SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
FOR ANNUAL AND TRANSITION REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(x) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended: May 3, 1997.
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period __________ to __________.
Commission file number 0-16900
RICHFOOD HOLDINGS, INC.
Incorporated under the laws I.R.S.Employer Identification
of Virginia No. 54-1438602
P.O. Box 26967
Richmond, Virginia 23261
Telephone Number (804) 746-6000
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Exchange on Which Registered
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Common Stock, without par value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None.
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 filing
requirements for the past 90 days. Yes X . No .
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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 the 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 June 27, 1997, the aggregate market value of all shares of voting stock held
by non-affiliates was $1.13 billion (based upon the last reported sale price of
the Common Stock on that date on the New York Stock Exchange composite tape). In
determining this figure, the Registrant has assumed that all directors and
executive officers are affiliates. Such assumption shall not be deemed
conclusive for any other purpose. The number of shares outstanding of each class
of the Registrant's common stock, as of June 27, 1997, was as follows: Common
Stock, without par value: 47,470,292 shares.
Portions of the Registrant's Annual Report to Shareholders for the fiscal year
ended May 3, 1997, are incorporated by reference into Parts I, II and IV of this
Form 10-K. Portions of the Registrant's Proxy Statement prepared for use in
connection with the 1997 annual meeting of shareholders are incorporated by
reference into Part III of this Form 10-K.
PART I
ITEM 1. BUSINESS
General
Richfood Holdings, Inc. ("Richfood" or the "Company"), a Virginia corporation
formed in July 1987, is headquartered at 8258 Richfood Road, Mechanicsville,
Virginia 23116.
The Company is the leading wholesale food distributor in its Mid-Atlantic
operating region and the fourth largest wholesale food distributor in the United
States. Richfood supplies a comprehensive selection of national brand and
private label grocery products, dairy products, frozen foods, fresh produce
items, meats, delicatessen and bakery products and non-food items from its three
modern, highly efficient principal distribution centers. The Company's
distribution centers are strategically located within its operating region and
have capacity to accommodate additional growth. The Company services more than
1,400 retail grocery stores, including leading regional chains and smaller
independent retailers throughout the Mid-Atlantic region, offering its customers
a dependable supply and prompt delivery of over 37,000 grocery and non-grocery
items at competitive prices.
The Company has four principal operating divisions:
o Richfood/Virginia, based in Richmond, Virginia, which operates a
1.3 million square foot distribution center that is one of the
largest and most efficient in the industry;
o Richfood/Pennsylvania, which operates: two distribution facilities
totaling approximately 1.0 million square feet in Harrisburg,
Pennsylvania, including a 635,000 square foot highly efficient,
automated distribution center; a 6.3 million cubic foot automated
frozen food distribution center based in West Point, Pennsylvania;
and a 150,000 square foot produce distribution center in
Norristown, Pennsylvania;
o the METRO/BASICS Retail Division, headquartered in the
metropolitan Baltimore, Maryland area, which operates thirteen
45,000 to 60,000 square foot "superstores" under the METRO
tradename, and three smaller traditional supermarkets under the
BASICS tradename; and
o the Richfood Dairy, located in Richmond, which is the largest
fluid dairy in Virginia and consists of a 65,000 square foot
facility capable of processing and packaging over 550,000 gallons
per week of milk and other dairy products, fruit juices, bottled
water and related items.
Management has implemented the regional division structure to serve properly the
unique needs of Richfood's customers in each of its geographic markets. Each
division is headed by a division president, together with a procurement officer
and a distribution and logistics officer, to oversee regional sales, marketing,
procurement, advertising, and distribution and logistics initiatives. Through
its corporate headquarters, the Company provides technology and support to the
divisions on an efficient, centralized basis, to avoid duplication of functions.
Centralized functions include corporate finance, legal, risk management, certain
distribution and logistics initiatives, management information systems, human
resources planning, development of safety and sanitation programs and support of
the Company's retail customers through store planning and development.
Richfood/Virginia includes the operations of Richfood, Inc., which was formed in
1935 and historically was the Company's principal operating subsidiary.
Richfood/Pennsylvania encompasses the operations of three of the Company's
recently acquired subsidiaries: Rotelle, Inc. ("Rotelle"), a wholesale frozen
food distribution company acquired by Richfood in August 1994; Super Rite
Corporation ("Super Rite"), a full service wholesale food distribution company
acquired by Richfood in a stock-for-stock merger effective October 15, 1995 (the
"Super Rite Acquisition"); and Penn Perishables, Inc. ("Norristown"), which
acquired substantially all of the assets of Norristown Wholesale, Inc. in
September 1996, and which supplies a full line of fresh produce and other
perishable food items. See "Business Strategy -- Pursuing Strategic
Acquisitions." The Company believes
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that combining the administrative functions of Super Rite, Rotelle and
Norristown affords opportunities for substantial cost savings through
centralizing and eliminating certain duplicative corporate and administrative
functions and by enhancing opportunities to sell products of each business to
customers of the other.
Business Strategy
Since 1990, Richfood's management team has implemented a business strategy
focused on reducing and controlling costs, increasing efficiency and pursuing
profitable growth. The success of this strategy has been reflected in the growth
of the Company's sales from $2.36 billion for the fiscal year ended May 1, 1993
("fiscal 1993") to $3.41 billion for the fiscal year ended May 3, 1997 ("fiscal
1997"), and in the Company's operating profit, which has grown from $45.9
million to $105.4 million over the same period. The key elements of the
Company's strategy include:
Reducing and Controlling Costs; Increasing Efficiency in Logistics
and Distribution
Management believes that, as a result of its strategic focus on cost control,
logistics and distribution, the Company is now one of the most efficient
wholesale food distributors in the United States. Over the past five fiscal
years, the Company has reduced and controlled costs by (i) capitalizing on its
size to improve its purchasing power, (ii) rationalizing product purchasing and
pricing systems, (iii) implementing a pricing system that encourages efficient
use of the Company's services and (iv) instituting productivity-based incentives
for distribution center associates. Over the same period, the Company has
significantly improved the efficiency of its logistics and distribution
functions by, among other things, implementing state-of-the-art computer systems
related to purchasing, inventory management and fleet loading and routing. These
improvements have permitted the Company to drive substantially increased volume
through its distribution system and to increase capacity utilization
significantly, thereby benefitting from its operating leverage. As a result of
the cost savings and efficiencies realized by the Company under its current
leadership, from fiscal 1993 to fiscal 1997 the Company's operating profit as a
percent of sales has increased from 1.9% to 3.1%, annual inventory turnover has
improved from 15.4x to 18.7x and working capital funding requirements have been
reduced substantially.
