<PAGE> 1
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 fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from _______ to _______
Commission File Number: 001-13537
----------
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
(Full title of the plan)
INTERNATIONAL HOME FOODS, INC.
(Exact name of issuer as specified in its charter)
100 NORTHFIELD STREET, GREENWICH, CT. 06830
(Address of principal executive offices) (Zip code)
DELAWARE 13-3377322
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
<PAGE> 2
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
<TABLE>
<CAPTION>
PAGE(S)
-------
<S> <C>
Report of Independent Accountants 2
Financial Statements:
Statement of Net Assets Available for Plan Benefits,
at December 31, 1999 and 1998 3
Statement of Changes in Net Assets Available for Plan Benefits,
for the year ended December 31, 1999 4
Notes to Financial Statements 5-11
Supplemental Schedules:
* Schedule of Assets Held for Investment Purposes,
at December 31, 1999 12
* Schedule of Reportable Transactions, for the year
ended December 31, 1999 13
Signature 14
</TABLE>
* Refers to required schedule in Form 5500 (Annual Return/Report of Employee
Benefit Plans) filed with the Department of Labor for the Plan year ended
December 31, 1999.
1
<PAGE> 3
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
International Home Foods 401(k) Savings Plan:
In our opinion, the accompanying statements of net assets available for plan
benefits and the related statement of changes in net assets available for plan
benefits present fairly, in all material respects, the net assets available for
plan benefits of International Home Foods 401(k) Savings Plan (the "Plan") at
December 31, 1999 and 1998, and the changes in net assets available for plan
benefits for the year ended December 31, 1999 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 statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes at December 31, 1999 and reportable transactions for the
year then ended are presented for the purpose of additional analysis and are not
a required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules are the responsibility of the Plan's
management. The supplemental schedules have been subjected to the auditing
procedures applied in the audit 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.
PricewaterhouseCoopers LLP
Florham Park, New Jersey
June 16, 2000
2
<PAGE> 4
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
At December 31, 1999 and 1998
<TABLE>
<CAPTION>
December 31,
--------------------------------
1999 1998
------------ ------------
<S> <C> <C>
ASSETS
Investments:
Investments, at fair value $ 61,408,131 $ 46,889,169
International Home Foods Loan Pool 2,228,312 1,362,193
------------ ------------
Total investments (see Note 3) 63,636,443 48,251,362
------------ ------------
Receivables:
Participant contributions 64,470 109,246
Employer contributions 12,986 33,197
------------ ------------
Total receivables 77,456 142,443
------------ ------------
Net assets available for plan benefits $ 63,713,899 $ 48,393,805
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 5
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
For the year ended December 31, 1999
<TABLE>
<CAPTION>
Year Ended
December 31,
------------
1999
------------
<S> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value in investments (See Note 3) $ 2,226,737
Dividends 2,797,719
Interest on loans allocated to borrowers' accounts 154,232
------------
5,178,688
------------
Contributions:
Participant 6,267,707
Employer 1,591,768
------------
7,859,475
------------
Rollovers 587,862
Transfers from other plans 11,613,614
------------
Total additions 25,239,639
------------
Deductions:
Benefits paid to participants 9,669,777
Administrative expenses 249,768
------------
Total deductions 9,919,545
------------
Net increase 15,320,094
Net assets available for plan benefits:
Beginning of period 48,393,805
------------
End of year $ 63,713,899
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 6
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN DESCRIPTION:
The following description of the International Home Foods 401(k)
Savings Plan (the "Plan") provides only general information. A complete
description of the Plan, including eligibility requirements and vesting
provisions, is contained in the plan document, a copy of which can be
obtained from the Plan Administrator.
GENERAL
Effective November 1, 1996, American Home Products Corporation sold a
majority interest in its subsidiary, International Home Foods, Inc.
("IHF" or "the Company") and its subsidiaries. Concurrent with this
transaction, IHF became a separate entity and established the Plan. The
Plan is a defined contribution plan designed to provide eligible
employees with tax-advantaged, long-term savings for retirement and is
subject to the provisions of the Employee Retirement Security Act of
1974 ("ERISA").
Effective November 1, 1996, IHF acquired Heritage Brands Holdings, Inc.
Participating Heritage employees were added to the Plan on September
20, 1999. Substantially all of the related assets of the employees were
transferred into the Plan on September 23, 1999. Related activity prior
to the date of the asset transfer is not included in the accompanying
financial statements. The transfer totaled $86,687 and is also included
in "Transfers from other plans" on the 1999 Statement of Changes in Net
Assets.
