-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JeHHq5MMqV8xTBlxz8dv1p9M42QW9MtEr5MIXbqzLlhbv/hlzzti5dXTtL34KOA3 X/XNu95o9bGaAf1D1S68hw== 0000950132-98-000525.txt : 19980630 0000950132-98-000525.hdr.sgml : 19980630 ACCESSION NUMBER: 0000950132-98-000525 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980629 SROS: NYSE SROS: PCX FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEINZ H J CO CENTRAL INDEX KEY: 0000046640 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FROZEN & PRESERVED FRUIT, VEG & FOOD SPECIALTIES [2030] IRS NUMBER: 250542520 STATE OF INCORPORATION: PA FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-03385 FILM NUMBER: 98656414 BUSINESS ADDRESS: STREET 1: 600 GRANT ST CITY: PITTSBURGH STATE: PA ZIP: 15219 BUSINESS PHONE: 4124565700 MAIL ADDRESS: STREET 2: P O BOX 57 CITY: PITTSBURGH STATE: PA ZIP: 15230 11-K 1 HEINZ SAVER PLAN 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 Form 11-K ANNUAL REPORT 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 [NO FEE REQUIRED] For the fiscal year ended December 31, 1997 [ ] 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 1-3385 H. J. HEINZ COMPANY SAVER PLAN (Title of Plan) H. J. Heinz Company (Name of Issuer of securities held pursuant to the Plan) 600 Grant Street Pittsburgh, PA 15219 (Address of Plan and of principal executive office of Issuer) Financial Statements and Exhibits The following Plan financial statements and supplemental schedule are attached hereto: 1. Report of Independent Accountants dated June 16, 1998 of Coopers & Lybrand L.L.P. for the Plan financial statements 2. Statements of Net Assets Available for Benefits as of December 31, 1997 and 1996 3. Statements of Changes in Net Assets Available for Benefits for the Years Ended December 31, 1997 and 1996 4. Notes to Financial Statements 5. Supplemental Schedule of Assets Held for Investment Purposes as of December 31, 1997 Exhibits required to be filed by Item 601 of Regulation S-K are listed below and are filed as a part hereof. Documents not designated as being incorporated herein by reference are filed herewith. The paragraph number corresponds to the exhibit number designated in Item 601 of Regulation S-K. 23. The consent of Coopers and Lybrand L.L.P. dated June 25, 1998 is filed herein. 1 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Employee Benefits Administration Board has duly caused this Form 11-K Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Pittsburgh, Commonwealth of Pennsylvania. H. J. HEINZ COMPANY SAVER PLAN (Name of Plan) EMPLOYEE BENEFITS ADMINISTRATION BOARD By: /s/ Gary D. Matson ....................................... Gary D. Matson, Chairman June 25, 1998 2 REPORT OF INDEPENDENT ACCOUNTANTS H. J. HEINZ COMPANY EMPLOYEE BENEFITS ADMINISTRATION BOARD: We have audited the accompanying statements of net assets available for benefits of the H. J. Heinz Company SAVER Plan as of December 31, 1997 and 1996 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 Employee Benefits Administration Board of the H. J. Heinz Company. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the H. J. Heinz Company SAVER Plan as of December 31, 1997 and 1996 and the changes in net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by the Department of Labor's Rules and Regulation for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The Fund Information in the statements of net assets available for benefits and the statements of changes in net assets available for benefits is presented for the purpose 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 schedule and Fund Information have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ Coopers & Lybrand L.L.P. COOPERS & LYBRAND L.L.P. Pittsburgh, Pennsylvania June 16, 1998 3
H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS as of December 31, 1997 H. J. Heinz Co. Managed Income Magellan Retirement Gov't Overseas Equity-Income Stock Fund Portfolio Fund Money Market Fund Fund --------------- -------------- -------- ---------------- --------- ------------- Assets: Investment in Master Trust (Notes 4, 8) $22,274,374 $4,606 $5,018,306 $17,832,353 $567,570 $2,823,472 Investment - - - - - - ----------- ------ ---------- ----------- -------- ---------- Total investment 22,274,374 4,606 5,018,306 17,832,353 567,570 2,823,472 ----------- ------ ---------- ----------- -------- ---------- Investment income receivable: Dividends 134,891 - - - - - Interest 1,496 26 3 81,011 - - ----------- ------ ---------- ----------- -------- ---------- Total investment income receivable 136,387 26 3 81,011 - - ----------- ------ ---------- ----------- -------- ---------- Contributions receivable: Employee 108,212 24 54,414 211,804 8,414 29,197 Employer 201,961 - 16,155 160,543 2,365 8,845 ----------- ------ ---------- ----------- -------- ---------- Total contributions receivable 310,173 24 70,569 372,347 10,779 38,042 ----------- ------ ---------- ----------- -------- ---------- Participant Loan Receivable 65 - 149 167 4 4 ----------- ------ ---------- ----------- -------- ---------- Total Assets 22,720,999 4,656 5,089,027 18,285,878 578,353 2,861,518 ----------- ------ ---------- ----------- -------- ---------- Net Assets Available for Benefits $22,720,999 $4,656 $5,089,027 $18,285,878 $578,353 $2,861,518 =========== ====== ========== =========== ======== ==========
