SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 for the year ended December 31, 1998.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934 for the transition period from ________ to ________.
Commission file number: 0-16900
A. Full title of plan and the address of the plan, if different from that of
issuer named below:
SUPER RITE FOODS, INC.
EMPLOYEE INVESTMENT OPPORTUNITY PLAN
FOR RETAIL UNION EMPLOYEES
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
Richfood Holdings, Inc.
4860 Cox Road, Suite 300
Glen Allen, Virginia 23060
Required Information
1. Audited Statements of Assets Available for Plan Benefits - As of
December 31, 1997 and 1998 (attached).
2. Audited Statements of Changes in Assets Available for Plan Benefits - Years
ended December 31, 1997 and 1998 (attached).
3. Written consents of the accountants with respect to the plan annual
financial statements' incorporation by reference in a registration
statement on Form S-8 under the Securities Exchange Act of 1933 (attached).
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the trustee
(or other persons who administer the employee benefit plan) have duly caused
this annual report to be signed on its behalf by the undersigned hereunto duly
authorized.
Dated: June 29, 1999 SUPER RITE FOODS, INC.
EMPLOYEE INVESTMENT
OPPORTUNITY PLAN FOR
RETAIL UNION EMPLOYEES
By /s/ John C. Belknap
-----------------------
John C. Belknap
Executive Vice President and
Chief Financial Officer
Financial Statements And Schedules
Super Rite Foods, Inc.
Employee Investment Opportunity Plan For
Retail Union Employees
Years Ended December 31, 1998 And 1997
with Report Of Independent Auditors
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Financial Statements and Schedules
December 31, 1998 and 1997
TABLE OF CONTENTS
Report of Independent Auditors..............................................1
Financial Statements
Statements of Assets Available for Plan Benefits............................2
Statements of Changes in Assets Available for Plan Benefits.................3
Notes to Financial Statements...............................................4
Schedules
Line 27a - Schedule of Assets Held for Investment Purposes.................12
Line 27d - Schedule of Reportable Transactions.............................13
Report of Independent Auditors
The Board of Directors
Richfood Holdings, Inc.
We have audited the accompanying statements of assets available for plan
benefits of the Super Rite Foods, Inc. Employee Investment Opportunity Plan for
Retail Union Employees (the Plan) as of December 31, 1998 and 1997, and the
related statements of changes in assets available for plan benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets available for plan benefits of the Super Rite
Foods, Inc. Employee Investment Opportunity Plan for Retail Union Employees at
December 31, 1998 and 1997, and the changes in assets available for plan
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
of assets held for investment purposes as of December 31, 1998, and reportable
transactions for the year then ended, are presented for purposes of complying
with the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974, and are
not a required part of the basic financial statements. The supplemental
schedules have been subjected to the auditing procedures applied in our audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ Ernst & Young LLP
Richmond, Virginia
June 25, 1999
1
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Statements of Assets Available for Plan Benefits
DECEMBER 31,
1998 1997
---------------- ----------------
ASSETS
Investments, at fair value:
Mutual funds $ 1,330,076 $ 821,161
Guaranteed interest contract 698,941 483,954
Richfood Holdings, Inc. common stock 240,559 265,107
Loans to participants 91,493 50,014
---------------- ----------------
2,361,069 1,620,236
Participant contributions receivable 24,369 30,086
================ ================
Assets available for plan benefits $ 2,385,438 $ 1,650,322
================ ================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
2
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Statements of Changes in Assets Available for Plan Benefits
YEAR ENDED DECEMBER 31,
1998 1997
----------------- ----------------
Investment income:
Interest and dividends $ 59,047 $ 40,059
Net appreciation in fair value of
investments 138,827 136,358
----------------- ----------------
197,874 176,417
Participant contributions 622,432 476,725
----------------- ----------------
820,306 653,142
Participant distributions and withdrawals 85,190 31,586
----------------- ----------------
Net increase in assets available for plan
benefits 735,116 621,556
Assets available for plan benefits at
beginning of year 1,650,322 1,028,766
----------------- ----------------
Assets available for plan benefits at
end of year $ 2,385,438 $ 1,650,322
================= ================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
3
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements
December 31, 1998 and 1997
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following are the significant accounting policies of the Super Rite Foods,
Inc. Employee Investment Opportunity Plan for Retail Union Employees (the Plan).
