Item 14(a) 3 Exhibits has been amended to include
exhibit 99.5.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-K/A
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 27, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No 0-631
ROSE'S STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware 56-0382475
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
218 S. Garnett Street
Henderson, NC 27536
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (919) 430-2600
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, No Par Value
Stock Warrants (to purchase Common Stock)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. ( X )
(continued on following page)<PAGE>
<PAGE>
(continued from previous page)
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the Registrant has filed all documents and
report required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes X No
As of February 19, 1996, of the 10,000,000 shares of common stock delivered
to First Union National Bank of North Carolina as Escrow Agent pursuant to the
Modified and Restated First Amended Joint Plan of Reorganization, the Company
has 8,158,316 shares of common stock outstanding. The remaining 865,936 shares
held in escrow will be distributed by FUNB in satisfaction of disputed Class 3
claims as and when such claims are resolved. If all pending claims are resolved
adversely to the Company, approximately 8,852,901 shares of common stock will
be outstanding. If all pending claims are resolved in accordance with the
Company's records, approximately 8,601,172 shares of common stock will be
outstanding. The foregoing estimates do not include any additional shares that
may be issued with respect to late-filed claims which the Bankruptcy Court may
allow which have not been filed as of the date hereof or the effect of nego-
tiated settlements made for amounts in excess of amounts shown in the Company's
records. To the extent that escrowed shares of common stock are not used to
satisfy claims, they will revert to the Company and will be retired or held in
the treasury of the Company.
As of March 21, 1996, the aggregate market value of common stock held by
non-affiliates (assuming all pending claims are resolved adversely to the Com-
pany) of the Registrant was approximately $18,046,671.
PAGE
<PAGE>
PART IV
ITEM 14: EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS
Independent Auditors' Report
Statements of Operations for the thirty-nine
weeks ended January 27, 1996, thirteen weeks
ended April 29, 1995, and the years ended
January 28, 1995 and January 29, 1994
Balance Sheets - January 27, 1996 and
January 28, 1995
Statements of Stockholders' Equity for the
thirty-nine weeks ended January 27, 1996,
thirteen weeks ended April 29, 1995, and
the years ended January 28, 1995 and
January 29, 1994
Statements of Cash Flows for the thirty-nine
weeks ended January 27, 1996, thirteen weeks
ended April 29, 1995, and the years ended
January 28, 1995 and January 29, 1994
Notes to the Financial Statements
2. FINANCIAL STATEMENT SCHEDULES
All schedules are omitted because they are not applicable
or not required, or because the required information is
included in the financial statements or notes thereto.
3. EXHIBITS
Exhibit
No.
10.1 Employment Agreement with R. Edward Incorporated
Anderson, Chairman of the Board, by reference
President and Chief Executive Officer,
dated May 29, 1995 (Incorporated by
reference to Exhibit 10.1 to Registrant's
Form 10-Q for the quarter ended
July 29, 1995).
10.2 New Retirement Benefits Savings Plan, Incorporated
effective July 1, 1995. (Incorporated by by reference
reference to Exhibit 10.2 to Registrant's
Form 10-Q for the quarter ended July 29, 1995).
10.3 Order of the United States Bankruptcy Court, Incorporated
Eastern District of North Carolina, Raleigh by reference
Division dated February 13, 1995, approving
the amendment changing the record date for
<PAGE>
distributions of the New Rose's Warrants
and New Rose's Common Stock Secondary
Distribution to the Effective Date of the
Plan (Incorporated by reference to
Registrant's Form 8-K dated February 13, 1995).
10.4 Order dated April 24, 1995, approving the Incorporated
Modified and Restated First Amended Joint by reference
Plan of Reorganization dated April 19, 1995
(Incorporated by reference to Exhibit (c)(2)
to Registrant's Current Report on Form 8-K
dated April 24, 1995).
PAGE
<PAGE>
10.5 The Registrant's Revolving Credit and related Incorporated
agreements (Incorporated by reference to by reference
Exhibit (c)(1) through (c)(10) to Registrant's
Current Report on Form 8-K dated April 28, 1995):
(a) Revolving Credit Agreement dated as of
April 28, 1995, among the Registrant as
Borrower, the lending institutions listed
on Schedule 1 to the Agreement and The
First National Bank of Boston and The
CIT Group/Business Credit, Inc., as
Facility Agents and The First National
Bank of Boston as Administrative Agent
(the "Credit Agreement").
(b) Security Agreement dated as of April 28,
1995, between the Registrant and The
First National Bank of Boston as Collat-
eral Agent for the lending institutions
who are parties to the Credit Agreement.
(c) $62,500,000 Revolving Credit Note dated
April 28, 1995, issued to The First
National Bank of Boston pursuant to the
Credit Agreement.
