SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] Annual report pursuant to section 15(d) of the Securities Exchange Act of
1934 [fee required] for the fiscal year ending December 31, 1997.
OR
[ ] Transition report pursuant to section 15(d) of the Securities Exchange
Act of 1934 [no fee required]
Commission file number 0-19867
A. Full title of the Plan:
ESKIMO PIE CORPORATION SAVINGS PLAN
B. Name of the issuer of the securities held pursuant to the plan and the
address of its principle executive office:
ESKIMO PIE CORPORATION
901 MOOREFIELD PARK DRIVE
RICHMOND, VIRGINIA 23236
(804) 560-8400
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan
Administrator has duly caused this annual report to be signed on its behalf by
the undersigned hereunto duly authorized.
ESKIMO PIE CORPORATION
SAVINGS PLAN
DATE: June 29, 1998 /s/ Thomas M. Mishoe, Jr.
-------------------- -------------------------
Thomas M. Mishoe, Jr.
Chief Financial Officer, Vice President,
Treasurer and Corporate Secretary
Eskimo Pie Corporation
<PAGE>
Financial Statements
and Supplemental Schedules
Eskimo Pie Corporation
Savings Plan
Year ended December 31, 1997 and 1996
with Report of Independent Auditors
<PAGE>
Eskimo Pie Corporation
Savings Plan
Financial Statements
and Supplemental Schedules
Table of Contents
Report of Independent Auditors...............................................1
Audited Financial Statements
Statements of Net Assets Available for Plan Benefits
as of December 31, 1997 and 1996..........................................2
Statement of Changes in Net Assets Available for Plan Benefits,
with Fund Information, for the year ended December 31, 1997...............3
Notes to Financial Statements................................................4
Supplemental Schedules
Item 27a-Schedule of Assets Held for Investment Purposes
Item 27d-Schedule of Reportable Transactions
<PAGE>
Report of Ernst & Young LLP, Independent Auditors
Plan Administrator
Eskimo Pie Corporation Savings Plan
We have audited the accompanying statements of net assets available for plan
benefits of Eskimo Pie Corporation Savings Plan as of December 31, 1997 and
1996, and the related statement of changes in net assets available for plan
benefits for the year ended December 31, 1997. 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, 1997 and 1996, and the changes in its net assets available for plan
benefits for the year ended December 31, 1997, 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, 1997, 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 Fund Information in
the statement of changes in net assets available for plan benefits is presented
for purposes of additional analysis rather than to present the changes in net
assets available for plan benefits of each fund. The supplemental schedules and
Fund Information 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 17, 1998
<PAGE>
Eskimo Pie Corporation
Savings Plan
Statements of Net Assets Available for Plan Benefits
<TABLE>
<CAPTION>
December 31
1997 1996
-----------------------------------
<S> <C>
Assets
Investments held by trustee, First Union National Bank, at fair value:
Stable Portfolio Group Trust $ 511,316 $ 511,733
Evergreen Short-Interm Bond Fund 160,728 261,877
Fidelity Puritan Fund 838,273 599,751
Enhanced Stock Market Fund 697,156 455,599
Fidelity Advisor Growth Opportunities Fund 1,104,655 783,777
Company Stock Fund 164,420 -
Loans to participants 114,738 119,286
-----------------------------------
Total investments 3,591,286 2,732,023
Receivables:
Employer's contribution 11,492 -
Employees' contributions 28,676 -
-----------------------------------
3,631,454 2,732,023
Liabilities
Contribution refunds payable 18,624 -
-----------------------------------
Net assets available for plan benefits $3,612,830 $2,732,023
===================================
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Savings Plan
Year ended December 31, 1997
Statement of Changes in Net Assets Available
for Plan Benefits, with Fund Information
<TABLE>
<CAPTION>
Participant - Directed
----------------------------------------------------------------------------
Stable Evergreen Fidelity Advisor
Portfolio Short-Interm Fidelity Enhanced Stock Growth
Group Trust Bond Fund Puritan Fund Market Fund Opportunities Fund
----------------------------------------------------------------------------
<S> <C>
Additions:
Employer contributions $ 3,591 $ 1,228 $ 6,425 $ 4,627 $ 7,534
Employee contributions 49,132 19,657 92,814 69,019 115,967
Employee Rollovers 1,609 2,459 3,006 1,477 627
Loan repayments 9,450 2,257 12,522 11,617 12,327
Loan interest 1,559 657 2,717 2,121 2,695
----------------------------------------------------------------------------
65,341 26,258 117,484 88,861 139,150
Deductions & Transfers:
Withdrawals by participants (77,247) (4,048) (24,636) (36,129) (23,776)
Interfund transfers and loan origination (19,915) (137,223) 5,989 34,230 (17,806)
Other (212) (39) (173) (145) (176)
----------------------------------------------------------------------------
(97,374) (141,310) (18,820) (2,044) (41,758)
Net realized and unrealized appreciation
in fair value of investments 31,616 13,903 139,858 154,740 223,486
----------------------------------------------------------------------------
Net increase (decrease) (417) (101,149) 238,522 241,557 320,878
Net assets available for plan benefits
at beginning of year 511,733 261,877 599,751 455,599 783,777
----------------------------------------------------------------------------
