UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
____
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
X
____ OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended May 6, 1995
OR
____
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
____ OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to ____________
COMMISSION FILE NUMBER 2-14466
_____
SUPER FOOD SERVICES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-2407235
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3233 Newmark Drive, Dayton, Ohio 45342
(Address of principal executive offices, including zip code)
(513) 439-7500
(Registrant's telephone number, including area code)
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 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 the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
At May 6, 1995, there were 10,948,814 Common Shares, $1.00 par
value per share, of the issuer's Common Shares outstanding.
<PAGE>
2
SUPER FOOD SERVICES, INC. AND SUBSIDIARIES
FORM 10-Q
For the Quarter Ended
May 6, 1995
Page
PART I. FINANCIAL INFORMATION
Item 1.
Financial Statements:
Consolidated Summary Balance Sheets
May 6, 1995, May 7, 1994 and August 27,
1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
Consolidated Summary Statements of Income
Twelve Weeks Ended May 6, 1995 and
May 7, 1994. . . . . . . . . . . . . . . . . . . . . . . . . .5
Consolidated Summary Statements of Income
Thirty-Six Weeks Ended May 6, 1995 and
May 7, 1994. . . . . . . . . . . . . . . . . . . . . . . . . .6
Consolidated Summary Statements of Cash
Flows Twelve Weeks Ended May 6, 1995
and May 7, 1994. . . . . . . . . . . . . . . . . . . . . . . .7
Notes to Consolidated Financial Statements . . . . . . . . . . .8
Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . . . . . . . . 11
Part II OTHER INFORMATION
Item 6.
Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . 14
<PAGE>
<TABLE>
3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Super Food Services, Inc. and Subsidiaries
Consolidated Summary Balance Sheets
May 6, 1995, May 7, 1994 and August 27, 1994
<CAPTION>
May 6, 1995 May 7, 1994 Aug. 27, 1994
_____________ _____________ _____________
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash $ 3,303,098 $ 7,423,566 $ 15,834,478
____________ ____________ ____________
Receivables:
Retailer-trade 72,483,192 70,276,397 60,679,596
-notes (current
portion) 4,543,046 4,733,487 4,543,046
Suppliers and
miscellaneous 8,580,003 9,101,492 8,210,002
____________ ____________ ____________
85,606,241 84,111,376 73,432,644
Less-Allowance for
doubtful accounts (9,422,380) (8,934,003) (7,733,255)
____________ ____________ ____________
Net Receivables 76,183,861 75,177,373 65,699,389
____________ ____________ ____________
Merchandise inventory 80,360,241 76,575,495 63,342,978
____________ ____________ ____________
Future tax benefits 6,767,576 1,709,327 6,767,576
____________ ____________ ____________
Prepaid expenses 8,336,898 6,185,717 8,835,158
____________ ____________ ____________
Total Current Assets 174,951,674 167,071,478 160,479,579
Notes Receivable-Retailers
(net long-term portion) 19,131,162 18,391,512 16,179,149
Land, Buildings and
Equipment, net 61,719,205 59,429,367 62,423,968
Future Tax Benefits (925,268) 5,709,981 (925,268)
Other Assets 19,988,297 20,146,751 20,261,871
____________ ____________ ____________
Total Assets $274,865,070 $270,749,089 $258,419,299
============ ============ ============
<FN>
The accompanying Notes are an integral part of these consolidated statements.
These interim statements are unaudited.
