
  Long-term                                                 4,381        6,350
                                                       -----------  -----------
                                                           $7,756       $9,266
                                                       ===========  ===========
</TABLE>

                                       43
<PAGE>   44

Income taxes (benefit) consist of the following:
<TABLE>
<CAPTION>

                                                            YEAR ENDED
                                                            DECEMBER 31

                                                  1997         1996         1995
<S>                                              <C>           <C>          <C>   
Currently payable:
  Federal                                        ($1,985)       $2,461       $5,810
  State and local                                      50          535        1,255
                                               -----------   ----------   ----------
                                                  (1,935)        2,996        7,065

Deferred federal and state                          1,510      (3,526)      (1,840)
                                               -----------   ----------   ----------
                                                   ($425)       ($530)       $5,225
                                               ===========   ==========   ==========
</TABLE>

In connection with the initial public offering of stock in 1993, the initial
shareholders of the Company entered into a Tax Indemnification Agreement that
requires the Company to reimburse them for certain additional taxes that they
may have to pay for any adjustments in prior years' taxable income. In addition,
the agreement requires the initial shareholders to reimburse the Company for
certain decreases in taxes that are refunded to them for adjustments in prior
years' taxable income. The Company also agreed to conduct, at its expense, the
defense of, or the negotiations in settlement with respect to, any challenge to
the S Corporation status in prior years. All obligations required under the Tax
Indemnification Agreement have been settled through 1992.

A reconciliation between the statutory federal income tax rate and the effective
tax rate follows:
<TABLE>
<CAPTION>

                                                                 YEAR ENDED
                                                                 DECEMBER 31

                                                          1997         1996         1995

<S>                                                       <C>          <C>            <C>
Statutory Federal income tax rate                         (34)%        (34)%          34%
State and local income taxes,
  net of federal benefit                                   (4)          (3)            5
Change in valuation allowance                              10
                                                    -----------   ----------   ----------
                                                          (28)%        (37)%          39%
                                                    ===========   ==========   ==========
</TABLE>

The disproportionate provision for income taxes in 1997 reflects minimum taxes
imposed by certain jurisdictions and a valuation reserve for certain state
operating loss carryforwards that the Company has determined are more likely
than not that the carryforwards will not yield a benefit to the Company in the
future.

H.  EMPLOYEE BENEFIT PLANS

The Company has a profit sharing plan for all eligible employees. Contributions
to the plan are made under guidelines established in the Roberds, Inc. Executive
Compensation Plan. Profit sharing plan expense was $80 for the year ended
December 31, 1997 and $97 for the year ended December 31, 1996. No contribution
was made to the profit sharing plan for the year ended December 31, 1995.

The Company has a self-insured group health and welfare benefit plan. This plan
operates through an independent trust and offers major medical, dental and
disability insurance coverage to all eligible employees. The Company provides
life insurance for all employees and their dependents at no cost to the
employees. The Company's expense under the health and welfare benefit plan was
approximately $318 in the year ended December 31, 1997, $281 in 1996, and $200
in 1995. At December 31, 1997, the Company had advances receivable from the
health and welfare benefit plan of $375, and $250 at December 31, 1996. The
Company does not provide post-employment or post-retirement benefits for its
employees.

                                       44
<PAGE>   45

I.  LITIGATION AND OTHER PROCEEDINGS

In February 1994, the Company announced its earnings for the fourth quarter and
year ended December 31, 1993. Following that announcement, the Company's stock
price declined substantially. Four lawsuits were filed against the Company,
certain of its directors, certain of its officers, and its co-managing
underwriters, in U.S. District Court for the Southern District of Ohio, case
numbers C-3-94-86, 99, 100, and 127. The suits were consolidated into a single
suit, In re Roberds Securities Litigation. In December 1996, the Company reached
an agreement to settle the class-action securities litigation and such agreement
was approved by the court in 1997. A total of $1.6 million was paid into an
escrow account to satisfy the plaintiffs' legal expenses and claims for damages
to the class. In 1997, Roberds paid $342,500 into escrow as its share of the
settlement, and the insurance carrier for its officers and directors paid
$1,257,500. No portion of the funds paid into escrow can revert to the Company.

During 1994, the Ohio Bureau of Workers' Compensation ("Bureau") completed an
examination of the Company's 1992 and 1993 Ohio workers' compensation tax
returns. As a result of that audit, the Bureau issued an assessment against the
Company for approximately $1,000. As a result of the Company's appeals and an
adjustment received in 1995, the assessment was reduced to $871. The assessment
was based on the Bureau's reclassification of the majority of the Company's Ohio
employees into higher rate classifications. In January 1997, the Company lost
its appeal of a portion of the assessment in the Ohio Court of Appeals. The
Company has filed another appeal of right with the Ohio Supreme Court.
The Company will be subject to similar adjustments for the years subsequent to
1993. The Company accrued $2,600 in the fourth quarter of 1996 for the estimated
amount of an assessment for the 1992-1996 time period. For 1997, the Company
accrued in selling, delivery and administrative expense the estimated amount of
additional taxes that would be caused by a reclassification of employees.

The amount of the Company's payment to settle the shareholders' suit, and the
related legal expenses, and the $2,600 accrual for the workers' compensation
issue are contained in Litigation in the consolidated statements of operations
in 1996.

The Company is involved in various legal proceedings, incidental to normal
operations. At this time, it is not possible to determine the ultimate
liability, if any, in these matters. In the opinion of management, after
consultation with legal counsel, such proceedings will not have a material
effect on the financial position or results of operations.

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
            FINANCIAL DISCLOSURE.     None.




                                       45
<PAGE>   46




                                    PART III

Certain information required by Part III of this Report is omitted because the
Company will file a definitive proxy statement, pursuant to Regulation 14A, for
its 1998 annual meeting of shareholders ("1998 Proxy Statement"), not later than
120 days after the end of the fiscal year covered by this Report, and certain
information included in the 1998 Proxy Statement is incorporated herein by
reference.

ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT

Information concerning the Company's directors is contained in the "Election of
Directors" section of the Company's 1998 Proxy Statement and is incorporated
herein by reference.