BASIS OF PRESENTATION
The accompanying financial statements have been prepared on the accrual basis of
accounting. Accordingly, interest and dividend income and contributions are
recognized as earned; benefits paid to participants and administrative expenses
are recognized when incurred; and net appreciation (depreciation) in the fair
value of investments is recognized as it occurs.
Purchases and sales of securities are recorded as of the trade date. The cost of
investments sold is determined on the basis of average cost.
INVESTMENTS
Ownership of the various mutual funds held by Prudential Investments Retirement
Services, the Plan's custodian, is expressed in number of shares. Each share is
valued by the Plan's custodian based upon quoted market prices.
Investments in the guaranteed interest contract are valued at contract value,
which approximates fair value.
The fair value of Richfood Holdings, Inc. common stock (Richfood Stock Fund) is
based upon the price of the stock as of the end of the plan year, as quoted on
the New York Stock Exchange.
USE OF ESTIMATES
The preparation of financial statements in accordance with generally accepted
accounting principles requires the Plan Administrator to make estimates and
assumptions that affect amounts reported in the financial statements and
accompanying notes. Actual results may differ from these estimates.
4
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN
The following brief description of the Plan is provided for general information
purposes only. Participants should refer to the Plan Document for more complete
information.
GENERAL
The Plan is a defined contribution plan and is subject to certain of the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The
Plan is administered by Richfood Holdings, Inc. (the Employer or the Company),
parent company of Super Rite Foods, Inc. and its subsidiaries. The Plan
custodian is Prudential Investments Retirement Services. The trustees of the
Plan are officers of the Company.
ELIGIBILITY
Under the Plan, participation is available to all Retail Union employees of
Super Rite Foods, Inc. and its subsidiaries, a wholly-owned subsidiary of
Richfood Holdings, Inc., who have attained age 21 and completed six months of
service.
CONTRIBUTIONS
Each employee participating in the Plan may elect to make pre-tax contributions
of not less than 1% nor more than 15% of his or her compensation for the Plan
year, in 1% increments. Participant contributions during any Plan year are
subject to Internal Revenue Code limitations. This limitation was $10,000 in
1998 and $9,500 in 1997.
5
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN (CONTINUED)
INVESTMENT OPTIONS
The Plan has entered into an administrative agreement with Prudential
Investments Retirement Services providing for the management, investment, and
reinvestment of Plan assets. The Plan provides for nine separate investment
options which are described as follows:
Prudential MoneyMart Assets - invests primarily in high quality money
market instruments maturing in thirteen months or less.
Prudential Government Income Fund - invests primarily in U.S.
Government securities issued by the U.S. Treasury.
Prudential Balanced Portfolio and Prudential Active Balanced Fund - consist
of a diversified portfolio of equity securities, debt obligations and money
market instruments.
Prudential Stock Index Fund - invests in a broad mix of stocks that are
designed to duplicate the performance of the S&P 500.
Prudential Jennison Growth Fund - consists of investments in equity
securities of established companies with above-average growth prospects.
Prudential International Stock Fund - invests primarily in equity
securities of foreign companies.
Prudential Guaranteed interest contract - invests primarily in fixed income
securities having short to intermediate maturities.
Richfood Stock Fund - consists of investments in common stock of Richfood
Holdings, Inc.
LOANS TO PARTICIPANTS
Under the terms of the Plan, participants may elect to borrow 50%, subject to a
minimum of $1,000, of their vested account balances. The terms of the loans are
set based on the nature of the borrowings. The Plan Administrator determines the
interest rates to be charged for participant loans based on comparable lending
rates used by third parties.
6
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT PROVISIONS OF THE PLAN (CONTINUED)
VESTING, DISTRIBUTIONS AND WITHDRAWALS, AND PLAN TERMINATION
Participants are at all times fully vested in their tax-deferred (pre-tax)
contributions and such amounts are never subject to forfeiture; however,
tax-deferred contributions may not be withdrawn except in the event of hardship,
death, disability, retirement or termination of employment.
Distributions and withdrawals, pursuant to the provisions of the Plan, are based
on the fair value of the participants' accounts as of the effective valuation
date.