Net assets available for plan benefits
at end of year $ 511,316 $ 160,728 $ 838,273 $ 697,156 $ 1,104,655
============================================================================
</TABLE>
<TABLE>
<CAPTION>
Non-Participant
Participant - Directed Directed
----------------------------------------- ---------------
Company
Company Loans to Stock
Stock Fund Participants Other Fund Total
-----------------------------------------------------------------------
<S> <C>
Additions:
Employer contributions $ - $ - $ 11,492 $ 105,079 $ 139,976
Employee contributions 15,131 - 28,676 - 390,396
Employee Rollovers 295 - - - 9,473
Loan repayments 1,443 (49,616) - - -
Loan interest 558 - - - 10,307
-----------------------------------------------------------------------
17,427 (49,616) 40,168 105,079 550,152
Deductions & Transfers:
Withdrawals by participants - (25,932) - (2,133) (193,901)
Interfund transfers and loan origination 63,725 71,000 - - -
Other (25) - (18,624) - (19,394)
-----------------------------------------------------------------------
63,700 45,068 (18,624) (2,133) (213,295)
Net realized and unrealized appreciation
in fair value of investments (13,281) - - (6,372) 543,950
-----------------------------------------------------------------------
Net increase (decrease) 67,846 (4,548) 21,544 96,574 880,807
Net assets available for plan benefits
at beginning of year - 119,286 - - 2,732,023
-----------------------------------------------------------------------
Net assets available for plan benefits
at end of year $ 67,846 $ 114,738 $ 21,544 $ 96,574 $ 3,612,830
=======================================================================
</TABLE>
See accompanying notes to financial statements.
<PAGE>
Eskimo Pie Corporation
Savings Plan
Notes to Financial Statements
December 31, 1997
1. Significant Accounting Policies
Basis of Accounting
The accounting records of Eskimo Pie Corporation Savings Plan (the Plan) are
maintained on the accrual basis.
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 amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
Valuation of Investments
The Plan's investments, other than loans to participants, are carried at market
value. Loans to participants are carried at the original amount of the loan less
repayments received. Investments in securities traded on national securities
exchanges are valued at the last reported sales price. All other investments are
valued at redemption value.
Securities transactions are recorded as of the trade date. Realized investment
gains and losses and unrealized appreciation/depreciation in fair value of
investments are recognized currently in the statement of changes in net assets
available for benefits.
<PAGE>
Eskimo Pie Corporation
Savings Plan
Notes to Financial Statements (continued)
2. Description of the Plan
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement or Summary Plan Description for
a more complete description of the Plan's provisions. This information is
available from Eskimo Pie Corporation.
General
The Plan is a defined contribution plan covering substantially all employees of
Eskimo Pie Corporation (the Company and Plan sponsor), Eskimo, Inc. and Sugar
Creek Foods who have one year of service and are age twenty-one or older. The
Plan is subject to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA).
Funding and Vesting
Participating employees may contribute up to 12% of their compensation as
defined in the Plan. The Plan sponsor matches 50% of the employees'
contributions for the first 6% of their compensation and may make additional
contributions to the Plan at the discretion of the Board of Directors.
Participants elect the investment options in which their contributions are
invested. Beginning March 31, 1997, all employer contributions to the Plan are
invested in the Company Stock Fund. Each participant's account is credited with
the participant's contribution, the Company's contributions and a pro-rata share
of investment earnings based upon the participant's elected options.
Participants immediately vest in their voluntary contributions and earnings
thereon. Participants are 100 percent vested in the remainder of their accounts
after three years of credited service. Any forfeitures of non-vested amounts are
used by the Company to reduce contributions. Upon termination of service, a
participant, subject to Plan limitations, may elect to receive a lump-sum amount
equal to the value of his or her account, annual installments, or an annuity
contract.
<PAGE>
2. Description of the Plan (continued)
Investment Options
Participants in the Plan have several investment options available to them with
respect to how their contributions are invested. Participants may elect to have
their contributions allocated in the following investments:
i.) The Stable Portfolio Group Trust which invests in government and
agency obligations, corporate bonds and insurance contracts,
ii.) The Evergreen Short - Interm Bond Fund which invests in U.S.
government securities, corporate bonds and cash equivalents,
iii.)The Fidelity Puritan Fund which invests in common and preferred
stock, convertible securities and bonds,
iv.) The Enhanced Stock Market Fund which invests in common stocks,
v.) The Fidelity Advisor Growth Opportunities Fund which invests in a
selection of financial instruments including common stocks, U.S.
government securities, cash equivalents, and foreign investments, and
vi.) The Company Stock Fund, which invests in common stock of Eskimo Pie
Corporation.