Effective April 14, 1998, IHF acquired all of the stock of Grist Mill
Co. Participating Grist Mill employees were added to the Plan on July
1, 1999. Substantially all of the related assets of the employees were
transferred into the Plan on July 2, 1999. Related activity prior to
the date of the asset transfer is not included in the accompanying
financial statements. The transfer totaled $7,727,371 and is also
included in "Transfers from other plans" on the 1999 Statement of
Changes in Net Assets.
Effective July 19, 1999, IHF acquired the manufacturing, sales
distribution and marketing operations of Louis Kemp from Tyson
Seafoods, Inc. Participating Louis Kemp employees were added to the
Plan on August 20, 1999. Substantially all of the related assets of the
employees were transferred into the Plan on August 26, 1999. Related
activity prior to the date of the asset transfer is not included in the
accompanying financial statements. The transfer totaled $3,799,556 and
is also included in "Transfers from other plans" on the 1999 Statement
of Changes in Net Assets.
5
<PAGE> 7
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
VESTING
Participants are fully vested in their own contributions and rollover
accounts. Generally, participants are 25 percent vested in employer
contributions after two years of service, and the percentage increases
25 percent annually thereafter, so that employees vest in employer
contributions 100 percent after five years. Certain additional vesting
provisions apply to employees transferred to the Plan as a result of
the Company's acquisitions.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's
contribution and allocations of the Company's contribution and Plan
earnings and is charged with an allocation of administrative expenses,
based on participant earnings or account balances, as defined in the
Plan document. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's vested account.
PARTICIPANT LOANS
A participant may borrow a minimum of $1,000; the maximum is the lesser
of 50% of the vested account balance or $50,000. The participant may
have three outstanding loans at any time.
Interest is charged on outstanding loan balances at the prime rate (as
quoted in the Wall Street Journal on the day the loan is requested)
plus 1 percent. Interest rates on loans in 1999 ranged from 7.00% to
10.25%. The loans are funded from the existing vested 401(k) account
balances on a pro rata basis from each of the existing accounts and
investment funds. The loans are generally repaid through mandatory
payroll deductions. The loan repayment period may not exceed five years
unless the loan is for the purchase of a primary residence, in which
case, the participant will have up to 15 years to repay. If the
participant fails to repay a loan within 90 days of termination, the
outstanding loan balance(s) is forgiven and becomes a taxable
distribution to the participant.
CONTRIBUTIONS
Participants may contribute up to 22 percent of annual compensation, as
defined in the Plan, subject to limitations imposed by the Internal
Revenue Service. Company contributions to eligible participant accounts
equal 50 percent of the first 6 percent of eligible compensation that
an eligible participant contributes to the Plan.
INVESTMENT OPTIONS
Upon achieving the eligibility requirements as set forth in the plan
document, a participant may direct contributions in any of the
following eight investment options:
SCHWAB RETIREMENT MONEY FUND --Seeks to provide a consistent rate of
return while preserving capital and minimizing risk.
6
<PAGE> 8
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
COLUMBIA FIXED-INCOME SECURITIES FUND --Seeks total return consistent
with prudent investment management.
DODGE & COX BALANCED FUND --Seeks income, conservation of principal,
and long-term growth of principal and income.
SAFECO EQUITY FUND --Seeks capital appreciation by investing primarily
in equity securities of companies with earnings that are expected to
grow at an above-average rate.
DAVIS NEW YORK VENTURE FUND CLASS A --Seeks maximum capital growth.
BARON ASSET FUND --Seeks rapid capital growth by primarily investing in
small to medium-sized companies that are expected to demonstrate growth
in earnings and revenue.
GAM INTERNATIONAL FUND --Invests primarily in stocks and debt
securities of companies and governments outside the United States.
IHF STOCK FUND --Invests in common stock of International Home Foods,
Inc.
TYSON FOODS STOCK FUND --Incorporated into the Plan on August 26, 1999
as a result of the transfer of assets into the Plan associated with the
Louis Kemp acquisition (see Note 1- General). All activity in this fund
was restricted to participants in the fund at the time of the transfer.
Participants in the fund had the right to transfer their investment to
any of the other Plan investment options listed above. Participants
were required to transfer their position into other eligible funds by
February 27, 2000. As of January 11, 2000, all investments in the Tyson
Foods Stock Fund were liquidated.