<PAGE>
4
LIABILITIES AND SHAREHOLDERS' EQUITY
<CAPTION>
May 6, 1995 May 7, 1994 Aug. 27, 1994
_____________ _____________ _____________
<S> <C> <C> <C>
Current Liabilities:
Accounts payable $ 39,220,451 $ 36,804,329 $ 38,301,945
Notes payable to banks 21,000,000 22,000,000 9,000,000
Current maturities of long-
term notes and mortgages
payable 2,657,000 2,657,000 2,657,000
Current maturities of
obligations under
capitalized leases 797,024 1,013,407 904,118
Current portion of Florida
Closing Liabilities 161,376 2,100,000 1,250,000
Accrued payroll and vacation 3,393,057 3,378,943 2,857,076
Taxes other than income 1,820,442 2,202,066 2,423,390
Other current liabilities 10,300,772 8,879,975 9,654,232
____________ ____________ ____________
Total Current
Liabilities 79,350,122 79,035,720 67,047,761
Long-term Notes and
Mortgages Payable 35,405,286 32,544,337 31,601,617
Obligations Under
Capitalized Leases 22,181,849 24,636,945 24,392,499
Long-term Florida Closing
Liabilities 1,904,293 3,331,218 2,404,000
____________ ____________ ____________
Total Liabilities 138,841,550 139,548,220 125,445,877
____________ ____________ ____________
Shareholders' Equity:
Common Shares, par value
$1.00, 35,000,000 shares
authorized 10,948,814 10,948,814 10,948,814
Paid-in capital 29,407,949 29,407,949 29,407,949
Retained earnings 95,666,757 90,844,106 92,616,659
____________ ____________ ____________
Total Shareholders'
Equity 136,023,520 131,200,869 132,973,422
____________ ____________ ____________
Total Liabilities and
Shareholders' Equity $274,865,070 $270,749,089 $258,419,299
============ ============ ============
<FN>
The accompanying Notes are an integral part of these consolidated statements.
These interim statements are unaudited.
<PAGE>
5
SUPER FOOD SERVICES, INC. AND SUBSIDIARIES
Consolidated Summary Statements of Income
For the Twelve Weeks Ended May 6, 1995 and May 7, 1994
<CAPTION>
1995 1994
_____________ _____________
<S> <C> <C>
Sales and Other Income $260,207,937 $253,233,977
____________ ____________
Cost and Expenses:
Cost of Sales 248,844,130 241,477,283
Selling, General and
Administrative Expenses 7,719,175 8,099,019
Interest Expense 1,737,853 1,472,221
Interest Income (919,992) (847,284)
____________ ____________
Total Costs and Expenses 257,381,166 250,201,239
____________ ____________
Income Before Income Taxes 2,826,771 3,032,738
Provision for Income Taxes 1,095,904 1,209,858
____________ ____________
Net Income Applicable to
Common Shares $ 1,730,867 $ 1,822,880
============ ============
Weighted Average Number of Common
Shares outstanding 10,948,814 10,948,814
============ ============
Earnings Per Common Share $ 0.16 $ 0.17
============ ============
Dividends Declared Per
Common Share $ .095 $ .09
============ ============
<FN>
The accompanying Notes are an integral part of these consolidated statements.
These interim statements are unaudited.
<PAGE>
6
SUPER FOOD SERVICES, INC. AND SUBSIDIARIES
Consolidated Summary Statements of Income
For the Thirty-Six Weeks Ended May 6, 1995 and May 7, 1994
<CAPTION>
1995 1994
_____________ _____________
<S> <C> <C>
Sales and Other Income $788,974,061 $781,790,768
____________ ____________
Cost and Expenses:
Cost of Sales 752,146,648 746,210,873
Selling, General and
Administrative Expenses 24,213,606 23,714,948
Interest Expense 5,155,693 4,465,497
Interest Income (2,651,052) (2,558,120)
____________ ____________
Total Costs and Expenses 778,864,895 771,833,198
____________ ____________
Income Before Income Taxes 10,109,166 9,957,570
Provision for Income Taxes 3,939,066 3,888,349
____________ ____________
Net Income Applicable to
Common Shares $ 6,170,100 $ 6,069,221
============ ============
Weighted Average Number of Common
Shares outstanding 10,948,814 10,940,313
============ ============
Earnings Per Common Share $ 0.56 $ 0.55
============ ============
Dividends Declared Per
Common Share $ .285 $ .27
============ ============
<FN>
The accompanying Notes are an integral part of these consolidated statements.