(d) $62,500,000 Revolving Credit Note dated
April 28, 1995, issued to The CIT Group/
Business Credit, Inc., pursuant to the
Credit Agreement.
(e) Deed of Trust, Assignment of Rents and
Security Agreement dated as of April 27,
1995 by and among Registrant, First
National Bank of Boston, The CIT Group/
Business Credit, Inc., pursuant to the
Credit Agreement.
(f) Master Release Agreement dated as of
April 28, 1995 by and between General
Electric Capital Corporation and Registrant.
(g) Post-Effective Date GE Assumption Agree-
ment dated as of April 28, 1995 by and
between General Electric Capital Corpora-
tion and Registrant.
(h) GE Deferred Obligations Agreement dated
as of April 28, 1995 by and between
General Electric Capital Corporation and
Registrant.
PAGE
<PAGE>
(i) Warrant Agreement dated as of April 28,
1995, between the Registrant and First
Union National Bank of North Carolina as
Warrant Agent.
(j) Escrow Agreement dated as of April 28,
1995, between the Registrant and First
Union National Bank of North Carolina as
Escrow Agent.
10.6 Letter of Credit and Mortgage Trust Agreement Incorporated
dated May 8, 1995 (Incorporated by reference by reference
to Exhibit (c)(1) to Registrant's Current Report
on Form 8-K dated April 28, 1995).
10.7 Second Deed of Trust dated May 8, 1995 Incorporated
(Incorporated by reference to Exhibit (c)(2) by reference
to Registrant's Current Report on Form 8-K
dated April 28, 1995).
10.8 Standby Letter of Credit dated May 8, 1995 Incorporated
(Incorporated by reference to Exhibit (c)(3) by reference
to Registrant's Current Report on Form 8-K
dated April 28, 1995).
10.9 Severance Pay Plan dated as of December 14,
1995.
27. Financial Data Schedule
99.1 Waiver and Amendment No. 1 dated as of Incorporated
July 31, 1995 (Incorporated by reference to by reference
Exhibit 99.1 to Registrant's Current Report
on Form 8-K dated July 31, 1995).
99.2 Waiver and Amendment No. 2 dated as of Incorporated
September 8, 1995 (Incorporated by reference to by reference
Exhibit 99.2 to Registrant's Current Report
on Form 8-K dated July 31, 1995).
99.3 Waiver and Amendment No. 3 dated as of Incorporated
September 29, 1995 (Incorporated by reference by reference
to Exhibit 99.3 to Registrant's Current Report
on Form 8-K dated July 31, 1995).
99.4 Waiver and Amendment No. 4 dated as of January
31, 1996.
99.5 Annual Report for the Rose's Stores, Inc., Retirement
Savings 401(k) Plan for the year ended December 31, 1995.
PAGE
<PAGE>
(b) REPORTS ON FORM 8-K
The Registrant filed the following reports on Form 8-K during the last
quarter of the period covered by this report:
Report on Form 8-K dated October 28, 1995, Incorporated
reporting under Item 5 the monthly and year- by reference
to-date financial results and other financial
data for the period ended October 28, 1995,
together with projected financial information
for similar periods as contained in the
Company's plan for the year ended January 27,
1996. The financial results were included as
an exhibit in Item 7.
Report on Form 8-K dated December 2, 1995, Incorporated
reporting under Item 5 the monthly and year-to- by reference
date financial results and other financial data
for the period ended December 2, 1995, together
with projected financial information for similar
periods as contained in the Company's revised
plan for the year ended January 27, 1996. The
financial results were included as an exhibit
in Item 7.
Report on Form 8-K dated December 30, 1995, Incorporated
reporting under Item 5 the monthly and year-to by reference
date financial results and other financial data
for the period ended December 30, 1995, together
with projected financial information for similar
periods as contained in the Company's revised
plan for the year ended January 27, 1996. The
financial results were included as an exhibit in
Item 7.
Report on Form 8-K dated March 1, 1996, Incorporated
reporting under Item 5 the agreement in by reference
principle regarding the acquisition by
merger of Rose's by Fred's.
PAGE
<PAGE>
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, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No 0-631
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(k) PLAN
ROSE'S STORES, INC.
218 S. Garnett Street
Henderson, NC 27536
<PAGE>
Exhibit
No.
23 Consent of Independent Certified Public
Accountants
99.5 Annual Report for the Rose's Stores,
Inc. Retirement Savings 401(k) Plan for the
Year ended December 31, 1995
PAGE
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Plan Administrator, Rose's Stores, Inc., has duly caused this annual report to
be signed by the undersigned, thereunto duly authorized.
ROSE'S STORES, INC.
RETIREMENT SAVINGS 401(k) PLAN
BY:/s/Camilla Wheeler
Camilla Wheeler,
Director, Human Resources
Date: June 27, 1996
PAGE
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Rose's Stores, Inc.
