<PAGE> 1
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 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _________________ to ____________________
Commission file number 2-94678
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
Savannah Foods & Industries, Inc. Employee Retirement Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
Savannah Foods & Industries, Inc., P.O. Box 339, Savannah, GA 31402
Page No. 1
<PAGE> 2
REQUIRED INFORMATION
The following documents are filed as a part of this report:
1. Financial Statements
Plan financial statements prepared in accordance with the financial
reporting requirements of ERISA include the following:
Report of Independent Public Accountants -- Page No. 5
Statement of Net Assets Available for Benefits, with Fund Information,
as of December 31, 1996 -- Page No. 7
Statement of Net Assets Available for Benefits, with Fund Information,
as of December 31, 1995 -- Page No. 8
Statement of Changes in Net Assets Available for Benefits, with Fund
Information, for the Year Ended December 31, 1996 -- Page No. 9
Notes to Financial Statements and Schedules -- Page No. 10
Supplemental Schedules:
Schedule I: Schedule of Assets Held for Investment Purposes -
December 31, 1996; Page No. 16
Schedule II: Schedule of Reportable Transactions - Year Ended
December 31, 1996; Page No. 17
Schedule III: Schedule of Loans in Default - December 31, 1996;
Page No. 18
2. Exhibits
The following exhibits are filed with this report:
Consent of Arthur Andersen LLP Page No. 19
Consent of Price Waterhouse LLP Page No. 20
Report of Independent Accountants Page No. 21
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned hereunto
duly authorized.
Date: June 25, 1997 Savannah Foods & Industries, Inc.
Employee Retirement Savings Plan
By: /S/Gregory H. Smith
------------------------
Name: Gregory H. Smith
Title: Senior Vice President, Chief
Financial Officer & Treasurer
Page No. 2
<PAGE> 3
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS AND SCHEDULES
AS OF DECEMBER 31, 1996 AND 1995
TOGETHER WITH
AUDITORS' REPORT
Page No. 3
<PAGE> 4
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
FINANCIAL STATEMENTS AND SCHEDULES
DECEMBER 31, 1996 AND 1995
TABLE OF CONTENTS
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
FINANCIAL STATEMENTS
Statement of Net Assets Available for Benefits, With Fund
Information--December 31, 1996
Statement of Net Assets Available for Benefits, With Fund
Information--December 31, 1995
Statement of Changes in Net Assets Available for Benefits, With Fund
Information, for the Year Ended December 31, 1996
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
SCHEDULES SUPPORTING FINANCIAL STATEMENTS
Schedule I: Item 27a--Schedule of Assets Held for Investment
Purposes--December 31, 1996
Schedule II: Item 27d--Schedule of Reportable Transactions for the
Year Ended December 31, 1996
Schedule III: Item 27b--Schedule of Loans in Default--December 31,
1996
Page No. 4
<PAGE> 5
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Administrative Committee of the
Savannah Foods & Industries, Inc.
Employee Retirement Savings Plan:
We have audited the accompanying statement of net assets available for benefits,
with fund information, of the SAVANNAH FOODS & INDUSTRIES, INC. EMPLOYEE
RETIREMENT SAVINGS PLAN as of December 31, 1996 and the related statement of
changes in net assets available for benefits, with fund information, for the
year ended December 31, 1996. These financial statements and the schedules
referred to below are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements and
schedules based on our audit.