Increasing Sales
The Company's purchasing power, low cost structure and efficient service levels
permit Richfood to offer lower prices and better service to support the
competitive position of its retail customers, while increasing customer
penetration, attracting new customers within its operating region and supporting
customers in their efforts to open new retail sites served by Richfood. The
Company believes that since 1990, customer penetration, the percentage of
customers' sales supplied by Richfood, has increased from approximately 50% to
over 60% for customers supplied by Richfood/Virginia's Mechanicsville, Virginia
distribution center. Although there can be no assurance as to future results,
management believes that opportunities exist to increase significantly
Richfood/Pennsylvania's customer penetration rate, which management believes is
now approximately 50%, as Super Rite previously offered its customers a limited
selection of private label goods and of certain higher- margin perishable
products. See " -- Pursuing Strategic Acquisitions." The Company has also
successfully attracted new customers and has benefitted from growth by the
leading regional chains and smaller independent retail grocers that it serves.
The Company believes that its success depends upon the success of its retail
customers. Accordingly, Richfood supports its existing customers, and pursues
its goal of increasing customer penetration and attracting new customers, by (i)
using the Company's purchasing power, low cost structure and efficient
distribution system to provide products to its customers at the lowest available
prices, (ii) assisting its retail customers in adapting to changes in consumer
preferences and to competition in the marketplace and (iii) offering its retail
customers a wide variety of retail support services typical of those offered by
large retail chains to their individual stores. As a result of these
initiatives, Richfood is able to provide its retail customers with the
competitive advantages associated with large purchasing power and extensive
retail services similar to those of large supermarket chains, while each
customer retains its regional focus and flexibility to respond to local
demographics and market conditions.
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Pursuing Strategic Acquisitions
Consolidation trends in the food distribution industry present opportunities for
strategic acquisitions by the Company. The Company pursues strategic targets
that are well run, established wholesale operations, with modern facilities and
capacity to accommodate anticipated growth, and that complement the Company's
existing operations and geographic service area. Since 1990, the Company has
completed six acquisitions, which have more than doubled its sales, added large,
modern distribution centers in Harrisburg and West Point, Pennsylvania, and
enhanced its presence in various regional markets.
The Company began a series of strategic acquisitions in fiscal 1991 with the
purchase of the Waynesboro, Virginia division of Fleming Foods of Virginia,
Inc., which increased the Company's presence in the western portion of its
operating region. On January 22, 1993, the Company acquired certain assets and
assumed certain contracts of the Civilian Division of B. Green & Company, Inc.,
a wholesale and retail grocery distributor headquartered in Baltimore, Maryland.
The acquisition of the Civilian Division increased significantly the Company's
presence in the Baltimore/Washington, D.C. market, while permitting the Company
to achieve greater efficiency and productivity from its existing warehousing and
delivery operations. On August 23, 1994, the Company acquired all of the
outstanding common shares of Rotelle, one of the largest wholesale frozen food
distributors in the United States. Rotelle, through its state-of-the-art
distribution center, distributes frozen food, ice cream and frozen bakery
products to its customers. On April 3, 1995, the Company acquired certain assets
and assumed certain contracts of the wholesale division of Camellia Food Stores,
Inc. ("Camellia"), a retail and wholesale food distributor located in Norfolk,
Virginia. As a result of that acquisition, the Company serves as wholesale
supplier to Camellia's 46 retail stores, and most of the 120 independent retail
stores previously served by Camellia's wholesale division. The Camellia
acquisition also has permitted the Company to achieve additional efficiencies
and economies of scale in its business.
Effective October 15, 1995, the Company completed the Super Rite Acquisition.
Super Rite, with sales of $1.47 billion for its last full fiscal year before the
acquisition, is a full service wholesale food distributor supplying more than
240 retail supermarkets in Pennsylvania, New Jersey, Maryland, Delaware,
Virginia and West Virginia. Super Rite also operated the Company's METRO/BASICS
Retail Division, which currently consists of thirteen 45,000 to 60,000 square
foot "superstores" in the Baltimore, Maryland and Dover, Delaware markets
operating under the METRO tradename, and three smaller traditional supermarkets
in metropolitan Baltimore, Maryland, operating under the BASICS tradename. Super
Rite is a separate, wholly-owned subsidiary of the Company and operates as part
of the Richfood/Pennsylvania division. The Company issued 9,770,188 shares of
Common Stock in the Super Rite Acquisition (14,655,282 shares after adjustment
for the Company's 3-for-2 stock split in September 1996), resulting in former
Super Rite shareholders holding approximately 31% of the then-outstanding shares
of Common Stock. The Super Rite Acquisition was accounted for as a pooling of
interests.
As part of the Richfood/Pennsylvania division, Super Rite operates approximately
1.0 million square feet of warehouse space, including a 635,000 square foot
highly efficient, automated distribution center in Harrisburg, Pennsylvania.
Super Rite's distribution system complements Richfood/Virginia's existing
operations, and its service area is geographically contiguous with the northern
portion of the area served by Richfood/Virginia's Mechanicsville, Virginia
distribution center. As a result of the Super Rite Acquisition, the Company has
achieved significant cost savings, operating efficiencies and growth
opportunities resulting from: (i) combining the purchasing volume of both
companies, thereby increasing purchasing power; (ii) centralizing and
eliminating certain duplicative corporate and administrative functions; (iii)
selling private label goods and certain higher- margin product lines to Super
Rite customers that are offered by Richfood/Virginia and Norristown but that
were previously offered on a limited basis by Super Rite, such as frozen foods,
fresh produce, meats and delicatessen and dairy products; (iv) consolidating
distribution networks to achieve logistical efficiencies and higher capacity
utilization; and (v) realizing interest expense savings by refinancing certain
Super Rite indebtedness at the lower rates available to the combined Company. On
April 1, 1997, the first permitted optional redemption date, the Company
redeemed the remaining $47.5 million principal amount of Super Rite's 10 5/8%
Senior Subordinated Notes. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations" referred to in Item 7 of this
Form 10-K.