We consent to incorporation by reference in the registration statement on Form
S-8 of Rose's Stores, Inc. of our report dated April 5, 1996 relating to the
statements of net assets available for Plan benefits as of December 31, 1995 and
1994 and the related statements of changes in net assets available for Plan
benefits for each of the years in the three-year period ended December 31, 1995
of Rose's Stores, Inc. Retirement Savings 401(k) Plan and the related supple-
mental schedules 1 and 2 for the year ended December 31, 1995 which report
appears in the December 31, 1995 annual report on Form 11-K of Rose's Stores,
Inc. Retirement Savings 401(k) Plan.
/s/KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Raleigh, North Carolina
June 26, 1996
PAGE
<PAGE>
ROSE'S STORES, INC.
RETIREMENT SAVINGS 401(k) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Financial Statements and Schedules
December 31, 1995 and 1994
(With Independent Auditors' Report Thereon)
PAGE
<PAGE>
INDEPENDENT AUDITORS' REPORT
Advisory Committee, Retirement Savings 401(k) Plan
Rose's Stores, Inc.:
We have audited the accompanying statements of net assets available for
plan benefits of the Rose's Stores, Inc. Retirement Savings 401(k) Plan
(the "Plan") as of December 31, 1995 and 1994 and the related statements
of changes in net assets available for plan benefits for each of the
years in the three-year period ended December 31, 1995. 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 plan
benefits of the Plan as of December 31, 1995 and 1994 and the changes in
net assets available for plan benefits for each of the years in the
three-year period ended December 31, 1995 in conformity with generally
accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedules 1 and
2 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. The fund information in the statement of net
assets available for benefits and the statement of changes in net assets
available for benefits is presented for purposes of additional analysis
rather than to present the net assets available for plan benefits and
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 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.
/s/KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
April 5, 1996
PAGE
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Net Assets Available for Plan Benefits with Fund Information
December 31, 1995 and 1994
1995
<TABLE>
<CAPTION>
Rose's Invesco
Stable Diversified Fidelity Total
Income Bond Magellan Return
Fund Fund Fund Fund
Assets:
<S> <C> <C> <C> <C>
FUNB Stable Investment Fund $17,875,534 - - -
U.S. Government obligations 17,189,390 - - -
FUNB Diversified Bond Fund - 2,133,998 - -
Fidelity Magellan Fund - - 9,178,526 -
Invesco Total Return Fund - - - 2,591,194
Fidelity Advisor Growth
Opportunity Fund (A shares) - - - -
Templeton Growth Fund I - - - -
Evergreen Fund (Y shares) - - - -
Loans to participants - - - -
Net investments 35,064,924 2,133,998 9,178,526 2,591,194
Employee contributions receivable 31,139 4,039 23,292 4,710
Total assets $35,096,063 2,138,037 9,201,818 2,595,904
Net assets available for plan benefits $35,096,063 2,138,037 9,201,818 2,595,904
</TABLE>
(Continued)
See accompanying notes to financial statements.
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Net Assets Available for Plan Benefits with Fund Information
December 31, 1995 and 1994
1995
<TABLE>
<CAPTION>
Fidelity Templeton Ever-
Advisor Growth green Loan
Fund Fund Fund Fund Total
Assets:
<S> <C> <C> <C> <C> <C>
FUNB Stable Investment Fund - - - - 17,875,534
U.S. Government obligations - - - - 17,189,390
FUNB Diversified Bond Fund - - - - 2,133,998
Fidelity Magellan Fund - - - - 9,178,526
Invesco Total Return Fund - - - - 2,591,194
Fidelity Advisor Growth
Opportunity Fund (A shares) 4,692,184 - - - 4,692,184
Templeton Growth Fund I - 1,077,849 - - 1,077,849
Evergreen Fund (Y shares) - - 758,347 - 758,347
Loans to participants - - - 526,492 526,492
Net investments 4,692,184 1,077,849 758,347 526,492 56,023,514
Employee contributions receivable 11,459 3,879 2,710 - 81,228
Total assets 4,703,643 1,081,728 761,057 526,492 56,104,742
Net assets available for plan benefits 4,703,643 1,081,728 761,057 526,492 56,104,742
</TABLE>
(Continued)
See accompanying notes to financial statements.