ITEM 11.     EXECUTIVE COMPENSATION

The information required by this Item is incorporated herein by reference to the
"Executive Compensation" section of the Company's 1998 Proxy Statement.

ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information required by this Item is incorporated herein by reference to the
"Security Ownership of Certain Beneficial Owners and Management" section of the
Company's 1998 Proxy Statement.

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information required by this Item is incorporated herein by reference to the
"Certain Relationships and Related Transactions" section of the Company's 1998
Proxy Statement.


                                     PART IV

ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

         (a)(1)   FINANCIAL STATEMENTS
         -----------------------------

         The following financial statements are filed as part of this Report and
are attached hereto:

                                       46
<PAGE>   47

                  Independent Auditors' Report.

                  Consolidated Balance Sheets at December 31, 1997 and 1996.

                  Consolidated Statements of Operations for the years ended
                  December 31, 1997, 1996, and 1995.

                  Consolidated Statements of Shareholders' Equity for the years
                  ended December 31, 1997, 1996, and 1995.

                  Consolidated Statements of Cash Flows for the years ended
                  December 31, 1997, 1996, and 1995.

                  Notes to Consolidated Financial Statements for the years ended
                  December 31, 1997, 1996 and 1995.




                                       47

<PAGE>   48




         (a)(2)   FINANCIAL STATEMENT SCHEDULES
         --------------------------------------

The following financial statement schedule of the Company, for the three years
ended December 31, 1997, is filed as part of this Report and should be read in
conjunction with the consolidated financial statements of Roberds, Inc. for the
periods then ended:

         Independent Auditors' Report

         Schedule II, Valuation and qualifying accounts

Schedules not listed above are omitted because they are not applicable, are not
required, or the information required to be set forth therein is included in the
Consolidated Financial Statements or the notes thereto.

INDEPENDENT AUDITORS' REPORT
----------------------------

Board of Directors
Roberds, Inc.
Dayton, Ohio

We have audited the consolidated financial statements of Roberds, Inc. and
subsidiary as of December 31, 1997 and 1996 and for each of the three years in
the period ended December 31, 1997, and have issued our report thereon dated
February 17, 1998. Such financial statements and report are included elsewhere
in this Annual Report on Form 10-K. Our audits also included the financial
statement schedule of Roberds, Inc. and subsidiary, listed in Item 14(a)(2) of
this Annual Report on Form 10-K. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express an
opinion based on our audits. In our opinion, such financial statement schedule,
when considered in relation to the basic consolidated financial statements taken
as a whole, presents fairly in all material respects, the information set forth
therein.

/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Dayton, Ohio
February 17, 1998






                                       48
<PAGE>   49




ROBERDS, INC. AND SUBSIDIARY

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
(IN THOUSANDS)
<TABLE>
<CAPTION>

                COLUMN A                        COLUMN B        COLUMN C         COLUMN D         COLUMN E
------------------------------------------    -------------   -------------    -------------    -------------
                                               BALANCE AT      CHARGED TO                        BALANCE AT
                                               BEGINNING       COSTS AND                           END OF
DESCRIPTION                                    OF PERIOD        EXPENSES        DEDUCTIONS         PERIOD
------------------------------------------    -------------   -------------    -------------    -------------

<S>                                               <C>             <C>              <C>              <C>
YEAR ENDED DECEMBER 31, 1997:
   Allowance for doubtful accounts                $80             $620             $625             $75

YEAR ENDED DECEMBER 31, 1996:
   Allowance for doubtful accounts                $50             $619             $589             $80

YEAR ENDED DECEMBER 31, 1995:
   Allowance for doubtful accounts                $50             $246             $246             $50
</TABLE>







                                       49
<PAGE>   50




      (a)(3)     EXHIBITS
      -------------------

2.3           Stock Purchase Agreement among Registrant, Kenneth W. Fletcher and
              Donald C. Wright transferring all of the outstanding shares of
              Roberds Service Company to Registrant, filed October 1, 1993 as
              Exhibit 2.3 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

2.4           Stock Purchase Agreement among Registrant, Kenneth W. Fletcher and
              Donald C. Wright transferring all of the outstanding shares of
              Roberd Insurance Agency, Inc. to Registrant, filed October 1, 1993
              as Exhibit 2.4 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

2.5           Certificate of merger of Roberds Service Company into Roberds,
              Inc., effective August 31, 1994, filed as Exhibit 2.5 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

3.1           Amended Articles of Incorporation of Registrant, filed January 10,
              1994, as Exhibit 4.1 to Registrant's Form S-8, Registration File
              No. 33-73900, and incorporated herein by reference.

3.2           Amended Code of Regulations of Registrant, filed January 10, 1994,
              as Exhibit 4.2 to Registrant's Form S-8, Registration File No.
              33-73900, and incorporated herein by reference.

4.1           Amended Articles of Incorporation of Registrant (filed as Exhibit
              3.1).

4.2           Amended Code of Regulations of Registrant (filed as Exhibit 3.2).

4.3           Specimen certificate for Registrant's Common Shares, filed October
              1, 1993 as Exhibit 4.3 to Registrant's Form S-1, Registration File
              No. 33-69876, and incorporated herein by reference.

4.3.1         Amended specimen certificate for Registrant's Common Shares,
              reflecting the change in stock transfer agent to National City
              Bank, Cleveland, Ohio, effective November 1, 1995, filed as
              Exhibit 4.3.1 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1995, and incorporated herein by
              reference.

4.4           Excluded from the exhibits are certain agreements relating to long
              term debt which, individually, do not exceed 10% of the total
              assets of Registrant. Registrant hereby undertakes to furnish a
              copy of such agreements upon request by the Commission.

10.1#         Roberds, Inc. 1993 Stock Incentive Plan, filed October 1, 1993 as
              Exhibit 10.1 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.1.1#       Amendment to Roberds, Inc. 1993 Stock Incentive Plan, filed as
              Exhibit 99.1 to Registrant's Form S-8, File No. 33-97262, filed
              September 25, 1995, and incorporated herein by reference.

