UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 11-K
(Mark One)
|X| ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
OR
| | TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER: NO. 001-13705
--------------------
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
KEEBLER COMPANY
SALARIED SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
Keebler Company
677 Larch Avenue
Elmhurst, IL 60126
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
TABLE OF CONTENTS
PAGE(S)
-------
Report of Independent Accountants..................................... 1
Financial Statements:
Statement of Net Assets Available for Benefits
as of December 31, 1999 and 1998........................ 2
Statement of Changes in Net Assets Available for Benefits
for the years ended December 31, 1999 and 1998.......... 3
Notes to Financial Statements................................ 4-8
Supplemental Schedule:
Schedule of Assets Held for Investment Purposes
as of December 31, 1999.................................. 9
Signatures............................................................ 10
Exhibit:
23 Consent of Independent Accountants
Note: Supplemental schedules required by the Employee Retirement Income
Security Act of 1974 that have not been included herein are not
applicable to the Keebler Company Salaried Savings Plan.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Retirement Committee of
Keebler Company Salaried Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits,
present fairly, in all material respects, the net assets available for benefits
of the Keebler Company Salaried Savings Plan (the "Plan") as of December 31,
1999 and 1998 and the changes in net assets available for benefits for the years
ended December 31, 1999 and 1998, in conformity with accounting principles
generally accepted in the United States. These financial statements are the
responsibility of the Plan's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States which require that we plan and perform
the audits to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audit of the Plan's financial statements as of and for the year ended
December 31, 1999 was made for the purpose of forming an opinion on the
financial statements taken as a whole. The supplemental schedule of Schedule of
Assets Held for Investment Purposes at December 31, 1999 is presented for the
purpose of additional analysis and is not a required part of the basic financial
statements, but is supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Security Act of 1974. The supplemental schedule has been subjected to
the procedures applied in the audit of the basic financial statements as of and
for the year ended December 31, 1999, and, in our opinion, is fairly stated in
all material respects in relation to the basic financial statements taken as a
whole.
PRICEWATERHOUSECOOPERS LLP
Chicago, Illinois
June 23, 2000
<PAGE>
<TABLE>
<CAPTION>
KEEBLER COMPANY SALARIED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1999 AND 1998
1999 1998
----------------- -----------------
<S> <C> <C>
ASSETS:
Investments:
Insurance Company general account $ 75,570,436 $ 59,796,126
Pooled separate accounts 90,080,950 58,720,546
United Biscuits Holdings plc common stock 148,822 103,899
Keebler Foods Company common stock 1,254,170 -
Participants loans 3,194,303 2,497,119
----------------- -----------------
Total investments 170,248,681 121,117,690
----------------- -----------------
Receivables:
Employer contribution receivable 4,878,291 3,572,931
Employee contribution
and loan repayment receivable 448,613 44,912
Receivable from President Baking
Co., Inc. 401(k) Plan (Note 1) - 20,275,345
----------------- -----------------
Total receivables 5,326,904 23,893,188
----------------- -----------------
----------------- -----------------
Net assets available for benefits $ 175,575,585 $ 145,010,878
================= =================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
2
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
KEEBLER COMPANY SALARIED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
1999 1998
---------------- ----------------
<S> <C> <C>
ADDITIONS:
Additions to net assets attributed to:
Contributions:
Employee $ 14,448,418 $ 10,636,589
Employer 4,878,291 3,572,938
Rollover balance transfers 1,082,125 992,807
---------------- ----------------
Net contributions 20,408,834 15,202,334
Investment income:
Interest 4,406,576 3,695,031
Dividends 4,097 6,548
Net appreciation in investments 15,355,419 11,297,236
---------------- ----------------
Net investment income 19,766,092 14,998,815
---------------- ----------------
Total additions 40,174,926 30,201,149
---------------- ----------------
OTHER (DECREASES) INCREASES:
Fund transfers - (4,160)
Benefit payments to participants (9,610,219) (9,926,401)
Receivable from President Baking Co.
