SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
-----------------
AMENDMENT TO APPLICATION OR REPORT
Filed pursuant to Section 12,13, or 15(d) of the
THE SECURITIES EXCHANGE ACT OF 1934
USFREIGHTWAYS CORPORATION
COMMISSION NUMBER 0-19791
AMENDMENT NO. 1
The undersigned registrant hereby amends its Annual Report on Form 10-K
for the fiscal year ended December 31, 1998 by adding the Annual Report of the
USF Employees' 401K Retirement Plan on Form 11-K for the year ended December 31,
1998.
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
USFREIGHTWAYS CORPORATION
By: /s/ Christopher L. Ellis
Christopher L. Ellis
Chief Financial Officer and Senior
Vice President, Finance
June 23, 1999
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE,
SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 for the fiscal year ended December 31, 1998 [FEE REQUIRED]
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the transition period from _________ to _________ [NO
FEE REQUIRED]
COMMISSION NUMBER 0-19791
USF EMPLOYEES' 401K RETIREMENT PLAN
USFREIGHTWAYS CORPORATION
9700 Higgins Road, Suite 570
Rosemont, Illinois 60018
<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the Plan Committee of the USF Employees' 401K Retirement Plan have duly caused
this Annual Report to be signed on its behalf by the undersigned hereunto duly
authorized.
USF EMPLOYEES' 401K RETIREMENT PLAN
By Members of the Plan Committee administering
the USF Employees' 401K Retirement Plan
/s/ John Campbell Carruth
John Campbell Carruth
/s/ Christopher L. Ellis
Christopher L. Ellis
/s/ Stephen G. Dill
Stephen G. Dill
Date: June 23, 1999
<PAGE>
USF EMPLOYEES' 401K RETIREMENT PLAN
FORM 11-K
FOR THE YEAR ENDED DECEMBER 31, 1998
FINANCIAL STATEMENTS AND SCHEDULES
December 31, 1998 and 1997
The following financial statements, supplementary schedules and exhibits are
filed as part of this Annual Report on Form 11-K of the USF Employees' 401K
Retirement Plan.
TABLE OF CONTENTS
Financial Statements
-REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS--December 31, 1998 and December 31,
1997
-FINANCIAL STATEMENTS--
Statements of Net Assets Available for Benefits as of December 31, 1998
and 1997
Statements of Changes in Net Assets Available for Benefits for the Years
Ended December 31, 1998 and 1997
-NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
-SCHEDULES SUPPORTING FINANCIAL STATEMENTS
Schedule I--Statements of Net Assets Available for Benefits by Fund as of
December 31, 1998 and 1997
Schedule II--Statements of Changes in Net Assets Available for Benefits by
Fund for the Years Ended December 31, 1998 and 1997
Schedule III--Item 27(a)--Schedule of Assets Held for Investment Purposes
as of December 31, 1998
Schedule IV--Item 27(d)--Schedule of Reportable Transactions for the Year
Ended December 31, 1998
All schedules, except as set forth above, are omitted as not applicable or not
required, or the required information is included in the financial statements or
notes thereto.
Exhibits EXHIBIT 23
Consent of Independent Auditors
The following documents, filed with the Securities and Exchange Commission, are
incorporated by reference herein:
Form S-8 Registration Statement No. 33-57634 filed January 28, 1993 and
Prospectus dated January 28, 1993 covering 315,000 shares of Common
Stock of USFreightways Corporation pursuant to the USF Employees' 401K
Retirement Plan.