10.1.2#       Amendment to Roberds, Inc. 1993 Stock Incentive Plan, referred to
              in Exhibit 10.1, effective as of November 1, 1996, and filed as
              Exhibit 10.1.2 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

10.2#         Roberds, Inc. Employee Stock Purchase Plan, filed October 1, 1993
              as Exhibit 10.2 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

                                       50
<PAGE>   51

10.2.1#       Amendment to Roberds, Inc. Employee Stock Purchase Plan, referred
              to in Exhibit 10.2, effective as of November 1, 1996, and filed as
              Exhibit 10.2.1 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

**10.2.2#     Amendment to Roberds, Inc. Employee Stock Purchase Plan, referred
              to in Exhibit 10.2, effective as of May 13, 1997, and filed as
              Exhibit 99.1 to Registrant's Form S-8, Registration File No.
              333-37829, and incorporated herein by reference.

10.3#         Roberds, Inc. 1993 Outside Director Stock Option Plan, filed
              October 1, 1993 as Exhibit 10.3 to Registrant's Form S-1,
              Registration File No. 33-69876, and incorporated herein by
              reference.

10.3.1#       Amendment to Roberds, Inc. 1993 Outside Director Stock Option
              Plan, referred to in Exhibit 10.3, effective as of November 1,
              1996, and filed as Exhibit 10.3.1 to Registrant's Annual Report on
              Form 10-K for the fiscal year ended December 31, 1996, and
              incorporated herein by reference.

10.3.2#       Roberds, Inc. Profit Sharing and Employee Retirement Savings Plan,
              as amended, filed as Exhibit 99 to Registrant's Form S-8,
              Registration File No. 33-81086, and incorporated herein by
              reference.

**10.3.2.1#   Roberds, Inc. Profit Sharing and Employee Retirement Savings Plan,
              as adopted March 26, 1997, and filed as Exhibit 99 to Registrant's
              Form S-8, Registration File No. 333-43977, and incorporated herein
              by reference.

10.3.3#       Roberds, Inc. Amended and Restated Deferred Compensation Plan for
              Outside Directors, effective 1996, filed as Exhibit 10.3.2 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.3.3.1#     Amendment to Roberds, Inc. Amended and Restated Deferred
              Compensation Plan for Outside Directors, referred to in Exhibit
              10.3.3, effective as of February 27, 1996, and filed as Exhibit
              10.3.3.1 to Registrant's Annual Report on Form 10-K for the fiscal
              year ended December 31, 1996, and incorporated herein by
              reference.

10.3.3.2#     Amendment to Roberds, Inc. Amended and Restated Deferred
              Compensation Plan for Outside Directors, referred to in Exhibit
              10.3.3, effective as of November 1, 1996, and filed as Exhibit
              99.1 to Registrant's Form S-8, Registration File No. 333-19903,
              and filed as Exhibit 10.3.3.2 to Registrant's Annual Report on
              Form 10-K for the fiscal year ended December 31, 1996, and
              incorporated herein by reference.

10.4.1        Lease Agreement dated April 1, 1990 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's facility
              located at 1000 East Central Avenue, West Carrollton, Ohio, and
              amendments thereto, filed October 1, 1993 as Exhibit 10.4.1 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.4.1.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1000
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher and Donald C. Wright, an Ohio general partnership, to
              Kenneth W. Fletcher, individually, and assigning Registrant's
              related lease of the property to Mr. Fletcher, all effective
              January 1, 1995, and filed as Exhibit 10.4.1.1 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

10.4.1.2      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1000
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher, individually, to DAF Investments LTD., an Ohio limited
              liability company controlled by Mr. Fletcher, and assigning
              Registrant's related lease of the property to DAF Investments
              LTD., all effective Janu-



                                       51
<PAGE>   52
              ary 1, 1995, and filed as Exhibit 10.4.1.2 to Registrant's Annual
              Report on Form 10-K for the fiscal year ended December 31, 1994
              and incorporated herein by reference.

10.4.1.3      Assignment and Assumption of Lease in connection with the transfer
              of ownership of Registrant's facility located at 1000 East Central
              Avenue, West Carrollton, Ohio from DAF Investments LTD., an Ohio
              limited liability company controlled by Mr. Kenneth W. Fletcher,
              to DAF West Carrollton Plaza, LTD., an Ohio limited liability
              company controlled by Mr. Fletcher, and assigning Registrant's
              related lease of the property to DAF West Carrollton Plaza, LTD.,
              effective January 14, 1997, and filed as Exhibit 10.4.1.3 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

10.4.2        Lease Agreement dated April 1, 1990 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's facility
              located at 1100 East Central Avenue, West Carrollton, Ohio, and
              amendments thereto, filed October 1, 1993 as Exhibit 10.4.2 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.4.2.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1100
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher and Donald C. Wright, an Ohio general partnership, to
              Kenneth W. Fletcher, individually, and assigning Registrant's
              related lease of the property to Mr. Fletcher, all effective
              January 1, 1995, and filed as Exhibit 10.4.2.1 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

10.4.2.2      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1100
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher, individually, to DAF Investments LTD., an Ohio limited
              liability company controlled by Mr. Fletcher, and assigning
              Registrant's related lease of the property to DAF Investments
              LTD., all effective January 1, 1995, and filed as Exhibit 10.4.2.2
              to Registrant's Annual Report on Form 10-K for the fiscal year
              ended December 31, 1994 and incorporated herein by reference.

10.4.2.3      Assignment and Assumption of Lease in connection with the transfer
              of ownership of Registrant's facility located at 1100 East Central
              Avenue, West Carrollton, Ohio from DAF Investments LTD., an Ohio
              limited liability company controlled by Mr. Kenneth W. Fletcher,
              to DAF West Carrollton Plaza, LTD., an Ohio limited liability
              company controlled by Mr. Fletcher, and assigning Registrant's
              related lease of the property to DAF West Carrollton Plaza, LTD.,
              effective January 14, 1997, and filed as Exhibit 10.4.2.3 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

10.4.3        Lease Agreement dated June 1, 1988 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's Piqua,
              Ohio facility, and amendments thereto, filed October 1, 1993 as
              Exhibit 10.4.3 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.4.3.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's Piqua, Ohio facility from
              Kenneth W. Fletcher and Donald C. Wright, an Ohio general
              partnership, to Donald C. Wright, individually, and assigning
              Registrant's related lease of the property to Mr. Wright, all
              effective January 1, 1995 and filed as Exhibit 10.4.3.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

10.4.4        Lease Agreement dated April 1, 1988 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's Richmond,
              Indiana facility, and amendments thereto, filed October 1, 1993 as
              Exhibit 10.4.4 to Registrant's Form S-1, Registration File No.
              33-69876, incorporated herein by reference.