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On September 30, 1996, the Company acquired substantially all of the assets and
certain liabilities of Norristown Wholesale, Inc. Norristown, headquartered near
Philadelphia, Pennsylvania, supplies a full line of fresh produce, fruits,
vegetables and other perishable food items to approximately 400 retail
supermarkets in Pennsylvania, Delaware, Maryland, New Jersey and Virginia, most
of which represent new accounts for the Company. The Norristown acquisition
permitted Richfood/Pennsylvania to add a complete range of fresh produce and
perishable items, not previously offered by the division, to its previous
assortment of dry grocery, frozen food, cheese and dairy products. With the
acquisition of Norristown, Richfood is now one of the largest procurers of fresh
produce on the East Coast.
The Company's substantial growth since 1990 is largely attributable to
acquisitions, particularly the acquisition of Super Rite in fiscal 1996. While
the Company believes that additional acquisition opportunities consistent with
its strategic criteria may arise from time to time, no assurance can be given
that the Company will consummate additional strategic acquisitions.
Wholesale Operations
Customer Base; Principal Markets
The Company services more than 1,400 retail grocery stores, including leading
regional chains and smaller independent retailers, in Virginia, Maryland,
Pennsylvania, New Jersey, Delaware, North Carolina, West Virginia, Washington,
D.C. and New York. The Company's regional chain customers are high quality,
growth- oriented operations, and include: Giant Food Stores, Inc. based in
Carlisle, Pennsylvania ("Giant of Carlisle"); Shoppers Food Warehouse Corp.
("Shoppers"); Farm Fresh, Inc. based in Norfolk, Virginia ("Farm Fresh of
Virginia"); Genuardi's Super Markets, Inc. ("Genuardi's"); Ukrop's Super
Markets, Inc. ("Ukrop's"); Redner's Markets, Inc.; Camellia; and the Company's
own METRO/BASICS stores. Customer store sizes range from 4,500 square feet to
60,000 square feet.
The Company believes that it is the principal source of wholesale supply for
most of its customers. The Company believes that since 1990, customer
penetration has increased from approximately 50% to over 60% for customers of
Richfood/Virginia's Mechanicsville, Virginia distribution center. Although there
can be no assurance as to future results, management believes that opportunities
exist to increase significantly Richfood/Pennsylvania's customer penetration
rate, which management believes is now approximately 50%. Super Rite previously
offered its customers a limited selection of private label products and certain
higher- margins perishable products, such as frozen foods, fresh produce, meats
and delicatessen and dairy products, that are offered by Richfood/Virginia,
Rotelle and Norristown.
The Company's five largest customers in fiscal 1997 were Giant of Carlisle,
Shoppers, Farm Fresh of Virginia, Genuardi's and Ukrop's, with Giant of
Carlisle, Shoppers and Farm Fresh of Virginia accounting for 17%, 9% and 9%,
respectively, of fiscal 1997 sales. The Company has enjoyed long-term supply
relationships with most of its principal customers: Ukrop's, Genuardi's, Farm
Fresh of Virginia, Giant of Carlisle and Shoppers have been customers of one or
more of the Company's divisions for 49, 30, 25, 17 and six years, respectively.
Farm Fresh of Virginia has announced that it is currently exploring strategic
alternatives.
Richfood is a party to multi-year supply agreements with most of its larger
customers that secure the Company's position as principal supplier to all stores
owned by such customers. Such supply agreements generally include minimum
purchase requirements by dollar amount and category of goods and may be subject
to adjustment as the customer acquires or disposes of stores. The Company's
supply agreements with Giant of Carlisle, Shoppers
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and Farm Fresh of Virginia expire in December 1999, December 1997 and December
2001, respectively. Overall, sales to customers covered by supply agreements
accounted for approximately 77% of fiscal 1997 wholesale division sales,
including intersegment sales.
Management believes that the loss of one of the Company's larger customers could
have a material adverse effect on its business. However, management believes
that the Company's purchasing power, low cost structure and efficient service
levels, coupled with its commitment to the success of its retail customers,
should enable the Company to operate profitably in the event of the loss of a
larger customer and to attract new customers.
For example, Richfood/Pennsylvania's supply agreement with Acme Markets, Inc.
("Acme") expired in July 1997. While the Company desired to extend its supply
relationship with Acme, which accounted for approximately $180 million of
wholesale grocery sales in fiscal 1997, it was unable to do so on terms
that were beneficial to the Company. Instead, the Company focused its
efforts on extending the terms of its supply agreements with other existing
customers and on attracting new customers, and in the last half of fiscal 1997
the Company announced that it had entered into new long-term supply
agreements with Genuardi's, Magruders, Inc. and Boyer's Food Markets, and
that it had extended through June 2002 its existing supply relationship with
Camellia. Accordingly, the Company does not expect that the loss of the Acme
business will have a material adverse effect on its results of operations or
financial position.
Products and Purchasing
The Company supplies a comprehensive selection of national brand and private
label grocery products, dairy products, frozen foods, fresh produce items,
meats, delicatessen and bakery products and non-food items from its three
modern, highly-efficient principal distribution centers. The Company offers its
customers a dependable supply and prompt delivery of over 37,000 grocery and
non-grocery items at competitive prices. The Company's business strategy
includes assisting its retail customers in adapting to changes in consumer
preferences and in the marketplace so they remain competitive. Accordingly, the
Company continually changes and enhances its product offerings to meet changing
consumer demands.
The Company supplies more than 35,000 national brand products, which accounted
for approximately 90% of the Company's total wholesale grocery sales in fiscal
1997. The Company also offers private label products to its customers. Private
label products allow retail customers to carry single labels on a store-wide
basis similar to chain stores, while providing consumers a lower-priced
alternative to national brands. The Company currently offers approximately 1,600
private label products to its customers, including approximately 1,300 products
under the "RICHFOOD" label and approximately 150 products under the
budget-priced "ECON" label. The Company also coordinates private labels for
certain regional supermarket chains in the Mid-Atlantic region. In fiscal 1997,
private label products, including private label products packaged for certain
customers, accounted for approximately 10% of the Company's total wholesale
grocery sales. The Company has introduced its private label products to
customers of Super Rite, which historically did not have an extensive private
label program.
The Company purchases products for resale from over 1,800 vendors in the United
States and overseas, and is not substantially dependent on any single source of
supply. The Company believes that its size enables it to purchase products at
the lowest available manufacturers' prices. The Company monitors manufacturers'
prices and uses its purchasing power to secure products at the best terms
available. In addition, because the Company maintains purchasing departments
associated with its Richfood/Virginia and Richfood/Pennsylvania operations,
Richfood is able to take advantage of regional buying opportunities. The Company
purchases long-term quantities of inventory items when manufacturers' prices are
advantageous ("forward-buys"). In particular, the Company purchases sufficient
quantities of certain staple items when offered at a discount and if justified
after giving effect to carrying costs.