<PAGE>
Report of Independent Public Accountants
To the Plan Administrative Committee of
USF Employees' 401K Retirement Plan:
We have audited the accompanying statements of net assets available for benefits
of the USF EMPLOYEES' 401K RETIREMENT PLAN as of December 31, 1998 and 1997, and
the related statements of changes in net assets available for benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our 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 USF
Employees' 401K Retirement Plan as of December 31, 1998 and 1997, and the
changes in net assets available for benefits for the years then ended in
conformity with generally accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental Schedules III and IV 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 supplemental schedules
have been subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, are fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/S/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Chicago, Illinois
June 18, 1999
<PAGE>
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(See Schedule I for Detail by Fund)
As of December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS:
Cash $ 82,304 $ 68,840
------------ ------------
Investments at fair value (Note 1)-
Fidelity-
Managed Income Portfolio 7,220,369 5,846,564
Retirement Money Market Portfolio 22,268,917 17,831,626
Blue Chip Growth Fund 38,200,071 24,336,736
Growth Company Fund 46,526,666 36,158,657
Intermediate Bond Fund 14,643,392 13,018,406
Fidelity Magellan Fund 48,119,280 32,659,321
Asset Manager 2,969,464 1,870,250
Equity Income Fund 8,902,961 7,895,811
Aetna Real Estate Limited Partnership 1,342,636 1,286,898
USFreightways Common Stock Fund 5,669,356 5,240,820
Participant loans 6,315,169 5,241,408
------------ ------------
Total investments 202,178,281 151,386,497
------------ ------------
Contributions receivable-
Participant 336,252 301,114
Employer 1,164,282 1,102,625
------------ ------------
Total contributions receivable 1,500,534 1,403,739
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $203,761,119 $152,859,076
============ ============
</TABLE>
The accompanying notes to financial statements and schedules are
an integral part of these statements.
<PAGE>
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(See Schedule II for Detail by Fund)
For the Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C>
1998 1997
INVESTMENT INCOME:
Dividend and interest income $10,639,921 $ 9,735,639
Net appreciation in fair value of investments
23,972,391 12,810,046
------------ ------------
Total investment income 34,612,312 22,545,685
------------ ------------
CONTRIBUTIONS:
Participants 17,077,439 13,180,781
Employer 7,829,443 6,750,182
------------ ------------
Total contributions 24,906,882 19,930,963
------------ ------------
OTHER DEDUCTIONS:
Benefits paid to participants (9,829,768) (11,224,518)
Administrative expenses (59,825) (54,906)
------------ ------------
Total deductions (9,889,593) (11,279,424)
------------ ------------
Transfers into the Plan (Note 1) 1,272,442 -
------------ ------------
Net change 50,902,043 31,197,224
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 152,859,076 121,661,852
------------ ------------
End of year $203,761,119 $152,859,076
============ ============
</TABLE>
The accompanying notes to financial statements and schedules are
an integral part of these statements.
<PAGE>
USF EMPLOYEES' 401K RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
December 31, 1998 and 1997
1. PLAN DESCRIPTION
The following description of the USF Employees' 401K Retirement Plan (the
"Plan") is provided for general information purposes only. More complete
information regarding the Plan provisions may be found in the Plan
document.
General
The Plan is a defined contribution plan established by USFreightways
Corporation, the principal sponsor of the Plan, under provisions of
Section 401(a) of the Internal Revenue Code ("IRC"). The Plan covers
certain employees of USFreightways Corporation, as well as certain
employees of the following adopting sponsors of the Plan, all of which are
wholly owned subsidiaries of USFreightways Corporation: USF Bestway Inc.,
USF Logistics Inc., USF Logistics Services Inc., USF Distribution
Services Inc., USF Dugan Inc., USF Sales Corporation, USF Holland Inc.,
USF Reddaway Inc., USF Red Star Inc., USF Coast Consolidators Inc., USF
Caribbean Services, Comet Transport Inc. (1997 only), USF Seko Worldwide,
Inc. (1998 only), USF Logistics [IMC] Inc.(1998 only) and USF Logistics
[TRICOR] Inc. (1998 only).
During 1998, USF Seko Worldwide, Inc. adopted the Plan, and as a result
transferred all of Seko Air Freight, Inc. Employees' 401(K) Plan and Trust
(the Seko Plan) asset balances totaling $1,272,442 into the Plan.
Hereafter, the principal and adopting sponsors of the Plan are referred to
collectively as "the Company" or individually as "each Company." All
employees of these subsidiaries are eligible to participate in the Plan
after completing one qualifying year of service, as defined. The Plan is
subject to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA"), as amended. Unionized employees are excluded from
participating in the Plan if they have separately bargained for retirement
benefits.
Plan Administration
The Plan is administered by the USF Plan Administrative Committee, which
is appointed by the Board of Directors of the Company. Plan assets were
held by Fidelity Management Trust Company ("Fidelity") as Trustee for the
years ended December 31, 1998 and 1997.
Eligibility
Participants become eligible to enter the plan on January 1, April 1, July
1, or October 1, following the date the participant completes a qualifying
year of service.