Puritan Intermediate OTC Fund Bond Fund Portfolio ---------- ------------ --------- Assets: Investment in Master Trust (Notes 4, 8) $2,484,402 $752,014 $33,260 Investment _ _ - ---------- -------- ------- Total Investment 2,484,402 752,014 33,260 ---------- -------- ------- Investment income receivable: Dividends - 4,018 - Interest 1 - - ---------- -------- ------- Total investment income receivable 1 4,018 - ---------- -------- ------- Contributions receivable: Employee 30,011 6,740 432 Employer 8,586 4,300 27 ---------- -------- ------- Total contributions receivable 38,597 11,040 459 ---------- -------- ------- Participant Loan Receivable 32 4 - ---------- -------- ------- Total Assets 2,523,032 767,076 33,719 ---------- -------- ------- Net Assets Available for Benefits $2,523,032 $767,076 $33,719 ========== ======== =======
The accompanying notes are an integral part of the financial statements. 4
H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS as of December 31, 1997 (continued) Vanguard Vanguard Vanguard Vanguard Vanguard Vanguard Fixed Income Wellington Windsor II Index Trust-500 U.S. Growth Explorer Securities Fund Fund Fund Portfolio Portfolio Fund --------------- ---------- ---------- --------------- ----------- -------- Assets: Investment in Master Trust (Notes 4, 8) $562 $90,363 $135,466 $199,112 $146,828 $22,451 Investment - - - - - - ---- ------- -------- -------- -------- ------- Total investment 562 90,363 135,466 199,112 146,828 22,451 ---- ------- -------- -------- -------- ------- Investment income receivable: Dividends 7 - - 2,337 5,934 2,476 Interest - - - - - - ---- ------- -------- -------- -------- ------- Total investment income receivable 7 - - 2,337 5,934 2,476 ---- ------- -------- -------- -------- ------- Contributions receivable: Employee 23 1,143 3,000 4,399 1,088 693 Employer - 125 649 738 176 266 ---- ------- -------- -------- -------- ------- Total contributions receivable 23 1,268 3,649 5,137 1,264 959 ---- ------- -------- -------- -------- ------- Participant Loan Receivable - - - 56 - - ---- ------- -------- -------- -------- ------- Total Assets 592 91,631 139,115 206,642 154,026 25,886 ---- ------- -------- -------- -------- ------- Net Assets Available for Benefits $592 $91,631 $139,115 $206,642 $154,026 $25,886 ==== ======= ======== ======== ======== =======
Vanguard Int'l Growth Participants' Portfolio Loans Total ------------ ------------- ----- Assets: Investment in Master Trust (Notes 4, 8) $26,873 - $52,412,012 Investment _ $2,279 2,279 ------- ------ ----------- Total Investment 26,873 2,279 52,414,291 ------- ------ ----------- Investment income receivable: Dividends 1,197 - 150,860 Interest - - 82,537 ------- ------ ----------- Total investment income receivable 1,197 - 233,397 ------- ------ ----------- Contributions receivable: Employee 861 - 460,455 Employer 264 - 405,000 ------- ------ ----------- Total contributions receivable 1,125 - 865,455 ------- ------ ----------- Participant Loan Receivable - (481) - ------- ------ ----------- Total Assets 29,195 1,798 53,513,143 ------- ------ ----------- Net Assets Available for Benefits $29,195 $1,798 $53,513,143 ======= ====== ===========
The accompanying notes are an integral part of the financial statements. 5
H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS as of December 31, 1996 H. J. Heinz Co. Magellan Retirement Gov't Overseas Equity-Income Puritan Stock Fund Fund Money Market Fund Fund Fund -------------- -------- ---------------- -------- ------------- ------- Assets: Investment in Master Trust (Notes 4, 8) $15,029,919 $4,360,424 $15,076,164 $613,278 $2,469,167 $2,223,079 Investment - - - - - - ---------- ----------- ----------- -------- ---------- ---------- Total investment 15,029,919 4,360,424 15,076,164 613,278 2,469,167 2,223,079 ---------- ----------- ----------- -------- ---------- ---------- Investment income receivable: Dividends 118,264 - - - - - Interest 1,002 30 66,957 6 14 16 ---------- ----------- ----------- -------- ---------- ---------- Total investment income receivable 119,266 30 66,957 6 14 16 ---------- ----------- ----------- -------- ---------- ---------- Contributions receivable: Employee 96,809 58,429 209,777 11,122 29,835 34,180 Employer 216,952 23,021 104,364 4,185 12,120 12,773 ---------- ----------- ----------- -------- ---------- ---------- Total contributions receivable 313,761 81,450 314,141 15,307 41,955 46,953 ---------- ----------- ----------- -------- ---------- ---------- Participant Loan Receivable 206 344 354 40 224 207 ---------- ----------- ----------- -------- ---------- ---------- Total Assets 15,463,152 4,442,248 15,457,616 628,631 2,511,360 2,270,255 ---------- ----------- ----------- -------- ---------- ---------- Net Assets Available for Benefits $15,463,152 $4,442,248 $15,457,616 $628,631 $2,511,360 $2,270,255 =========== =========== =========== ======== ========== ==========
Intermediate Retirement Participants' Bond Fund Growth Fund Loans Total ---------- ----------- ------------- ----- Assets: Investment in Master Trust (Notes 4, 8) $1,008,534 $2,090,338 - $42,870,903 Investment _ - $18,895 18,895 ---------- ---------- ------- ----------- Total Investment 1,008,534 2,090,338 18,895 42,889,798 ---------- ---------- ------- ----------- Investment income receivable: Dividends 5,215 - - 123,479 Interest 6 11 - 68,042 ---------- ---------- ------- ----------- Total investment income receivable 5,221 11 - 191,521 ---------- ---------- ------- ----------- Contributions receivable: Employee 9,652 26,411 - 476,215 Employer 6,768 10,583 - 390,766 ---------- ---------- ------- ----------- Total contributions receivable 16,420 36,994 - 866,981 ---------- ---------- ------- ----------- Participant Loan Receivable 38 156 (1,569) - ---------- ---------- ------- ----------- Total Assets 1,030,213 2,127,499 17,326 43,948,300 ---------- ---------- ------- ----------- Net Assets Available for Benefits $1,030,213 $2,127,499 $17,326 $43,948,300 ========== ========== ======= ===========