PAGE
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Net Assets Available for Plan Benefits with Fund Information,
Continued
December 31, 1995 and 1994
<TABLE>
<CAPTION>
1994
Guaranteed Diversified Rose's
Income Equity Stock Temporary
Fund Fund Fund Fund
Assets:
<S> <C> <C> <C> <C>
Investments at current value:
Variable rate deposits - BB&T $5,084,814 - - -
Fidelity Magellan Equity Fund - 3,526,971 - -
Common stock of Rose's Stores, Inc. - - 17,617 -
Bond Fund of America - - - -
Money market funds - - 700 45,700
American Balanced Fund - - - -
Loans to participants - - - 569,691
Net investments 5,084,814 3,526,971 18,317 615,391
Cash - - 94 55
Employee contributions receivable - - - 72,025
Accrued income receivable - - 3 423
Total assets 5,084,814 3,526,971 18,414 687,894
Net assets available for plan benefits $5,084,814 3,526,971 18,414 687,894
</TABLE>
(Continued)
See accompanying notes to financial statements.
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Net Assets Available for Plan Benefits with Fund Information,
Continued
December 31, 1995 and 1994
1994
<TABLE>
<CAPTION>
Bond American
Fund Balanced
of America Fund Total
Assets:
<S> <C> <C> <C>
Investments at current value:
Variable rate deposits - BB&T - - 5,084,814
Fidelity Magellan Equity Fund - - 3,526,971
Common stock of Rose's Stores, Inc. - - 17,617
Bond Fund of America 467,439 - 467,439
Money market funds - - 46,400
American Balanced Fund - 123,886 123,886
Loans to participants - - 569,691
Net investments 467,439 123,886 9,836,818
Cash - - 149
Employee contributions receivable - - 72,025
Accrued income receivable 13 5 444
Total assets 467,452 123,891 9,909,436
Net assets available for plan benefits 467,452 123,891 9,909,436
</TABLE>
See accompanying notes to financial statements.
PAGE
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Changes in Net Assets Available for Plan Benefits with Fund
Information
Years ended December 31, 1995, 1994 and 1993
1995
<TABLE>
<CAPTION>
Guaranteed Diversified Rose's
Income Equity Stock Temporary
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in fair
value of investments $ - 548,252 (15,218) -
Dividends - 16,039 - -
Interest 123,929 - 2 1,320
123,929 564,291 (15,216) 1,320
Employee contributions and roll-overs - - - 344,466
Other - - - 30,034
Total additions 123,929 564,291 (15,216) 375,820
Deductions from net assets attributed to:
Plan benefits paid - - 2,195 1,080,164
Other - - - -
Insurance premiums paid - - - -
Transfer to successor trustee 4,992,193 3,811,005 - 570,902
Total deductions 4,992,193 3,811,005 2,195 1,651,066
Net transfers of assets among funds (216,550) (280,257) (1,003) 587,352
Net increase (decrease) (5,084,814) (3,526,971) (18,414) (687,894)
Net assets available for plan benefits:
Beginning of year 5,084,814 3,526,971 18,414 687,894
End of year $ - - - -
</TABLE>
See accompanying notes to financial statements.
(Continued)
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Changes in Net Assets Available for Plan Benefits with Fund
Information
Years ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995
Life Bond American
Insurance Fund of Balanced Sub
Option America Fund Total
<S> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in fair
value of investments $ - 27,549 11,494 572,077
Dividends - 16,577 2,648 35,264
Interest - 19 21 125,291
- 44,145 14,163 732,632
Employee contributions and roll-overs 25,512 - - 369,978
Other - - - 30,034
Total additions 25,512 44,145 14,163 1,132,644
Deductions from net assets attributed to:
Plan benefits paid - - - 1,082,359
Other - - - -
Insurance premiums paid 25,512 - - 25,512
Transfer to successor trustee - 451,357 108,752 9,934,209
Total deductions 25,512 451,357 108,752 11,042,080
Net transfers of assets among funds - (60,240) (29,302) -
Net increase (decrease) - (467,452) (123,891) (9,909,436)
Net assets available for plan benefits:
Beginning of year - 467,452 123,891 9,909,436
End of year $ - - - -
</TABLE>
See accompanying notes to financial statements.
(Continued)
PAGE
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
December 31, 1995, 1994 and 1993
1995
<TABLE>
<CAPTION>
Rose's Invesco
Stable Diversified Fidelity Total
Income Bond Magellan Return
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in
fair value of investments $ 866,613 141,380 608,841 251,756
Dividends 24,755 663 - -
Interest 59,385 2,618 9,612 3,049
950,753 144,661 618,453 254,805
Employee contributions and roll-overs 501,588 66,665 431,886 76,660
Transfer from predecessor trustee 4,992,193 450,694 3,811,668 108,752
Transfer from Profit Sharing Plan - - - -
Other 28,016 2,386 19,266 5,131
Total additions 6,472,550 664,406 4,881,273 445,348
Deductions from net assets attributed to:
Plan benefits paid 8,581,632 97,700 488,922 134,344
Other - 21 338 -
Trustee fees 24,966 4,148 9,434 37,019
Insurance premiums paid - - - -
Transfer to successor trustee - - - -
Total deductions 8,606,598 101,869 498,694 171,363
Net transfers of assets among funds 37,230,111 1,575,500 4,819,239 2,321,919
Net increase (decrease) 35,096,063 2,138,037 9,201,818 2,595,904
Net assets available for plan benefits:
Beginning of year - - - -
End of year $35,096,063 2,138,037 9,201,818 2,595,904
</TABLE>
(Continued)
See accompanying notes to financial statements.