Contributions
Eligible employees can contribute an amount up to 15% of their cash
compensation, as defined by the Plan, subject to certain limitations under
the IRC. Each Company may provide a matching contribution and/or
nonelective contribution subject to group discrimination limitations. The
Company may also contribute a discretionary amount. The Company made no
discretionary contribution during 1998 and 1997.
Vesting
Participants are fully vested in their contributions, the Company's
matching and/or nonelective contributions, and plan earnings thereon.
<PAGE>
Benefits
Upon termination of service due to death, disability, retirement, or
financial hardship, the participant or their beneficiary is entitled to
distribution of his or her account through an elected distribution method
made by the participant in accordance with the Plan's provisions.
Participant Accounts
Each participant's account is credited with the participant's
contribution, each Company's matching contribution (if applicable), each
Company's nonelective contribution (if applicable), the Company's
discretionary contribution (if applicable), and the Plan's earnings
allocation. The allocation of plan earnings is based on participant
account balances, as defined. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's
account.
Investment Options
Participants may direct their employee and employer contributions and any
related earnings among eight separate Fidelity investment accounts and the
USF Common Stock fund. Participants may change their current investment
elections at any time. The allocation of investment fund balances may be
changed up to four times a year. Employee deferral elections can be made
at the beginning of each calendar year quarter and are effective
throughout the quarter. A description of each investment option is
provided below:
Managed Income Portfolio--This portfolio purchases investment
contracts offered by major insurance companies and other approved
financial institutions and short-term instruments to provide for
liquidity needs. The objective of this fund is to provide a
competitive level of income over time while preserving the value of
the investment.
Retirement Money Market Portfolio--This fund invests in high-quality
short-term money market securities of U.S. and foreign issuers,
including short-term corporate obligations, U.S. Government
obligations and certificates of deposit.
Blue Chip Growth Fund--This fund primarily invests in common stocks
of well-known, established companies. The objective of this fund is
to provide growth of capital over the long term.
Growth Company Fund--This fund invests primarily in stocks of
companies with earnings or gross sales that indicate the potential
for above-average growth. The objective of this fund to increase the
investment over the long term through capital growth.
Intermediate Bond Fund--This fund invests in all types of U.S. and
foreign bonds, including corporate or U.S. Government issues.
USFreightways Common Stock Fund--This fund invests in USFreightways
common stock.
Fidelity Magellan Fund--This fund invests in common stocks of small,
medium and large companies, both well known and lesser known, with
above-average growth potential and a correspondingly higher level of
risk.
Asset Manager--This fund invests in stocks, bonds and short-term and
money market instruments of U.S. and foreign issuers.
Equity Income Fund--This fund invests in income-producing stocks
such as common and preferred stocks.
<PAGE>
MIP/Aetna Real Estate Associates, Limited Partnership--Under a
predecessor plan, contributions of USF Holland Inc. were invested in
certain assets, including either a Guaranteed Insurance Contract or
a Real Estate Limited Partnership ("RELP"). Under the Plan, no
further investment of either employer or employee contributions has
been permitted in these assets. In order to provide liquidity to
fund distributions to employees of USF Holland (due, for example,
either to termination of service or retirement) the investment in
the Managed Income Portfolio portion of this investment has been
restricted until such time as the RELP provides sufficient liquidity
from its assets to fund such distributions or the RELP itself is
liquidated. The RELP is revalued by Aetna based on the estimated
fair value of the properties held. Purchases and sales of securities
are recorded on a settlement date basis. The impact of not recording
these transactions on a trade-date basis has been determined to be
immaterial.
The stated objectives of these funds are not necessarily indicators of
actual performance.
Loans to Participants
Subject to such rules and limitations as may be established from time to
time, participants are allowed to borrow from employee deferral
contributions, rollover accounts, or any after-tax deferrals in their
account subject to a limit of the lesser of 50% of their vested account
balance, or $50,000. The interest rate on loans is the prime rate reported
in The Wall Street Journal in effect on the last day of the month
preceding the loan request. Loan repayments are normally made by payroll
deductions, generally over a period not to exceed five years at the
election of the participant, with the exception of prime residence loans,
which may be extended over a longer period.
2. SUMMARY OF 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.
Income Recognition
Interest income is recorded as earned on the accrual basis. Dividend
income is recorded on the ex-dividend date.
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.
Net Appreciation in Fair Value of Investments
Net realized and unrealized appreciation (depreciation) is recorded in the
accompanying statements of changes in net assets available for benefits as
net appreciation in fair value of investments.