We conducted our audit 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 audit provides 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 as of
December 31, 1996 and the changes in its net assets available for benefits for
the year ended December 31, 1996 in conformity with generally accepted
accounting principles.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes, reportable transactions, and loans in default 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 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, with fund information,
Page No. 5
<PAGE> 6
and the statement of changes in net assets available for benefits, with fund
information, 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 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/Arthur Andersen LLP
Atlanta, Georgia
June 25, 1997
Page No. 6
<PAGE> 7
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1996
<TABLE>
<CAPTION>
VANGUARD
COMPANY STABLE VANGUARD VANGUARD VANGUARD
STOCK VALUE WELLINGTON EXPLORER INDEX 500
FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
INVESTMENTS, AT CONTRACT VALUE (NOTE 2):
Collective funds $ 0 $ 8,525,877 $ 0 $ 0 $ 0
INVESTMENTS, AT FAIR VALUE (NOTE 2):
Cash equivalents 83,738 0 0 0 0
Mutual funds 0 0 965,241 4,004 4,217,954
Common stock 11,181,330 0 0 0 0
Loans to participants 0 0 0 0 0
------------ ------------ ------------ ------------ ------------
Total investments 11,265,068 8,525,877 965,241 4,004 4,217,954
------------ ------------ ------------ ------------ ------------
RECEIVABLES:
Participant contributions 40,158 43,268 7,773 384 28,756
Employer contributions 7,971 8,716 1,242 52 5,334
Loan repayments 83,545 84,187 6,856 300 31,045
Accrued investment income 481 0 0 0 0
------------ ------------ ------------ ------------ ------------
132,155 136,171 15,871 736 65,135
------------ ------------ ------------ ------------ ------------
Total assets 11,397,223 8,662,048 981,112 4,740 4,283,089
LIABILITIES (8,412) (3,501) 0 0 0
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 11,388,811 $ 8,658,547 $ 981,112 $ 4,740 $ 4,283,089
============ ============ ============ ============ ============
<CAPTION>
VANGUARD VANGUARD
VANGUARD U.S. INTERNATIONAL
WINDSOR II GROWTH GROWTH LOAN
FUND FUND FUND FUND TOTAL
------------ ------------ ------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
INVESTMENTS, AT CONTRACT VALUE (NOTE 2):
Collective funds $ 0 $ 0 $ 0 $ 0 $ 8,525,877
INVESTMENTS, AT FAIR VALUE (NOTE 2):
Cash equivalents 0 0 0 0 83,738
Mutual funds 1,640,600 24,432 0 0 6,852,231
Common stock 0 0 0 0 11,181,330
Loans to participants 0 0 0 2,309,598 2,309,598
------------ ------------ ------------ ------------ ------------
Total investments 1,640,600 24,432 0 2,309,598 28,952,774
------------ ------------ ------------ ------------ ------------
RECEIVABLES:
Participant contributions 14,525 337 188 0 135,389
Employer contributions 2,496 123 28 0 25,962
Loan repayments 6,147 502 81 (212,663) 0
Accrued investment income 0 0 0 42,549 43,030
------------ ------------ ------------ ------------ ------------
23,168 962 297 (170,114) 204,381
------------ ------------ ------------ ------------ ------------
Total assets 1,663,768 25,394 297 2,139,484 29,157,155
LIABILITIES 0 0 0 0 (11,913)
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 1,663,768 $ 25,394 $ 297 $ 2,139,484 $ 29,145,242
============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of this statement.
Page No. 7
<PAGE> 8
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
DECEMBER 31, 1995
<TABLE>
<CAPTION>
COMPANY CASH EQUITY AGGRESSIVE
STOCK INCOME INCOME GROWTH
FUND FUND FUND FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at contract value (Note 2):
Collective fund $ 0 $ 9,036,794 $ 0 $ 0
Investments, at fair value (Note 2):
Cash equivalents 16,767 93,516 0 0
Mutual funds 0 0 1,158,816 4,337,026
Common stock 8,564,112 0 0 0
Loans to participants 0 0 0 0
------------ ------------ ------------ ------------
8,580,879 9,130,310 1,158,816 4,337,026
------------ ------------ ------------ ------------
Cash 18,672 0 0 0
------------ ------------ ------------ ------------
Receivables:
Participant contributions 41,034 54,262 11,324 22,655
Employer contributions 9,288 11,172 2,040 4,743
Accrued investment income 312 83 11 8
------------ ------------ ------------ ------------
50,634 65,517 13,375 27,406
------------ ------------ ------------ ------------
LIABILITIES:
Cash overdraft 0 (89,749) 0 0
------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 8,650,185 $ 9,106,078 $ 1,172,191 $ 4,364,432
============ ============ ============ ============
<CAPTION>
BALANCED LOANS TO
FUND PARTICIPANTS TOTAL
------------ ------------ ------------
<S> <C> <C> <C>
ASSETS:
Investments, at contract value (Note 2):
Collective fund $ 0 $ 0 $ 9,036,794
Investments, at fair value (Note 2):
Cash equivalents 0 465 110,748
Mutual funds 1,040,380 0 6,536,222
Common stock 0 0 8,564,112
Loans to participants 0 2,371,034 2,371,034
------------ ------------ ------------
1,040,380 2,371,499 26,618,910
------------ ------------ ------------
Cash 0 0 18,672
------------ ------------ ------------
Receivables:
Participant contributions 8,184 0 137,459
Employer contributions 1,413 0 28,656
Accrued investment income 7 2 423
------------ ------------ ------------
9,604 2 166,538
------------ ------------ ------------
LIABILITIES:
Cash overdraft 0 0 (89,749)
------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $ 1,049,984 $ 2,371,501 $ 26,714,371
============ ============ ============
</TABLE>
The accompanying notes are an integral part of this statement.