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
December 31, 1995, 1994 and 1993
1995
<TABLE>
<CAPTION>
Fidelity Templeton
Advisor Growth Evergreen Loan
Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in
fair value of investments $ 350,623 25,456 296,676 - 3,113,422
Dividends - - - - 60,682
Interest 5,168 1,305 756 25,363 232,547
355,791 26,761 297,432 25,363 3,406,651
Employee contributions and roll-overs 184,282 63,334 45,558 - 1,739,951
Transfer from predecessor trustee - - - 570,902 9,934,209
Transfer from Profit Sharing Plan - - 51,722,696 - 51,722,696
Other 8,082 1,356 798 - 95,069
Total additions 548,155 91,451 52,066,484 596,265 66,898,576
Deductions from net assets attributed to:
Plan benefits paid 154,867 19,661 30,385 71,534 10,661,404
Other 36 11 12 - 418
Trustee fees 6,160 - - - 81,727
Insurance premiums paid - - - - 25,512
Transfer to successor trustee - - - - 9,934,209
Total deductions 161,063 19,672 30,397 71,534 20,703,270
Net transfers of assets among funds 4,316,551 1,009,949 (51,275,030) 1,761 -
Net increase (decrease) 4,703,643 1,081,728 761,057 526,492 46,195,306
Net assets available for plan benefits:
Beginning of year - - - - 9,909,436
End of year $4,703,643 1,081,728 761,057 526,492 56,104,742
</TABLE>
(Continued)
See accompanying notes to financial statements.
<PAGE>
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
Years ended December 31, 1995, 1994 and 1993
1994
<TABLE>
<CAPTION>
Guaranteed Diversified Rose's
Income Equity Stock Temporary
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net depreciation in fair value
of investments $ - (246,171) (51,354) -
Dividends - 175,341 - -
Interest 232,108 - 776 6,969
232,108 (70,830) (50,578) 6,969
Employee contributions and roll-overs - - - 1,224,583
Other - - - -
Total additions (deductions) 232,108 (70,830) (50,578) 1,231,552
Deductions from net assets attributed to:
Plan benefits paid - - 6,760 5,063,376
Insurance premiums paid - - - -
Other - - - 42,957
Total deductions - - 6,760 5,106,333
Net transfers of assets among funds (2,643,692) (732,379) (101,726) 3,580,734
Net increase (decrease) (2,411,584) (803,209) (159,064) (294,047)
Net assets available for plan benefits:
Beginning of year 7,496,398 4,330,180 177,478 981,941
End of year $ 5,084,814 3,526,971 18,414 687,894
</TABLE>
See accompanying notes to financial statements.
(Continued)
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
December 31, 1995, 1994 and 1993
1994
<TABLE>
<CAPTION>
Wachovia
Bond/
Biltmore
Fixed Life Bond American
Income Insurance Fund Balanced
Fund Option of America Fund Total
<S> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net depreciation in fair value
of investments $ (42,397) - (27,698) (906) (368,526)
Dividends 13,335 - 27,931 3,433 220,040
Interest 224 - 265 48 240,390
(28,838) - 498 2,575 91,904
Employee contributions and roll-overs - 85,148 - - 1,309,731
Other - - - - -
Total additions (deductions) (28,838) 85,148 498 2,575 1,401,635
Deductions from net assets attributed to:
Plan benefits paid - - - - 5,070,136
Insurance premiums paid - 85,148 - - 85,148
Other 578 - - - 43,535
Total deductions 578 85,148 - - 5,198,819
Net transfers of assets among funds (691,207) - 466,954 121,316 -
Net increase (decrease) (720,623) - 467,452 123,891 (3,797,184)
Net assets available for plan benefits:
Beginning of year 720,623 - - - 13,706,620
End of year $ - - 467,452 123,891 9,909,436
</TABLE>
(Continued)
See accompanying notes to financial statements.