Administrative Expenses
The Company pays all administrative expenses of the Plan, except for
administrative fees related to servicing participant loans, broker fees
and the RELP fees. The investment income of the trust is net of any
investment advisory fees charged by the managers.
Benefit Payments
Benefits are recorded when paid.
<PAGE>
3. TAX STATUS
The Plan has received a favorable determination letter from the Internal
Revenue Service dated March 10, 1995, stating that the Plan is qualified
under Section 401(a) of the Internal Revenue Code ("IRC") and, therefore,
the related trust is exempt from tax under Section 501(a) of the IRC. Once
qualified, the Plan is required to operate in conformity with the IRC to
maintain its qualification. The Plan has been amended since receiving the
determination letter. The plan administrator believes that the Plan is
currently designed and is being operated in compliance with the applicable
requirements of the IRC.
4. 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.
5. RECONCILIATION TO FORM 5500
The following is a reconciliation of net assets available for benefits per
the financial statements to the Form 5500:
<TABLE>
<CAPTION>
<S> <C> <C>
December 31,
1998 1997
Net assets available for benefits per the financial statements
$203,761,119 $152,859,076
Amounts allocated to withdrawing participants (130,582) (140,738)
------------ ------------
Net Assets available for benefits per the
Form 5500 $203,630,537 $152,718,338
============ ============
</TABLE>
<TABLE>
<CAPTION>
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500:
<S> <C>
Year Ended
Dec.31, 1998
Benefits paid to participants per the financial statements
$9,829,768
Add: Amounts allocated to withdrawing participants at December 31, 1998
130,582
Less: Amounts allocated to withdrawing participants at December 31, 1997
(140,738)
----------
Benefits paid to participants per the Form 5500 $9,819,612
==========
</TABLE>
6. SUBSEQUENT EVENT
Effective January 1, 1998, the following operating companies adopted the
USF Employees' 401K Retirement Plan: Glen Moore Transport, Inc. and
certain subsidiaries of Golden Eagle Group Inc.
<PAGE>
Schedule I
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS BY FUND
As of December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1998
Retirement USF
Managed Money Blue Chip Growth Intermediate Common
Income Market Growth Company Bond Stock
Portfolio Portfolio Fund Fund Fund Fund
ASSETS:
Cash $ - $ - $ - $ - $ - $ 82,304
---------- ----------- ----------- ----------- ---------- ----------
Investments at fair value (Notes 1 and 3)-
Managed Income Portfolio 5,847,323 - - - - -
Retirement Money Market Portfolio - 22,268,917 - - - -
Blue Chip Growth Fund - - 38,200,071 - - -
Growth Company Fund - - - 46,526,666 - -
Intermediate Bond Fund - - - - 14,643,392 -
USFreightways Common Stock Fund - - - - - 5,669,356
Fidelity Magellan Fund - - - - - -
Real Estate Limited Partnership - - - - - -
Asset Manager - - - - - -
Equity Income - - - - - -
Participant loans - - - - - -
---------- ----------- ----------- ----------- ----------- ----------
Total investments 5,847,323 22,268,917 38,200,071 46,526,666 14,643,392 5,669,356
---------- ----------- ----------- ----------- ----------- ----------
Contributions receivable-
Participants 10,209 57,863 64,769 61,757 20,070 20,592
Employer 29,572 351,413 191,374 174,848 68,238 52,779
---------- ----------- ----------- ----------- ----------- ----------
Total contributions receivable 39,781 409,276 256,143 236,605 88,308 73,371
---------- ----------- ----------- ----------- ----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $5,887,104 $22,678,193 $38,456,214 $46,763,271 $14,731,700 $5,825,031
========== =========== =========== =========== =========== ==========
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule I
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS BY FUND
As of December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1998
MIP/
Fidelity Real Equity
Magellan Estate Asset Income Loan
Fund Fund Manager Fund Fund Total
ASSETS:
Cash $ - $ - $ - $ - $ - $ 82,304
----------- ---------- ---------- ---------- ---------- ------------
