<PAGE> 1
UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998.
COMMISSION FILE NUMBER: 0-1532
A. Full title of the plan and the address of the plan, if
different than that of the issuer named below:
MARSH SUPERMARKETS, INC. 401(K) PLAN
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
MARSH SUPERMARKETS, INC.
9800 CROSSPOINT BOULEVARD
INDIANAPOLIS, INDIANA 46256
<PAGE> 2
FINANCIAL STATEMENTS AND EXHIBITS
The following financial statements of Marsh Supermarkets, Inc. 401(k)
Plan are included herein:
Report of Independent Auditors
Statement of Net Assets Available for Benefits, with Fund Information
as of December 31, 1998 and December 31, 1997
Statement of Changes in Net Assets Available for Benefits, with Fund Information
for the Years Ended December 31, 1998 and December 31, 1997
Notes to Financial Statements
Schedules
Consent of Independent Auditors
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Retirement Committee has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
MARSH SUPERMARKETS, INC. 401(k) PLAN
By: /s/ P. Lawrence Butt, Secretary
------------------------------------------
P. Lawrence Butt, Secretary
Retirement Committee
June 24, 1999
<PAGE> 3
FINANCIAL STATEMENTS AND SCHEDULES
MARSH SUPERMARKETS, INC. 401(k) Plan
YEARS ENDED DECEMBER 31, 1998 AND 1997
WITH REPORT OF INDEPENDENT AUDITORS
<PAGE> 4
Marsh Supermarkets, Inc. 401(k) Plan
Financial Statements and Schedules
Years ended December 31, 1998 and 1997
Contents
<TABLE>
<S> <C>
Report of Independent Auditors 1
Audited Financial Statements
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 4
Notes to the Financial Statements 6
Schedules
Schedule of Assets Held for Investment Purposes 12
Schedule of Reportable Transactions 13
</TABLE>
<PAGE> 5
[ERNST & YOUNG LLP LETTERHEAD]
Report of Independent Auditors
Administrative Committee
Marsh Supermarkets, Inc. 401(k) Plan
We have audited the accompanying statements of net assets available for
benefits of the Marsh Supermarkets, Inc. 401(k) Plan as of December 31, 1998
and 1997, and the related statements of changes in net assets available for
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 net assets available for benefits of the Plan at
December 31, 1998 and 1997, and the changes in its net assets available for
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 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 additional
analysis and are not a required part of the financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement and
Income Security Act of 1974. These supplemental schedules are the responsibility
of the Plan's management. The Fund Information in the statements of net assets
available for benefits and the statements of changes in net assets available for
benefits is presented for purposes of additional analysis rather than to present
the net assets available for benefits and changes in net assets available for
benefits for each fund. The supplemental schedules and Fund Information have
been subjected to the auditing procedures applied in our audits of the financial
statements and in our opinion, are fairly stated in all material respects in
relation to the financial statements taken as a whole.
Ernst & Young, LLP
June 11, 1999
<PAGE> 6
Marsh Supermarkets, Inc. 401(k) Plan
Statements of Net Assets Available for Benefits, with Fund Information
December 31, 1998
<TABLE>
<CAPTION>
FRANKLIN TEMPLETON GEORGE PUTNAM
FIDELITY SMALL CAP EB EQUITY FOREIGN BALANCED AMERICAN EB MAGIC
CONTRAFUND FUND INDEX FUND FUND FUND BOND FUND FUND
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments, at fair value:
Money market funds $ -- $ -- $ -- $ -- $ -- $ -- $ --
Marsh stock -- -- -- -- -- -- --
Mutual funds 17,569,423 476,523 -- 1,271,947 295,928 4,958,734 --
Common/collective trust -- -- 1,096,530 -- -- -- 2,045,624
Loans to participants -- -- -- -- -- -- --
---------------------------------------------------------------------------------------
Total investments 17,569,423 476,523 1,096,530 1,271,947 295,928 4,958,734 2,045,624
Receivables and other assets:
Employee contributions 58,693 1,592 3,663 4,249 989 16,565 6,834
Employer contributions -- -- -- -- -- -- --
Interest and dividends receivable -- -- -- -- -- -- --
---------------------------------------------------------------------------------------
58,693 1,592 3,663 4,249 989 16,565 6,834
---------------------------------------------------------------------------------------
Total assets 17,628,116 478,115 1,100,193 1,276,196 296,917 4,975,299 2,052,458
LIABILITIES
Due to (from) brokers 891 (1,392) -- -- (1,837) 2,884 --
---------------------------------------------------------------------------------------
Net assets available for benefits $17,627,225 $479,507 $1,100,193 $1,276,196 $298,754 $4,972,415 $2,052,458
=======================================================================================
<CAPTION>
MARSH
STOCK PARTICIPANT
FUND LOANS TOTAL
--------------------------------------
<S> <C> <C> <C>
ASSETS
Investments, at fair value:
Money market funds $ 236,877 $ -- $ 236,877
Marsh stock 12,999,255 -- 12,999,255
Mutual funds -- -- 24,572,555
Common/collective trust -- -- 3,142,154
Loans to participants -- 1,156,060 1,156,060
--------------------------------------
Total investments 13,236,132 1,156,060 42,106,901
Receivables and other assets:
Employee contributions 44,227 -- 136,812
Employer contributions 27,065 -- 27,065
Interest and dividends 1,396 -- 1,396
receivable --------------------------------------
72,688 -- 165,273
--------------------------------------
Total assets 13,308,820 1,156,060 42,272,174
LIABILITIES
Due to (from) brokers 20,896 -- 21,442
--------------------------------------
Net assets available for benefits $13,287,924 $1,156,060 $42,250,732
======================================
</TABLE>
See accompanying notes.
2
<PAGE> 7
Marsh Supermarkets, Inc. 401(k) Plan
Statements of Net Assets Available for Benefits, with Fund Information
December 31, 1997
<TABLE>
<CAPTION>
VICTORY
FIDELITY TEMPLETON INVESTMENT MARSH
MAGELLAN FIDELITY FOREIGN QUALITY EB MAGIC STOCK
FUND CONTRAFUND FUND BOND FUND FUND FUND
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments, at fair value:
Money market funds $ -- $ -- $ -- $ -- $ -- $ 143,234
Marsh stock -- -- -- -- -- 9,634,550
Mutual funds 10,662,552 2,385,992 1,199,777 4,023,375 -- --
Common/collective trust -- -- -- -- 1,713,327 --
Loans to participants -- -- -- -- -- --
------------------------------------------------------------------------------
Total investments 10,662,552 2,385,992 1,199,777 4,023,375 1,713,327 9,777,784
Receivables and other assets:
Employee contributions 54,280 12,146 6,108 20,482 8,722 49,775
Employer contributions -- -- -- -- -- 30,250
Interest and dividends receivable -- -- -- -- -- 487
------------------------------------------------------------------------------
54,280 12,146 6,108 20,482 8,722 80,512
------------------------------------------------------------------------------
Total assets 10,716,832 2,398,138 1,205,885 4,043,857 1,722,049 9,858,296
LIABILITIES
Due to (from) brokers (21,645) 21,555 9,798 (8,228) -- --
------------------------------------------------------------------------------
Net assets available for benefits $10,738,477 $2,376,583 $1,196,087 $4,052,085 $1,722,049 $9,858,296
==============================================================================
<CAPTION>
PARTICIPANT
LOANS TOTAL
----------------------------
<S> <C> <C>
ASSETS
Investments, at fair value:
Money market funds $ -- $ 143,234
Marsh stock -- 9,634,550
Mutual funds -- 18,271,696
Common/collective trust -- 1,713,327
Loans to participants 634,033 634,033
--------------------------
Total investments 634,033 30,396,840
Receivables and other assets:
Employee contributions -- 151,513
Employer contributions -- 30,250
Interest and dividends receivable -- 487
--------------------------
-- 182,250
--------------------------
Total assets 634,033 30,579,090
LIABILITIES
Due to (from) brokers -- 1,480
--------------------------
Net assets available for benefits $634,033 $30,577,610
==========================
</TABLE>
See accompanying notes.