Page No. 8
<PAGE> 9
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS,
WITH FUND INFORMATION,
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
VANGUARD
STABLE VANGUARD VANGUARD VANGUARD
COMPANY VALUE WELLINGTON EXPLORER INDEX 500
STOCK FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
CONTRIBUTIONS:
Participant $ 465,429 $ 596,824 $ 22,451 $ 384 $ 87,063
Participant rollovers 76 2,119 10,160 0 25,399
Employer 93,406 119,083 3,595 52 15,875
------------ ------------ ------------ ------------ ------------
Total contributions 558,911 718,026 36,206 436 128,337
------------ ------------ ------------ ------------ ------------
INVESTMENT INCOME:
Net appreciation (depreciation) in
fair value of investments 1,642,663 0 (27,468) 32 162,820
Interest 3,629 381,026 0 0 0
Dividends 80,172 75,939 54,748 0 49,706
------------ ------------ ------------ ------------ ------------
Total investment income 1,726,464 456,965 27,280 32 212,526
------------ ------------ ------------ ------------ ------------
DISTRIBUTIONS TO PARTICIPANTS:
Cash (346,869) (1,166,163) 0 0 0
In-kind (368,695) 0 0 0 0
------------ ------------ ------------ ------------ ------------
Total distributions (715,564) (1,166,163) 0 0 0
------------ ------------ ------------ ------------ ------------
INTERFUND TRANSFERS 1,047,387 (504,985) 910,770 3,972 3,911,181
LOAN ACTIVITY:
Loan withdrawals (297,440) (406,495) 0 0 0
Loan principal and interest repayments 419,491 457,450 6,856 300 31,045
FORFEITURES (623) (2,329) 0 0 0
------------ ------------ ------------ ------------ ------------
NET INCREASE (DECREASE) 2,738,626 (447,531) 981,112 4,740 4,283,089
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 8,650,185 9,106,078 0 0 0
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 11,388,811 $ 8,658,547 $ 981,112 $ 4,740 $ 4,283,089
============ ============ ============ ============ ============
<CAPTION>
VANGUARD VANGUARD
VANGUARD U.S. INTERNATIONAL EQUITY
WINDSOR II GROWTH GROWTH LOAN INCOME
FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
CONTRIBUTIONS:
Participant $ 45,077 $ 337 $ 188 $ 0 $ 151,241
Participant rollovers 15,239 0 0 0 2,194
Employer 7,625 123 28 0 25,320
------------ ------------ ------------ ------------ ------------
Total contributions 67,941 460 216 0 178,755
------------ ------------ ------------ ------------ ------------
INVESTMENT INCOME:
Net appreciation (depreciation) in
fair value of investments (14,718) (343) 0 0 148,117
Interest 0 0 0 195,380 71
Dividends 101,289 0 0 0 35,923
------------ ------------ ------------ ------------ ------------
Total investment income 86,571 (343) 0 195,380 184,111
------------ ------------ ------------ ------------ ------------
DISTRIBUTIONS TO PARTICIPANTS:
Cash 0 0 0 (122,286) (94,780)
In-kind 0 0 0 0 0
------------ ------------ ------------ ------------ ------------
Total distributions 0 0 0 (122,286) (94,780)
------------ ------------ ------------ ------------ ------------
INTERFUND TRANSFERS 1,503,109 24,775 0 (2,812) (1,454,299)
LOAN ACTIVITY:
Loan withdrawals 0 0 0 802,674 (9,134)
Loan principal and interest repayments 6,147 502 81 (1,104,973) 23,389
FORFEITURES 0 0 0 0 (233)