Product Pricing
The Company sells products to its customers at landed vendor invoice cost. The
customer is also charged a service fee and a delivery fee based upon the
characteristics of the order. The fee structure includes incentives to encourage
customers to increase their purchases from the Company and to order and accept
merchandise for
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delivery more efficiently, thereby increasing the Company's efficiency. Such
incentives include minimum delivery fees that encourage economic order
quantities and lower fees for off-peak deliveries. Over the past several years,
the Company's pricing system, together with increased efficiencies in purchasing
operations, have resulted in more competitively-priced merchandise and have
placed the Company and its retail customers in a stronger market position.
Logistics and Distribution
The Company is highly focused on reducing and controlling costs and on improving
efficiency in the logistics and distribution areas of its business. Over the
past five fiscal years, the Company's management team has implemented
improvements in the logistics and distribution areas of its business that have
permitted Richfood to drive substantially increased volume through its
distribution system and to increase capacity utilization, thereby benefitting
from its operating leverage. These improvements have included: (i) implementing
state-of-the-art computer systems related to purchasing, inventory management
and fleet loading and routing; (ii) instituting a pricing system that encourages
customers to utilize the Company's services efficiently; and (iii) introducing
warehouse management practices that reward workers for enhanced productivity.
Management believes that, as a result of its strategic focus on cost control,
logistics and distribution, the Company is now one of the most efficient
wholesale food distributors in the United States.
The Company distributes its products out of its three main distribution centers:
Richfood/Virginia's 1.3 million square foot Mechanicsville, Virginia
distribution center; Richfood/Pennsylvania's 635,000 square foot automated
distribution facility in Harrisburg, Pennsylvania; and Richfood/Pennsylvania's
6.3 million cubic foot frozen food distribution facility in West Point,
Pennsylvania. The Company's customers are generally located within 200 miles of
one of the Company's distribution centers.
Products are delivered to the Company's distribution centers by manufacturers,
common carriers and the Company's own fleet of trucks on return to its
distribution centers from deliveries to customers ("backhauls"). The Company
employs a management information system that enables it to lower its inbound
transportation costs by making optimum use of its own fleet for backhaul
opportunities. In addition, "drop shipments" are sent directly to retailers by
suppliers under programs established by the Company.
The Company produces and distributes catalogs with weekly updates indicating
manufacturers' prices and wholesale prices to customers for each of its more
than 37,000 products. In addition, the Company's sales personnel use
telemarketing to advise customers of periodic special prices and product
offerings. Customers place orders through direct computer links to the Company.
Customers' orders are then assembled in the appropriate distribution center,
shrink-wrapped to ensure order completeness and staged according to the required
delivery sequence. In fiscal 1997, the Company maintained an in-stock service
level of approximately 97%.
Products are delivered from the Company's distribution centers to retail
customers by the Company's drivers and contract carriers via trucks leased or
owned by the Company. In dispatching trucks for both pick-ups and deliveries,
the Company employs a computerized routing system designed to optimize delivery
efficiency and minimize drive time, wait time and excess mileage. The Company
currently leases 189 tractors, 198 refrigerated trailers and 331 dry trailers,
and owns 131 tractors, 172 refrigerated trailers and 111 dry trailers. All of
the Company's fleet utilizes on-board computer systems that monitor vehicle
speeds, fuel efficiency, idle time and other statistical information. During
fiscal 1997, the Company achieved an on-time delivery record of approximately
97%.
Customers are billed for goods sold on a weekly basis with payment generally due
the following week. The Company reviews credit histories on an individual basis
and requires customers to provide collateral to secure outstanding accounts when
appropriate.
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Retail Support
The Company's largest customers generally find it cost efficient to perform
their own retail support services and have selected the Company as a supplier
because of its competitive prices. The Company's smaller customers, however,
generally do not have the resources to perform the retail services that large
national chains provide to their individual stores. The Company offers a wide
variety of retail support services to assist its smaller customers. Customers
decide individually which services to use and are charged a fee for such
services.
Services offered by the Company include retail development, retail sales
consulting, marketing and merchandising assistance, data processing and
customized software, and financial planning and analysis. The Company's retail
development services are focused on store planning and development, and include
advising retailers on site planning through construction, lease negotiation,
product display and promotion. This assistance also includes demographic
studies, engineering support, contracting assistance and layout strategy. Retail
sales counselors assist customers with detailed analyses of their stores'
operations, pricing, advertising, delivery schedules, inventory control and
merchandising plans, to help each customer enhance its competitive position.
Marketing services include developing marketing strategies, designing and
producing signs and flyers and coordinating print and media campaigns. The
Company provides data processing services and customized software to many of its
customers, which allows them to manage accounting functions, time-and-attendance
data and inventories. The Company also assists customers in strategic planning
and capital budgeting as well as in cash management and overall financial
planning.
The Company provides secured financing to retailers, primarily to finance store
acquisitions, construction and remodeling, generally at a variable interest rate
equal to the prime lending rate plus 2%. The Company has developed credit
criteria intended to ensure that such loans are made only with appropriate
collateral and in situations that are expected to contribute to the Company's
growth. The Company believes that its cash flow from operations and current
financing arrangements provide it with the necessary flexibility to offer
financing to its customers as a tool to expand its business. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
referred to in Item 7 of this Form 10-K.
At May 3, 1997, the Company had an aggregate $43.4 million of secured loans
outstanding to its retail customers. The Company expects to continue to provide
secured financing to creditworthy retail customers as part of its strategy to
retain existing business and attract new business. The amount of customer
financing that may be provided by the Company in future years is not presently
determinable since such amount will depend upon, among other things, the number
of store sites that are offered for sale or available for development in the
Company's service area and the availability of alternative sources of financing.
Retail Operations
The Company's METRO/BASICS Retail Division was acquired in connection with the
Super Rite Acquisition, and accounted for 9.9% of the Company's sales for fiscal
1997. The Company's Retail Grocery Division operates thirteen 45,000 to 60,000
square foot "superstores" under the METRO tradename, and three smaller
traditional supermarkets under the BASICS tradename, in the metropolitan
Baltimore, Maryland and Dover, Delaware markets.