3
<PAGE> 8
Marsh Supermarkets, Inc. 401(k) Plan
Statements of Changes in Net Assets Available for Benefits,
with Fund Information
Year ended December 31, 1998
<TABLE>
<CAPTION>
FIDELITY FRANKLIN TEMPLETON GEORGE PUTNAM
MAGELLAN FIDELITY SMALL CAP EB EQUITY FOREIGN BALANCED
FUND CONTRAFUND FUND INDEX FUND FUND FUND
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net realized and unrealized
appreciation (depreciation) in
fair value of investments $ 29,984 $ 4,100,839 $ (9,228) $ 178,410 $ (207,653) $ (1,234)
Interest 3,458 1,738 63 182 140 39
Dividends -- -- 6,753 -- 137,298 24,487
------------------------------------------------------------------------------------
33,442 4,102,577 (2,412) 178,592 (70,215) 23,292
Contributions:
Employee 1,943 2,656,980 145,298 136,346 387,645 65,182
Employer -- -- -- -- -- --
------------------------------------------------------------------------------------
1,943 2,656,980 145,298 136,346 387,645 65,182
------------------------------------------------------------------------------------
Total additions 35,385 6,759,557 142,886 314,938 317,430 88,474
Deductions from net assets attributed to:
Benefits paid to participants
or their beneficiaries -- 994,452 24,287 67,308 105,635 656
Administrative expenses -- -- -- -- -- --
------------------------------------------------------------------------------------
Total deductions -- 994,452 24,287 67,308 105,635 656
------------------------------------------------------------------------------------
Net increase prior to interfund transfers 35,385 5,765,105 118,599 247,630 211,795 87,818
Transfers (10,773,862) 9,485,537 360,908 852,563 (131,686) 210,936
------------------------------------------------------------------------------------
Net increase (decrease) (10,738,477) 15,250,642 479,507 1,100,193 80,109 298,754
Net assets available for benefits:
Beginning of year 10,738,477 2,376,583 -- -- 1,196,087 --
------------------------------------------------------------------------------------
End of year $ -- $ 17,627,225 $ 479,507 $ 1,100,193 $ 1,276,196 $ 298,754
====================================================================================
<CAPTION>
VICTORY
INVESTMENT MARSH
AMERICAN QUALITY EB MAGIC STOCK PARTICIPANT
BOND FUND BOND FUND FUND FUND LOANS TOTAL
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net realized and unrealized
appreciation (depreciation) in
fair value of investments $ (139,720) $ 16,422 $ 105,792 $ 625,089 $ -- $ 4,698,701
Interest 808 1,297 2,043 25,911 70,315 105,994
Dividends 350,197 -- -- 308,787 -- 827,522
---------------------------------------------------------------------------------------
211,285 17,719 107,835 959,787 70,315 5,632,217
Contributions:
Employee 910,989 360 454,092 1,039,514 -- 5,798,349
Employer -- -- -- 2,776,151 -- 2,776,151
---------------------------------------------------------------------------------------
910,989 360 454,092 3,815,665 -- 8,574,500
---------------------------------------------------------------------------------------
Total additions 1,122,274 18,079 561,927 4,775,452 70,315 14,206,717
Deductions from net assets attributed to:
Benefits paid to participants
or their beneficiaries 289,092 -- 130,795 743,098 148,079 2,503,402
Administrative expenses -- -- -- 30,193 -- 30,193
---------------------------------------------------------------------------------------
Total deductions 289,092 -- 130,795 773,291 148,079 2,533,595
---------------------------------------------------------------------------------------
Net increase prior to interfund transfers 833,182 18,079 431,132 4,002,161 (77,764) 11,673,122
Transfers 4,139,233 (4,070,164) (100,723) (572,533) 599,791 --
---------------------------------------------------------------------------------------
Net increase (decrease) 4,972,415 (4,052,085) 330,409 3,429,628 522,027 11,673,122
Net assets available for benefits:
Beginning of year -- 4,052,085 1,722,049 9,858,296 634,033 30,577,610
---------------------------------------------------------------------------------------
End of year $ 4,972,415 $ -- $ 2,052,458 $ 13,287,924 $ 1,156,060 $42,250,732
=======================================================================================
</TABLE>
See accompanying notes.