------------ ------------ ------------ ------------ ------------
NET INCREASE (DECREASE) 1,663,768 25,394 297 (232,017) (1,172,191)
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 0 0 0 2,371,501 1,172,191
------------ ------------ ------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 1,663,768 $ 25,394 $ 297 $ 2,139,484 $ 0
============ ============ ============ ============ ============
<CAPTION>
AGGRESSIVE
GROWTH BALANCED
FUND FUND TOTAL
------------ ------------ ------------
<S> <C> <C> <C>
CONTRIBUTIONS:
Participant $ 268,750 $ 80,110 $ 1,717,854
Participant rollovers 18,208 0 73,395
Employer 49,367 13,801 328,275
------------ ------------ ------------
Total contributions 336,325 93,911 2,119,524
------------ ------------ ------------
INVESTMENT INCOME:
Net appreciation (depreciation) in
fair value of investments 592,509 61,378 2,564,990
Interest 118 28 580,252
Dividends 0 26,378 424,155
------------ ------------ ------------
Total investment income 592,627 87,784 3,569,397
------------ ------------ ------------
DISTRIBUTIONS TO PARTICIPANTS:
Cash (993,255) (161,857) (2,885,210)
In-kind 0 0 (368,695)
------------ ------------ ------------
Total distributions (993,255) (161,857) (3,253,905)
------------ ------------ ------------
INTERFUND TRANSFERS (4,370,552) (1,068,546) 0
LOAN ACTIVITY:
Loan withdrawals (65,131) (24,474) 0
Loan principal and interest repayments 136,480 23,232 0
FORFEITURES (926) (34) (4,145)
------------ ------------ ------------
NET INCREASE (DECREASE) (4,364,432) (1,049,984) 2,430,871
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 4,364,432 1,049,984 26,714,371
------------ ------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 0 $ 0 $ 29,145,242
============ ============ ============
</TABLE>
The accompanying notes are an integral part of this statement.
Page No. 9
<PAGE> 10
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
DECEMBER 31, 1996 AND 1995
1. PLAN DESCRIPTION
The following description of the Savannah Foods & Industries, Inc.
Employee Retirement Savings Plan (the "Plan") is provided for general
informational purposes only. More complete information regarding the
Plan's provisions may be found in the plan document.
GENERAL
The Plan is a defined contribution plan established by Savannah Foods &
Industries, Inc. (the "Company") under the provisions of Section 401(a) of
the Internal Revenue Code (the "IRC") which includes a qualified cash or
deferred arrangement, as described in Section 401(k) of the IRC, for the
benefit of eligible employees of the Company. Substantially all employees
of the Company and its subsidiaries who do not participate in a collective
bargaining unit, have completed 1,000 hours of service, as defined, and
have attained the age of 21 are eligible to participate. The Plan is
subject to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA"), as amended.
PLAN ADMINISTRATION
Chase Manhattan Bank was the Plan's appointed trustee through October 31,
1996. The Plan's administrative committee appointed Vanguard Fiduciary
Trust Company ("Vanguard") as trustee effective November 1, 1996. The Plan
is administered by an administrative committee, which is appointed by the
board of directors of the Company.