The Company believes that the METRO format offers significant opportunities for
growth. The METRO stores feature an expanded selection of higher-margin
perishables and prepared foods together with value-oriented dry groceries and
in-store banking facilities. In 1997, METRO/BASICS was the second largest
grocery retailer in the Baltimore market. During fiscal 1998, the Company
expects to continue its strategy of opening new METRO stores in the Baltimore
market and converting certain BASICS stores to the METRO format.
Competition
The food distribution industry is highly competitive. The Company faces
competition from national, regional and local food distributors on the basis of
price, quality and assortment, frequency and reliability of deliveries and the
range and quality of services provided. In addition, the Company's customers and
its own
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METRO/BASICS Retail Division compete with retail supermarket chains that provide
their own distribution function, purchasing directly from producers and
distributing products to their supermarkets for sale to consumers.
The principal competitors of the Company's wholesale operations include Fleming
Companies, Inc., SuperValu Inc., Nash Finch Company, DiGiorgio Company,
Nassau-Suffolk Frozen Food Co., Inc. and Burris Foods, Inc. The primary retail
grocery competitors of the Company's wholesale customers and of the METRO/BASICS
Retail Division include Giant Food, Inc. based in Landover, Maryland, The Great
Atlantic & Pacific Tea Co., Weis Supermarkets, Inc., Safeway Inc., Food Lion,
Inc., Winn Dixie Stores, Inc., The Kroger Co., Harris Teeter, Inc. and Hannaford
Bros. Co.
The Company believes that it can compete successfully on the wholesale level
while supporting the competitive efforts of its customers by pursuing its
business strategy focused on reducing and controlling costs, increasing
efficiency and pursuing profitable growth. In particular, the Company enhances
its competitive position by using its purchasing power, low cost structure and
efficient distribution system to provide products to its customers at the lowest
available prices, while offering its customers a wide variety of services to
support their competitive position. In addition, the Company expects to continue
to pursue opportunities for customers to acquire additional stores that become
available within and adjacent to the Company's principal service area.
Employee Relations
Management believes that relations with the Company's associates are excellent.
At May 3, 1997, the Company employed approximately 606 salaried and 4,545
non-salaried associates, compared to 571 salaried and 4,354 non-salaried
associates employed at April 27, 1996.
The Company is party to a four-year collective bargaining agreement that expires
in April 2000 covering its transportation unit employees at the Mechanicsville,
Virginia distribution center. The Company is also party to a four-year
collective bargaining agreement that expires in July 1998 covering warehouse
employees at the West Point, Pennsylvania distribution center and a five-year
collective bargaining agreement that expires in June 2002 covering employees of
the METRO/BASICS Retail Division. The Company is not a party to any other
collective bargaining agreements, nor is it aware of any pending union petitions
related to its employees.
Regulation
The Company is subject to federal, state and local laws and regulations
governing the processing, purchase, handling, sale and transportation of its
products. Management believes that the Company is in material compliance with
all federal, state and local laws and regulations governing its business.
Trademarks and Licenses
The Company owns or licenses various registered trademarks. Federal
registrations for the "RICHFOOD" and "ECON" trademarks have been obtained by the
Company for use on a variety of products distributed by the Company.
The Company licenses the "IGA" trademark from IGA, Inc., a Delaware non-stock
corporation. The IGA license authorizes the Company to supply "IGA" brand
products and to sublicense the "IGA" trademark to retailers that desire to
operate their retail stores under the "IGA" banner. IGA, Inc. may terminate the
license in the event the Company violates the terms of IGA, Inc.'s bylaws and
fails to cure the violation within the applicable cure period.
-8-
Certain Financial Information
Information with respect to the Company's sales, operating profit and financial
condition for each of its past five fiscal years appears in the "Selected
Consolidated Financial Data" referred to in Item 6 of this Form 10-K.
Information with respect to the Company's industry segments is included in Note
13 of the Notes to Consolidated Financial Statements referred to in Item 8 of
this Form 10-K. Information with respect to the Company's working capital
practices appears above under the captions "Business Strategy -- Reducing and
Controlling Costs; Increasing Efficiency in Logistics and Distribution" and
"Wholesale Operations -- Products and Purchasing," and in the "Financial Review"
referred to in Item 7 of this Form 10-K.
ITEM 2. PROPERTIES
The Company's three principal facilities are: Richfood/Virginia's 1.3 million
square foot distribution center located in Mechanicsville, Virginia (the
"Mechanicsville Facility"); Richfood/Pennsylvania's leased 635,000 square foot
automated distribution facility located in Harrisburg, Pennsylvania (the
"Harrisburg Facility"); and Richfood/Pennsylvania's 6.3 million cubic foot
highly automated frozen food distribution facility located in West Point,
Pennsylvania (the "West Point Facility").
The Mechanicsville Facility, one of the largest grocery distribution centers in
the country, is situated on a 400 acre site, of which only 100 acres are
currently utilized. Richfood also has a long-term lease for a 650,000 square
foot warehouse in Chester, Virginia. Richfood utilizes a portion of the Chester
warehouse primarily to accommodate opportunistic bulk purchases and for
additional seasonal storage capacity. The Chester warehouse, which formerly
served as a regional grocery distribution center, is available to supplement the
Mechanicsville Facility to accommodate additional growth.
The Harrisburg Facility is a 635,000 square foot state-of-the-art distribution
center that utilizes fully automated inventory handling equipment. The lease for
the Harrisburg Facility expires in 2025. The Company also operates 160,480
square feet of refrigerated warehouse space in neighboring Shiremanstown,
Pennsylvania, under a lease that expires in 2015, and 147,000 square feet of dry
grocery warehouse space in Harrisburg, Pennsylvania, under a lease that expires
in 2002.
The West Point Facility is a highly automated, frozen food distribution facility
with 6.3 million cubic feet of refrigerated space. In addition, there are
approximately 185,000 square feet of office space and truck maintenance
facilities associated with this facility.
Norristown operates a 150,000 square foot refrigerated produce distribution
center under a lease that expires in 1998. Such lease term may be extended, at
Norristown's option, for an additional year.
The Richfood Dairy, located in Richmond, Virginia, is a 65,000 square foot
facility capable of processing and packaging over 550,000 gallons per week of
milk and other dairy products, fruit juices, bottled water and related items.
This facility is owned by Richfood.
The METRO/BASICS Retail Division operates sixteen retail stores in the
Baltimore, Maryland and Dover, Delaware markets. These retail locations are all
leased on a long-term basis with lease terms, including options, exceeding four
years.