The accompanying notes are an integral part of the financial statements. 6 H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS for the Year Ended December 31, 1997
Managed H. J. Heinz Co. Income Magellan Retirement Gov't. Overseas Equity-Income Puritan Stock Fund Portfolio Fund Money Market Fund Fund Fund --------------- --------- ---------- ---------------- ----------- ------------ ---------- Net change in Investment in Master Trust (Note 8) $ 7,634,855 $4,632 $1,083,663 $ 1,548,582 $ 59,525 $1,020,811 $ 481,930 Additions: Participant contributions 1,206,671 24 657,337 2,532,698 116,891 374,331 400,374 Employer contributions, net 2,472,326 -- 292,830 3,088,128 38,383 145,623 154,449 Transfer for Loan Repayments 2,368 -- 3,197 4,165 439 1,563 1,466 ----------- ------ ---------- ----------- ---------- ---------- ---------- Total additions 3,681,365 24 953,364 5,624,991 155,713 521,517 556,289 ----------- ------ ---------- ----------- ---------- ---------- ---------- Deductions: Withdrawals 4,058,373 -- 1,390,248 4,345,311 265,516 1,192,170 785,442 ----------- ------ ---------- ----------- ---------- ---------- ---------- Total deductions 4,058,373 -- 1,390,248 4,345,311 265,516 1,192,170 785,442 ----------- ------ ---------- ----------- ---------- ---------- ---------- Net increase (decrease) in net assets available for benefits for the year 7,257,847 4,656 646,779 2,828,262 (50,278) 350,158 252,777 Net assets available for benefits at the beginning of the year 15,463,152 -- 4,442,248 15,457,616 628,631 2,511,360 2,270,255 ----------- ------ ---------- ----------- ---------- ---------- ---------- Net assets available for benefits at the end of the year $22,720,999 $4,656 $5,089,027 $18,285,878 $ 578,353 $2,861,518 $2,523,032 =========== ====== ========== =========== ========== ========== ==========
Intermediate OTC Bond Fund Portfolio ------------ --------- Net change in Investment in Master Trust (Note 8) $ 13,241 $ 32,402 Additions: Participant contributions 90,499 1,290 Employer contributions, net 79,117 27 Transfer for Loan Repayments 441 -- ---------- -------- Total additions 170,057 1,317 ---------- -------- Deductions: Withdrawals 446,435 -- ---------- -------- Total deductions 446,435 -- ---------- -------- Net increase (decrease) in net assets available for benefits for the year (263,137) 33,719 Net assets available for benefits at the beginning of the year 1,030,213 -- ---------- -------- Net assets available for benefits at the end of the year $ 767,076 $ 33,719 ========== ========
The accompanying notes are an integral part of the financial statements. 7 H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS for the Year Ended December 31, 1997 (continued)
Vanguard Vanguard Vanguard Vanguard Vanguard Vanguard Fixed Income Wellington Windsor II Index Trust-500 U.S. Growth Explorer Securities Fund Fund Fund Portfolio Portfolio Fund --------------- ---------- ---------- --------------- ----------- ---------- Net change in Investment in Master Trust (Note 8) $569 $88,220 $130,487 $193,846 $151,069 $23,494 Additions: Participant contributions 23 3,027 7,732 11,370 3,325 1,656 Employer contributions, net -- 384 1,674 2,144 396 736 Transfer for Loan Repayments -- -- -- 56 -- -- ---- ------- -------- -------- -------- ------- Total additions 23 3,411 9,406 13,570 3,721 2,392 ---- ------- -------- -------- -------- ------- Deductions: Withdrawals -- -- 778 774 764 -- ---- ------- -------- -------- -------- ------- Total deductions -- -- 778 774 764 -- ---- ------- -------- -------- -------- ------- Net increase (decrease) in net assets available for benefits for the year 592 91,631 139,115 206,642 154,026 25,886 Net assets available for benefits at the beginning of the year -- -- -- -- -- -- ---- ------- -------- -------- -------- ------- Net assets available for benefits at the end of the year $592 $91,631 $139,115 $206,642 $154,026 $25,886 ==== ======= ======== ======== ======== =======
Vanguard Int'l Growth Retirement Participants' Fund Growth Fund Loans Total ------------ ----------- ------------- ------------- Net change in Investment in Master Trust $25,930 $(1,599,040) -- $10,894,216 (Note 8) Additions: Participant contributions 2,565 205,574 -- 5,615,387 Employer contributions, net 700 75,049 -- 6,351,966 Transfer for Loan Repayments -- 1,000 $(14,695) -- ------- ----------- -------- ----------- Total additions 3,265 281,623 (14,695) 11,967,353 ------- ----------- -------- ----------- Deductions: Withdrawals -- 810,082 833 13,296,726 ------- ----------- -------- ----------- Total deductions -- 810,082 833 13,296,726 ------- ----------- -------- ----------- Net increase (decrease) in net assets available for benefits for the year 29,195 (2,127,499) (15,528) 9,564,843 Net assets available for benefits at the beginning of the year -- 2,127,499 17,326 43,948,300 ------- ----------- -------- ----------- Net assets available for benefits at the end of the year $29,195 -- $ 1,798 $53,513,143 ======= =========== ======== ===========
The accompanying notes are an integral part of the financial statements. 8 H. J. HEINZ COMPANY SAVER PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS for the Year Ended December 31, 1996