                                       52
<PAGE>   53

10.4.4.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's Richmond, Indiana facility
              from Kenneth W. Fletcher and Donald C. Wright, an Ohio general
              partnership, to Donald C. Wright, individually, and assigning
              Registrant's related lease of the property to Mr. Wright, all
              effective January 1, 1995, and filed as Exhibit 10.4.4.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

10.4.5        Lease Agreement dated March 1, 1992 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's
              Springfield, Ohio facility, and amendments thereto, filed October
              1, 1993 as Exhibit 10.4.5 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.5.1      Assignment and Assumption of Leases transferring ownership of
              Registrant's Springfield, Ohio facility from Kenneth W. Fletcher
              and Donald C. Wright, an Ohio general partnership, to Springfield
              Properties, Inc., an Ohio corporation owned by Messrs. Fletcher
              and Wright, and assigning Registrant's related lease of the
              property to Springfield Properties, Inc., all effective November
              16, 1994, and filed as Exhibit 10.4.5.1 to Registrant's Annual
              Report on Form 10-K for the fiscal year ended December 31, 1994,
              and incorporated herein by reference.

10.4.6        Lease Agreement dated March 1, 1987 between Registrant and Howard
              Investments, a partnership owned by the Initial Shareholders,
              relating to Registrant's Norcross, Georgia facility, filed October
              1, 1993 as Exhibit 10.4.6 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.6.1      Amendments to Lease Agreement between Registrant and Howard
              Investments, referred to in Exhibit 10.4.6, effective December 20,
              1995, pursuant to a sale of the property by Howard Investments to
              800 Broadway and Ponce de Leon Stores, which are unrelated to the
              Company and the Initial Shareholders, filed as Exhibit 10.4.6.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.4.7        Lease Agreement dated March 1, 1987 between Registrant and Howard
              Investments, a partnership owned by the Initial Shareholders,
              relating to Registrant's Marietta, Georgia facility, filed October
              1, 1993 as Exhibit 10.4.7 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.8        Lease Agreement dated November 1, 1987 between Registrant and
              Howard Investments, a partnership owned by the Principal
              Shareholders, relating to Registrant's Forest Park, Georgia
              facility, and amendments thereto, filed October 1, 1993 as Exhibit
              10.4.8 to Registrant's Form S-1, Registration File No. 33-69876,
              and incorporated herein by reference.

10.4.9        Rent-Up Guarantee Agreement, filed October 1, 1993 as Exhibit
              10.4.9 to Registrant's Form S-1, Registration File No. 33-69876,
              and incorporated herein by reference.

10.5          Tax Indemnification Agreement among Kenneth W. Fletcher, Donald C.
              Wright, Howard W. Smith, and Registrant, filed October 1, 1993 as
              Exhibit 10.5 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.6.2        Inventory Financing and Security Agreement between Whirlpool
              Financial Corporation and Registrant, filed October 1, 1993 as
              Exhibit 10.6.2 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.6.3        Business Loan Agreement between Bank One, Dayton, NA and
              Registrant, dated November 23, 1993, for up to $30 million. Filed
              as Exhibit 10.6.3 to Registrant's Form 10-K for the fiscal year
              ended December 31, 1993, and incorporated herein by reference.

                                       53
<PAGE>   54

                                                                        
10.6.3.1      Amendment to Business Loan Agreement between Bank One, Dayton, NA
              and Registrant, dated April 20, 1994, amending the agreement
              referred to in Exhibit 10.6.3, and filed as Exhibit 10.6.3.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994, and incorporated herein by reference.

10.6.3.2      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated December 7, 1994,
              amending the agreement referred to in Exhibit 10.6.3, and filed as
              Exhibit 10.6.3.2 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1994, and incorporated herein
              by reference.

10.6.3.3      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated October 13, 1995,
              amending the agreement referred to in Exhibit 10.6.3, filed as
              Exhibit 10.6.3.3 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1995, and incorporated herein
              by reference.

10.6.3.4      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated as of June 29, 1996,
              amending the agreement referred to in Exhibit 10.6.3, filed as
              Exhibit 10.6.3.4 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

10.6.3.5      Second Amendment to Amended and Restated Business Loan Agreement
              between Bank One, Dayton, NA and Registrant, dated December 31,
              1996, amending the agreement referred to in Exhibit 10.6.3.4,
              filed as Exhibit 10.6.3.5 to Registrant's Annual Report on Form
              10-K for the fiscal year ended December 31, 1996, and incorporated
              herein by reference.

10.6.3.6      Amendment to Second Amended and Restated Business Loan Agreement
              between Bank One, Dayton, NA and Registrant, dated February 27,
              1997, amending the agreement referred to in Exhibit 10.6.3, filed
              as Exhibit 10.6.3.6 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

**10.6.3.7    Second Amendment to Second Amended and Restated Business Loan
              Agreement between Bank One, NA, successor by merger of Bank One,
              Dayton, NA, and Registrant, dated as of June 30, 1997, amending
              the agreement referred to in Exhibit 10.6.3, filed as Exhibit 10
              to Registrant's Quarterly Report on Form 10-Q for the quarter
              ended September 30, 1997, and incorporated herein by reference.

10.6.4        Term loan agreement between Bank One, Dayton, NA and Registrant,
              dated November 8, 1994, for up to $7 million, and filed as Exhibit
              10.6.4 to Registrant's Annual Report on Form 10-K for the fiscal
              year ended December 31, 1994, and incorporated herein by
              reference.