Each of the foregoing facilities is well-maintained and in good operating
condition. The Company believes that each of its facilities has adequate
capacity to meet the demands of anticipated growth.
ITEM 3. LEGAL PROCEEDINGS
The Company is party to various legal actions that are incidental to its
business. While the outcome of legal actions cannot be predicted with certainty,
the Company believes that the outcome of any of these proceedings, or all of
them combined, will not have a material adverse effect on its consolidated
financial position or business.
-9-
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
EXECUTIVE OFFICERS
The following persons are executive officers of the Company. Officers serve at
the discretion of the Company's Board of Directors and are elected at each
annual meeting of the Board of Directors.
Donald D. Bennett, age 61, has served as Chairman of the Board of the Company
since January 1, 1997. Mr. Bennett formerly served as Chairman of the Board and
Chief Executive Officer of the Company from June 1995 to December 1996, and as
President and Chief Executive Officer of the Company from May 1990 to June 1995.
John E. Stokely, age 44, was elected President and Chief Executive Officer of
the Company effective January 1, 1997, after serving as President and Chief
Operating Officer of the Company from June 1995 to December 1996. Mr. Stokely
was formerly Executive Vice President-Finance and Administration of the Company
from August 1993 to June 1995, Senior Vice President-Finance and Chief Financial
Officer of the Company from April 1991 to August 1993 and Vice President-Finance
and Chief Financial Officer of the Company from August 1990 to April 1991.
John C. Belknap, age 50, was elected Executive Vice President and Chief
Financial Officer of the Company in July 1997. Mr. Belknap formerly served as
Executive Vice President and Chief Financial Officer of OfficeMax, Inc., an
office products superstore chain, from December 1995 to June 1997, and as
Executive Vice President and Chief Financial Officer of Zale Corporation, a
retail jewelry store chain, from February 1994 to February 1995. From January
1990 to January 1994 and from February 1995 to December 1995, Mr. Belknap was an
independent financial consultant. From January 1989 to May 1993, Mr. Belknap
also was a director of, and consultant to, Finlay Enterprises, Inc., an operator
of leased fine jewelry departments in major department stores nationwide.
Alec C. Covington, age 40, was elected Executive Vice President and Chief
Operating Officer - Wholesale Operations of the Company in January 1997. Mr.
Covington formerly served as President and Chief Operating Officer of Richfood,
Inc. from May 1996 to December 1996 and Executive Vice President and Chief
Operating Officer of Richfood, Inc. from October 1995 to May 1996. Prior to his
employment by the Company, Mr. Covington served as President and Chief Operating
Officer of Houchens Industries, Inc. from June 1993 to October 1995, and as
President of the Quincy, Florida division of SuperValu Inc. and President of the
Greenville, Kentucky division of Wetterau, Inc. from 1990 to 1993.
Christopher A. Brown, age 34, was elected Executive Vice President -
Procurement, of the Company in April 1997. Mr. Brown formerly served as Senior
Executive Vice President of Super Rite Foods, Inc. from March 1996 to March
1997, President and Chief Operating Officer of Rotelle from October 1995 through
February 1996 and Executive Vice President and Chief Operating Officer of
Rotelle from August 1994 to October 1995. Mr. Brown was formerly Richfood,
Inc.'s Executive Vice President-Procurement and Marketing from September 1993 to
August 1994, Senior Vice President-Procurement from September 1992 to September
1993 and Vice President-Procurement from February 1991 to August 1992.
Gary W. Bittner, age 49, was elected President and Chief Operating Officer of
the Company's Richfood/Virginia division in March 1997. Mr. Bittner formerly
served as Regional Vice President of McLane Company, a distributor to
convenience stores, since 1992.
Joseph Della Noce, Jr., age 40, was elected President and Chief Operating
Officer of the Company's Richfood/Pennsylvania division in January 1997. Mr.
Della Noce formerly served as Executive Vice President of Rotelle, Inc. from May
1995 until December 1996, Senior Vice President - Retail Sales and Support
-10-
Services of Richfood, Inc. from October 1994 to April 1995 and Vice President -
Retail Sales of Richfood, Inc. from April 1991 to September 1994.
Donald G. Eipp, age 64, was elected Executive Vice President - Dairy Operations
of the Company in October 1995. Mr. Eipp formerly served as Midwest Regional
Operations Manager of Borden Inc., a national dairy operation, from January 1992
through September 1995.
Wilbur E. Hatcher, age 41, was elected Vice President and Chief Information
Officer of the Company in July 1996. Mr. Hatcher formerly served as Vice
President Information Systems of Books-A-Million, Inc., a retail bookstore
chain, from July 1994 to June 1996, and as Manager of Information Systems
Development of Publix Supermarkets, Inc., a regional supermarket chain, from
February 1992 to June 1994.
David W. Hoover, age 34, was elected Vice President - Finance of the Company in
August 1993. Mr. Hoover formerly served as Director - Planning and Analysis of
the Company from December 1990 to August 1993.
John F. Rotelle, age 61, was elected Chairman of Rotelle in October 1995. Mr.
Rotelle formerly was President of Rotelle, having served in such capacity since
1959.
John D. Ryder, age 49, was elected President and Chief Operating Officer of the
Company's METRO/Basics Retail division in October 1995, after serving as
President and Chief Operating Officer of the retail division of Super Rite
Foods, Inc. since 1990.
FORWARD LOOKING STATEMENTS
This Annual Report on Form 10-K includes 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. Although the Company
believes that its expectations are based on reasonable assumptions, it can give
no assurance that its goals or strategies will be achieved. Important factors
that could cause actual results to differ materially from those reflected in the
forward looking statements made herein are detailed in Exhibit 99.1 hereto, and
other risks and uncertainties may be detailed from time to time in the Company's
future filings with the Securities and Exchange Commission.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
The Common Stock of the Company is listed on the New York Stock Exchange and
trades under the symbol "RFH". As of June 27, 1997, there were 1,458 holders of
record of the Company's Common Stock. The information set forth under the
headings "Market Price Range" and "Cash Dividends Declared Per Common Share,"
and in the final paragraph, of Note 14 of the Notes to Consolidated Financial
Statements, which appears in the Company's Annual Report to Shareholders for
Fiscal 1997 (the "1997 Annual Report"), is hereby incorporated by reference.
The Company has paid cash dividends on its Common Stock since September 1991.