CONTRIBUTIONS
Participation in the Plan is voluntary, and contributions are made by
payroll deduction. Participants may elect to contribute between 1% and
13.5% of compensation, as defined by the Plan, on a pretax basis, subject
to certain limitations under the IRC. The Plan provides for a minimum
matching contribution from the Company equal to 25% of each participant's
contribution up to 6% of compensation. In addition, the Company may elect
to make a discretionary contribution to the Plan. Any discretionary
contributions made to the Plan are allocated, based on relative
compensation of participants who are active on the last day of the plan
year or who separated during the year due to retirement (age 65 or age 55
with five years of service), disability, or death.
Page No. 10
<PAGE> 11
VESTING
Participants are fully vested in their contributions and the earnings
thereon. Vesting in company contributions is based on years of credited
service. Vesting occurs at a rate of 20% per year of service, with 100%
vesting at the end of five years. Participants who reach normal retirement
age (65), die, or become disabled while still employed by the Company
become 100% vested in their account balances. Forfeitures are used to fund
the Company's matching contribution.
BENEFITS
Upon termination of service, death, disability, or retirement, a
participant (or his/her beneficiary) may elect to receive an amount equal
to the value of the participant's vested interest in his/her account.
Distributions from the Company Stock Fund may be distributed in cash or in
shares of company stock at the participant's election. Hardship
withdrawals are permitted but must be approved by the plan administrator
and must meet the requirements detailed in the plan document.
PARTICIPANT ACCOUNTS
Individual accounts are maintained for each of the Plan's participants to
reflect the participants' contributions, employer matching contributions,
and any employer discretionary contributions as well as the participants'
shares of the Plan's income. Allocations of earnings are based on the
proportion that each participant's account balance has to the total of all
participants' account balances.
INVESTMENT OPTIONS
Participants may direct their contributions as well as any company
contributions and any related earnings, in 10% increments, into the
investment options described below. Participants may change their
investment elections daily through a voice-response system. A description
of each investment option with Chase Manhattan Bank (closed October 31,
1996) as trustee is provided below:
EQUITY INCOME FUND
This fund was invested in an equity mutual fund. The objective of
this fund was current income and long-term growth of capital.
AGGRESSIVE GROWTH FUND
This fund was invested in an equity mutual fund, the objective of
which was growth of capital.
Page No. 11
<PAGE> 12
BALANCED FUND
This fund was invested in a mutual fund, which invested in a mix
of equity, fixed, and variable income securities.
A description of each investment option with Vanguard (new effective
November 1, 1996) is provided below:
STABLE VALUE FUND (FORMERLY THE CASH INCOME FUND)
This fund invests in two collective trusts that invest
primarily in investment contracts of insurance companies and
banks and similar fixed principal investments. One of the
collective trusts held by this fund is being liquidated over a
five-year period that ends in 2001.
WELLINGTON FUND
This fund invests in a mutual fund which invests in a mix of
equity and bonds. The objective of this fund is conservation
of principal, reasonable income, and profits without undue
risk.
EXPLORER FUND
This fund invests in an equity mutual fund, the objective of
which is long-term growth of capital through investing primarily
in equity securities of relatively small, unseasoned, or
embryonic companies.
INDEX 500 FUND
This fund invests in an equity mutual fund, the objective of
which is to emulate the investment results that correspond to the
price and yield performance of the S&P 500 by owning all of the
stocks in the S&P 500.
WINDSOR II FUND
This fund invests in an equity mutual fund, the objective of
which is long-term growth and modest dividend income through
investment in common stocks.
U.S. GROWTH FUND
This fund invests in an equity mutual fund, the objective of
which is long-term growth through investment in the equity
securities of U.S.-based corporations.
Page No. 12
<PAGE> 13
INTERNATIONAL GROWTH FUND
This fund invests in an international equity fund, the objective
of which is long-term growth through investment in the equity
securities of companies based outside the United States.
COMPANY STOCK FUND
This fund invests primarily in common stock of the Company. This
fund assigns units to participants. At December 31, 1996,
outstanding units were 1,353,021.352.
The stated objectives of these funds are not necessarily indicators of
actual performance.