Co., Inc. 401(k) Plan (Note 1) - 20,275,345
---------------- ----------------
Net other (decreases) increases (9,610,219) 10,344,784
---------------- ----------------
Net increase 30,564,707 40,545,933
---------------- ----------------
Net assets available for benefits:
Beginning of year 145,010,878 104,464,945
---------------- ----------------
End of year $ 175,575,585 $ 145,010,878
================ ================
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
3
</TABLE>
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1. PLAN DESCRIPTION
The following brief description of the Keebler Company Salaried Savings
Plan (the "Plan") is provided for general information only. Participants
should refer to the Plan agreement for more complete information.
GENERAL
The Plan, which became effective January 1, 1984, is a defined
contribution plan offered to eligible employees of Keebler Foods Company
("Keebler").
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA").
Effective December 31, 1998, the President Baking Company, Inc. 401(k)
Plan merged into the Plan, and was terminated. The Plan has assumed all
assets, liabilities and obligations of the President Baking Company, Inc.
401(k) Plan. Accordingly, the statement of net assets available for
benefits and statement of changes in net assets available for benefits
reflect the transfer of net assets of $20,275,345, which occurred in
April 1999.
PARTICIPATION AND CONTRIBUTION
All full-time and regular part-time employees are immediately eligible to
participate in the Plan, with the exception of employees covered by a
collective bargaining agreement, store merchandisers and other temporary
employees. Eligible employees who elect to participate in the Plan may
have Keebler make before-tax contributions on their behalf in increments
of 1% to 15% of the participant's compensation. Before-tax contributions
are limited by the applicable laws under ERISA. Eligible employees may
also contribute an additional 1% to 10% of compensation on an after-tax
basis.
Keebler makes contributions ranging from zero to fifty cents, depending
on company performance, for every before-tax dollar contributed by the
employee, up to 6% of the employees' eligible pay.
VESTING
Participants are 100% vested in employee contributions and any earnings
thereon immediately upon entering the Plan. Participants are vested in
employer contributions in 20% increments each year of service, beginning
with the first year of service.
PAYMENT OF BENEFIT
A participant is eligible to receive a distribution in the form of a
single lump-sum cash payment, an annuity or a combination of the above
upon reaching normal retirement age, or his or her termination as defined
in the Plan. If the participant dies before a distribution is made then
his or her vested balance shall be distributed in accordance with the
participants' specifications. An employee may also apply for a hardship
withdrawal as defined in the Plan. A participant may also receive 100% of
his or her vested balance upon retirement due to disability.
4
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
1. PLAN DESCRIPTION (CONTINUED)
PARTICIPANT LOANS
A participant may borrow an amount no less than $1,000 and not to exceed
$50,000, less any loan amounts repaid in the previous twelve months or,
50% of his or her vested account balance. Each loan must be evidenced by
a participant collateral promissory note. Each loan bears a fixed
interest rate determined on a case by case basis given the prevailing
prime interest rate at the time of the loan application. The loan
repayment period generally ranges between one and five years. Upon
retirement or termination, any outstanding loan balance will be treated
as a participant distribution.
ADMINISTRATIVE EXPENSES
The Plan is administered by a Retirement Committee appointed by Keebler's
Board of Directors. All expenses incurred in the administration of the
Plan are paid by Keebler with the exception of certain transaction fees
charged on loans and withdrawals, which are paid by the participants.
FUND INFORMATION
Connecticut General Life Insurance Company ("CIGNA") serves as the
trustee and record keeper of the Plan. Under the terms of the Plan
agreement, CIGNA invests contributions in fifteen investment accounts in
proportions specified by participants. Participants should refer to the
Plan agreement for descriptions of investment options.
Investment in the United Biscuits Holdings plc Common Stock fund and
United Biscuit (Holdings) contains investments in the common stock of
United Biscuits (Holdings), plc (former ultimate parent company of
Keebler Foods Company).
Investment in Keebler Foods Company Common Stock fund contains
investments in Keebler's common stock.
Deposits allocated to a specific fund are commingled with those of other
participants and are invested in accordance with the policies of the
specific fund. Realized and unrealized gains and losses, dividends,
interest income and expenses are allocated to individual participants
based on their proportionate interest in the fund.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan are prepared on the accrual basis in
accordance with generally accepted accounting principles.
REALIZED AND UNREALIZED GAINS AND LOSSES
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation in investments, which consists of realized
gains or losses and the unrealized appreciation (depreciation) on those
investments.