The Company expects to continue paying cash dividends on its Common Stock when
justified by the Company's financial condition. The amount of future dividends,
if any, will depend on general business conditions encountered by the Company,
its earnings, financial condition and capital requirements and such other
factors as the Board of Directors of the Company may deem relevant.
-11-
ITEM 6. SELECTED FINANCIAL DATA
The information appearing under the caption "Selected Consolidated Financial
Data," which appears in the 1997 Annual Report, is incorporated herein by
reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The information appearing under the caption "Financial Review," which appears in
the 1997 Annual Report, is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements and related notes of Richfood Holdings,
Inc. and its subsidiaries, together with the report of Ernst & Young LLP
thereon, which appear in the 1997 Annual Report, are incorporated herein by
reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not required to be included in this Form 10-K in accordance with instruction 1
to Item 304 of Regulation S-K.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information contained in the Company's Proxy Statement prepared for use in
connection with the 1997 annual meeting of shareholders (the "1997 Proxy
Statement") under the captions "Nominees for Election to the Board of
Directors," "Board of Directors and Committees" and "Section 16(a) Beneficial
Ownership Reporting Compliance" is incorporated herein by reference. See also
"Executive Officers" at the end of Part I of this Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
The information contained in the 1997 Proxy Statement under the caption
"Executive Compensation" is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information contained in the 1997 Proxy Statement under the caption
"Security Ownership of Certain Beneficial Owners and Management" is incorporated
herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information contained in the 1997 Proxy Statement under the captions
"Certain Relationships and Related Transactions" and "Compensation Committee
Interlocks and Insider Participation" is incorporated herein by reference.
-12-
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Financial statements, financial statement schedules and exhibits
included in this Form 10-K:
1. Financial Statements:
The following consolidated financial statements and independent
auditors' report, which appear on pages 19 through 33 of the 1997
Annual Report, are incorporated herein by reference:
Report of Ernst & Young LLP.
Richfood Holdings, Inc. Consolidated Balance Sheets at May 3,
1997, and April 27, 1996.
Richfood Holdings, Inc. Consolidated Statements of Earnings for
the fiscal years ended May 3, 1997, April 27, 1996, and April 29,
1995.
Richfood Holdings, Inc. Consolidated Statements of Shareholders'
Equity for the fiscal years ended May 3, 1997, April 27, 1996, and
April 29, 1995.
Richfood Holdings, Inc. Consolidated Statements of Cash Flows for
the fiscal years ended May 3, 1997, April 27, 1996, and April 29,
1995.
Notes to Consolidated Financial Statements.
In addition, (i) the report of KPMG Peat Marwick LLP, which is
referred to in the report of Ernst & Young LLP, and (ii) the report of
Coopers & Lybrand L.L.P., which is referred to in the report of KPMG
Peat Marwick LLP, are filed herewith as Financial Statement Schedules.
2. Financial Statement Schedules:
Report of KPMG Peat Marwick LLP
Report of Coopers & Lybrand L.L.P.
Schedule II Valuation and Qualifying Accounts.
The report of Ernst & Young LLP on Schedule II is included in the
consent filed as Exhibit 23.1 hereto.
Schedules other than those listed above have been omitted because such
schedules are not required or are not applicable.
3. Exhibits:
The exhibits that are required to be filed or incorporated by
reference herein are listed in the Exhibit Index. Exhibits 10.1 to
10.10 hereto constitute management contracts or compensatory plans or
arrangements required to be filed as exhibits hereto.
(b) Reports on Form 8-K:
None.
-13-
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders
Richfood Holdings, Inc.:
We have audited the consolidated balance sheet of Richfood Holdings, Inc. and
subsidiaries as of April 27, 1996 and the related consolidated statements of
earnings, shareholders' equity and cash flows for the fiscal years ended April
27, 1996 and April 29, 1995. In connection with our audits of the consolidated
financial statements, we also have audited the financial statement schedule as
listed in the accompanying index for the fiscal years ended April 27, 1996 and
April 29, 1995. The consolidated financial statements and financial statement
schedule give effect to the merger on October 15, 1995 of a wholly-owned
subsidiary of Richfood Holdings, Inc. with and into Super Rite Corporation,
which has been accounted for using the pooling of interests method as described
in note 2 to the consolidated financial statements. These consolidated financial
statements and financial statement schedule are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
consolidated financial statements and financial statement schedule based on our
audits. We did not audit the fiscal 1995 consolidated financial statements and
financial statement schedule of Super Rite Corporation, which consolidated
financial statements reflect net sales constituting approximately 49% of the
related consolidated financial statement totals for fiscal 1995. The fiscal 1995
consolidated financial statements and financial statement schedule of Super Rite
Corporation were audited by other auditors, whose report thereon has been
furnished to us, and our opinion expressed herein, insofar as it relates to the
amounts included for Super Rite Corporation, is based solely on the report of
the other auditors.
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 and the report of the other auditors provide a
reasonable basis for our opinion.
In our opinion, based on our audits and the report of the other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the financial position of Richfood Holdings, Inc. and
subsidiaries as of April 27, 1996, and the results of their operations and their
cash flows for the fiscal years ended April 27, 1996 and April 29, 1995, in
conformity with generally accepted accounting principles. Also in our opinion
based on our audit and the report of the other auditors, the related 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/ KPMG PEAT MARWICK LLP
Richmond, Virginia
June 10, 1996
-14-
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Super Rite Corporation
Harrisburg, Pennsylvania
We have audited the consolidated statements of income, cash flows and
stockholders' equity for the fifty-three week period ended March 4, 1995 of
Super Rite Corporation and subsidiaries (not presented herein). We have also
audited the financial statement schedule of Super Rite Corporation as of March
4, 1995 and for the fifty-three week period then ended (not presented herein).
These consolidated financial statements and financial statement schedule are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements and financial schedule based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated results of operations and
cash flows of Super Rite Corporation for the fifty-three week period ended March
4, 1995 in conformity with generally accepted accounting principles. In
addition, in our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken as a whole,
present fairly, in all material respects, the information required to be
included therein.
/s/ COOPERS & LYBRAND L.L.P.
Harrisburg, Pennsylvania
April 21, 1995, except for
the sixth paragraph of Note
6 which is dated as
of May 5, 1995
-15-
SCHEDULE II
RICHFOOD HOLDINGS, INC.