LOANS TO PARTICIPANTS
A participant may borrow the lesser of $50,000, less the highest aggregate
principal balance of loans to the participant during the prior 12 months,
or 50% of his/her vested account balance, less outstanding loans, with a
minimum loan amount of $1,000. Loans are repayable through payroll
deductions over periods ranging up to 54 months for general-purpose loans
and up to 30 years for primary residence loans. The interest rate is equal
to the prime rate on the first business day of the calendar quarter during
which the loan is approved plus 1% and is fixed over the life of the note.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accompanying financial statements are prepared on the accrual basis of
accounting. The preparation of the financial statements in conformity with
generally accepted accounting principles requires the Plan's management to
use estimates and assumptions that affect the accompanying financial
statements and disclosures. Actual results could differ from these
estimates.
INVESTMENT VALUATION
Cash equivalents are stated at cost, which approximates market value.
Marketable securities are stated at fair value. Securities traded on a
national securities exchange are valued at the last reported sales price
on the last business day of the year; investments traded in the
over-the-counter market and listed securities for which no sale was
reported on the last day of the plan year are valued at the last reported
bid price.
The Plan adopted Statement of Position ("SOP") 94-4, "Reporting of
Investment Contracts Held by Health and Welfare Benefit Plans and Defined
Contribution Pension Plans," effective January 1, 1996. This SOP specifies
that fully benefit-responsive contracts held by defined contribution plans
should be reported at contract value. The collective trusts in which the
Page No. 13
<PAGE> 14
Stable Value Fund is invested in turn invest in guaranteed investment
contracts issued by insurance companies and banks, as well as in synthetic
investment contracts. These collective trusts have been determined to be
fully benefit-responsive and are therefore carried at contract value in
the accompanying financial statements.
NET APPRECIATION (DEPRECIATION) IN FAIR VALUE OF INVESTMENTS
Net realized and unrealized appreciation (depreciation) is recorded in the
accompanying statement of changes in net assets available for benefits,
with fund information, as net appreciation (depreciation) in fair value of
investments.
Brokerage fees are added to the acquisition costs of assets purchased and
are subtracted from the proceeds of assets sold.
ADMINISTRATIVE EXPENSES
The Company pays all administrative expenses of the Plan, except for the
administrative costs of mutual funds and loan processing fees.
3. INVESTMENTS
The fair values of individual assets that represent 5% or more of the
Plan's net assets as of December 31, 1996 and 1995 are as follows (in
thousands):
<TABLE>
<S> <C>
1996:
Savannah Foods & Industries, Inc. common stock $11,181
BT Pyramid GIC Fund 7,016
Vanguard Investment Contract Trust 1,510
Vanguard Index Trust 500 Fund 4,218
Vanguard/Windsor II Fund 1,641
1995:
Savannah Foods & Industries, Inc. common stock 8,564
BT Pyramid GIC Fund 9,037
Janus Fund 4,337
</TABLE>
Net appreciation in fair value of investments by major investment type for
the year ended December 31, 1996 is as follows:
<TABLE>
<S> <C>
Common stock $1,642,663
Mutual funds 922,327
----------
$2,564,990
==========
</TABLE>
Page No. 14
<PAGE> 15
4. TAX STATUS
The Internal Revenue Service issued a determination letter dated June 13,
1996 stating that the Plan was designed in accordance with applicable IRC
requirements as of that date. The Plan has been amended and restated since
receiving the determination letter. However, the plan administrator
believes that the Plan is currently designed and is being operated in
compliance with the applicable requirements of the IRC. Therefore, the
plan administrator believes that the Plan was qualified and that the
related trust was tax-exempt for the years ended December 31, 1996 and
1995.
5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
plan termination, participants will become fully vested in their account
balances.
6. RECONCILIATION TO FORM 5500
As of December 31, 1996 and 1995, the Plan had approximately $585,000 and
$189,000, respectively, of pending distributions to participants who
elected to withdraw from the Plan. These amounts are recorded as a
liability in the Plan's Form 5500 for 1996; however, these amounts are not
recorded as a liability in the accompanying statement of net assets
available for benefits as of December 31, 1996 in accordance with
generally accepted accounting principles.