Although it has not expressed any intent to do so, the Employer has the right
under the Plan to terminate the Plan subject to the provisions of ERISA. In the
event of Plan termination, the funds of the Plan shall be used for the exclusive
benefit of the participants. See Note 7 - Subsequent Event.
INCOME TAXES
The Internal Revenue Service has determined and informed the Plan Administrator
by a letter dated August 31, 1995 that the Plan is qualified and the trust
established under the Plan is tax-exempt under the applicable sections of the
Internal Revenue Code. The Plan Administrator is not aware of any actions or
events in the operation of the Plan that would jeopardize the Plan's qualified
status.
7
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
3. INVESTMENTS
The Plan's investments are held by Prudential Investments Retirement Services,
the Plan's custodian. The fair value of each investment maintained by Prudential
Investments Retirement Services, including individual investments that represent
5% or more of assets available for plan benefits, as of December 31, 1998 and
1997 is presented in Note 8.
4. INVESTMENT TRANSFERS
Under the provisions of the Plan, a participant may elect to have the value of
his or her participant account attributable to a particular investment fund
transferred to any of the other available investment funds upon request, with
certain restrictions.
5. ADMINISTRATIVE EXPENSES
In accordance with the Plan Document, administrative expenses are generally paid
by the Employer.
6. YEAR 2000 (UNAUDITED)
The Company has developed and is implementing a strategic, long-term information
technology plan to upgrade its core application systems, including those systems
that impact the processing of employee benefits. Concurrently, it has developed,
and is implementing, a plan to ensure that such systems are year 2000 compliant.
The Company believes that with the currently planned system conversions and
upgrades, as well as certain additional modifications to existing software, the
Company will achieve year 2000 compliance without any significant operational
problems related to the Company's information systems. The Company is also
communicating with the Plan's significant service providers to coordinate year
2000 compliance. The Plan's service providers have indicated that they are
presently taking steps to ensure that the Plan's systems and operations will be
year 2000 compliant.
8
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
7. SUBSEQUENT EVENT
On June 9, 1999, the Company announced that it had entered into an Agreement and
Plan of Merger (the "Agreement"), dated as of June 9, 1999, among SUPERVALU
INC., a Delaware corporation ("SUPERVALU"), Winter Acquisition, Inc., a Delaware
corporation and wholly-owned subsidiary of SUPERVALU ("Acquisition"), and the
Company. Under the terms of the Agreement, the Company will be merged with and
into Acquisition (the "Merger") with Acquisition being the surviving
corporation. The transaction is subject to regulatory approval and the approval
by the Company's shareholders, as well as other customary conditions, and is
expected to be consummated prior to the end of calendar 1999. Following the
consummation of the Merger, the Company will become an indirect, wholly-owned
subsidiary of SUPERVALU.
9
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
8. SUMMARY OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS BY ACCOUNT
A summary of the changes in assets available for plan benefits, by account, for
the year ended December 31, 1998 is as follows:
MONEY GOV'T. ACTIVE STOCK JENNISON GUARANTEED
MART INCOME BALANCED BALANCED INDEX GROWTH INTERNATIONAL INTEREST
ASSETS FUND PORTFOLIO FUND FUND FUND STOCK FUND CONTRACT
-------- --------- ----------- ---------- ---------- ---------- -------------- -----------
Additions to assets attributable
to:
Investment income:
Interest and dividends $ 5,466 $ 3,552 $ 3,150 $ 2,919 $ 3,213 $ 971 $ 1,653 $ 35,587
Net appreciation
(depreciation) in fair value of
investments - 1,290 5,865 12,846 48,587 126,787 11,266 -