These interim statements are unaudited.
<PAGE>
7
SUPER FOOD SERVICES, INC. AND SUBSIDIARIES
Consolidated Summary Statements of Cash Flows
For the Thirty-Six Weeks Ended May 6, 1995 and May 7, 1994
<CAPTION>
1995 1994
_____________ _____________
<S> <C> <C>
CASH PROVIDED BY (USED FOR) OPERATIONS:
Net Income $ 6,170,100 $ 6,069,221
Items not affecting cash
Depreciation and amortization 5,233,475 5,116,835
Current items (excluding cash and
notes payable)
Receivables (10,484,472) (10,741,640)
Merchandise Inventory (17,017,263) (11,413,501)
Prepaid expenses and other 498,260 651,589
Accounts payable 918,506 2,061,804
Other current liabilities 625,096 (14,091)
Florida Closing Liabilities (1,588,331) (1,992,788)
____________ ____________
NET CASH USED FOR OPERATIONS (15,644,629) (10,262,571)
____________ ____________
CASH PROVIDED BY (USED FOR) INVESTING:
Additions of property, equipment and
direct financing leases (4,300,660) (12,681,390)
Increase in long-term notes receivable (6,989,393) (3,611,720)
Payments on long-term notes receivable 4,037,380 3,189,552
____________ ____________
NET CASH USED FOR INVESTING (7,252,673) (13,103,558)
____________ ____________
CASH PROVIDED BY (USED FOR) FINANCING:
Notes payable to banks (short-term) 12,000,000 22,000,000
Note payable to bank (long-term) 10,000,000 0
Payments on term debt and capital leases (8,514,075) (3,103,156)
Proceeds from Stock Purchase Plan/
Stock Option Plan 0 446,281
Cash dividends (3,120,003) (2,955,921)
____________ ____________
NET CASH PROVIDED BY FINANCING 10,365,922 16,387,204
____________ ____________
INCREASE (DECREASE) IN CASH (12,531,380) (6,978,925)
CASH, BEGINNING OF YEAR 15,834,478 14,402,491
____________ ____________
CASH, END OF PERIOD $ 3,303,098 $ 7,423,566
============ ============
<PAGE>
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the year for:
Interest (excludes interest
capitalized and imputed
interest on leases) $ 3,489,984 $ 2,958,084
============ ============
Income taxes $ 2,786,486 $ 3,544,794
============ ============
</TABLE>
[FN]
The accompanying Notes are an integral part of these consolidated statements.
These interim statements are unaudited.
<PAGE>
8
Super Food Services, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
1. Financial Statements -
The condensed financial statements included herein have
been prepared by the Company, without audit, pursuant to
the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures
normally included in financial statements prepared in
accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and
regulations, although the Company believes that the
disclosures are adequate to make the information presented
not misleading. It is suggested that these condensed
financial statements be read in conjunction with the
financial statements and the notes thereto included in the
Company's latest annual report on Form 10-K.
2. Accounting Policies -
The interim financial information presented in this report
has been prepared in accordance with the accounting
policies described in the Notes to the Company's financial
statements filed on the most recent Form 10-K. While
management believes that the procedures followed in the
preparation of interim information are reasonable, the
accuracy of some estimated amounts is dependent upon facts
that will exist or calculations that will be accomplished
later in the fiscal year. Examples of such estimates
(none individually significant) include unpaid expenses
not invoiced and pension costs. In addition, an amount is
expensed ratably for possible inventory shrinkage (based
on prior experience and is adjusted to actual twice during
the fiscal year) and to adjust the LIFO reserve (based
upon the Company's best estimate of inflation to date).
The information included in this Form 10-Q reflects all
adjustments which are of a normal recurring nature and, in
the opinion of management, necessary for a fair statement
of the results of operations for the period presented.
<PAGE>
9
3. Reclassifications -
Certain reclassifications have been made to prior years'
amounts to make them comparable with the classifications
of such amounts for fiscal year 1995.