4
<PAGE> 9
Marsh Supermarkets, Inc. 401(k) Plan
Statements of Changes in Net Assets Available for Benefits,
with Fund Information
Year ended December 31, 1997
<TABLE>
<CAPTION>
VICTORY
FIDELITY TEMPLETON INVESTMENT MARSH
MAGELLAN FIDELITY FOREIGN QUALITY EB MAGIC STOCK
FUND CONTRAFUND FUND BOND FUND FUND FUND
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net realized and unrealized
appreciation (depreciation) in
fair value of investments $ 2,055,776 $ 328,130 $ (72,282) $ 85,008 $ 87,751 $1,419,136
Interest 379 56 40 128 54 3,930
Dividends -- -- 129,478 215,251 -- 261,243
--------------------------------------------------------------------------------
2,056,155 328,186 57,236 300,387 87,805 1,684,309
Contributions:
Employee 1,880,922 624,706 402,413 884,303 534,014 1,007,087
Employer -- -- -- -- -- 1,010,789
--------------------------------------------------------------------------------
1,880,922 624,706 402,413 884,303 534,014 2,017,876
--------------------------------------------------------------------------------
Total additions 3,937,077 952,892 459,649 1,184,690 621,819 3,702,185
Deductions from net assets attributed to:
Benefits paid to participants
or their beneficiaries 509,421 96,098 46,661 282,399 108,924 591,136
Administrative expenses -- -- -- -- -- 21,192
--------------------------------------------------------------------------------
Total deductions 509,421 96,098 46,661 282,399 108,924 612,328
--------------------------------------------------------------------------------
Net increase prior to interfund transfers 3,427,656 856,794 412,988 902,291 512,895 3,089,857
Transfers (99,482) 310,458 (2,728) (164,144) (37,534) (180,770)
--------------------------------------------------------------------------------
Net increase (decrease) 3,328,174 1,167,252 410,260 738,147 475,361 2,909,087
Net assets available for benefits:
Beginning of year 7,410,303 1,209,331 785,827 3,313,938 1,246,688 6,949,209
--------------------------------------------------------------------------------
End of year $10,738,477 $2,376,583 $1,196,087 $4,052,085 $1,722,049 $9,858,296
================================================================================
<CAPTION>
PARTICIPANT
LOANS TOTAL
----------------------
<S> <C> <C>
Additions to net assets attributed to:
Investment income:
Net realized and unrealized
appreciation (depreciation) in
fair value of investments $ -- $ 3,903,519
Interest 45,916 50,503
Dividends -- 605,972
----------------------
45,916 4,559,994
Contributions:
Employee -- 5,333,445
Employer -- 1,010,789
----------------------
-- 6,344,234
----------------------
Total additions 45,916 10,904,228
Deductions from net assets attributed to:
Benefits paid to participants
or their beneficiaries 38,483 1,673,122
Administrative expenses -- 21,192
----------------------
Total deductions 38,483 1,694,314
----------------------
Net increase prior to interfund transfers 7,433 9,209,914
Transfers 174,200 --
----------------------
Net increase (decrease) 181,633 9,209,914
Net assets available for benefits:
Beginning of year 452,400 21,367,696
----------------------
End of year $634,033 $30,577,610
======================
</TABLE>
See accompanying notes.
5
<PAGE> 10
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements
December 31, 1998
1. DESCRIPTION OF THE PLAN
The following description of the Marsh Supermarkets, Inc. 401(k) Plan (the
"Plan") provides only general information. Participants should refer to the
Summary Plan Description for a more complete description of the Plan's
provisions.
GENERAL
The Marsh Supermarkets, Inc. 401(k) Plan was established by Marsh Supermarkets,
Inc. (the "Company") to provide retirement benefits for participating eligible
employees. The Company's Retirement Committee, appointed by the Board of
Directors of the Company, serves as the Plan Administrative Committee. The
trustee of the Plan is Key Trust Company of Ohio, N.A. ("Key Trust").
The Plan is a defined contribution retirement plan covering employees of the
Company who have met certain requirements for participation. The Plan provides
for normal retirement at age 65, but includes a provision that allows
participants to elect to receive benefits prior to their normal retirement age.
The Plan also has provisions allowing for hardship withdrawals and loans.
CONTRIBUTIONS
The Plan provides for employees to contribute from 1 to 15 percent (up to the
IRS maximum) of their compensation on a pre-tax basis. The Company contributes
an amount equal to 25 percent of employee before tax contributions (excluding
contributions in excess of six percent of compensation) in the form of Company
stock. The Plan also provides for additional grandfathered and discretionary
profit sharing contributions determined by the Board of Directors of the
Company. The grandfathered contribution is not discretionary. It is allocated to
certain longer service employees who participated in the Marsh Pension Plan and
is intended to help offset the loss of future benefit accruals under the Pension
Plan. The first contribution for the grandfather contribution was in June 1998
for $892,820. During 1998 and 1997, respectively, a total of $765,835 and $0 in
discretionary profit sharing contributions were made.