Investments at fair value (Notes 1 and 3)-
Managed Income Portfolio - 1,373,046 - - - 7,220,369
Retirement Money Market Portfolio - - - - - 22,268,917
Blue Chip Growth Fund - - - - - 38,200,071
Growth Company Fund - - - - - 46,526,666
Intermediate Bond Fund - - - - - 14,643,392
USFreightways Common Stock Fund - - - - - 5,669,356
Fidelity Magellan Fund 48,119,280 - - - - 48,119,280
Real Estate Limited Partnership - 1,342,636 - - - 1,342,636
Asset Manager - - 2,969,464 - - 2,969,464
Equity Income - - - 8,902,961 - 8,902,961
Participant loans - - - - 6,315,169 6,315,169
----------- ---------- ---------- ---------- ---------- ------------
Total investments 48,119,280 2,715,682 2,969,464 8,902,961 6,315,169 202,178,281
----------- ---------- ---------- ---------- ---------- ------------
Contributions receivable-
Participants 70,637 - 9,624 20,731 - 336,252
Employer 207,567 - 25,293 63,198 - 1,164,282
----------- ---------- ---------- ---------- ---------- ------------
Total contributions receivable 278,204 - 34,917 83,929 - 1,500,534
----------- --------- ---------- ---------- ---------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $48,397,484 $2,715,682 $3,004,381 $8,986,890 $6,315,169 $203,761,119
=========== ========== ========== ========== ========== ============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule I
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS BY FUND
As of December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1997
Managed Money Blue Chip Growth Intermediate Common
Income Market Growth Company Bond Stock
Portfolio Portfolio Fund Fund Fund Fund
ASSETS:
Cash $ - $ - $ - $ - $ - $ 68,840
---------- ----------- ----------- ----------- ----------- ----------
Investments at fair value (Notes 1 and 3)-
Managed Income Portfolio 4,456,812 - - - - -
Retirement Money Market Portfolio - 17,831,626 - - - -
Blue Chip Growth Fund - - 24,336,736 - - -
Growth Company Fund - - - 36,158,657 - -
Intermediate Bond Fund - - - - 13,018,406 -
USFreightways Common Stock Fund - - - - - 5,240,820
Fidelity Magellan Fund - - - - - -
Real Estate Limited Partnership - - - - - -
Asset Manager - - - - - -
Equity Income - - - - - -
Participant loans - - - - - -
---------- ----------- ----------- ----------- ----------- ----------
Total investments 4,456,812 17,831,626 24,336,736 36,158,657 13,018,406 5,240,820
---------- ----------- ----------- ----------- ----------- ----------
Contributions receivable-
Participants 10,301 53,047 57,288 58,389 21,066 18,653
Employer 30,466 351,166 165,664 180,249 70,540 63,822
---------- ----------- ----------- ----------- ----------- ----------
Total contributions receivable 40,767 404,213 222,952 238,638 91,606 82,475
---------- ----------- ----------- ----------- ----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS $4,497,579 $18,235,839 $24,559,688 $36,397,295 $13,110,012 $5,392,135
========== =========== =========== =========== =========== ==========
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule I
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS BY FUND
As of December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1997
MIP/
Fidelity Real Equity
Magellan Estate Asset Income Loan
Fund Fund Manager Fund Fund Total
ASSETS:
Cash $ - $ - $ - $ - $ - $ 68,840
----------- ---------- ---------- ---------- ---------- ------------
Investments at fair value (Notes 1 and 3)-
Managed Income Portfolio - 1,389,752 - - - 5,846,564
Retirement Money Market Portfolio - - - - - 17,831,626
Blue Chip Growth Fund - - - - - 24,336,736
Growth Company Fund - - - - - 36,158,657
Intermediate Bond Fund - - - - - 13,018,406
USFreightways Common Stock Fund - - - - - 5,240,820
Fidelity Magellan Fund 32,659,321 - - - - 32,659,321
Real Estate Limited Partnership - 1,286,898 - - - 1,286,898
Asset Manager - - 1,870,250 - - 1,870,250
Equity Income - - - 7,895,811 - 7,895,811
Participant loans - - - - 5,241,408 5,241,408
----------- ---------- ---------- ---------- ---------- ------------
Total investments 32,659,321 2,676,650 1,870,250 7,895,811 5,241,408 151,386,497
----------- ---------- ---------- ---------- ---------- ------------
Contributions receivable
Participants 58,382 - 8,328 15,660 - 301,114