H. J. Heinz Co. Magellan Retirement Gov't. Overseas Equity-Income Puritan Stock Fund Fund Money Market Fund Fund Fund ------------- ---------- ------------- ---------- ------------ ---------- Net change in Investment in Master Trust (Note 8) $1,494,155 $380,416 $85,661 $114,405 $623,774 $340,142 Additions: Participant contributions 1,192,258 785,212 2,810,178 135,768 328,347 419,397 Employer contributions, net 2,733,423 381,355 2,712,680 56,250 168,090 191,159 Transfer for Loan Repayments 5,045 5,980 6,852 932 3,796 3,241 ------------- ---------- ----------- -------- --------- -------- Total additions 3,930,726 1,172,547 5,529,710 192,950 500,233 613,797 ------------- ---------- ----------- -------- --------- -------- Deductions: Withdrawals 1,153,750 357,979 1,919,885 30,532 124,499 125,421 ------------- ---------- ----------- -------- --------- -------- Total deductions 1,153,750 357,979 1,919,885 30,532 124,499 125,421 ------------- ---------- ----------- -------- --------- -------- Net increase (decrease) in net assets available for benefits for the year 4,271,131 1,194,984 3,695,486 276,823 999,508 828,518 Net assets available for benefits at the beginning of the year 11,192,021 3,247,264 11,762,130 351,808 1,511,852 1,441,737 ------------ ---------- ----------- -------- --------- ---------- Net assets available for benefits at the end of the year $15,463,152 $4,442,248 $15,457,616 $628,631 $ 2,511,360 $2,270,255 ============= ========== =========== ======== ============ ==========
Intermediate Retirement Participants' Bond Fund Growth Fund Loans Total --------- ----------- ---------- ------------- Net change in Investment in Master Trust ($13,250) $170,031 - $3,195,334 (Note 8) Additions: Participant contributions 138,821 345,769 - 6,155,750 Employer contributions, net 107,637 153,934 - 6,504,528 Transfer for Loan Repayments 863 2,644 (29,353) - ----------- --------- --------- ------------ Total additions 247,321 502,347 (29,353) 12,660,278 ----------- --------- --------- ------------ Deductions: Withdrawals 81,570 176,877 4,073 3,974,586 ----------- --------- --------- ------------ Total deductions 81,570 176,877 4,073 3,974,586 ----------- --------- --------- ------------ Net increase (decrease) in net assets available for benefits for the year 152,501 495,501 (33,426) 11,881,026 Net assets available for benefits at the beginning of the year 877,712 1,631,998 50,752 32,067,274 ----------- --------- --------- ------------ Net assets available for benefits at the end of the year $1,030,213 $2,127,499 $17,326 $43,948,300 =========== ========== ========= ===========
The accompanying notes are an integral part of the financial statements. 9 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (1) Plan Description: The following description of the H. J. Heinz Company ("Company") SAVER Plan ("Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. The Plan was amended effective January 1, 1993 to provide for the age-related company contribution account, which is explained in detail below. General The Plan is a defined contribution plan covering eligible hourly employees actively employed by the Company or any of the affiliated companies, and who are in a division, or plant of a division, of the Company authorized to participate in the Plan. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The administration of the Plan and the responsibility for interpreting and carrying out its provisions is vested in the Employee Benefits Administration Board ("Committee"). The Committee consists of members appointed by the Board of Directors upon the recommendation of the Investment Committee of the Board of Directors. The members of the Committee are not compensated for serving on the Committee. The Board of Directors has designated Fidelity Management Trust Company to act as trustee ("Trustee") under the Plan. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The plan provides for various investment options as described in Note 4. Any investment is exposed to various risks, such as interest rate, market and credit. These risks could result in a material effect on participants' account balances and the amounts reported in the statement of net assets available for benefits and the statement of changes in net assets available for benefits. Certain prior-year amounts have been reclassified in order to conform with the current year presentation. Contributions Participant contributions to the Plan may be either tax deferred or after tax. The participant's maximum tax deferred and after tax contributions may not exceed 12% and 10%, respectively, of their earnings. The total of a participant's tax deferred plus after tax contributions may not exceed 12% of their earnings. A participant may make contributions, in whole percentages, of not less than 1% of their earnings. Tax deferred contributions made by certain highly compensated participants may be limited under Internal Revenue Code rules. Tax deferred contributions by any participant under the Plan and any other qualified cash or deferred arrangement were limited to $9,500 in 1997 and 1996. A participant affected by these limitations will be given timely notification by the Committee. 