6
<PAGE> 11
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
ALLOCATIONS TO PARTICIPANTS
Income on the investments of the funds is allocated daily to participants'
accounts based on their account balance. Forfeited balances of terminated
participants' nonvested accounts are used to reduce future Company
contributions.
INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct their contributions to
these investment options:
Fidelity Contrafund--Funds are invested in equity securities of
companies that are considered under-valued, with the objective of
obtaining capital appreciation.
Franklin Small Cap Fund--Funds are invested primarily in equity
securities of companies with market capitalization of less than $1
billion, with the objective of seeking long-term capital
appreciation.
EB Equity Index Fund--This fund approximates the return of Standard
& Poor's 500 Index, which measures the performance of stocks of the
500 largest companies traded on U.S. exchanges.
Templeton Foreign Fund--Funds are invested in stocks and debt
obligations of companies and governments outside of the United
States, with the objective of achieving long-term capital growth.
George Putnam Balanced Fund--Funds are invested in a diversified
portfolio of stocks and bonds seeking to produce both capital growth
and current income.
American Bond Fund--Funds are invested primarily in bonds issued
both in the United States and abroad, with the objective of seeking
to obtain as high a level of current income as is consistent with
the preservation of capital.
7
<PAGE> 12
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
INVESTMENT OPTIONS
EB MaGIC Fund--Funds are primarily invested in a diversified
portfolio of guaranteed investment contracts with various insurance
companies. The investment objective of the Fund is to seek a
reasonable level of income together with stability of principal.
Marsh Stock Fund--Funds are invested in Class A Common Stock and
Class B Common Stock of the Company.
PAYMENT OF BENEFITS
Upon retirement or termination, a participant may receive contributions made to
the Plan, the vested portion of the employer contributions and an allocable
share of the Plan's earnings or losses. If requested, benefits are payable in a
lump sum no later than 60 days after the end of the plan year in which a
participant reaches normal retirement age or terminates employment.
EXPENSES OF THE PLAN
Investment management fees reduce plan earnings. All other plan expenses are
paid by the sponsor.
VESTING POLICY
The Employer Matching Contributions and Profit Sharing Contributions are subject
to vesting and forfeitures. 401(k) deferrals, rollovers and Grandfathered
Contributions are 100% vested and nonforfeitable. The matching and profit
sharing contributions are fully vested after 5 years.
2. SUMMARY OF ACCOUNTING POLICIES
INVESTMENTS
Investments are carried at fair value. The fair value of investments in
securities traded on a national securities exchange is determined based on the
last reported sale on the last business day of the plan year as quoted in
business publications and by security brokers. Dividends are recorded as income
on the dividend record date.
8
<PAGE> 13
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements (continued)
2. SUMMARY OF ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES
Preparation of the financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
3. INVESTMENTS
Investments held by the Plan at December 31 are presented in the following
table. Investments that represent five percent or more of the Plan's net assets
are separately identified.
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Investments at Fair Value as Determined
by Quoted Market Price:
Registered Investment Companies:
Fidelity Magellan Fund $ -- $10,662,552
Fidelity Contrafund 17,569,423 2,385,992
Franklin Small Cap Fund 476,523 --
Templeton Foreign Fund 1,271,947 1,199,777
George Putnam Balanced Fund 295,928 --
American Bond Fund 4,958,734 --
Victory Investment Quality Bond Fund -- 4,023,375
-----------------------------
24,572,555 18,271,696
Common Stock:
Marsh Class A Common Stock:
458,742 and 312,694 shares 7,854,030 4,729,497
Marsh Class B Common Stock:
354,917 and 332,546 shares 5,145,225 4,905,053
-----------------------------
12,999,255 9,634,550
Common/Collective Trusts:
EB MaGIC Fund 2,045,624 1,713,327
EB Equity Index Fund 1,096,530 --
-----------------------------
3,142,154 1,713,327
Investments at Estimated Fair Value:
Money market funds 236,877 143,234
Loans to participants 1,156,060 634,033
-----------------------------
1,392,937 777,267
-----------------------------
Total investments at fair value $42,106,901 $30,396,840
=============================
</TABLE>
9
<PAGE> 14
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements (continued)
3. INVESTMENTS (CONTINUED)
During 1998 and 1997 the Plan's investments (including investments bought, sold,
and held during the year) appreciated (depreciated) as presented in the
following table.