PAGE
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
Years ended December 31, 1995, 1994 and 1993
1993
<TABLE>
<CAPTION>
Guaranteed Diversified Rose's
Income Equity Stock Temporary
Fund Fund Fund Fund
<S> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in fair
value of investments $ - 454,382 (878,689) -
Dividends - 411,565 - -
Interest 304,855 - 1,050 3,562
304,855 865,947 (877,639) 3,562
Employee contributions and roll-overs - - - 1,586,451
Other - - - 74,821
Total additions (deductions) 304,855 865,947 (877,639) 1,664,834
Deductions from net assets attributed to:
Plan benefits paid - - 100,280 2,463,611
Insurance premiums paid - - - -
Other - - - 80
Total deductions - - 100,280 2,463,691
Net transfers of assets among funds (973,412) (45,518) 143,766 654,993
Net increase (decrease) (668,557) 820,429 (834,153) (143,864)
Net assets available for plan benefits:
Beginning of year 8,164,955 3,509,751 1,011,631 1,125,805
End of year $7,496,398 4,330,180 177,478 981,941
</TABLE>
See accompanying notes to financial statements.
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Statements of Changes in Net Assets Available for Plan Benefits with Fund
Information, Continued
Years ended December 31, 1995, 1994 and 1993
1993
<TABLE>
<CAPTION>
Wachovia
Bond/
Biltimore
Fixed Life
Income Insurance
Fund Option Total
<S> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation (depreciation) in fair
value of investments $ 7,193 - (417,114)
Dividends 45,115 - 456,680
Interest - - 309,467
52,308 - 349,033
Employee contributions and roll-overs - 128,251 1,714,702
Other - - 74,821
Total additions (deductions) 52,308 128,251 2,138,556
Deductions from net assets attributed to:
Plan benefits paid - - 2,563,891
Insurance premiums paid - 128,251 128,251
Other - - 80
Total deductions - 128,251 2,692,222
Net transfers of assets among funds 220,171 - -
Net increase (decrease) 272,479 - (553,666)
Net assets available for plan benefits:
Beginning of year 448,144 - 14,260,286
End of year $ 720,623 - 13,706,620
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<PAGE>
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Notes to Financial Statements
(1) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements of the Rose's Stores, Inc. Retirement
Savings 401(k) Plan (the Plan) have been prepared on an accrual basis and
present the net assets available for plan benefits and the changes in those
net assets.
(b) Investments in Securities
Investments in marketable securities are stated at current value based on
quotations obtained from national securities exchanges or brokerage firms.
The cost basis of marketable securities is average cost and first-in first-
out (FIFO) for Rose's Stores, Inc. common stock. The valuation of common
trust fund units is based on the quoted market prices of the underlying
securities.
Securities transactions are recognized on the trade date (the date the
order to buy or sell is executed).
The Plan adopted AICPA Statement of Position 94-4 (SOP 94-4) Reporting of
Investment Contracts Held by Health and Welfare Benefit Plans and Defined-
Contribution Pension Plans for the year ended December 31, 1994. The
provisions of SOP-94-4 require the Plan to report guaranteed investment
contracts at fair value. The difference between contract value and fair
value at December 31, 1994 is not significant. There were no guaranteed
investment contracts held at December 31, 1995.
(c) Use of Estimates
In preparing the financial statements, the plan administrator is required
to make estimates and assumptions that affect the reported amounts of
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.
PAGE
<PAGE>
(2) Description of the Plan
The Plan is a defined-contribution plan sponsored by Rose's Stores, Inc.
(Rose's) and is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). All Rose's employees are eligible to
participate in the Plan after one year of continuous employment in which
they have worked at least 1,000 hours. Effective January 1, 1991, the Plan
was amended to adopt the "safe harbor" minimum coverage provisions of the
Internal Revenue Code, and eliminated life insurance as a new investment
option effective December 31, 1991. Participants, who were enrolled in the
life insurance option prior to the Plan's amendment were allowed to
continue with this investment option. By an agreement entered into on
January 1, 1994, and effective January 1, 1989, the Plan was restated
bringing it into compliance with the Tax Reform Act of 1986 and subsequent
legislation through 1993, and to incorporate all plan amendments.
The IRS is evaluating the work force reduction from 1993 and 1994 for its
classification as a "partial plan termination". If the work force
reduction is considered a "partial plan termination", all of the employees
who voluntarily terminate would become fully vested and their previously
forfeited accounts, approximately $552,000, would be reestablished and paid
out. Because the IRS has not made this determination, the forfeitures for
1995, 1994, and 1993 were not allocated to participant accounts. The
annual net investment income is allocated to individual participants'
accounts proportionally based on account balances at the beginning of the
Plan's fiscal year.
On May 31, 1995, the Rose's Stores, Inc. Variable Investment Plan, changed
trustees from Central Carolina Bank to First Union National Bank. The
Company amended the Variable Investment Plan as required in order to
facilitate the merger with the Rose's Stores, Inc. Profit Sharing Plan. As
a result of these amendments the plan changed its name to the Rose's
Stores, Inc. Retirement Savings 401(k) Plan. On July 31, 1995, the
assets of the Rose's Stores, Inc. Profit Sharing Plan were merged into the
Rose's Stores, Inc. Retirement Savings 401(k) Plan.