Employer 180,559 - 19,292 40,867 - 1,102,625
----------- ---------- ---------- ---------- ---------- ------------
Total contributions receivable 238,941 - 27,620 56,527 - 1,403,739
----------- ---------- ---------- ---------- ---------- ------------
NET ASSETS AVAILABLE FOR BENEFITS $32,898,262 $2,676,650 $1,897,870 $7,952,338 $5,241,408 $152,859,076
=========== ========== ========== ========== ========== ============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule II
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY FUND
For the Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1998
Retirement USF
Managed Money Blue Chip Growth Intermediate Common
Income Market Growth Company Bond Stock
Portfolio Portfolio Fund Fund Fund Fund
INVESTMENT INCOME:
Dividend and interest income $ 290,812 $ 1,076,973 $ 1,563,332 $ 3,365,538 $ 869,590 $ 27,707
Net appreciation (depreciation) in fair value of
investments - 240 7,752,201 6,631,967 130,775 (416,800)
---------- ----------- ----------- ---------- ----------- ----------
Total investment income 290,812 1,077,213 9,315,533 9,997,505 1,000,365 (389,093)
---------- ----------- ----------- ----------- ----------- ----------
CONTRIBUTIONS:
Participants 487,899 2,943,942 3,200,676 3,143,318 1,121,119 841,919
Employer 222,128 2,038,134 1,314,641 1,265,535 506,255 409,423
---------- ----------- ----------- ----------- ----------- ----------
Total contributions 710,027 4,982,076 4,515,317 4,408,853 1,627,374 1,251,342
---------- ----------- ----------- ----------- ----------- ----------
OTHER INCREASES (DECREASES):
Loans to participants (150,622) (832,940) (586,562) (501,286) (316,037) (84,173)
Benefits paid to participants (232,497) (1,936,283) (1,918,355) (1,810,786) (1,025,742) (306,209)
Loan repayments 68,025 357,782 380,358 531,122 158,772 149,594
Interfund transfers, net 686,545 709,389 1,928,673 (2,491,851) 151,760 (188,565)
Loan/custodial servicing fees (2,095) (20,560) (7,508) (2,767) (4,620) -
Transfers to successor plans 19,330 105,677 269,070 235,186 29,816 -
---------- ----------- ----------- ----------- ----------- ----------
Total other increases (decreases)
388,686 (1,616,935) 65,676 (4,040,382) (1,006,051) (429,353)
---------- ----------- ----------- ----------- ---------- ----------
Net change 1,389,525 4,442,354 13,896,526 10,365,976 1,621,688 432,896
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 4,497,579 18,235,839 24,559,688 36,397,295 13,110,012 5,392,135
---------- ----------- ----------- ----------- ---------- ----------
End of year $5,887,104 $22,678,193 $38,456,214 $46,763,271 $14,731,700 $5,825,031
========== =========== =========== =========== ========== ==========
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule II
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY FUND
For the Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
1998
<S> <C> <C> <C> <C> <C> <C>
MIP/
Fidelity Real Equity
Magellan Estate Asset Income Loan
Fund Fund Manager Fund Fund Total
INVESTMENT INCOME:
Dividend and interest income $ 2,274,644 $ 93,633 $ 529,385 $ 548,307 $ - $ 10,639,921
Net appreciation (depreciation) in fair value of
investments 9,508,835 76,243 (152,867) 441,797 - 23,972,391
----------- ---------- ---------- --------- ---------- ------------
Total investment income 11,783,479 169,876 376,518 990,104 - 34,612,312
----------- ---------- ---------- ---------- ---------- ------------
CONTRIBUTIONS:
Participants 3,602,661 - 493,539 1,242,366 - 17,077,439
Employer 1,436,055 - 180,392 456,880 - 7,829,443
----------- ---------- ---------- ---------- ---------- ------------
Total contributions 5,038,716 - 673,931 1,699,246 - 24,906,882
----------- ---------- ---------- ---------- ---------- ------------
OTHER INCREASES (DECREASES):
Loans to participants (1,152,556) - (108,209) (131,860) 3,864,245 -
Benefits paid to participants (1,664,349) (110,846) (64,914) (241,198) (518,589) (9,829,768)
Loan repayments 538,871 - 30,661 87,805 (2,302,990) -
Interfund transfers, net 682,747 - 132,208 (1,610,906) - -
Loan/ custodial servicing fees (1,106) (19,998) (1,106) (65) - (59,825)
Transfers to successor plans 273,420 - 67,422 241,426 31,095 1,272,442