<TABLE>
<CAPTION>
1998 1997
----------------------------
<S> <C> <C>
Investments at Fair Value as Determined
by Quoted Market Price:
Fidelity Magellan Fund $ 29,984 $ 2,055,776
Fidelity Contrafund 4,100,839 328,130
Franklin Small Cap Fund (9,228) --
EB Equity Index Fund 178,410 --
Templeton Foreign Fund (207,653) (72,282)
George Putnam Balanced Fund (1,234) --
American Bond Fund (139,720) --
Victory Investment Quality Bond Fund 16,422 85,008
EB MaGIC Fund 105,792 87,751
Marsh Stock Fund 625,089 1,419,136
----------------------------
Net change in fair value $ 4,698,701 $ 3,903,519
============================
</TABLE>
4. TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated October 16, 1998, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (the "Code") and, therefore, the related trust is
exempt from taxation. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The Plan Administrator
believes the Plan is operated in compliance with the applicable requirements of
the Code and, therefore, believes that the Plan is qualified and the related
trust is tax exempt.
5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right to
discontinue its Plan 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.
10
<PAGE> 15
Marsh Supermarkets, Inc. 401(k) Plan
Notes to the Financial Statements (continued)
6. YEAR 2000 ISSUE (UNAUDITED)
The Plan Sponsor has determined that it will be necessary to take certain steps
in order to ensure that the Plan's information systems are prepared to handle
year 2000 dates. The Plan Sponsor is taking a two phase approach. The first
phase addresses internal systems that must be modified or replaced to function
properly. Both internal and external resources are being utilized to replace or
modify existing software applications, and test the software and equipment for
the year 2000 modifications. The Plan Sponsor anticipates substantially
completing this phase of the project by October 1999. Costs associated with
modifying software and equipment are not estimated to be significant and will be
paid by the Plan Sponsor.
For the second phase of the project, Plan management established formal
communications with its third party service providers to determine that they
have developed plans to address their own year 2000 problems as they relate to
the Plan's operations. All third party service providers have indicated that
they will be year 2000 compliant by early 1999. If modification of data
processing systems of either the Plan, the Plan Sponsor, or its service
providers are not completed timely, the year 2000 problem could have a material
impact on the operations of the Plan. Plan management has not developed a
contingency plan, because they are confident that all systems will be year 2000
ready.
11
<PAGE> 16
SCHEDULES
<PAGE> 17
Marsh Supermarkets, Inc. 401(k) Plan
Line 27a - Schedule of Assets Held for Investment Purposes
December 31, 1998
EIN Number: 35-0918179
Plan Number: 004
<TABLE>
<CAPTION>
(b) (c) (d) (e)
Identity of Issue Description of Investment Cost Current Value
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Shares of Registered Investment Companies:
Fidelity Contrafund 895,677.119 shares $13,275,981 $17,569,423
Franklin Small Cap Growth Fund 21,113.104 shares 479,022 476,523
George Putnam Fund of Boston 16,403.979 shares 300,640 295,928
Templeton Foreign Fund 151,602.778 shares 1,489,861 1,271,947
Bond Fund of America Open-End Fund 364,344.901 shares 5,093,750 4,958,734
-----------------------------
20,639,254 24,572,555
Common/Collective Trust:
EB Equity Index Fund* 2,236.494 shares 930,255 1,096,530
EB MaGIC Fund* 159,142.953 shares 1,855,734 2,045,624
Money Market Fund:
Key Trust Company of Ohio, N.A.* Employee Benefits Money Market Fund 236,877 236,877
Common Stock:
Marsh Supermarkets, Inc.* 458,742 shares of Class A Common Stock 6,338,744 7,854,030
Marsh Supermarkets, Inc.* 354,917 shares of Class B Common Stock 4,269,002 5,145,225
-----------------------------
10,607,746 12,999,255
Loans to Participants Interest rates ranging from 8.25% to 10.0% -- 1,156,060
-----------------------------
$34,269,866 $42,106,901
=============================
</TABLE>
* Indicates party-in-interest to the Plan.
12
<PAGE> 18
Marsh Supermarkets, Inc.