The Plan currently offers seven investment options for employee
contributions: the Rose's Stable Income Fund, the Diversified Bond Fund,
the Fidelity Magellan Fund, the Invesco Total Return Fund, the Fidelity
Advisor Fund, the Templeton Growth Fund, and the Evergreen Fund.
Participants may change their elections daily. Due to the Plan sponsor's
filing of Chapter 11 bankruptcy, the Rose's Stock Fund has not been
available as an investment option since September 1, 1993.
Each participant's account is credited with the participant's contribution,
an allocation of Rose's contribution, if any, and Plan earnings.
Allocations are based on participant compensation or account balances as
defined in the Plan. Participants are immediately vested in their voluntary
contributions plus actual earnings thereon. Vesting in the remainder of
their accounts is based on the number of years of continuous service at a
rate of 20% per year of credited service.
The Plan permits withdrawals in the event of termination of employment,
disability, death, age 59-l/2 or retirement. Withdrawals may also be made
to meet certain financial hardships, as defined.
PAGE
<PAGE>
(2) Description of the Plan, Continued
In the event the Plan is terminated, the Trustee will assume full
responsibility for the management and administration of the Plan. Upon
termination of the Plan, participants may elect to receive benefits
immediately, or may elect to defer benefits until they terminate their
employment with Rose's or reach retirement age.
(3) Contributions
Employer contributions to the Plan are discretionary. The Company may
elect to match 50% of participant contributions up to 6% of the
participants compensation. Additional amounts may be contributed at the
option of the Board of Directors. For the years ending December 31, 1995,
1994 and 1993, Rose's Stores, Inc. made no matching contributions to the
Plan.
Participants may contribute up to 20% of their gross annual wages not to
exceed the IRS allowable limit.
(4) Investments
The following investments exceeded 5% of the Plan's net assets at December
31, 1995 and 1994:
Investment 1995 1994
BB&T - Variable rate deposits $ - 5,084,814
Fidelity Magellan Fund 9,178,526 3,526,971
Fidelity Advisor Growth Opportunity Fund 4,692,184 -
FUNB Stable Investment Fund 17,862,220 -
U.S. Government obligations 17,202,704 -
The Bond Fund of America - 467,439
Loans to participants - 569,691
PAGE
<PAGE>
(4) Investments, Continued
The Plan's investments were administered by Central Carolina Bank & Trust
Company, N.A. through June 1995 and by First Union National Bank from July
1995 through December 31, 1995. During the years ended December 31, 1995,
1994 and 1993, the Plan had the following net appreciation (depreciation)
in its investments (including investments bought and sold during the year):
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Fidelity Magellan Fund - FUNB administered $ 608,841 - -
Fidelity Magellan Fund - CCB administered 548,252 (246,171) 454,382
Common stocks - Rose's Stores, Inc.
non-voting Class B (15,218) (51,354) (878,689)
Wachovia Bond/Biltmore Fixed
Income Fund - (42,397) 7,193
Bond Fund of America 27,549 (27,698) -
American Balanced Fund 11,494 (906) -
U.S. Government obligations 203,552 - -
FUNB Stable Investment Fund 663,061 - -
FUNB Diversified Bond Fund 141,380 - -
Invesco Total Return Fund 251,756 - -
Fidelity Advisor Growth Opportunities
Fund 350,623 - -
Templeton Growth Fund 25,456 - -
Evergreen Fund 296,676 - -
$3,113,422 (368,526) (417,114)
</TABLE>
(5) Loans to Participants
The Plan permits participants to borrow 50% of their account balance, up to
$50,000. These loans must be repaid through payroll deductions over a
period not to exceed four and one-half years. Prior to January 1, 1993,
the interest rate to be paid on the amounts borrowed was equal to the
average interest rate of the Home Equity Loan Rate at the five major
commercial banks in the area at the time of the loan. The interest rate
for monies borrowed in 1993 and later was equal to the average prime rate
at the sponsor's banks, plus one percent. At December 31, 1995 and 1994,
there were $526,492 and $569,691 in loans outstanding, respectively. These
loans bear interest at rates ranging from 7.0% to 11.5% and are due at
various dates through 2000.
(6) Related Party Transactions
The Plan owned 93,956 shares of Rose's Stores, Inc. non-voting Class B
stock at December 31, 1994. The stock was purchased at prevailing market
prices. The Plan received no dividends from Rose's Stores, Inc. during the
three year period ended December 31, 1995.
All expenses of the Plan were paid by the plan sponsor, Rose's Stores,
Inc., in 1994 and 1993. In 1995 the Plan paid the investment management
fees and the sponsor paid the administrative fees.