Loans to Participants
The Plan has a loan feature available to all Plan participants. Loans are made
from the participant's account, reducing the investment balance and creating a
receivable classified as Loans to Participants. Loans are secured by the
participant's vested account balance. Loans are repaid through payroll deduction
including principal and interest. The principal portion reduces the receivable
from participants and both principal and interest are transferred to the
participant's investment account as repayments are received.
Participants may obtain loans based on the vested value of their accounts. New
loans cannot exceed 50% of the participant's account value or a maximum of
$50,000 in accordance with the Department of Labor's regulations on loans to
participants. Loans shall bear a reasonable rate of interest and must be repaid
over a period not to exceed 5 years unless used to purchase the participant's
primary residence, in which case the loan must be repaid over a period not to
exceed 10 years.
<PAGE>
2. Description of the Plan (continued)
Administrative Expenses
All administrative expenses of the Plan are paid by the Plan sponsor.
3. Trusteed Assets
First Union National Bank, trustee of the Plan, holds the PlanOs investment
assets and executes transactions thereon.
4. Income Tax Status
The U.S. Treasury Department has informed the PlanOs sponsor that the Plan is
qualified under Section 401(a) of the Internal Revenue Code (the Code) and that
the trust established under the Plan is, therefore, exempt from Federal income
taxes under the provisions of Section 501(a) of the Code. Continued
qualification of the Plan will depend on operational adherence to the PlanOs
qualified form. The Plan Administrator is not aware of any actions or events
that have occurred that might adversely affect the PlanOs qualified status.
5. Year 2000 Issue (Unaudited)
The Plan sponsor has developed a plan to modify its internal information
technology to be ready for the year 2000 and has begun converting critical data
processing systems. The project also includes determining whether third party
service providers have reasonable plans in place to become year 2000 compliant.
The Plan sponsor currently expects the project to be substantially complete by
1999. The Plan sponsor does not expect this project to have a significant effect
on plan operations.
<PAGE>
Supplemental Schedules
<PAGE>
Eskimo Pie Corporation
Savings Plan
Item 27a-Schedule of Assets Held for Investment Purposes
December 31, 1997
<TABLE>
<CAPTION>
Current
Description Cost Value
- --------------------------------------------------------------- -------------------- --------------------
<S> <C>
*First Union Stable Portfolio Group Trust $ 447,838 $ 511,316
Evergreen Short-Interm Bond Fund 142,707 160,728
Fidelity Puritan Fund 602,727 838,273
*First Union Enhanced Stock Market Fund 452,174 697,156
Fidelity Advisor Growth Opportunities Fund 733,737 1,104,655
*Company Stock Fund 174,856 164,420
Loans to participants 6.25%-10.00% - 114,738
-------------------- --------------------
$2,554,039 $3,591,286
==================== ====================
</TABLE>
* Party-in-interest to the Plan.
<PAGE>
Eskimo Pie Corporation
Savings Plan
Item 27d-Schedule of Reportable Transactions
Year Ended December 31, 1997
<TABLE>
<CAPTION>
Current Value
Identity of Purchase Selling Cost of of Net
Party Involved Description Price Price Asset Asset Gain/(Loss)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Series of transactions in excess of 5 percent of plan assets.
First Union National Bank First Union Stable Portfolio Group Trust $69,280 $101,312 $90,116 $69,280 $11,196
First Union National Bank Evergreen Short- Interm Bond Fund 33,463 148,515 132,701 33,463 15,814
Fidelity Investments, Inc. Fidelity Puritan Fund 166,665 68,001 53,210 166,665 14,791
First Union National Bank First Union Enhanced Stock Market Fund 177,703 90,885 64,036 177,703 26,849
Fidelity Investments, Inc. Fidelity Advisor Growth Opportunities Fund 237,566 140,174 101,931 237,566 38,243
FUNB/ Eskimo Pie Company Stock Fund 257,774 73,701 82,918 257,774 (9,217)
First Union National Bank Participant Loans 71,000 75,549 75,549 71,000 -
</TABLE>
Exhibit 23
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-24893) pertaining to the Eskimo Pie Corporation 1996 Incentive Stock
Plan, the Eskimo Pie Corporation Savings Plan and the Eskimo Pie Corporation
Employee Stock Purchase Plan of our report dated June 17, 1998, with respect to
the financial statements and schedules of the Eskimo Pie Corporation Savings
Plan included in this Annual Report (Form 11-K) for the year ended December 31,
1997.
/s/ Ernst & Young LLP
Richmond, Virginia
June 26, 1998