4. Florida Division Closing -
In the third quarter of Fiscal 1992, the Company recorded
a special pretax charge of $22,986,000 in connection with
the closing of the Company's Florida Division and the
disposition of its assets. The closing was required as a
result of the loss by the Florida Division of its single
largest customer, Albertson's, Inc., ("Albertsons") which
accounted for approximately 85% of the sales of the
Florida Division. This charge included provisions
primarily for losses incurred on the disposition of the
inventory and fixed assets, the estimated portion of the
remaining lease obligations and the related operating
costs necessary to maintain the Florida warehouse
facilities until tenants can be found, litigation costs in
connection with the Company's lawsuit against Albertsons,
and other costs relating to the closing. This provision
was based on management's best estimate and judgment under
the prevailing circumstances but management believes such
provision will adequately provide for the costs associated
with disposition of the Florida assets and operations.
The Company's lawsuit against Albertsons was filed on
March 30, 1992, in the Ninth Judicial Circuit Court of
Orange County, Florida. Initially, the Company sought to
enjoin Albertsons temporarily from proceeding with its
plans to self-distribute in Florida and to obtain specific
performance of Albertsons agreement to purchase the assets
of the Florida Division in settlement of the Company's
claims against Albertsons. The Court declined to issue an
injunction, holding that the Company had an adequate
remedy at law for damages if it proved that Albertsons had
violated its obligations to the Company, and this decision
was affirmed on appeal. The Company filed an amended
complaint seeking monetary damages for Albertsons breach
of the requirements contract between the parties or, in
the alternative, damages for Albertsons failure to honor
the settlement agreement between the parties relating to
the purchase by Albertsons of the assets of the Company's
Florida Division. On March 29, 1994, the Company and
Albertsons entered into a joint stipulation to the entry
of a final judgment on the Company's claim for breach of
the requirements contract after the Court had ruled that
<PAGE>
10
if a requirements contract existed between the parties, it
was terminable by either party upon reasonable notice and
that the issue to be tried would be limited as to whether
Albertsons notice of termination was reasonable, which the
Company did not allege as an issue on the lawsuit. On
March 31, 1994, the Court granted Albertsons' motion for
summary judgment on the Company's claims that Albertsons
failed to honor the settlement agreement between the
parties. The Company filed an appeal of the Court's
rulings and on December 27, 1994, the 5th District Court
of Appeals for the State of Florida affirmed, without
opinion, the dismissal by the Circuit Court of Orange
County, Florida of the Company's lawsuit against
Albertsons. The Company then filed a motion with the 5th
District Court of Appeals requesting either a rehearing,
clarification or a certification. On January 27, 1995, an
order was entered denying the Company's motion for a
rehearing and/or clarification or certification. On March
21, 1995 Albertsons filed a motion for taxation of certain
costs in the lawsuit in the amount of $78,148.78 for
expert witness charges and the cost of taking certain
depositions. The Company has filed a memorandum in
opposition to Albertsons motion and oral arguments on the
motion were heard on June 5, 1995.
<PAGE> 11
Management's Discussion and Analysis of
Financial Condition and Results of Operations
The following discussion should be read in conjunction with the
consolidated financial statements and notes thereto. All dollar
information is in thousands, except per share amounts:
Third Quarter Comparisons
- -------------------------
1995 1994 % Change
Sales and Other Income $260,208 $253,234 2.8%
The increase in sales is a result of increased sales to existing
customers; we continue to have competitive pressures on sales.
1995 1994 % Change
Cost of Sales $248,844 $241,477 3.1%
Cost of sales includes cost of the products distributed as well
as warehouse, delivery and building expenses. The Company
experienced higher cost of sales due to higher sales volumes and
slightly lower margins as a result of an unfavorable shift in
product mix. In addition, the Company incurred higher warehouse
expenses ($398) and higher delivery expenses ($39) due primarily
to higher payroll costs incurred to support new business in the
future. Building costs decreased ($79) because of lower real
estate taxes and storage costs, offset by higher payroll, repair,
depreciation and utilities.