10.7          Amended and Restated Private Label Revolving Plan Agreement
              between Registrant and Bank One, Dayton, N.A., filed October 1,
              1993 as Exhibit 10.7 to Registrant's Form S-1, Registration File
              No. 33-69876, and incorporated herein by reference. Portions of
              the Exhibit have been omitted pursuant to a request by Registrant
              for confidential treatment.

10.8.1        Termination of Stock Redemption Agreement dated September 24, 1993
              between Roberds Service Company and shareholders of Roberds
              Service Company, filed October 1, 1993 as Exhibit 10.8.1 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.8.2        Termination of Stock Redemption Agreement dated September 24, 1993
              between Roberds, Inc. and shareholders of Roberds, Inc., filed
              October 1, 1993 as Exhibit 10.8.2 to Registrant's Form S-1,
              Registration File No. 33-69876, and incorporated herein by
              reference.

                                       54
<PAGE>   55

10.9#         Letter Agreements Limiting Salary and Bonus of Messrs. Fletcher,
              Wright and Smith, filed November 12, 1993 as Exhibit 10.9 to
              Registrant's Amendment No. 3 to Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.10#        Registrant's Executive Compensation Plan, adopted in 1994,
              effective for the 1995 calendar year, filed as Exhibit 10.10 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

10.10.1#      Registrant's Amended and Restated Executive Compensation Plan, as
              amended for the 1996 calendar year, amending the Plan referred to
              in Exhibit 10.10 above, and filed as Exhibit 10.10.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.10.2#      Registrant's Seconded Amended and Restated Executive Compensation
              Plan, as amended for the 1997 calendar year, amending the Plan
              referred to in Exhibit 10.10.1 above, filed as Exhibit 10.10.2 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

*10.10.3#     Registrant's Third Amended and Restated Executive Compensation
              Plan, as amended for the 1998 calendar year, amending the Plan
              referred to in Exhibit 10.10.2 above, filed herewith.

10.11.1#      Employment Agreement, dated as of March 1, 1996, between
              Registrant and Charles H. Palko, Vice President-Appliances, filed
              as Exhibit 10.11.1 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

10.11.2#      Employment Agreement, dated as of July 10, 1996, between
              Registrant and Michael E. Ray, President-Tampa Market, filed as
              Exhibit 10.11.2 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

*10.11.3#     Employment Agreement, dated as of May 27, 1997, between Registrant
              and Billy D. Benton, Executive Vice President-Operations, filed
              herewith.

*10.11.4#     Consulting Agreement, dated as of December 1, 1997, between
              Registrant and Kenneth W. Fletcher, Chairman of the Board, filed
              herewith.

11            Calculation of pro forma net earnings for the years ended December
              31, 1993 and 1992, filed on March 25, 1994, as Exhibit 11 to
              Registrant's Annual Report on Form 10-K for the year ended
              December 31, 1993, Commission File Number 0-22702, and
              incorporated herein by reference.

21            Subsidiary of Registrant, filed as Exhibit 21 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

*23           Independent Auditors' Consent.

*24           Powers of attorney.

*27           Financial Data Schedules

*        Exhibits electronically filed herewith.
**       Exhibits incorporated by reference for the first time.
#        Constitutes a "management contract or compensatory plan or
         arrangement," pursuant to Item 14(a)(3),(c).

                                       55
<PAGE>   56

         (b)      REPORTS ON FORM 8-K
         ----------------------------

On November 25, 1997, the Registrant filed a Report on Form 8-K announcing the
retirement of Mr. Kenneth W. Fletcher from the positions of Chief Executive
Officer and President of the Company and the appointment of Mr. James F. Robeson
to those positions.

         (c)      EXHIBITS
         -----------------

The response to this portion of Item 14 is submitted as a separate section of
this Report.

         (d)      FINANCIAL STATEMENT SCHEDULES
         --------------------------------------

The response to this portion of Item 14 is submitted as a separate section of
this Report.







                                       56
<PAGE>   57



                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

ROBERDS, INC., by

/s/ James F. Robeson*
------------------------------------
James F. Robeson, its
Chief Executive Officer
and President

/s/ Robert M. Wilson
------------------------------------
Robert M. Wilson, its
Executive Vice President and
Chief Financial Officer

/s/ Michael A. Bruns
------------------------------------
Michael A. Bruns, its
Vice President and
Chief Accounting Officer

           /s/ Robert M. Wilson
*By:________________________________

 Robert M. Wilson
 Attorney in Fact

February 17, 1998





                                       57
<PAGE>   58


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of Registrant and in
the capacities indicated on February 17, 1998.

/s/ Kenneth W. Fletcher*
------------------------------------
Kenneth W. Fletcher
Director

/s/ Carl E. Gunter*
------------------------------------
Carl E. Gunter
Director

/s/ Jerry L. Kirby*
------------------------------------
Jerry L. Kirby
Director

/s/ James F. Robeson*
------------------------------------
James F. Robeson
Director

/s/ Howard W. Smith*
------------------------------------
Howard W. Smith
Director

------------------------------------
Gilbert P. Williamson
Director

/s/ Robert M. Wilson
------------------------------------
Robert M. Wilson
Director

/s/ Donald C. Wright*
------------------------------------
Donald C. Wright
Director

            /s/ Robert M. Wilson
*By:________________________________

 Robert M. Wilson
 Attorney in Fact



                                       58
<PAGE>   59



  

                                  EXHIBIT INDEX
                                  -------------

2.3           Stock Purchase Agreement among Registrant, Kenneth W. Fletcher and
              Donald C. Wright transferring all of the outstanding shares of
              Roberds Service Company to Registrant, filed October 1, 1993 as
              Exhibit 2.3 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

2.4           Stock Purchase Agreement among Registrant, Kenneth W. Fletcher and
              Donald C. Wright transferring all of the outstanding shares of
              Roberd Insurance Agency, Inc. to Registrant, filed October 1, 1993
              as Exhibit 2.4 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

2.5           Certificate of merger of Roberds Service Company into Roberds,
              Inc., effective August 31, 1994, filed as Exhibit 2.5 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

3.1           Amended Articles of Incorporation of Registrant, filed January 10,
              1994, as Exhibit 4.1 to Registrant's Form S-8, Registration File
              No. 33-73900, and incorporated herein by reference.