----------- ---------- ---------- ---------- ---------- ------------
Total other increases (decreases)
(1,322,973) (130,844) 56,062 (1,654,798) 1,073,761 (8,617,151)
----------- ---------- ---------- ---------- ---------- ------------
Net change 15,499,222 39,032 1,106,511 1,034,552 1,073,761 50,902,043
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 32,898,262 2,676,650 1,897,870 7,952,338 5,241,408 152,859,076
----------- ---------- ---------- ---------- ---------- ------------
End of year $48,397,484 $2,715,682 $3,004,381 $8,986,890 $6,315,169 $203,761,119
=========== ========== ========== ========== ========== ============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule II
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY FUND
For the Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1997
Retirement USF
Managed Money Blue Chip Growth Intermediate Common
Income Market Growth Company Bond Stock
Portfolio Portfolio Fund Fund Fund Fund
INVESTMENT INCOME:
Dividend and interest income $ 255,778 $ 933,478 $ 1,233,934 $ 3,527,163 $ 838,736 $ 80,683
Net appreciation in fair value of investments
4,787 18,573 3,734,816 2,199,232 124,579 794,648
---------- ----------- ----------- ----------- ----------- ----------
Total investment income 260,565 952,051 4,968,750 5,726,395 963,315 875,331
---------- ----------- ----------- ----------- ---------- ----------
CONTRIBUTIONS:
Participants 497,710 2,039,085 2,306,928 2,770,186 960,821 681,077
Employer 209,438 1,741,766 1,026,932 1,222,003 493,031 367,798
---------- ----------- ----------- ----------- ----------- ----------
Total contributions 707,148 3,780,851 3,333,860 3,992,189 1,453,852 1,048,875
---------- ----------- ----------- ----------- ----------- ----------
OTHER INCREASES (DECREASES):
Loans to participants (184,910) (784,482) (524,484) (612,423) (296,522) (82,182)
Benefits paid to participants (377,837) (2,591,122) (1,769,455) (2,212,242) (1,130,765) (264,406)
Loan repayments 64,474 275,530 306,911 478,500 150,025 124,215
Interfund transfers, net (291,396) (153,394) 806,842 (1,028,903) (829,716) (247,898)
Loan/ custodial servicing fees (1,420) (18,914) (5,533) (3,470) (4,370) (4)
Transfers to successor plans - - - - - -
---------- ----------- ----------- ----------- ----------- ----------
Total other increases (decreases)
(791,089) (3,272,382) (1,185,719) (3,378,538) (2,111,348) (470,275)
---------- ----------- ---------- ----------- ----------- ----------
Net change 176,624 1,460,520 7,116,891 6,340,046 305,819 1,453,931
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 4,320,955 16,775,319 17,442,797 30,057,249 12,804,193 3,938,204
---------- ----------- ----------- ----------- ----------- ----------
End of year $4,497,579 $18,235,839 $24,559,688 $36,397,295 $13,110,012 $5,392,135
========== =========== =========== =========== =========== ==========
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule II
Continued
USF EMPLOYEES' 401K RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS BY FUND
For the Years Ended December 31, 1998 and 1997
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1997
MIP/
Fidelity Real Equity
Magellan Estate Asset Income Loan
Fund Fund Manager Fund Fund Total
INVESTMENT INCOME:
Dividend and interest income $ 2,141,392 $ 138,625 $ 157,611 $ 428,239 $ - $ 9,735,639
Net appreciation in fair value of
investments 4,518,805 61,541 127,648 1,225,417 - 12,810,046
----------- ---------- ---------- ---------- ---------- ------------
Total investment income 6,660,197 200,166 285,259 1,653,656 - 22,545,685
----------- ---------- ---------- ---------- ---------- ------------
CONTRIBUTIONS
Participants 2,802,098 - 312,582 810,294 - 13,180,781
Employer 1,270,722 - 121,776 296,716 - 6,750,182
----------- ---------- ---------- ---------- ---------- ------------
Total contributions 4,072,820 - 434,358 1,107,010 - 19,930,963
----------- ---------- ---------- ---------- ---------- ------------
OTHER INCREASES (DECREASES):
Loans to participants (966,211) - (44,679) (85,980) 3,581,873 -
Benefits paid to participants (1,484,065) (112,762) (55,207) (829,522) (397,135) (11,224,518)
Loan repayments 477,840 - 27,822 77,157 (1,982,474) -