The following table reconciles amounts per the financial statements to
the Form 5500 as filed by the Company for the year ended December
31, 1996:
<TABLE>
<CAPTION>
NET ASSETS
BENEFITS AVAILABLE
PAYABLE TO FOR PLAN
PARTICIPANTS BENEFITS PAID BENEFITS
------------ ------------- ----------
<S> <C> <C> <C>
Per financial statements $ 0 $3,253,905 $29,145,242
Accrued benefits payable 585,000 585,000 (585,000)
-------- ---------- -----------
Per Form 5500 $585,000 $3,838,905 $28,560,242
======== ========== ===========
</TABLE>
Page No. 15
<PAGE> 16
SCHEDULE I
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
ITEM 27A--SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
<TABLE>
<CAPTION>
IDENTITY OF ISSUER, BORROWER, DESCRIPTION OF INVESTMENT, INCLUDING MATURITY DATE, CURRENT
LESSOR, OR SIMILAR PARTY RATE OF INTEREST, COLLATERAL, AND PAR OR MATURITY VALUE COST VALUE
- --------------------------------------- ------------------------------------------------------- ----------- -----------
<S> <C> <C> <C> <C>
* VARIOUS PLAN PARTICIPANTS Participant loans, various maturities,
interest rates ranging from 6% to 12% $ 2,309,598 $ 2,309,598
* SAVANNAH FOODS & INDUSTRIES, INC. Common stock 10,794,373 11,181,330
BANKERS TRUST COMPANY BT Pyramid GIC Fund 7,015,812 7,015,812
* VANGUARD GROUP, INC. Vanguard Money Market Return--Prime 83,738 83,738
Vanguard Investment Contract Trust 1,510,065 1,510,065
Vanguard/Wellington Fund 992,533 965,241
Vanguard Explorer Fund 3,972 4,004
Vanguard Index Trust--500 Fund 4,055,511 4,217,954
Vanguard/Windsor II Fund 1,655,357 1,640,600
Vanguard World Fund U.S. Growth Portfolio 24,775 24,432
----------- -----------
$28,445,734 $28,952,774
=========== ===========
</TABLE>
*Represents a party in interest.
The accompanying notes are an integral part of this schedule.
Page No. 16
<PAGE> 17
SCHEDULE II
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
ITEM 27D--SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
PURCHASES
DESCRIPTION OF INVESTMENT, ------------------------------
INCLUDING MATURITY DATE, NUMBER
IDENTITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL, OF PURCHASE
LESSOR, OR SIMILAR PARTY AND PAR OR MATURITY VALUE TRANSACTIONS PRICE
----------------------------------- ----------------------------------- ------------ ----------
<S> <C> <C> <C> <C>
* CHASE MANHATTAN BANK Pooled Investment Trust for 190 $2,749,939
Employee Benefit
Plans II--Cash Investment Fund
* SAVANNAH FOODS & INDUSTRIES, INC. Common stock 42 1,394,213
BANKERS TRUST COMPANY BT Pyramid GIC Fund 249 1,642,780
JANUS GROUP OF MUTUAL FUNDS Janus Fund 60 956,650
PIMPCO ADVISORS INSTITUTIONAL FUNDS NFJ Equity Income Fund, 43 466,140
institutional
INVESCO FUNDS GROUP, INC. Value: Total Return Fund 40 334,654
* THE VANGUARD GROUP Vanguard Investment Contract Trust 7 1,597,048
Vanguard Index Trust--500 Fund 6 4,062,078
Vanguard/Windsor II 7 1,659,508
<CAPTION>
SALES
DESCRIPTION OF INVESTMENT, --------------------------------------------------
INCLUDING MATURITY DATE, NUMBER COST NET
IDENTITY OF ISSUER, BORROWER, RATE OF INTEREST, COLLATERAL, OF SELLING OF GAIN
LESSOR, OR SIMILAR PARTY AND PAR OR MATURITY VALUE TRANSACTIONS PRICE ASSETS (LOSS)
----------------------------------- ---------------------------------- ------------ ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