3.2           Amended Code of Regulations of Registrant, filed January 10, 1994,
              as Exhibit 4.2 to Registrant's Form S-8, Registration File No.
              33-73900, and incorporated herein by reference.

4.1           Amended Articles of Incorporation of Registrant (filed as Exhibit
              3.1).

4.2           Amended Code of Regulations of Registrant (filed as Exhibit 3.2).

4.3           Specimen certificate for Registrant's Common Shares, filed October
              1, 1993 as Exhibit 4.3 to Registrant's Form S-1, Registration File
              No. 33-69876, and incorporated herein by reference.

4.3.1         Amended specimen certificate for Registrant's Common Shares,
              reflecting the change in stock transfer agent to National City
              Bank, Cleveland, Ohio, effective November 1, 1995, filed as
              Exhibit 4.3.1 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1995, and incorporated herein by
              reference.

4.4           Excluded from the exhibits are certain agreements relating to long
              term debt which, individually, do not exceed 10% of the total
              assets of Registrant. Registrant hereby undertakes to furnish a
              copy of such agreements upon request by the Commission.

10.1#         Roberds, Inc. 1993 Stock Incentive Plan, filed October 1, 1993 as
              Exhibit 10.1 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.1.1#       Amendment to Roberds, Inc. 1993 Stock Incentive Plan, filed as
              Exhibit 99.1 to Registrant's Form S-8, File No. 33-97262, filed
              September 25, 1995, and incorporated herein by reference.

10.1.2#       Amendment to Roberds, Inc. 1993 Stock Incentive Plan, referred to
              in Exhibit 10.1, effective as of November 1, 1996, and filed as
              Exhibit 10.1.2 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

10.2#         Roberds, Inc. Employee Stock Purchase Plan, filed October 1, 1993
              as Exhibit 10.2 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

                                       59
<PAGE>   60

10.2.1#       Amendment to Roberds, Inc. Employee Stock Purchase Plan, referred
              to in Exhibit 10.2, effective as of November 1, 1996, and filed as
              Exhibit 10.2.1 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

**10.2.2#     Amendment to Roberds, Inc. Employee Stock Purchase Plan, referred
              to in Exhibit 10.2, effective as of May 13, 1997, and filed as
              Exhibit 99.1 to Registrant's Form S-8, Registration File No.
              333-37829, and incorporated herein by reference.

10.3#         Roberds, Inc. 1993 Outside Director Stock Option Plan, filed
              October 1, 1993 as Exhibit 10.3 to Registrant's Form S-1,
              Registration File No. 33-69876, and incorporated herein by
              reference.

10.3.1#       Amendment to Roberds, Inc. 1993 Outside Director Stock Option
              Plan, referred to in Exhibit 10.3, effective as of November 1,
              1996, and filed as Exhibit 10.3.1 to Registrant's Annual Report on
              Form 10-K for the fiscal year ended December 31, 1996, and
              incorporated herein by reference.

10.3.2#       Roberds, Inc. Profit Sharing and Employee Retirement Savings Plan,
              as amended, filed as Exhibit 99 to Registrant's Form S-8,
              Registration File No. 33-81086, and incorporated herein by
              reference.

**10.3.2.1#   Roberds, Inc. Profit Sharing and Employee Retirement Savings Plan,
              as adopted March 26, 1997, and filed as Exhibit 99 to Registrant's
              Form S-8, Registration File No. 333-43977, and incorporated herein
              by reference.

10.3.3#       Roberds, Inc. Amended and Restated Deferred Compensation Plan for
              Outside Directors, effective 1996, filed as Exhibit 10.3.2 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.3.3.1#     Amendment to Roberds, Inc. Amended and Restated Deferred
              Compensation Plan for Outside Directors, referred to in Exhibit
              10.3.3, effective as of February 27, 1996, and filed as Exhibit
              10.3.3.1 to Registrant's Annual Report on Form 10-K for the fiscal
              year ended December 31, 1996, and incorporated herein by
              reference.

10.3.3.2#     Amendment to Roberds, Inc. Amended and Restated Deferred
              Compensation Plan for Outside Directors, referred to in Exhibit
              10.3.3, effective as of November 1, 1996, and filed as Exhibit
              99.1 to Registrant's Form S-8, Registration File No. 333-19903,
              and filed as Exhibit 10.3.3.2 to Registrant's Annual Report on
              Form 10-K for the fiscal year ended December 31, 1996, and
              incorporated herein by reference.

10.4.1        Lease Agreement dated April 1, 1990 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's facility
              located at 1000 East Central Avenue, West Carrollton, Ohio, and
              amendments thereto, filed October 1, 1993 as Exhibit 10.4.1 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.4.1.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1000
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher and Donald C. Wright, an Ohio general partnership, to
              Kenneth W. Fletcher, individually, and assigning Registrant's
              related lease of the property to Mr. Fletcher, all effective
              January 1, 1995, and filed as Exhibit 10.4.1.1 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

10.4.1.2      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1000
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher, individually, to DAF Investments LTD., an Ohio limited
              liability company controlled by Mr. Fletcher, and assigning
              Registrant's related lease of the property to DAF Investments
              LTD., all effective January 1, 1995, and filed as Exhibit 10.4.1.2
              to Registrant's Annual Report on Form 10-K for the fiscal year
              ended December 31, 1994 and incorporated herein by reference.