10 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) Contributions (continued) At the discretion of the Board of Directors, the Company or any participating affiliated company, may contribute, in the form of company stock, on a monthly basis (or as otherwise indicated by the Committee), on behalf of each participating employee an amount not less than 10 cents and not more than one dollar for each tax deferred dollar contributed by a participant. The Company reserves the right to limit the maximum amount of matching contributions that may be contributed on behalf of any participant. The determination of the amount of such contribution is made by the Board of Directors of the Company after considering recommendations made by appropriate officers of participating affiliated companies or divisions. The amount of such contribution may be different for any specified group of participants. For the years ended December 31, 1997 and 1996, the matching contribution amounts at various divisions or plants of divisions ranged from 12 cents to $1.00 for each tax deferred dollar up to 6% of participants' earnings. Additionally, the Company may, but is not required to, contribute for each Plan year an additional supplemental amount determined by the Committee. The supplemental contribution is allocated to the supplemental contribution accounts of all eligible participants on a pro rata basis according to the ratio of each participant's earnings for the plan year to the total earnings of all participants for the plan year. Supplemental contributions are reflected in the Plan financial statements in the year in which the Committee approves them. The supplemental contributions were $910,005 for the year ended December 31, 1997 and $947,992 for the year ended December 31, 1996. A Company Contribution Account ("CCA") was added to the Plan effective January 1, 1993. The Company will make monthly, age-related contributions to the accounts of eligible employees who direct the investment of such contributions into one or more of the investment funds stated in Note 4. The age-related contributions are based on percentages of participants' eligible earnings and range from a rate of 1% for participants that are less than 30 years old to a rate of 8.5% for participants that are 65 years old and over. A participant may transfer amounts received from other retirement plans to the Plan. Amounts that are rolled over from other retirement plans are held in a separate rollover account. Participant Accounts Each participant's account is credited with the participant's contribution(s) and allocation of (a) the Company's matching, supplemental, and age-related contribution(s), as defined, and (b) Plan earnings. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. Vesting The value of a participant's tax deferred account which is maintained for tax deferred contributions; after tax account, which is maintained for after tax contributions; and rollover account, which is maintained for rollover contributions, is fully vested at all times. A participant's matching account (which will be maintained for the Company's matching contributions), will be fully vested upon the completion of three years of service, attainment of age 65, disability or death. Participants will be vested in the value of their CCA contributions and supplemental contributions upon the occurrence of any of the following events: completion of five years of service, attainment of age 65, disability or death. 11 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) Withdrawals A participant may elect to withdraw from their after tax or rollover account up to 100% of their account balance. A participant's tax deferred contributions will be available for withdrawal if: (a) The participant is eligible for a "hardship" withdrawal in accordance with the rules established by the Internal Revenue Service ("IRS"), or (b) The participant has attained age 59 1/2. A participant may not make withdrawals from the Company matching, supplemental, or CCA accounts during active employment. A participant who qualifies for a hardship withdrawal is suspended from making contributions to the Plan for one year. Under present IRS rules, a "hardship" means an immediate and heavy need to draw on financial resources to meet obligations related to health, education or housing. A participant, upon termination of services, shall receive a lump sum equal to the value of their vested account. Loans The granting of participant loans is prohibited by the Plan; however, the Plan accepted the existing participant loans from merged plans. The interest rates for all outstanding loans for the years ended December 31, 1997 ranged from 6.45% to 9.4% and 1996 ranged from 6.1% to 10.0%. Payment of principal and interest is by payroll deduction, subject to rules permitting prepayment. Repayments of the loan principal will be allocated first to the participant's after tax account, and then to the participant's tax deferred account. Payments of loan interest are allocated to the participant's after tax account and tax deferred account, respectively, in the same proportion that the outstanding principal of the loan was attributable to such accounts at the end of the month preceding the payment. Payments of principal and interest are reinvested in the investment fund(s) in accordance with the participant's investment directions in effect at the time such interest or principal repayment is received by the Trustee. Termination In accordance with the procedures set forth in the Plan, the Company may terminate the Plan at any time in whole or in part. To the extent permitted under Section 401(k) of the Internal Revenue Code and the regulations thereunder, in the event of the dissolution, merger, consolidation or reorganization of the Company, the Plan will terminate and the Trust Fund will be liquidated unless the Plan is continued by a successor to the Company in accordance with the Plan. If the Plan is completely or partially terminated, the accounts of all participants affected thereby will become fully vested and nonforfeitable to the extent funded. Currently, the Company has no intention of terminating the Plan. Administration Expenses All expenses of the Plan including record-keeping fees, administrative charges, professional fees, and Trustee fees for the years ended December 31, 1997 and 1996 were paid by the Company. Effective May 1, 1998, the first $150,000 of annual administration expenses will be paid by the Plan; amounts in excess of $150,000 will continue to be paid by the Company. 