-------- --------- ----------- ---------- ---------- ---------- -------------- -----------
5,466 4,842 9,015 15,765 51,800 127,758 12,919 35,587
Participant contributions 30,959 18,282 35,874 33,116 82,424 114,436 40,260 190,903
-------- --------- ----------- ---------- ---------- ---------- -------------- -----------
36,425 23,124 44,889 48,881 134,224 242,194 53,179 226,490
Deductions from assets attributable to:
Participant distributions and
withdrawals 3,907 3,027 2,951 1,432 4,556 14,953 7,054 15,801
Interfund transfers 31,765 (2,536) (691) (7,304) 5,374 (35,008) (27,721) 4,298
-------- --------- ----------- ---------- ---------- ---------- -------------- -----------
Net increase (decrease) in assets 64,283 17,561 41,247 40,145 135,042 192,233 18,404 214,987
Assets available for benefits:
Beginning of year 76,117 45,781 80,331 84,643 133,302 297,898 103,089 483,954
======== ========= =========== ========== ========== ========== ============== ===========
End of year $140,400 $63,342 $121,578 $124,788 $268,344 $490,131 $121,493 $698,941
======== ========= =========== ========== ========== ========== ============== ===========
RICHFOOD
STOCK LOANS TO CONTRIBUTIONS
FUND PARTICIPANTS RECEIVABLE TOTAL
----------- ------------ -------------- ------------
Additions to assets attributable
to:
Investment income:
Interest and dividends $ 2,536 $ - $ - $ 59,047
Net appreciation
(depreciation) in fair value of
investments (67,814) - - 138,827
----------- ------------ -------------- ------------
(65,278) - - 197,874
-
Participant contributions 81,895 - (5,717) 622,432
----------- ------------ -------------- ------------
16,617 (5,717) 820,306
Deductions from assets attributable to:
Participant distributions and
withdrawals 27,769 3,740 - 85,190
Interfund transfers (13,396) 45,219 - -
----------- ------------ -------------- ------------
Net increase (decrease) in assets (24,548) 41,479 (5,717) 735,116
Assets available for benefits:
Beginning of year 265,107 50,014 30,086 1,650,322
=========== ============ ============== ============
End of year $240,559 $ 91,493 $ 24,369 $2,385,438
=========== ============ ============== ============
10
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for
Retail Union Employees
Notes to Financial Statements (continued)
8. SUMMARY OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS BY ACCOUNT
(CONTINUED)
A summary of the changes in assets available for plan benefits, by account, for
the year ended December 31, 1997 is as follows:
MONEY GOV'T. ACTIVE STOCK JENNISON GUARANTEED
MART INCOME BALANCED BALANCED INDEX GROWTH INTERNATIONAL INTEREST
ASSETS FUND PORTFOLIO FUND FUND FUND STOCK FUND CONTRACT
--------- --------- ---------- ---------- ---------- ----------- ------------- ----------
Additions to assets attributable
to:
Investment income
Interest and dividends $ 3,082 $ 2,499 $ 2,020 $ 2,102 $ 1,596 $ 474 $ 1,337 $ 25,436
Net appreciation in fair
value of investments - 1,040 6,721 8,043 19,753 61,058 3,370 -
--------- --------- ---------- ---------- ---------- ----------- ------------- ----------
Total investment income 3,082 3,539 8,741 10,145 21,349 61,532 4,707 25,436
Participant contributions 27,993 18,712 29,089 24,174 41,039 85,858 37,341 158,286
--------- --------- ---------- ---------- ---------- ----------- ------------- ----------
31,075 22,251 37,830 34,319 62,388 147,390 42,048 183,722
Deductions from assets attributable to:
Participant distributions and
withdrawals 1,750 1,161 1,504 1,318 999 5,970 1,341 14,797
Interfund transfers 3,615 (5,322) (4,753) (6,069) 20,356 (19,709) (3,666) 3,530
--------- --------- ---------- ---------- ---------- ----------- ------------- ----------
Net increase in assets 32,940 15,768 31,573 26,932 81,745 121,711 37,041 172,455
Assets available for benefits:
Beginning of year 43,177 30,013 48,758 57,711 51,557 176,187 66,048 311,499
========= ========= ========== ========== ========== =========== ============= ==========
End of year $76,117 $45,781 $80,331 $84,643 $133,302 $297,898 $103,089 $483,954
========= ========= ========== ========== ========== =========== ============= ==========