                                       60
<PAGE>   61

10.4.1.3      Assignment and Assumption of Lease in connection with the transfer
              of ownership of Registrant's facility located at 1000 East Central
              Avenue, West Carrollton, Ohio from DAF Investments LTD., an Ohio
              limited liability company controlled by Mr. Kenneth W. Fletcher,
              to DAF West Carrollton Plaza, LTD., an Ohio limited liability
              company controlled by Mr. Fletcher, and assigning Registrant's
              related lease of the property to DAF West Carrollton Plaza, LTD.,
              effective January 14, 1997, and filed as Exhibit 10.4.1.3 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

10.4.2        Lease Agreement dated April 1, 1990 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's facility
              located at 1100 East Central Avenue, West Carrollton, Ohio, and
              amendments thereto, filed October 1, 1993 as Exhibit 10.4.2 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.4.2.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1100
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher and Donald C. Wright, an Ohio general partnership, to
              Kenneth W. Fletcher, individually, and assigning Registrant's
              related lease of the property to Mr. Fletcher, all effective
              January 1, 1995, and filed as Exhibit 10.4.2.1 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

10.4.2.2      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's facility located at 1100
              East Central Avenue, West Carrollton, Ohio from Kenneth W.
              Fletcher, individually, to DAF Investments LTD., an Ohio limited
              liability company controlled by Mr. Fletcher, and assigning
              Registrant's related lease of the property to DAF Investments
              LTD., all effective January 1, 1995, and filed as Exhibit 10.4.2.2
              to Registrant's Annual Report on Form 10-K for the fiscal year
              ended December 31, 1994 and incorporated herein by reference.

10.4.2.3      Assignment and Assumption of Lease in connection with the transfer
              of ownership of Registrant's facility located at 1100 East Central
              Avenue, West Carrollton, Ohio from DAF Investments LTD., an Ohio
              limited liability company controlled by Mr. Kenneth W. Fletcher,
              to DAF West Carrollton Plaza, LTD., an Ohio limited liability
              company controlled by Mr. Fletcher, and assigning Registrant's
              related lease of the property to DAF West Carrollton Plaza, LTD.,
              effective January 14, 1997, and filed as Exhibit 10.4.2.3 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

10.4.3        Lease Agreement dated June 1, 1988 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's Piqua,
              Ohio facility, and amendments thereto, filed October 1, 1993 as
              Exhibit 10.4.3 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.4.3.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's Piqua, Ohio facility from
              Kenneth W. Fletcher and Donald C. Wright, an Ohio general
              partnership, to Donald C. Wright, individually, and assigning
              Registrant's related lease of the property to Mr. Wright, all
              effective January 1, 1995 and filed as Exhibit 10.4.3.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

10.4.4        Lease Agreement dated April 1, 1988 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's Richmond,
              Indiana facility, and amendments thereto, filed October 1, 1993 as
              Exhibit 10.4.4 to Registrant's Form S-1, Registration File No.
              33-69876, incorporated herein by reference.

10.4.4.1      Assignment and Assumption Agreement in connection with the
              transfer of ownership of Registrant's Richmond, Indiana facility
              from Kenneth W. Fletcher and Donald C. Wright, an Ohio general
              partnership, to Donald C. Wright, individually, and assigning
              Registrant's related lease of the property to Mr. Wright, all
              effective January 1, 1995, and filed as Exhibit 10.4.4.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

                                       61
<PAGE>   62

10.4.5        Lease Agreement dated March 1, 1992 among Registrant, Kenneth W.
              Fletcher and Donald C. Wright, relating to Registrant's
              Springfield, Ohio facility, and amendments thereto, filed October
              1, 1993 as Exhibit 10.4.5 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.5.1      Assignment and Assumption of Leases transferring ownership of
              Registrant's Springfield, Ohio facility from Kenneth W. Fletcher
              and Donald C. Wright, an Ohio general partnership, to Springfield
              Properties, Inc., an Ohio corporation owned by Messrs. Fletcher
              and Wright, and assigning Registrant's related lease of the
              property to Springfield Properties, Inc., all effective November
              16, 1994, and filed as Exhibit 10.4.5.1 to Registrant's Annual
              Report on Form 10-K for the fiscal year ended December 31, 1994,
              and incorporated herein by reference.

10.4.6        Lease Agreement dated March 1, 1987 between Registrant and Howard
              Investments, a partnership owned by the Initial Shareholders,
              relating to Registrant's Norcross, Georgia facility, filed October
              1, 1993 as Exhibit 10.4.6 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.6.1      Amendments to Lease Agreement between Registrant and Howard
              Investments, referred to in Exhibit 10.4.6, effective December 20,
              1995, pursuant to a sale of the property by Howard Investments to
              800 Broadway and Ponce de Leon Stores, which are unrelated to the
              Company and the Initial Shareholders, filed as Exhibit 10.4.6.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.4.7        Lease Agreement dated March 1, 1987 between Registrant and Howard
              Investments, a partnership owned by the Initial Shareholders,
              relating to Registrant's Marietta, Georgia facility, filed October
              1, 1993 as Exhibit 10.4.7 to Registrant's Form S-1, Registration
              File No. 33-69876, and incorporated herein by reference.

10.4.8        Lease Agreement dated November 1, 1987 between Registrant and
              Howard Investments, a partnership owned by the Principal
              Shareholders, relating to Registrant's Forest Park, Georgia
              facility, and amendments thereto, filed October 1, 1993 as Exhibit
              10.4.8 to Registrant's Form S-1, Registration File No. 33-69876,
              and incorporated herein by reference.

10.4.9        Rent-Up Guarantee Agreement, filed October 1, 1993 as Exhibit
              10.4.9 to Registrant's Form S-1, Registration File No. 33-69876,
              and incorporated herein by reference.

10.5          Tax Indemnification Agreement among Kenneth W. Fletcher, Donald C.
              Wright, Howard W. Smith, and Registrant, filed October 1, 1993 as
              Exhibit 10.5 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.6.2        Inventory Financing and Security Agreement between Whirlpool
              Financial Corporation and Registrant, filed October 1, 1993 as
              Exhibit 10.6.2 to Registrant's Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.6.3        Business Loan Agreement between Bank One, Dayton, NA and
              Registrant, dated November 23, 1993, for up to $30 million. Filed
              as Exhibit 10.6.3 to Registrant's Form 10-K for the fiscal year
              ended December 31, 1993, and incorporated herein by reference.

10.6.3.1      Amendment to Business Loan Agreement between Bank One, Dayton, NA
              and Registrant, dated April 20, 1994, amending the agreement
              referred to in Exhibit 10.6.3, and filed as Exhibit 10.6.3.1 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994, and incorporated herein by reference.