12 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (2) Summary of Significant Accounting Policies: Investment Valuation The value of the shares in a mutual fund is based on the market value of the underlying securities in the fund. Investments in securities traded on a national exchange are valued at the last reported sales price on the last business day of the year. Temporary investments in short-term investment funds are valued at cost which approximates market value. Other Purchases and sales of securities are reflected on a trade-date basis. Gains or losses on sales of securities are based on average cost. Dividend income is recorded on the ex-dividend date. Interest is recorded as earned. (3) Federal Income Taxes: The IRS has made a determination that the Plan is a qualified plan under Section 401(a) of the Internal Revenue Code of 1986, as amended ("Code"). Therefore, the Trust established under the Plan is exempt from Federal income taxes under Section 501(a) of the Code. The IRS has determined and informed the Company by letter dated February 3, 1998 that the Plan is designed in accordance with applicable sections of the Code. The Plan has been amended since a favorable determination letter was issued, however, tax and ERISA counsel to the Company is of the opinion that the Plan continues to be a "qualified" plan under Section 401(a) of the Code, and that the Plan contains a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code. Under present Federal income tax laws and regulations, and as long as the Plan is approved as a qualified plan, participants are not subject to Federal income taxes as a result of their participation in the Plan until their accounts are withdrawn or distributed to them. In order for the Company's Retirement and Savings Plan to comply with the nondiscrimination coverage requirements under Code sections 410(b) and 401(a)(4) for the plan year ended December 31, 1996, an additional contribution of $190,583 was made to the SAVER Plan on behalf of certain non- highly compensated employees to satisfy the applicable Code requirements. (4) Investment Programs: Effective October 1, 1997, the funds offered by the Plan were changed to increase investment choices and reduce the Plan's dependence on a single mutual fund company. Nine new funds were added--seven Vanguard funds and two Fidelity funds while Fidelity's Retirement Growth Fund was eliminated. Participant fund balances in the Retirement Growth Fund were automatically transferred to the Retirement Government Money Market Fund if participants had not transferred them to other available funds as of September 29, 1997. Fidelity Management Trust Company remains Trustee for all the investment funds. Participants may direct the investment of their accounts in multiples of 1%, in any one or more of the Investment funds selected by the Committee. A description of the Investment funds by investment category follows: Company Stock The H.J. Heinz Company Stock Fund consists of common stock of the Company. 13 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (4) Investment Programs (continued): Stable Value Fidelity's Managed Income Portfolio invests in guaranteed investment contracts offered by major insurance companies and other approved financial institutions and in certain types of fixed income securities. A portion of the fund is invested in a money market fund to provide daily liquidity. Guaranteed investment contracts are recorded at contract value, which includes principal and accumulated interest, which approximates market value. Growth The Fidelity Magellan Fund is an aggressive growth fund, the assets of which are invested primarily in common stocks of both well known and lesser-known companies with above-average growth potential and a correspondingly higher level of risk. The Vanguard U.S. Growth Fund seeks to provide long-term capital appreciation by investing in common stocks of large companies with above- average growth potential. Money Market The assets of Fidelity's Retirement Government Money Market Portfolio are invested in high-quality short-term money market securities for which the U.S. Government or its agencies or instrumentalities guarantee timely payment of principal and interest. International The Fidelity Overseas Fund is an aggressive growth fund, which seeks long-term capital appreciation, primarily through investments in foreign securities. The fund invests primarily in securities of issuers whose principal business activities are outside the U.S. Vanguard International Growth Portfolio seeks long-term capital growth by investing in common stocks of companies based outside of the United States that have above-average growth potential. Index Vanguard Index Trust--500 Portfolio seeks long-term growth of capital and income from dividends. It holds all of the 500 stocks that make up the Standard & Poor's 500 Composite Stock Price Index (S&P 500). Growth and Income The assets of the Fidelity Equity-Income Fund are invested primarily in income-producing equity securities. Capital appreciation is a secondary objective of the fund. It tries to achieve a yield of the securities of the S&P 500. Vanguard Windsor II is a value-oriented growth and income fund seeking long-term growth of capital and income from dividends. The fund invests in a diversified group of out-of-favor stocks of large-capitalization companies. 