VALUATION AND QUALIFYING ACCOUNTS
(Dollar amounts in thousands)
Balance at Charged to Balance at
Beginning of Costs and Deductions End of
Description Fiscal Year Expenses and other Fiscal Year
----------- ----------- -------- --------- -----------
For Fiscal Year Ended
May 3, 1997
Deducted from asset accounts:
Allowance for doubtful accounts $5,573 $4,241 $4,483 $5,331
For Fiscal Year Ended
April 27, 1996
Deducted from asset accounts:
Allowance for doubtful accounts 4,744 6,197 5,368 5,573
For Fiscal Year Ended
April 29, 1995
Deducted from asset accounts:
Allowance for doubtful accounts 3,518 4,490 3,264 4,744
-16-
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
RICHFOOD HOLDINGS, INC.
(Registrant)
By /s/ John E. Stokely
-------------------------------------
August 1, 1997 John E. Stokely
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities indicated.
By /s/ Donald D. Bennett By /s/ Albert F. Sloan
- -------------------------------- --------------------------------
Donald D. Bennett Albert F. Sloan
Chairman of the Board Director
of Directors
By /s/ John E. Stokely
By /s/ Roger L. Gregory --------------------------------
- -------------------------------- John E. Stokely
Roger L. Gregory Director, President and
Director Chief Executive Officer
By /s/ Grace E. Harris By /s/ George H. Thomazin
- -------------------------------- --------------------------------
Grace E. Harris George H. Thomazin
Director Director
By /s/ John C. Jamison By /s/ James E. Ukrop
- -------------------------------- --------------------------------
John C. Jamison James E. Ukrop
Director Director
By /s/ G. Gilmer Minor, III By /s/ Edward Villanueva
- -------------------------------- --------------------------------
G. Gilmer Minor, III Edward Villanueva
Director Director
By /s/ Claude B. Owen, Jr. By /s/ John C. Belknap
- -------------------------------- --------------------------------
Claude B. Owen, Jr. John C. Belknap
Director Executive Vice President &
Chief Financial Officer
By /s/ John F. Rotelle
- -------------------------------- By /s/ David W. Hoover
John F. Rotelle --------------------------------
Director David W. Hoover
Vice President - Finance
(Principal Accounting Officer)
Each of the above signatures is affixed as of August 1, 1997.
-17-
EXHIBIT INDEX
2.1 Agreement and Plan of Reorganization, dated June 26, 1995, by
and between the Company and Super Rite Corporation. (1)
2.2 Amendment No. 1, dated October 13, 1995, to the Agreement and
Plan of Reorganization by and between the Company and Super Rite
Corporation. (2)
2.3 Amendment No. 2, dated February 6, 1996, and effective as of
October 15, 1995, to the Agreement and Plan of Reorganization by
and between the Company and Super Rite Corporation. (3)
The Registrant agrees to furnish supplementally to the
Securities and Exchange Commission, upon request, copies of any
schedules and exhibits to the foregoing exhibits that are not
filed herewith in accordance with Item 601(b)(2) of Regulation
S-K.
3.1 Amended and Restated Articles of Incorporation of the Company.
(4)
3.2 Bylaws of the Company, amended and restated as of January 28,
1997. (5)
10.1 Employment and Severance Benefits Agreement, dated as of April
28, 1996, between the Company and Donald D. Bennett. (6)
10.2 Employment and Severance Benefits Agreement, dated as of April
28, 1996, between the Company and John E. Stokely. (6)
10.3 Employment and Severance Benefits Agreement, dated August 23,
1994, between Rotelle, Inc. and John F. Rotelle. (7)
10.4 Employment Agreement, dated October 13, 1995, between Super Rite
Corporation and John D. Ryder. (6)
10.5 Amended and Restated Long-Term Incentive Plan. (8)
10.6 Amended and Restated Omnibus Stock Incentive Plan. (8)
10.7 Non-Employee Directors' Stock Option Plan. (7)
10.8 Supplemental Executive Retirement Plan and related Trust
Agreement. (9)
10.9 Executive Officer Performance Plan. (10)
10.10 Super Rite Corporation 1991 Omnibus Stock Incentive Plan. (11)
10.11 Bylaws of IGA, Inc., restated as of March 1, 1988. (12)
10.12 Revised and Restated Lease Agreement, dated October 13, 1995,
between G. F. Lucknow Associates, as Landlord, and Super Rite
Foods, Inc. (6)
10.13 Lease, dated November 1, 1977, originally made between
Safe-Chester Associates, as lessor, and Safeway Stores,
Incorporated, as lessee, as assigned to Richfood. (13)
11.1 Statement re computation of net earnings per common share.
12.1 Statement re computation of certain ratios.
13.1 Portions of Richfood Holdings, Inc.'s 1997 Annual Report to
Shareholders.
21.1 Subsidiaries of the Company.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of Coopers & Lybrand L.L.P.
27.1 Financial Data Schedule.
99.1 Cautionary Statements for Purposes of the Safe Harbor Provisions
of the Securities Litigation Reform Act of 1995.
The Registrant agrees to furnish to the Securities and Exchange
Commission, upon request, copies of those agreements defining the rights
of holders of long-term debt of the Registrant and its subsidiaries that
are not filed herewith pursuant to Item 601(b)(4)(iii) of Regulation
S-K.
----------------------------
(1) Incorporated by reference to the Company's Current Report on
Form 8-K dated June 26, 1995 (Commission File No. 0-16900).
(2) Incorporated by reference to the Company's Current Report on
Form 8-K dated October 15, 1995 (Commission File No. 0-16900).
(3) Incorporated by reference to the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended January 6, 1996
(Commission File No. 0-16900).
(4) Incorporated by reference to the Company's Quarterly Report on
Form 10-Q for the twelve week period ended July 24, 1993
(Commission File No. 0-16900).
(5) Incorporated by reference to the Company's Quarterly Report on
Form 10-Q for the twelve week period ended January 4, 1997
(Commission File No. 0-16900).
(6) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended April 27, 1996 (Commission File
No. 0-16900).
(7) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended April 29, 1995 (Commission File
No. 0-16900).
(8) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended April 30, 1994 (Commission File
No. 0-16900).
(9) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended May 2, 1992 (Commission File No.
0-16900).
(10) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended April 28, 1990 (Commission File
No. 0-16900).
(11) Incorporated by reference to the Company's Registration
Statement on Form S-8 (Commission File No. 33-63447).
(12) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended May 1, 1993 (Commission File No.
0-16900).
(13) Incorporated by reference to the Company's Annual Report on Form
10-K for the fiscal year ended April 30, 1988 (Commission File
No. 0-16900).