RICHFOOD
STOCK LOANS TO CONTRIBUTIONS
FUND PARTICIPANTS RECEIVABLE TOTAL
----------- ------------- -------------- -----------
Additions to assets attributable
to:
Investment income
Interest and dividends $ 1,513 $ - $ - $ 40,059
Net appreciation in fair
value of investments 36,373 - - 136,358
----------- ------------- -------------- -----------
Total investment income 37,886 - - 176,417
Participant contributions 65,886 - (11,653) 476,725
----------- ------------- -------------- -----------
103,772 - (11,653) 653,142
Deductions from assets attributable to:
Participant distributions and
withdrawals 1,510 1,236 - 31,586
Interfund transfers (26,307) 38,325 - -
----------- ------------- -------------- -----------
Net increase in assets 75,955 37,089 (11,653) 621,556
Assets available for benefits:
Beginning of year 189,152 12,925 41,739 1,028,766
=========== ============= ============== ===========
End of year $265,107 $50,014 $30,086 $1,650,322
=========== ============= ============== ===========
11
Schedules
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for Retail Union Employees
Employer ID #54-1438602, Plan #0003
Line 27a - Schedule of Assets Held For Investment Purposes
December 31, 1998
UNITS COST FAIR VALUE
------------- ---------------- ---------------
Mutual funds maintained by Prudential
Investments Retirement Services*:
MoneyMart Assets 140,400 $ 140,400 $ 140,400
Government Income Fund 6,848 60,892 63,342
Balanced Portfolio 10,081 126,810 121,578
Active Balanced Fund 9,621 122,309 124,788
Stock Index Fund 9,730 197,488 268,344
Jennison Growth Fund 26,754 350,859 490,131
International Stock Fund 6,250 109,637 121,493
---------------- ---------------
Total mutual funds 1,108,395 1,330,076
Guaranteed interest contract - 698,941 698,941
Richfood* Stock Fund 11,593 240,470 240,559
Loans to participants - - 91,493
================ ===============
$ 2,047,806 $ 2,361,069
================ ===============
* Party-in-Interest
12
Super Rite Foods, Inc.
Employee Investment Opportunity Plan for Retail Union Employees
Employer ID #54-1438602, Plan #0003
Line 27d - Schedule of Reportable Transactions
Year ended December 31, 1998
IDENTITY OF PURCHASE SELLING LEASE EXPENSE INCURRED
PARTY INVOLVED DESCRIPTION OF ASSET PRICE PRICE RENTAL WITH TRANSACTION
- ------------------------------------------------------------------------------------------------------------------------------------
CATEGORY (II) -SERIES OF NON-SECURITIES TRANSACTIONS IN EXCESS OF 5% OF PLAN
ASSETS:
Prudential Investments
Retirement Securities* Guaranteed Interest Contract $247,809 $ - $ - $ -
Guaranteed Interest Contract - 32,823 -
CATEGORY (III) -SERIES OF SECURITIES TRANSACTIONS IN EXCESS OF 5% OF PLAN
ASSETS:
Prudential Investments
Retirement Securities* Stock Index Fund 91,413 - - -
Stock Index Fund - 3,378 - -
Jennison Growth Fund 122,971 - - -
Jennison Growth Fund - 44,089 - -
**
Richfood Holdings, Inc.*
Common Stock 85,984 - - -
Richfood Holdings, Inc.*
Common Stock - 42,718 - -
* Party-in-Interest
**Transactions made on the market
There were no category (i) or (iv) reportable transactions during the year ended
December 31, 1998.
CURRENT VALUE
COST OF OF ASSET ON NET GAIN
ASSET TRANSACTION DATE OR (LOSS)
-----------------------------------------
CATEGORY (II) -SERIES OF NON-SECURITIES TRANSACTIONS IN EXCESS OF 5% OF PLAN
ASSETS:
Prudential Investments
Retirement Securities* Guaranteed Interest Contract $247,809 $247,809 $ -
Guaranteed Interest Contract 32,823 32,823 -
CATEGORY (III) -SERIES OF SECURITIES TRANSACTIONS IN EXCESS OF 5% OF PLAN
ASSETS:
Prudential Investments
Retirement Securities* Stock Index Fund 91,413 91,413 -
Stock Index Fund 1,936 3,378 1,442
Jennison Growth Fund 122,971 122,971 -
Jennison Growth Fund 34,670 44,089 9,419
**
Richfood Holdings, Inc.*
Common Stock 85,984 85,984 -
Richfood Holdings, Inc.*
Common Stock 36,048 42,718 6,670
* Party-in-Interest
**Transactions made on the market
There were no category (i) or (iv) reportable transactions during the year ended
December 31, 1998.