1995 1994 % Change
Selling, general and
administrative expenses $ 7,719 $ 8,099 (4.7)%
Expenses decreased by $380 due primarily to a lower provision for
doubtful accounts ($215). All other expenses were comparable
except for a reduction in promotion expenses ($300) offset by
increased compensation, employee and retiree medical benefits.
1995 1994 % Change
Interest expense, net $ 818 $ 625 30.9%
Interest expense increased due to higher interest rates on short-term
borrowings, as well as higher average borrowing levels oflong-term debt.
<PAGE> 12
1995 1994
Effective tax rate 38.8% 39.9%
The Company's effective tax rate decreased because the Company
received a refund due to a favorable tax treatment at the State
level.
1995 1994
Net Income $ 1,731 $ 1,823
Earnings per common share $ .16 $ .17
As reported, the Company's earnings to sales ratio decreased from
.72% in the third quarter of Fiscal 1994 to .67% in the third
quarter of Fiscal 1995.
Thirty-Six Weeks
- ----------------
1995 1994 % Change
Sales and Other Income $788,974 $781,971 .9%
The increase in sales resulted from increased sales from existing
customers; we continue to have competitive pressures in the
market place.
1995 1994 % Change
Cost of Sales $752,147 $746,211 8%
Cost of sales includes cost of the products distributed as well
as warehouse, delivery and building expenses. The Company
experienced higher cost of sales due to higher sales volume
offset by slightly higher margins as a result of a favorable
shift in product mix. The Company experienced higher warehouse
expenses ($619) due primarily to higher payroll costs. Building
costs decreased ($123) because of higher payroll costs,
depreciation and repairs, offset by lower storage costs and real
estate taxes.
1995 1994 % Change
Selling, general and
administrative expenses $ 24,214 $ 23,715 2.1%
Expenses increased by $499 due primarily to increased
compensation, employee and retiree medical benefits cost.
1995 1994 % Change
Interest expense, net $ 2,505 $ 1,907 31.4%
Interest expense increased due to higher interest rates on short-term
borrowings, as well as higher average borrowing levels oflong-term debt.
<PAGE>
13
1995 1994
Effective tax rate 38.9% 39.0%
The Company's effective tax rate remained the same for both
years.
1995 1994
Net Income $ 6,170 $ 6,069
Earnings per common share $ .56 $ .55
The Company's earnings to sales ratio of .78% is the same for
both the thirty-six weeks of Fiscal 1995 compared to the thirty-six weeks of
Fiscal 1994.
As of and for the 36 Weeks
in the period ended As of
Liquidity and __________________________ _____________
Capital Resources May 6, 1995 May 7, 1994 Aug. 27, 1994
_________________________________________________________________
Cash $ 3,303 $ 7,424 $15,834
Working Capital 95,602 88,036 93,432
Long-term debt 35,405 32,544 31,602
Cash provided by (used
for) operations (15,644) (10,263)
Cash provided by (used
for) investing (7,253) (13,104)
Cash provided by (used
for) financing 10,366 16,387
The Company's financial condition remained strong as of May 6,
1995. The current ratio was 2.20 to 1.
Since fiscal year-end 1994, receivables increased by $10,484 and
inventories increased by $17,017 due to the seasonality of the
business. The Company experienced minimal price changes on
products distributed during the first thirty-six weeks of fiscal
1995. In addition, the Company's accounts payable level
increased by $919 in conjunction with the inventory purchases.
Total capital expenditures for the thirty-six weeks ended May 6,
1995 were $4,301 compared to $12,681 during 1994. The decrease
from the prior year resulted primarily from the Bridgeport
warehouse addition ($8,333) which was completed early in Fiscal
1995. In addition, the Company increased long-term notes
receivable from retailers by approximately $3,000 in 1995 for
store equipment and improvements. Depreciation and amortization
of property, equipment and capital leases increased to $5,233 in
fiscal 1995 compared to $5,116 in fiscal 1994.