5
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
RISKS AND UNCERTAINTIES
The Plan provides for various investment options in several investment
securities. Investment securities are exposed to various risks, such as
interest rate, market and credit. Due to the level of risk associated
with certain investment securities and the level of uncertainty related
to changes in the value of investment securities, it is at least
reasonably possible that changes in risks in the near term would
materially affect participants' account balances and the amounts reported
in the statement of net assets available for benefits and the statement
of changes in net assets available for benefits.
USE OF ESTIMATES
The preparation of the Plan's financial statements in conformity with
generally accepted accounting principles requires the Plan administrator
to make estimates and assumptions that affect the reported amount of net
assets available for benefits at the date of the financial statements and
the changes in net assets available for benefits during the reporting
period and, when applicable, the disclosures of contingent assets and
liabilities at the date of the financial statements. Actual results could
differ from those estimates.
3. INVESTMENTS
The Plan's investment in an insurance company general account
(unallocated contract) is valued at contract value, which approximates
fair value. The value represents contributions made to the fund, plus
interest at the contract rate. The interest rate is determined in
November for the upcoming Plan year. The annual yield and the crediting
interest rate for the years ending December 31, 1999 and 1998 were 6.25%
and 6.60%, respectively.
The Plan's investment in the CIGNA Charter Large Company Stock Index
Fund, Fidelity Growth Opportunities Account, Janus Worldwide account,
American (Twentieth) Century Ultra Account, Fidelity Contrafund Account,
Lazard Small Cap Account, CIGNA Lifetime 20 Fund, CIGNA Lifetime 30 Fund,
CIGNA Lifetime 40 Fund, CIGNA Lifetime 50 Fund, CIGNA Lifetime 60 Fund
and Fidelity Advisor Balanced Account are valued based on the fair value
of the underlying assets in CIGNA's related pooled separate accounts.
Fair value of the underlying assets is based upon quoted market prices as
of the last business day of the year.
The Plan also invests in United Biscuits (Holdings), PLC common stock and
Keebler Foods Company common stock, which are valued based upon the
closing market price of the respective common stocks as of the last
business day of the year.
6
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
3. INVESTMENTS (CONTINUED)
Investments at fair market value are summarized as follows:
<TABLE>
<CAPTION>
1999 1998
------------------ -----------------
<S> <C> <C>
CIGNA Charter Guaranteed Long-Term Fund
(cost equals fair market value) $ 75,570,436 * $ 59,796,126 *
CIGNA Charter Large Company Stock Index Fund
(cost $16,217,173 and $12,988,660, respectively) 24,049,691 * 18,440,529 *
Fidelity Growth Opportunities Account
(cost $16,670,055 and $10,883,916, respectively) 21,586,313 * 16,535,620 *
Janus Worldwide Account
(cost $10,200,259 and $5,021,638, respectively) 15,171,131 * 5,385,170
American (Twentieth) Century Ultra Account
(cost $9,063,539 and $5,009,408, respectively) 12,562,827 * 5,800,026 *
Fidelity Contrafund Account
(cost $4,270,826 and $2,708,119, respectively) 5,571,617 3,185,197
Lazard Small Cap Account
(cost $1,801,327 and $1,645,406, respectively) 1,665,727 1,380,903
CIGNA Lifetime 20 Fund
(cost $813,441 and $507,410, respectively) 984,689 533,184
CIGNA Lifetime 30 Fund
(cost $1,076,840 and $914,335, respectively) 1,322,269 964,783
CIGNA Lifetime 40 Fund
(cost $2,241,571 and $2,375,329, respectively) 2,760,657 2,519,962
CIGNA Lifetime 50 Fund
(cost $1,177,201 and $1,232,399, respectively) 1,382,700 1,306,601
CIGNA Lifetime 60 Fund
(cost $886,979 and $900,223, respectively) 1,003,996 961,321
Fidelity Advisor Balanced Account
(cost $1,891,652 and $1,607,879, respectively) 2,019,333 1,707,250
United Biscuits (Holdings), plc Common Stock
(cost $140,041 and $113,053, respectively) 148,822 103,899
Keebler Foods Company Common Stock
(cost $1,280,762) 1,254,170 -
Participant Loans
(interest rate 6% to 12%) 3,194,303 2,497,119
---------------- ----------------
$ 170,248,681 $ 121,117,690
================ ================
* Represents 5% or more of the Plan's net assets.