Line 27d - Schedule of Reportable Transactions
Year Ended December 31, 1998
EIN Number: 35-0918179
Plan Number: 004
<TABLE>
<CAPTION>
(a) (b) (c) (d) (g)
Purchase Selling Cost of
Identity of Party Involved Description of Asset Price Price Assets
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Category (i) - Single transactions in excess of 5% of plan assets:
Fidelity Investments Fidelity Contrafund
Purchases $10,625,574
Fidelity Investments Fidelity Magellan Fund
Sales 10,692,526 8,221,986
Bond Fund of America Open-End Fund
Purchases 4,034,994
The Victory Portfolios Victory Investment Quality Bond Fund
Sales 4,039,797 3,954,554
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 10,694,140
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 4,040,373
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Sales 10,694,140 10,694,140
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Sales 4,040,373 4,040,373
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 1,681,650
<CAPTION>
(a) (b) (h) (i)
Current Value
of Asset on Net Gain
Identity of Party Involved Description of Asset Transaction or (Loss)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Category (i) - Single transactions in excess of 5% of plan assets:
Fidelity Investments Fidelity Contrafund
Purchases $ 10,625,574
Fidelity Investments Fidelity Magellan Fund
Sales 10,692,526 2,470,540
Bond Fund of America Open-End Fund
Purchases 4,034,994
The Victory Portfolios Victory Investment Quality Bond Fund
Sales 4,023,375 85,243
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 10,694,140
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 4,040,373
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Sales 10,694,140
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Sales 4,040,373
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Purchases 1,681,650
</TABLE>
13
<PAGE> 19
Marsh Supermarkets, Inc.
Line 27d - Schedule of Reportable Transactions
Year Ended December 31, 1998
EIN Number: 35-0918179
Plan Number: 004
<TABLE>
<CAPTION>
(a) (b) (c) (d)
Purchase Selling
Identity of Party Involved Description of Asset Price Price
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Category (iii) - A series of transactions in excess of 5% of plan assets:
Fidelity Investments Fidelity Magellan Fund
Purchases 7,009
Sales 10,699,544
Fidelity Investments Fidelity Contrafund
Purchases 13,145,865
Sales 2,063,273
The Victory Portfolios Victory Investment Quality Bond Fund
Purchases 2,226
Sales 4,042,023
Bond Fund of America Open-End Fund
Purchases 5,442,796
Sales 344,342
Marsh Marsh Common Stock
Purchases 2,429,750
Sales 25,623
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Deposits 18,736,002
Withdrawals 18,642,358
<CAPTION>
(a) (b) (g) (h) (i)
Current Value
Cost of of Asset on Net Gain
Identity of Party Involved Description of Asset Assets Transaction Date or (Loss)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Category (iii) - A series of transactions in excess of 5% of plan assets:
Fidelity Investments Fidelity Magellan Fund
Purchases 7,009 7,009
Sales 8,228,995 10,699,544 2,470,549
Fidelity Investments Fidelity Contrafund
Purchases 13,145,865 13,145,865
Sales 1,859,147 2,063,273 204,126
The Victory Portfolios Victory Investment Quality Bond Fund
Purchases 2,226 2,226
Sales 3,956,780 4,042,023 85,243
Bond Fund of America Open-End Fund
Purchases 5,442,796 5,442,796
Sales 349,046 344,342 (4,704)
Marsh Marsh Common Stock
Purchases 2,429,750 2,429,750
Sales 20,070 25,623 5,553
Key Trust Company of Ohio, N.A. Employee Benefits Money Market Fund
Deposits 18,736,002 18,736,002
Withdrawals 18,642,358 18,642,358
</TABLE>
Information concerning (e) "Lease Rental" and (f) "Expense Incurred with
Transaction" has not been presented as it is not applicable. There were no
category (ii) or (iv) reportable transactions during 1998.
14
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
Ex 23 Consent of Arthur Andersen LLP,
Independent Public Accountants,
dated
</TABLE>
<PAGE> 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8 number 33-56626) pertaining to the Marsh Supermarkets, Inc. 401(k) Plan of
our report, dated June 11, 1999, with respect to the financial statements and
schedules of the Marsh Supermarkets, Inc. 401(k) Plan included in this Annual
Report (Form 11-K) for the year ended December 31, 1998.
/s/ Ernst & Young LLP
Indianapolis, Indiana
June 24, 1999