To support the higher levels of receivables and inventory, the
Company borrowed from its banks an additional $22,000 since year-end; $12,000
from banks on a short-term basis and $10,000 under along-term bank agreement.
The dividend on common shares wasincreased from $.09 to $.095 effective with
the dividend paid onDecember 15, 1994.
<PAGE> 14
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
10.1 Amendment 1 to the Supplemental Executive
Retirement Plan
10.2 Amendment 1 to the Supplemental Executive
Retirement Trust Agreement between Registrant and
Society National Bank
27 Financial Data Schedule
(b) Reports on Form 8-K:
There were no reports on Form 8-K for the
twelve weeks ended May 6, 1995.
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
Super Food Services, Inc.
(Registrant)
Date: June 19, 1995 By /s/ Jack Twyman
______________________________
Jack Twyman
Chairman of the Board
(Chief Executive Officer)
Date: June 19, 1995 By /s/ Robert F. Koogler
______________________________
Robert F. Koogler
Senior Vice President-Finance,
Treasurer and Assistant
Secretary (Chief Financial
and Accounting Officer)
EXHIBIT 10.1
AMENDMENT 1 TO THE
SUPER FOOD SERVICES, INC.,
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
THIS AMENDMENT 1 TO THE SUPER FOOD SERVICES, INC., SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN ("Amendment") made as of the 27th day of
March, 1995.
WITNESSETH, THAT,
WHEREAS, by resolutions adopted on March 27, 1995, the Board
of Directors of Super Food Services, Inc., (the "Company") approved
certain amendments to the Company's Supplemental Executive
Retirement Plan, As Amended and Restated Effective as of May 18,
1994, (the "Supplemental Plan"); and
WHEREAS, this Amendment 1 is entered into to reflect the
substance of the amendments to the Supplemental Plan as set forth
in the resolutions of the Board of Directors adopted on March 27,
1995.
NOW, THEREFORE, the Supplemental Plan is hereby amended as
follows:
1. Section 4. Accelerated Payment, be and hereby is deleted
in its entirety and that the following Section 4 is substituted
therefor:
"4. Accelerated Payment. Upon a Change of Control, as
defined herein:
(a) Company Contribution. The Company shall, as
soon as possible, but in no event longer than thirty (30) days
following the Change of Control, make an irrevocable contribution
to the Supplemental Plan and fund the trust established pursuant to
the provisions of Section 7 hereof in an amount (if any) which will
cause the total assets held in the trust to equal the present value
of benefits payable from the Supplemental Plan to each participant
or his or her Beneficiary. For purposes of this Section 4 only,
the present value of the benefit payable from the Supplemental Plan
shall be determined as the greater of the present value of such
benefit if the Participant terminated employment on the date of
Change of Control, retired immediately and commenced receiving
benefit payments from the Pension Plan and the present value of the
projected benefit payable from the Supplemental Plan determined as
if the Participant continued employment at his or her highest level
of compensation until his or her normal retirement age under the
Pension Plan. The present value of the Supplemental Plan benefits
shall be determined using the following actuarial assumptions:
<PAGE>
Interest: The interest rate(s) published by
the Pension Benefit Guaranty Corporation for purposes of valuing a
benefit payable from a terminating single employer qualified
defined benefit plan in the form of a deferred annuity commencing
at age 65. Such interest shall be determined on the first day of
the month during which a Change in Control occurs.
Mortality: UP 1984
(b) Annuity Purchase. The Trustee shall, as soon
as possible, but in no event longer than sixty (60) days following
the Change of Control, purchase from one or more acceptable life
insurance companies group or individual annuity contracts
guaranteeing the payment of a deferred or immediate annuity
benefit, as appropriate, equal to the accrued benefits payable from
the Supplemental Plan, determined as of the date of the Change of
Control. Within thirty (30) days of the end of each calendar year
following a Change of Control, the Trustee shall purchase from one
or more acceptable life insurance companies an additional amount of
guaranteed annuity equal to the additional benefit accruing to each
Participant under the Supplemental Plan during such calendar year
or if lesser, the amount accrued since the date of the Change of
Control. The Trustee shall own any annuity contract purchased
under this Section and all amounts payable under such annuity
contracts shall be paid to Trustee."