* CHASE MANHATTAN BANK Pooled Investment Trust for 241 $2,749,939 $2,749,939 $ 0
Employee Benefit
Plans II--Cash Investment Fund
* SAVANNAH FOODS & INDUSTRIES, INC. Common stock 20 68,173 76,369 (8,196)
BANKERS TRUST COMPANY BT Pyramid GIC Fund 66 3,728,493 3,728,493 0
JANUS GROUP OF MUTUAL FUNDS Janus Fund 63 5,886,185 4,736,663 1,149,522
PIMPCO ADVISORS INSTITUTIONAL FUNDS NFJ Equity Income Fund, 56 1,773,073 1,516,936 256,137
institutional
INVESCO FUNDS GROUP, INC. Value: Total Return Fund 49 1,436,411 1,246,349 190,062
* THE VANGUARD GROUP Vanguard Investment Contract Trust 2 25,753 25,753 0
Vanguard Index Trust--500 Fund 2 6,944 6,567 377
Vanguard/Windsor II 2 4,191 4,151 40
</TABLE>
*Represents a party in interest.
The accompanying notes are an integral part of this schedule.
Page No. 17
<PAGE> 18
SCHEDULE III
SAVANNAH FOODS & INDUSTRIES, INC.
EMPLOYEE RETIREMENT SAVINGS PLAN
ITEM 27B--SCHEDULE OF LOANS IN DEFAULT
DECEMBER 31, 1996
<TABLE>
<CAPTION>
AMOUNT
RECEIVED DURING UNPAID
ORIGINAL REPORTING YEAR BALANCE AMOUNT OVERDUE
AMOUNT ---------------------- AT END -----------------------
IDENTITY OF OBLIGOR OF LOAN PRINCIPAL AND INTEREST OF YEAR DETAILED DESCRIPTION OF LOAN PRINCIPAL INTEREST
------------------- ------- ---------------------- ------- ---------------------------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
* VARIOUS PLAN
PARTICIPANTS $ 28,484 $ 3,241 $ 16,220 Issued January 26, 1992
through October 11, 1995;
interest rates 6% to 10% $ 1,161 $ 227
</TABLE>
*Party in interest.
The accompanying notes are an integral part of this schedule.
Page No. 18
<PAGE> 19
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report included in this Form 11-K, into Savannah Foods & Industries, Inc.'s
previously filed Registration Statement File No. 2-94678 covering the Savannah
Foods & Industries, Inc. Employee Retirement Savings Plan.
/S/Arthur Andersen LLP
Atlanta, GA
June 25, 1997
Page No. 19
<PAGE> 20
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 2-94678) of Savannah Foods & Industries, Inc.
Employee Retirement Savings Plan of our report dated May 24, 1996 which appears
on page 21 of this Form 11-K.
/S/Price Waterhouse LLP
Atlanta, GA
June 25, 1997
Page No. 20
<PAGE> 21
REPORT OF INDEPENDENT ACCOUNTANTS
May 24, 1996
To the Participants and Administrator of the Savannah Foods & Industries, Inc.
Employee Retirement Savings Plan:
In our opinion, the accompanying statement of net assets available for benefits,
with fund information, for the Savannah Foods & Industries, Inc. Employee
Retirement Savings Plan (the Plan) as of December 31, 1995 presents fairly, in
all material respects, the financial status of the Plan at December 31, 1995 in
conformity with generally accepted accounting principles. This financial
statement is the responsibility of the Plan's management; our responsibility is
to express an opinion on this financial statement based on our audit. We
conducted our audit in accordance with generally accepted auditing standards,
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for the opinion expressed above. We have not audited the
financial statements of the Plan for any period subsequent to December 31, 1995.
/S/ Price Waterhouse LLP
Atlanta, Georgia
Page No. 21