PAGE
<PAGE>
(7) Federal Income Taxes
The Internal Revenue Service issued its latest determination letter on May
7, 1993 which stated that the Plan and its underlying trust qualify under
the applicable provisions of the Internal Revenue Code and the trust is
therefore exempt from federal income taxes. The Plan and its underlying
trust have been amended due to a merger of the Rose's Stores, Inc. Profit
Sharing and Variable Investment Plans. The amended Plan documents have
been submitted to the Internal Revenue Service for a letter of
determination that the Plan continues to qualify under applicable
provisions of the Internal Revenue Code. In the opinion of the Plan
Administrator, the Plan and its underlying trust have operated within the
terms of the Plan and trust and remain qualified and tax exempt,
respectively.
(8) Subsequent Events
On March 1, 1996, the Plan's sponsor and Fred's, Inc. ("Fred's") entered
into a letter of intent (the "Letter of Intent"), providing for the
acquisition by merger of Rose's by Fred's. Fred's is a publicly traded
retailer that operates approximately 200 stores in the southeastern United
States. The Letter of Intent provides that the merger is subject to the
execution of a definitive agreement and to the occurrence or (to the extent
permitted by the definitive merger agreement or applicable law) waiver of a
number of conditions, including the approval of the stockholders of Rose's
and Fred's.
The effect of the merger on the Plan is unknown at the present time.
(9) Reconciliation to Form 5500
The accompanying financial statements have been prepared on an accrual
basis and show employee contributions receivable of $81,228 as a component
of net assets available for plan benefits and as part of the employee
contributions in the statements of changes in net assets available for plan
benefits, while Form 5500 has been prepared on a cash basis and does not
reflect this amount. Certain amounts in the statements of changes in net
assets available for plan benefits have been classified differently between
the financial statements and the Form 5500. These reclassifications have
not affected the increase in net assets available for plan benefits.
PAGE
<PAGE>
Schedule 1
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1995
<TABLE>
<CAPTION>
Par value Identity of party and Maturity Market
or units description of assets date Cost value
<C> <S> <C> <C> <C>
101,039.79 Mutual fund investment:
Fidelity Magellan Fund - $ 8,825,168 9,178,526
923,208.99 *FUNB Stable Investment Fund - 17,316,476 17,875,534
136,355.82 Fidelity Advisor Growth
Opportunities Fund - 4,360,729 4,692,184
113,275.00 Invesco Total Return Fund - 2,389,681 2,591,194
55,466.74 Templeton Growth Fund - 1,053,207 1,077,849
45,950.70 *Evergreen Fund - 703,272 758,347
526,492.00 Loans to participants with
interest rates ranging from
7 to 11.5% with payments
due through 2000 - 526,492 526,492
Bond funds:
100,556.15 *FUNB - Diversified Fund - 2,000,354 2,133,998
U.S. Government obligations:
8,020,000 United States Treasury Bills 1-25-96 7,999,549 7,999,549
9,409,000 United States Treasury Bills 5-30-96 8,999,603 9,189,841
Total assets held for investment
purposes $54,174,531 56,023,514
</TABLE>
*Denotes party-in-interest.
PAGE
<PAGE>
Schedule 2
ROSE'S STORES, INC. RETIREMENT SAVINGS 401(K) PLAN
(FORMERLY VARIABLE INVESTMENT PLAN)
Item 27d - Schedule of Reportable Transactions (1)
Year ended December 31, 1995
<TABLE>
<CAPTION>
Aggregate
cost
Aggregate Aggregate of assets Net
purchase selling sold or realized
Identity of party and price price distributed gain
description of assets (2) (3) (2) (3) (2) (loss)
<S> <C> <C> <C> <C>
BB&T - Variable Rate Deposits $ 583,508 5,668,322 5,668,322 -
Employee Benefit Money Market Fund 671,529 717,229 717,229 -
The Bond Fund of America 48,134 543,122 539,527 3,595
Rose's Stable Income Fund 23,100,802 10,868,869 10,776,518 92,351
Diversified Bond Fund 2,388,027 841,955 838,368 3,587
Invesco Total Return Fund 2,611,112 353,562 340,339 13,223
Fidelity Advisor Growth Opportunities
Fund (A shares) 4,839,846 492,201 479,193 13,008
Templeton Growth Fund I 1,180,642 128,250 127,435 815
Evergreen Fund (Y shares) 776,960 52,027,832 51,786,231 241,601
Fidelity Magellan Fund 7,190,282 2,671,016 2,368,928 302,088
United States Treasury Bill, due
January 26, 1996 7,999,549 - - -
United States Treasury Bill, due
May 30, 1996 8,999,603 - - -
</TABLE>
(1) This schedule presents transactions in any security where the aggregate of
such transactions in that security exceeds five percent of plan assets at
January 1, 1995.
(2) The value of securities at the time of purchase or sale is the market
value.
(3) Brokerage commissions are included in purchase prices and deducted from
sales proceeds.