2. Paragraph (a) of Section 7 is hereby amended by deleting
the words "are authorized" at the end of line 1 and replacing them
with the words "shall establish".
3. Paragraph (b) of Section 7 is hereby amended by inserting
at the beginning thereof the words: "In addition to the
Contributions required by Section 4,"
2. To record the amendments to the Supplemental Plan as set
forth above, the Company has caused this Amendment 1 to the
Supplemental Plan to be signed and attested on its behalf by its
duly authorized representatives as of the 27th day of March, 1995.
SUPER FOOD SERVICES, INC.,
a Delaware corporation
By /s/ Jack Twyman
______________________________
Chairman of the Board
Attest: /s/ John Demos
________________________________
Secretary
EXHIBIT 10.2
AMENDMENT 1 TO THE
SUPPLEMENTAL EXECUTIVE RETIREMENT TRUST AGREEMENT
THIS AMENDMENT 1 TO THE SUPPLEMENTAL EXECUTIVE RETIREMENT TRUST
AGREEMENT ("Amendment 1") made as of the 27th day of March, 1995,
by and between SUPER FOOD SERVICES, INC., a Delaware corporation,
(the "Company") and SOCIETY NATIONAL BANK (the "Trustee").
WITNESSETH, THAT,
WHEREAS, the Company and the Trustee entered into a
Supplemental Executive Retirement Trust Agreement dated July 22,
1994 (the "Trust Agreement"); and
WHEREAS, the Company desires to amend the Trust Agreement
pursuant to the amendatory provisions set forth in Article 11 of
the Trust Agreement.
NOW, THEREFORE, the Trust Agreement is hereby amended as
follows:
1. Page 4, Article 1.8. Establishment of Trust. The current
Article 1.8 appearing on page 4 and page 5 is deleted in its
entirety and is replaced by the attached Article 1.8 and
Article 1.9.
2. Page 4, Article 2.1. Trust Fund. Replace "and 1.6
hereof," in line 4 on page 5 with "1.6 and 1.8 hereof,"
3. Page 5, Article 1.8. Establishment of Trust. After the
words "Change of Control occurs" which appear on line 8 on page 5,
add the following:
"Mortality: UP 1984"
4. Page 17, Article 11.3 Amendment on Termination. After
the number "1.8" in line 1 on page 17 insert the number "1.9," and
replace "and 11" in line 2 on page 17 with "11 and 15".
5. Schedule A. Schedule A, as attached to the Trust
Agreement is deleted in its entirety and is replaced by the
attached Schedule A.
6. Except as otherwise stated herein, all of the other terms
and provisions of the Trust Agreement are hereby ratified and
affirmed.
<PAGE>
IN WITNESS WHEREOF, Super Food Services, Inc., and Society
National Bank, as Trustee, have caused this Amendment 1 to be
signed on the day and year first above written.
Company:
SUPER FOOD SERVICES, INC.,
a Delaware corporation
By /s/ Jack Twyman
______________________________
Chairman
Attest: /s/ John Demos
______________________________
Trustee:
SOCIETY NATIONAL BANK,
Trustee as aforesaid
By /s/ Angela K. Reynolds
______________________________
Vice President
<PAGE>
1.8 Upon a Change of Control, the Company shall, as soon
as possible, but in no event longer than thirty (30) days following
the Change of Control, as defined in Section 11.5 hereof, make an
irrevocable contribution to the Trust in an amount (if any) which
will cause the total assets held in the Trust to equal the present
value of benefits payable from the Plan to each participant or his
or her beneficiary. For purposes of this Section only, the present
value of the benefit payable from the Plan shall be the greater of,
(a) the present value of such benefit determined as if the
participant terminated employment on the date of Change of Control,
retired immediately and commenced receiving benefit payments from
the Pension Plan, and (b) the present value of the projected
benefit payable from the Plan determined as if the participant
continued employment at his highest level of compensation until his
Normal Retirement Age under the Pension Plan. The present value of
the Plan benefits shall be determined using the following actuarial
assumptions:
Interest: The interest rate published by the Pension
Benefit Guaranty Corporation for purposes of valuing a
benefit payable from a terminating single employer
qualified defined benefit plan in the form of deferred
annuity commencing at age 65. Such interest rate shall
be determined on the first day of the month during which
a Change in Control occurs.