Interfund transfers, net (600,354) - 512,800 1,832,019 - -
Loan/ custodial servicing fees (865) (19,998) (290) (42) - (54,906)
Transfers to successor plans - - - - - -
----------- ---------- ---------- ---------- ---------- ------------
Total other increases (decreases)
(2,573,655) (132,760) 440,446 993,632 1,202,264 (11,279,424)
----------- ---------- ---------- ---------- ---------- ------------
Net change 8,159,362 67,406 1,160,063 3,754,298 1,202,264 31,197,224
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 24,738,900 2,609,244 737,807 4,198,040 4,039,144 121,661,852
----------- ---------- ---------- ---------- ---------- ------------
End of year $32,898,262 $2,676,650 $1,897,870 $7,952,338 $5,241,408 $152,859,076
=========== ========== ========== ========== ========== ============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
<PAGE>
Schedule III
USF EMPLOYEES' 401K RETIREMENT PLAN
ITEM 27(a)--SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
As of December 31, 1998
(Employer Identification Number 36-3790696, Plan Number 002)
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Cost Current
Identity of Issuer Description of Investment Basis Value
*Fidelity Institutional Retirement
Services Managed Income Portfolio $7,220,369 $7,220,369
*Fidelity Institutional Retirement
Services Retirement Money Market 22,268,917 22,268,917
*Fidelity Institutional Retirement
Services Blue Chip Fund 25,984,693 38,200,071
*Fidelity Institutional Retirement
Services Growth Company Fund 33,636,490 46,526,666
*Fidelity Institutional Retirement
Services Intermediate Bond Fund 14,293,987 14,643,392
*USFreightways Corporation USFreightways Corp. Common Stock
4,677,048 5,669,356
*Fidelity Institutional Retirement
Services Fidelity Magellan Fund 33,602,811 48,119,280
*Fidelity Institutional Retirement MIP/Real Estate Fund--Real Estate
Services 1,834,881 1,342,636
*Fidelity Institutional Retirement
Services Asset Manager 3,041,514 2,969,464
*Fidelity Institutional Retirement
Services Equity Income Fund 7,701,972 8,902,961
Participant loans 6,315,169 6,315,169
------------ ------------
$160,577,851 $202,178,281
============ ============
</TABLE>
*Party in interest.
The accompanying notes to financial statements and schedules are an integral
part of this schedule.
<PAGE>
Schedule IV
USF EMPLOYEES' 401K RETIREMENT PLAN
ITEM 27(d)--SCHEDULE OF REPORTABLE TRANSACTIONS
For the Year Ended December 31, 1998
(Employer Identification Number 36-3790696, Plan Number 002)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Current Net
Purchase Selling Cost of Value of Gain or
Identity of Party Involved Description of Asset Price Price Asset Asset (Loss)
*Fidelity Institutional Retirement
Services Magellan Fund $10,615,255 $ - $ - $10,615,255 $ -
*Fidelity Institutional Retirement
Services Magellan Fund - 4,664,131 3,770,427 - 893,704
*Fidelity Institutional Retirement
Services Growth Company Fund 10,057,341 - - 10,057,341 -
*Fidelity Institutional Retirement
Services Growth Company Fund - 6,321,299 5,056,262 - 1,265,037
*Fidelity Institutional Retirement
Services Blue Chip Growth Fund 10,281,828 - - 10,281,828 -
*Fidelity Institutional Retirement
Services Blue Chip Growth Fund - 4,169,946 3,210,105 - 959,841
*Fidelity Institutional Retirement
Services Equity Income Fund 4,273,310 - - 4,273,310 -
*Fidelity Institutional Retirement
Services Equity Income Fund - 3,707,958 3,261,655 - 446,303
*Fidelity Institutional Retirement Retirement Money Market Portfolio
Services 10,593,840 - - 10,593,840 -
*Fidelity Institutional Retirement Retirement Money Market Portfolio
Services - 6,156,550 6,156,550 - -
----------- ----------- ----------- ----------- ----------
$45,821,574 $25,019,884 $21,454,999 $45,821,574 $3,564,885
=========== =========== =========== =========== ==========
</TABLE>
*Party in interest.
The accompanying notes to financial statements and schedules are an integral
part of this schedule.
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 the USF Employees' 401K Retirement
Plan's previously filed Registration Statement File No. 33-57634 dated January
28, 1993.
/S/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
Chicago, Illinois
June 25,1999