</TABLE>
7
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
3. INVESTMENTS (CONTINUED)
During 1999 and 1998, the Plan's investments in pooled separate accounts
and common stock appreciated (depreciated) in value as follows:
<TABLE>
<CAPTION>
1999 1998
--------------- ---------------
<S> <C> <C>
Pooled separate accounts $ 15,382,310 $ 11,293,775
United Biscuits (Holdings), plc common stock 12,023 (10,108)
United Biscuits (Holdings) common stock - 13,569
Keebler Foods Company common stock (38,914) -
--------------- ---------------
Net appreciation in fair value $ 15,355,419 $ 11,297,236
=============== ===============
</TABLE>
4. TAX STATUS
The Plan is intended to be qualified under section 401(a) of the Internal
Revenue Code of 1986 (the "Code") and is intended to be exempt from
taxation under section 501(a) of the Code. The Plan relies on a favorable
opinion letter issued by the IRS dated April 21, 1998. The Plan
administrator believes that the Plan is currently designed and being
operated in compliance with the applicable requirements of the Code and
the related trust was tax-exempt as of the financial statement date.
Therefore, no provision for income taxes has been included in the Plan's
financial statements.
5. PLAN TERMINATION
Keebler has the right to terminate the Plan subject to the provisions of
ERISA at any time, although it has expressed no intention to do so. Upon
termination of the Plan, participants become fully vested in their
accounts and are entitled to a distribution from the Plan.
6. RELATED PARTY TRANSACTIONS
Certain plan investments represent pooled separate accounts and an
insurance company general account managed by CIGNA. CIGNA is the trustee
and record keeper, as defined by the Plan and, therefore, these
transactions qualify as party-in-interest transactions. In addition, plan
investments include loan balances due from participants; thus, these
transactions qualify as party-in-interest transactions.
8
<PAGE>
SUPPLEMENTAL SCHEDULE
<PAGE>
KEEBLER COMPANY SALARIED SAVINGS PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1999
<TABLE>
<CAPTION>
Historical Market
Identity of Issuer Description of Investment Cost Value
-------------------------------------------------- -------------------------------- -------------- --------------
<S> <C> <C> <C>
Connecticut General Life Insurance Company:
* CIGNA Charter Guaranteed Long-Term Fund Insurance Company General Account $ 75,570,436 $ 75,570,436
CIGNA Charter Large Company Stock Index Fund Pooled Separate Account 16,217,173 24,049,691
Fidelity Growth Opportunities Account Pooled Separate Account 16,670,055 21,586,313
Janus Worldwide Account Pooled Separate Account 10,200,259 15,171,131
American (Twentieth) Century Ultra Account Pooled Separate Account 9,063,539 12,562,827
Fidelity Contrafund Account Pooled Separate Account 4,270,826 5,571,617
Lazard Small Cap Account Pooled Separate Account 1,801,327 1,665,727
* CIGNA Lifetime 20 Fund Pooled Separate Account 813,441 984,689
* CIGNA Lifetime 30 Fund Pooled Separate Account 1,076,840 1,322,269
* CIGNA Lifetime 40 Fund Pooled Separate Account 2,241,571 2,760,657
* CIGNA Lifetime 50 Fund Pooled Separate Account 1,177,201 1,382,700
* CIGNA Lifetime 60 Fund Pooled Separate Account 886,979 1,003,996
Fidelity Advisor Balanced Account Pooled Separate Account 1,891,652 2,019,333
United Biscuits (Holdings), PLC Stock Common Stock 140,041 148,822
Keebler Foods Company Common Stock Common Stock 1,280,762 1,254,170
* Participant Loans Interest rates from 6%-12% - 3,194,303
-------------- --------------
$ 143,302,102 $ 170,248,681
============== ==============
* Party-in-interest
9
</TABLE>
<PAGE>
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934,
the administrators of the Plan have duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
KEEBLER COMPANY
SALARIED SAVINGS PLAN
(Name of Plan)
/s/ JAMES T. SPEAR
------------------------------------------------------
James T. Spear
Vice President Finance and Corporate Controller
(Principal Accounting Officer)
Date: June 28, 2000
/s/ ALAN T. GAMBREL
------------------------------------------------------
Alan T. Gambrel
Vice President Human Resources
Date: June 28, 2000