14 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (4) Investment Programs (continued): Small Capitalization The Fidelity OTC Portfolio seeks long-term capital appreciation by investing in the securities of smaller, less well-known companies. Vanguard Explorer Fund seeks long-term growth of capital by investing primarily in common stocks of small and emerging growth companies. Balanced The assets of the Fidelity Puritan Fund are invested in a broadly diversified portfolio of high-yielding U.S. and foreign securities including those in emerging markets, which may involve additional risk. The investments can include all types of bonds of any quality or maturity as well as common stocks and preferred stocks. The Vanguard Wellington Fund is a balanced fund designed to pursue three investment objectives: conservation of capital, reasonable current income, and profits without undue risk. The funds assets are divided between common stocks and bonds. Fixed Income The assets of the Fidelity Intermediate Bond Fund are invested in high- quality, fixed-income obligations whose average maturity ranges between 3 and 10 years. The Vanguard Fixed Income Securities Fund--Long-Term Corporate Portfolio seeks to provide a high and sustainable level of current income consistent with the maintenance of principal and liquidity by investing in a diversified portfolio of long-term investment-grade bonds. Discontinued Fund The Fidelity Retirement Growth Fund was discontinued as of September 30, 1997. The fund was an aggressive growth fund which sought capital appreciation by investing primarily in common stocks, but also in other types of securities. 15 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (5) Net Asset Value per Unit: The interests of Plan participants are accounted for under a unit method. The number of units in each fund and the net asset value per unit are as follows:
December 31, 1997 December 31, 1996 ---------------------- ------------------------ Value per Value per Units Unit Units Unit ---------- --------- --------- ---------- H. J. Heinz Co. Stock Fund...... 9,244,155 $2.418 9,089,729 $1.667 Managed Income Portfolio........ 4,584 $1.011 -- -- Magellan Fund................... 2,637,327 $1.903 2,905,698 $1.501 Retirement Gov't. Money Market.. 14,703,759 $1.218 13,096,505 $1.156 Overseas Fund................... 409,193 $1.387 490,860 $1.249 Equity-Income Fund.............. 1,356,570 $2.081 1,554,038 $1.599 Puritan Fund.................... 1,424,630 $1.744 1,561,299 $1.424 Intermediate Bond Fund.......... 613,737 $1.232 885,054 $1.146 OTC Portfolio................... 37,492 $ .891 -- -- Fixed Income Securities Fund.... 553 $1.022 -- -- Wellington Fund................. 90,233 $1.019 -- -- Windsor II Fund................. 133,621 $1.029 -- -- Index Trust--500 Portfolio...... 198,708 $1.014 -- -- U.S. Growth Portfolio........... 147,796 $1.035 -- -- Explorer Fund................... 26,806 $ .934 -- -- Int'l Growth Portfolio.......... 31,462 $ .893 -- -- Retirement Growth Fund.......... -- -- 1,551,634 $1.347
(6) Forfeitures: Company contributions which have been credited to participants' accounts and which have not vested are forfeited upon termination of employment. These forfeitures are credited against subsequent Company contributions. Forfeitures were $285,143 for the year ended December 31, 1997 and $245,571 for the year ended December 31, 1996. (7) Plan Amendments: On December 1, 1997, the Board of Directors approved a proposal to amend the Plan to increase the amount for a mandatory distribution of the account balance after termination of employment from $3,500 to $5,000 as permitted by the Taxpayer Relief Act of 1997, effective January 1, 1998. On December 1, 1997, the Board of Directors approved a proposal to allow former Heinz Pet Products employees at the Perham, Minnesota plant to receive distributions from the Plan after the factory was sold, exclusive of the pre-tax contributions which are restricted under Section 401(k) of the Internal Revenue Code. On December 4, 1996, the Board of Directors approved the transfer to the Plan of the remaining assets of the Pestritto Foods, Inc. Profit Sharing Plan, amounting to approximately $2,000, attributable to former employees who could not be located when the plan was terminated in May 1994, and to establish and implement a procedure for the Plan to follow when a participant cannot be located within three years after his or her benefit becomes payable. 16 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (8) Master Trust: The Company entered into a Master Trust arrangement with the Trustee. The Trustee maintains accounts to record the pro rata share of each participating Plan; reflecting contributions received on behalf of the Plan, benefit payments or other expense allocable to the Plan and its pro rata share of collected or accrued income, gain or loss, general expenses and other transactions allocable to the Investment Funds or the Trust as a whole. The following tables present the Master Trust information for the Plan.