FORFEITURES
Forfeitures from a participant's company matching account are used to
reduce future company matching contributions. Forfeitures in 1999
totaled $127,851.
PAYMENT OF BENEFITS
Upon terminating employment with IHF, the participant will receive 100%
of his or her employee, prior employer and rollover account balances.
The participant will also receive employer contributions subject to the
vesting requirements noted in the "Vesting" section of this note.
The normal form of benefit is a lump sum payment. The participant may
voluntarily defer payment of 401(k) benefits beyond retirement, but may
not defer payment past the age of 70-1/2.
7
<PAGE> 9
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
PLAN AMENDMENTS
Effective July 1, 1999, August 20, 1999 and September 20, 1999, the
Company amended the Plan to include employees from Grist Mill, Louis
Kemp and Heritage, respectively.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The financial statements of the Plan are prepared in accordance with
generally accepted accounting principles. The significant accounting
policies followed by the Plan are as follows:
METHOD OF ACCOUNTING
The accompanying financial statements are prepared on the accrual basis
of accounting.
IMPACT OF RECENT ACCOUNTING STANDARDS
The American Institute of Certified Public Accountants issued Statement
of Position 99-3, "Accounting for and Reporting of Certain Defined
Contribution Benefit Plan Investments and Other Disclosure Matters"
("SOP 99-3") in September 1999. SOP 99-3 revises certain investment
disclosure requirements of employee benefit plans. This SOP is
effective for financial statements for plan years ending after December
15, 1999. The Company has adopted SOP 99-3.
VALUATION OF INVESTMENTS AND INCOME RECOGNITION
Investments are valued at fair value on the trade date as reported by
the respective fund managers. Dividends are recorded on the ex-dividend
date. Investments in the common stock of IHF and Tyson Foods are valued
at readily available common quoted market prices as of the valuation
date.
The Plan presents in the statements of changes in net assets available
for benefits, the net appreciation (depreciation) in the fair value of
its investments, which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
ADMINISTRATIVE EXPENSES
Both IHF and the Plan share recordkeeping and certain administrative
expenses related to the Plan. Investment and transaction fees are
incurred directly by the Plan.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenue
and expenses during the reporting period. Actual results could differ
from those estimates.
8
<PAGE> 10
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
RISKS AND UNCERTAINTIES
The plan provides for various investment options in any combination of
stocks, bonds, fixed income securities, mutual funds, and other
investment securities. Investment securities are exposed to various
risks, such as interest rate, market and credit risks. 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 statement of changes in net assets available for benefits.
3. PLAN INVESTMENTS:
Investments held by the Plan at December 31, 1999 and 1998 are
summarized in the following table:
<TABLE>
<CAPTION>
FAIR VALUE
---------------------------------
1999 1998
------------ ------------
<S> <C> <C>
Schwab Retirement Money Fund $ 12,989,901* $ 10,883,230*
Columbia Fixed-Income Securities Fund 1,978,980 1,453,916
Dodge & Cox Balanced Fund 12,649,767* 12,364,522*
Safeco Equity Fund 11,198,448* 8,777,691*
Davis New York Venture Fund Class A 13,339,379* 9,129,811*
Baron Asset Fund 5,542,695* 2,772,079*
GAM International Fund 1,718,576 1,036,525
IHF Stock Fund 1,779,439 471,395
Tyson Foods Stock Fund 210,946 --
International Home Foods Loan Pool 2,228,312 1,362,193
------------ ------------
$ 63,636,443 $ 48,251,362
============ ============
*Investment represents more than 5% of net assets available for Plan benefits.
</TABLE>
During 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
appreciated in value by $2,226,737 as follows:
<TABLE>
<S> <C>
Mutual funds $2,179,533
Common stock 47,204
----------
$2,226,737
==========
</TABLE>
9
<PAGE> 11
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
4. TAX STATUS:
The U.S. Treasury Department, in a letter dated September 10, 1998,
advised the Plan's management that the amended Plan in 1998 constitutes
a qualified plan under Section 401(a) of the Internal Revenue Code
("IRC") and is, therefore, exempt from federal income taxes under
Section 501(a). The Plan has been amended since receiving the
determination letter. However, the Plan Administrator believes that the
plan is currently designed and being operated in compliance with the
applicable requirements of the IRC, and is, therefore, exempt from
federal income taxes at the financial statement date.
5. PLAN TERMINATION:
Although it has not expressed any intent to do so, IHF has the right
under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
plan termination, participants will become 100 percent vested in their
accounts.
6. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500:
The following is a reconciliation of net assets available for Plan
benefits per the financial statements to the Form 5500 (Annual
Return/Report of Employee Benefit Plans):
<TABLE>
<CAPTION>
AT
DECEMBER 31, 1999
-----------------
<S> <C>
Net assets available for Plan benefits
per the financial statements $ 63,713,899
Deduct: benefits payable at December 31, 1999 (25,849)
---------------
Net assets available for Plan benefits per the Form 5500 $ 63,688,050
===============
</TABLE>
<TABLE>
<CAPTION>
AT
DECEMBER 31, 1998
-----------------
<S> <C>
Net assets available for Plan benefits
per the financial statements $ 48,393,805
Deduct: benefits payable at December 31, 1998 (12,029)
---------------
Net assets available for Plan benefits per the Form 5500 $ 48,381,776
===============
</TABLE>
10
<PAGE> 12
The following is a reconciliation of benefits paid to participants per
the financial statements to the Form 5500:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED
DECEMBER 31, 1999
------------------
<S> <C>
Benefits paid to participants per the
financial statements $ 9,669,777
Add: benefits payable at December 31, 1999 25,849
Deduct: benefits payable at December 31, 1998 (12,029)
---------------
Benefits paid to participants per the Form 5500 $ 9,683,597
===============
</TABLE>
7. SUBSEQUENT EVENTS:
On June 23, 2000, ConAgra, Inc. and IHF entered into a merger agreement
in which ConAgra will acquire IHF. The agreement is subject to the
approval of IHF's stockholders, government regulations and other
conditions. It is expected that the acquisition will close in the third
quarter of calendar 2000.
11
<PAGE> 13
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
At December 31, 1999
<TABLE>
<CAPTION>
IDENTITY OF ISSUE AND DESCRIPTION OF INVESTMENT COST FAIR VALUE
------------------------------------------------------------- ----------------- -----------------
<S> <C> <C>
Schwab Retirement Money Fund $ 12,984,079 $ 12,989,901
Columbia Fixed-Income Securities Fund 2,072,713 1,978,980
Dodge & Cox Balanced Fund 13,092,407 12,649,767
Safeco Equity Fund 10,422,849 11,198,448
Davis New York Venture Fund Class A 11,292,231 13,339,379
Baron Asset Fund 4,961,934 5,542,695
GAM International Fund 1,523,672 1,718,576
IHF Stock Fund 1,677,506 1,779,439
Tyson Foods Stock Fund 221,540 210,946
International Home Foods Loan Pool, 7.00% to 10.25% 0 2,228,312
----------------- ----------------
Total investments $ 58,248,931 $ 63,636,443
================= ================
</TABLE>
12
<PAGE> 14
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
For the year ended December 31, 1999
<TABLE>
<CAPTION>
CURRENT
VALUE ON
DESCRIPTION PURCHASE SELLING TRANSACTION
NAME OF PARTY OF ASSET PRICE PRICE EXPENSES(1) COST DATE NET GAIN
---------------- ------------------------ ------------ ----------- ----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Baron Asset Fund $2,321,428 $2,321,428 $2,321,428
281 transactions
Baron Asset Fund $1,155,598 1,095,998 1,155,598 $59,600
265 transactions
Davis NY Venture Fund Class A 6,024,889 6,024,889 6,024,889
305 transactions
Davis NY Venture Fund Class A 3,018,346 2,630,429 3,018,346 387,917
319 transactions
Dodge & Cox Balanced Fund 3,773,394 3,773,394 3,773,394
264 transactions
Dodge & Cox Balanced Fund 3,683,986 3,674,724 3,683,986 9,262
348 transactions
Safeco Equity Fund 5,868,209 5,868,209 5,868,209
288 transactions
Safeco Equity Fund 3,306,464 2,872,900 3,306,464 433,564
312 transactions
Schwab Retirement Money Fund 7,204,561 7,204,561 7,204,561
343 transactions
Schwab Retirement Money Fund 4,858,568 4,858,568 4,858,568 --
284 transactions
</TABLE>
(1) No expenses are incurred with individual transactions
13
<PAGE> 15
SIGNATURE
FORM 11-K
INTERNATIONAL HOME FOODS 401(k) SAVINGS PLAN
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Treasurer has duly caused this annual report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: June 28, 2000 /s/ Lynne Misericordia
-----------------------
Lynne Misericordia
Treasurer
14
<PAGE> 16
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
23 Consent of Independent Accountants
</TABLE>