Mortality: UP 1984.
1.9 Upon a Change of Control, the Trustee shall, as soon
as possible, but in no event longer than sixty (60) days following
the Change of Control, as defined in Section 11.5 hereof, purchase
from one or more acceptable life insurance companies, annuity
contracts guaranteeing the payment of a deferred or immediate
annuity benefit, as appropriate, equal to the accrued benefits
payable from the Plan, determined as of the date of the Change of
Control. Within thirty (30) days of the end of each calendar year
following a Change of Control the Trustee shall purchase from one
or more acceptable life insurance companies an additional amount of
annuity equal to the additional benefit accruing to each
Participant under the Plan during such calendar year, or if lesser,
the amount accrued since the date of Change of Control. For
purposes of this Section, an acceptable life insurance company is
one that is licensed to conduct the life insurance and annuity
business in the State of Ohio and that, as of the date each of
purchase, has a claims paying or equivalent credit rating from two
or more of the rating agencies listed below that equals or exceeds
the minimum acceptable rating listed below:
Rating Agency Minimum Acceptable Rating
_____________ _________________________
A. M. Best & Co. A+
Duff. & Phelps AA
Moody's Investor Service Aa2
Standard & Poor's AA
The Trustee shall own any annuity contract purchased under this
Section and all amounts payable under such annuity contracts shall
be paid to the Trustee.
<PAGE>
Super Food Services, Inc.
Supplemental Executive Retirement Trust Agreement
Schedule A
The Trust shall be invested in fixed income investments or their
equivalent. This includes, but is not limited to, fixed income
mutual funds, cash equivalent money market funds on instruments,
Treasury securities, Agency securities, Mortgage and Asset backed
securities, corporate debt obligations and fixed annuity contracts,
issued by acceptable life insurance companies, on the lives of the
Participants.
The Trust shall not invest in futures, options or other derivative
instruments or in any mutual fund which may invest more than 5% of
its assets in such instruments.
This schedule may be modified, at any time prior to a Change in
Control, in the Company's discretion.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED SUMMARY BALANCE SHEETS AS OF MAY 6, 1995 AND THE CONSOLIDATED
SUMMARY STATEMENTS OF INCOME FOR THE 36 WEEKS ENDED MAY 6, 1995 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> AUG-26-1995
<PERIOD-END> MAY-06-1995
<CASH> 3,303
<SECURITIES> 0
<RECEIVABLES> 77,026
<ALLOWANCES> 9,422
<INVENTORY> 80,360
<CURRENT-ASSETS> 174,952
<PP&E> 124,371
<DEPRECIATION> 62,652
<TOTAL-ASSETS> 274,865
<CURRENT-LIABILITIES> 79,350
<BONDS> 56,587
<COMMON> 10,949
0
0
<OTHER-SE> 125,075
<TOTAL-LIABILITY-AND-EQUITY> 274,865
<SALES> 785,685
<TOTAL-REVENUES> 788,974
<CGS> 752,147
<TOTAL-COSTS> 752,147
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 1,665
<INTEREST-EXPENSE> 5,156
<INCOME-PRETAX> 10,109
<INCOME-TAX> 3,939
<INCOME-CONTINUING> 6,170
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,170
<EPS-PRIMARY> .56
<EPS-DILUTED> .56
</TABLE>