December 31, 1997 --------------------------------------------------------------------------------------------- SAVER Plan Fair Value of Net Percentage of Investment of Investment Income Change in Interest in the Master Trust Dividends Interest the Fair Value* Master Trust --------------- -------------- ----------- --------------- --------------- H. J. Heinz Co. Stock Fund $240,109,663 $ 6,127,688 $ 134,223 $ 66,566,428 9.28% Managed Income Portfolio 10,920,342 -- 675,017 5,035,813 .04% Magellan Fund 59,990,834 3,907,759 -- 9,862,291 8.37% Retirement Gov't Money Market 64,662,982 -- 2,660,526 23,114,145 27.58% Overseas Fund 11,768,150 593,239 -- 806,687 4.82% Equity-Income Fund 43,734,130 2,431,026 -- 12,131,682 6.46% Puritan Fund 37,854,039 3,208,692 -- 5,043,476 6.56% Intermediate Bond Fund 10,733,697 681,961 -- 791,500 7.01% OTC Portfolio 4,299,844 179,867 -- 4,288,956 .77% Fixed Income Securities Fund 1,969,693 35,948 -- 1,989,859 .03% Wellington Fund 3,626,690 175,753 -- 3,616,206 2.49% Windsor II Fund 7,351,383 491,210 -- 7,285,688 1.84% Index Trust--500 Fund 11,538,760 131,514 -- 11,605,465 1.73% U.S. Growth Portfolio 5,442,397 218,228 -- 5,584,369 2.70% Explorer Fund 2,006,808 221,500 -- 2,199,727 1.12% International Growth Fund 2,675,356 118,420 -- 2,747,717 1.00% Asset Manager Growth Fund -- -- -- (5,306,609) -- Asset Manager Income Fund -- 16,732 -- (536,745) -- Asset Manager Fund -- 65,954 -- (2,857,090) -- Retirement Growth Fund -- -- -- (24,252,657) -- ------------ ----------- ---------- ------------- ----- Total Master Trust $518,684,768 $18,605,491 $3,469,766 $129,716,908 10.10% ============ =========== ========== ============= =====
*Includes transfers between funds. 17 H. J. HEINZ COMPANY SAVER PLAN Notes to Financial Statements (Continued) (8) Master Trust (continued):
December 31, 1996 --------------------------------------------------------------------------------------- SAVER Plan Percentage of Net Interest Fair Value of Change in in the Investment of Investment Income the Fair Master Master Trust Dividends Interest Value* Trust --------------- -------------- ----------- ------------ ------------ H. J. Heinz Co. Stock Fund $ 193,649,074 $ 6,085,903 $ 89,599 $ 9,295,951 7.76% Managed Income Portfolio 9,946,832 - 515,136 1,654,650 - Magellan Fund 49,482,858 7,744,772 - (2,245,807) 8.81% Retirement Gov't Money Market 40,146,651 - 1,801,220 2,473,341 37.55% Overseas Fund 10,590,303 638,560 - 4,524,475 5.79% Equity-Income Fund 32,599,351 1,832,555 - 13,575,945 7.57% Puritan Fund 33,264,907 3,616,507 - 5,858,634 6.68% Intermediate Bond Fund 10,357,653 635,912 - 856,242 9.74% Asset Manager Growth Fund 5,002,592 425,339 - 2,471,812 - Asset Manager Income Fund 489,017 30,560 - 139,998 - Asset Manager Fund 2,736,284 208,284 - 825,958 - Retirement Growth Fund 23,622,577 2,897,571 - 923,809 8.85% --------------- -------------- ----------- ------------- -------- Total Master Trust $ 411,888,099 $ 24,115,963 $ 2,405,955 $ 40,355,008 10.41% =============== ============== =========== ============= ========
*Includes transfers between funds. (9) Form 5500 Reconciliation: In accordance with the American Institute of Certified Public Accountants revised Audit and Accounting Guide "Audits of Employee Benefit Plans", the Plan includes payments due to participants in net assets available for plan benefits. Payments due to participants as of December 31, 1997 and 1996 were $813,510 and $354,762 respectively. This methodology differs from that required under ERISA. Therefore, for the Form 5500, the Plan includes such distributions payable as a liability of the Plan. 18 H.J. HEINZ COMPANY SAVER PLAN EIN #25-0542520; PLAN 011 LINE 27a-SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES as of December 31, 1997
(c) Description of investment including (b) Identity of issue, borrower, maturity date, rate of interest, (e) Market (a) lessor, or similar party collateral, par or maturity value (d) Cost Value - ------- ------------------------------- -------------------------------------- -------- ---------- * H.J. Heinz Company Participants' Loans - $2,279 Interest Rate 6.45%-9.4%
19 EXHIBIT INDEX Exhibits required to be filed by Item 601 of Regulation S-K are listed below and are filed as part hereof. Documents not designated as being incorporated herein by reference are filed herewith. The paragraph number corresponds to the exhibit number designated in Item 601 of Regulation S-K. 23. The consent of Coopers and Lybrand L.L.P. dated June 25, 1998 is filed herein. EX-23 2 ACCOUNTANTS' CONSENT Exhibit 23 ACCOUNTANTS' CONSENT We consent to the incorporation by reference in the Registration Statement of H. J. Heinz Company SAVER Plan on Form S-8 (File No. 33-32563) of our report dated June 16, 1998 on our audits of the financial statements of the H. J. Heinz Company SAVER Plan as of December 31, 1997 and 1996 and for the years then ended, which report is included in this Annual Report on Form 11-K. /s/ Coopers & Lybrand L.L.P. COOPERS & LYBRAND L.L.P. Pittsburgh, Pennsylvania June 25, 1998 -----END PRIVACY-ENHANCED MESSAGE-----