10.6.3.2      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated December 7, 1994,
              amending the agreement referred to in Exhibit 10.6.3, and 


                                       62
<PAGE>   63

              filed as Exhibit 10.6.3.2 to Registrant's Annual Report on Form
              10-K for the fiscal year ended December 31, 1994, and incorporated
              herein by reference.

10.6.3.3      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated October 13, 1995,
              amending the agreement referred to in Exhibit 10.6.3, filed as
              Exhibit 10.6.3.3 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1995, and incorporated herein
              by reference.

10.6.3.4      Amendment to Amended and Restated Business Loan Agreement between
              Bank One, Dayton, NA and Registrant, dated as of June 29, 1996,
              amending the agreement referred to in Exhibit 10.6.3, filed as
              Exhibit 10.6.3.4 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

10.6.3.5      Second Amendment to Amended and Restated Business Loan Agreement
              between Bank One, Dayton, NA and Registrant, dated December 31,
              1996, amending the agreement referred to in Exhibit 10.6.3.4,
              filed as Exhibit 10.6.3.5 to Registrant's Annual Report on Form
              10-K for the fiscal year ended December 31, 1996, and incorporated
              herein by reference.

10.6.3.6      Amendment to Second Amended and Restated Business Loan Agreement
              between Bank One, Dayton, NA and Registrant, dated February 27,
              1997, amending the agreement referred to in Exhibit 10.6.3, filed
              as Exhibit 10.6.3.6 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

**10.6.3.7    Second Amendment to Second Amended and Restated Business Loan
              Agreement between Bank One, NA, successor by merger of Bank One,
              Dayton, NA, and Registrant, dated as of June 30, 1997, amending
              the agreement referred to in Exhibit 10.6.3, filed as Exhibit 10
              to Registrant's Quarterly Report on Form 10-Q for the quarter
              ended September 30, 1997, and incorporated herein by reference.

10.6.4        Term loan agreement between Bank One, Dayton, NA and Registrant,
              dated November 8, 1994, for up to $7 million, and filed as Exhibit
              10.6.4 to Registrant's Annual Report on Form 10-K for the fiscal
              year ended December 31, 1994, and incorporated herein by
              reference.

10.7          Amended and Restated Private Label Revolving Plan Agreement
              between Registrant and Bank One, Dayton, N.A., filed October 1,
              1993 as Exhibit 10.7 to Registrant's Form S-1, Registration File
              No. 33-69876, and incorporated herein by reference. Portions of
              the Exhibit have been omitted pursuant to a request by Registrant
              for confidential treatment.

10.8.1        Termination of Stock Redemption Agreement dated September 24, 1993
              between Roberds Service Company and shareholders of Roberds
              Service Company, filed October 1, 1993 as Exhibit 10.8.1 to
              Registrant's Form S-1, Registration File No. 33-69876, and
              incorporated herein by reference.

10.8.2        Termination of Stock Redemption Agreement dated September 24, 1993
              between Roberds, Inc. and shareholders of Roberds, Inc., filed
              October 1, 1993 as Exhibit 10.8.2 to Registrant's Form S-1,
              Registration File No. 33-69876, and incorporated herein by
              reference.

10.9#         Letter Agreements Limiting Salary and Bonus of Messrs. Fletcher,
              Wright and Smith, filed November 12, 1993 as Exhibit 10.9 to
              Registrant's Amendment No. 3 to Form S-1, Registration File No.
              33-69876, and incorporated herein by reference.

10.10#        Registrant's Executive Compensation Plan, adopted in 1994,
              effective for the 1995 calendar year, filed as Exhibit 10.10 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1994 and incorporated herein by reference.

10.10.1#      Registrant's Amended and Restated Executive Compensation Plan, as
              amended for the 1996 calendar year, amending the Plan referred to
              in Exhibit 10.10 above, and filed as Exhibit 10.10.1 to
              Regis-

                                       63
<PAGE>   64

              rant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1995, and incorporated herein by reference.

10.10.2#      Registrant's Seconded Amended and Restated Executive Compensation
              Plan, as amended for the 1997 calendar year, amending the Plan
              referred to in Exhibit 10.10.1 above, filed as Exhibit 10.10.2 to
              Registrant's Annual Report on Form 10-K for the fiscal year ended
              December 31, 1996, and incorporated herein by reference.

*10.10.3#     Registrant's Third Amended and Restated Executive Compensation
              Plan, as amended for the 1998 calendar year, amending the Plan
              referred to in Exhibit 10.10.2 above, filed herewith.

10.11.1#      Employment Agreement, dated as of March 1, 1996, between
              Registrant and Charles H. Palko, Vice President-Appliances, filed
              as Exhibit 10.11.1 to Registrant's Annual Report on Form 10-K for
              the fiscal year ended December 31, 1996, and incorporated herein
              by reference.

10.11.2#      Employment Agreement, dated as of July 10, 1996, between
              Registrant and Michael E. Ray, President-Tampa Market, filed as
              Exhibit 10.11.2 to Registrant's Annual Report on Form 10-K for the
              fiscal year ended December 31, 1996, and incorporated herein by
              reference.

*10.11.3#     Employment Agreement, dated as of May 27, 1997, between Registrant
              and Billy D. Benton, Executive Vice President-Operations, filed
              herewith.

*10.11.4#     Consulting Agreement, dated as of December 1, 1997, between
              Registrant and Kenneth W. Fletcher, Chairman of the Board, filed
              herewith.

11            Calculation of pro forma net earnings for the years ended December
              31, 1993 and 1992, filed on March 25, 1994, as Exhibit 11 to
              Registrant's Annual Report on Form 10-K for the year ended
              December 31, 1993, Commission File Number 0-22702, and
              incorporated herein by reference.

21            Subsidiary of Registrant, filed as Exhibit 21 to Registrant's
              Annual Report on Form 10-K for the fiscal year ended December 31,
              1994 and incorporated herein by reference.

*23           Independent Auditors' Consent.

*24           Powers of attorney.

*27           Financial Data Schedules

*        Exhibits electronically filed herewith.
**       Exhibits incorporated by reference for the first time.
#        Constitutes a "management contract or compensatory plan or 
         arrangement," pursuant to Item 14(a)(3),(c).



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