-----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, A/+riYQQXsgVFlX3/ezmJelr/QbFxSLNR+v1V/tQPUjZgugyN4g/pCdS7j75RGVv 5CD0wkgtF2A4AtDtdlpDLw== 0000950144-96-009244.txt : 19961223 0000950144-96-009244.hdr.sgml : 19961223 ACCESSION NUMBER: 0000950144-96-009244 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 19960929 FILED AS OF DATE: 19961220 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: RUDDICK CORP CENTRAL INDEX KEY: 0000085704 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-GROCERY STORES [5411] IRS NUMBER: 560905940 STATE OF INCORPORATION: NC FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: 1934 Act SEC FILE NUMBER: 001-06905 FILM NUMBER: 96684101 BUSINESS ADDRESS: STREET 1: 2000 TWO FIRST UNION CTR CITY: CHARLOTTE STATE: NC ZIP: 28282 BUSINESS PHONE: 7043725404 MAIL ADDRESS: STREET 1: 2000 TWO FIRST UNION CTR CITY: CHARLOTTE STATE: NC ZIP: 28282 10-K405 1 RUDDICK CORPORATION FORM 10-K YEAR ENDED 9/29/96 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark one) [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended: September 29, 1996 ------------------- [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required) For the transition period from to Commission File Number: 1-6905 ------ RUDDICK CORPORATION - ------------------------------------------------------------------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) NORTH CAROLINA 56-0905940 - ------------------------------------- ------------------------- (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 2000 TWO FIRST UNION CENTER, CHARLOTTE, NORTH CAROLINA 28282 ----------------------------------------------------------------------- (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (704) 372-5404 SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: TITLE OF EACH CLASS: NAME OF EXCHANGE ON WHICH REGISTERED: - ----------------------------------------- ------------------------------------- COMMON STOCK NEW YORK STOCK EXCHANGE, INC. RIGHTS TO PURCHASE SERIES A JUNIOR PARTICIPATING ADDITIONAL PREFERRED STOCK NEW YORK STOCK EXCHANGE, INC. SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE ---- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ---- ---- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] The aggregate market value of the voting stock held by nonaffiliates of the Registrant as of December 6, 1996, was $362,774,639. As of December 6, 1996, the Registrant had outstanding 46,520,833 shares of Common Stock. DOCUMENTS INCORPORATED BY REFERENCE Parts I and II: Certain portions of the Annual Report to Shareholders for the fiscal year ended September 29, 1996 (with the exception of those portions which are specifically incorporated by reference in this Form 10-K and included as Exhibit 13 hereto, the Annual Report to Shareholders for the fiscal year ended September 29, 1996, is not deemed to be filed or incorporated by reference as part of this report). Part III: Definitive Proxy Statement dated December 20, 1996, as filed pursuant to Section 14 of the Securities Exchange Act of 1934 in connection with the 1997 Annual Meeting of Shareholders. (With the exception of those portions which are specifically incorporated by reference in this Form 10-K, the Proxy Statement is not deemed to be filed or incorporated by reference as part of this report.) 2 RUDDICK CORPORATION AND CONSOLIDATED SUBSIDIARIES Form 10-K for the Fiscal Year ended September 29, 1996 TABLE OF CONTENTS PAGE - ---- PART I Item 1. Business ................................................................................ 1 Item 2. Properties .............................................................................. 3 Item 3. Legal Proceedings ....................................................................... 5 Item 4. Submission of Matters to a Vote of Security Holders ..................................... 5 Item 4A. Executive Officers of the Registrant .................................................... 5 PART II Item 5. Market for Registrant's Common Equity and Related Shareholder Matters ..................................................................... 6 Item 6. Selected Financial Data ................................................................. 6 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations ..................................................... 6 Item 8. Financial Statements and Supplementary Data ............................................. 6 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ..................................................... 7 PART III Item 10. Directors and Executive Officers of the Registrant ...................................... 7 Item 11. Executive Compensation .................................................................. 7 Item 12. Security Ownership of Certain Beneficial Owners and Management .............................................................................. 7 Item 13. Certain Relationships and Related Transactions .......................................... 7 PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K ............................................................................. 8
3 PART I ITEM 1. BUSINESS Ruddick Corporation (the "Registrant") is a holding company which, through its wholly-owned subsidiaries, is engaged in two primary businesses: Harris Teeter, Inc. ("Harris Teeter") operates a regional chain of supermarkets in five southeastern states and American & Efird, Inc. ("A&E") manufactures and distributes industrial and consumer sewing thread and sales yarn. At September 29, 1996, the Registrant and its subsidiaries had total consolidated assets of $801,702,000 and had approximately 20,100 employees. The principal executive offices of the Registrant are located at 2000 Two First Union Center, Charlotte, North Carolina 28282. Ruddick Corporation, which is incorporated under North Carolina law, was created in 1968 through the consolidation of the predecessor companies of A&E and Ruddick Investment Company, a subsidiary of the Registrant. In 1969 the Registrant acquired Harris Teeter. Also in 1969, the Registrant acquired the predecessor of Jordan Graphics, Inc. ("Jordan Graphics"). On January 23, 1996, certain assets of Jordan Graphics were sold to The Reynolds and Reynolds Company. Jordan Graphics' name has been changed to JGBF, Inc., and it no longer represents one of the Registrant's primary businesses. The two businesses in which the Registrant engages through its principal operating subsidiaries, together with certain financial information and competitive aspects of such businesses, are discussed separately below. For certain other information regarding industry segments, see the Note entitled "Industry Segment Information" of the Notes to Consolidated Financial Statements of Ruddick Corporation and Subsidiaries in the Registrant's 1996 Annual Report to Shareholders (the "1996 Annual Report"), which information is incorporated herein by reference. The only foreign operations conducted by the Registrant are through A&E. Neither of the two businesses engaged in by the Registrant would be characterized as seasonal. The Registrant employs twenty-one people, including five executives who formulate and implement overall corporate objectives and policies. The Registrant's employees perform functions in a number of areas including finance, accounting, audit, insurance, reporting, employee benefits, and public and shareholder relations. The Registrant assists its subsidiaries in developing long-range goals, in strengthening management personnel and skills, and in financing operations. Management of each subsidiary is responsible for implementing operating policies and reports to management of the Registrant. 4 A & E A&E produces industrial sewing thread from natural and synthetic fibers for use by apparel, automotive, upholstered furniture, home furnishings, medical supplies and footwear manufacturers. A&E also produces consumer sewing thread for use in home sewing. These products are primarily manufactured in fourteen plants, all located in North Carolina, and are sold primarily in the United States. Limited quantities of industrial sewing threads are exported. A&E also distributes sewing supplies manufactured by other companies. Thread and notion products accounted for approximately 99% of A&E's net sales in fiscal 1996. A&E also produces a limited quantity of mercerized cotton yarns for use by the knitting and weaving industries, which products accounted for 1% of A&E's net sales in fiscal 1996. This yarn production has decreased considerably in recent years as plant capacity has been converted to the manufacture of sewing thread. Sales operations are conducted through primarily A&E's employed salespersons, and additionally, through commission brokers and distributors. A&E's sales constituted 14% of the Registrant's consolidated sales in fiscal 1996 (15% in 1995 and 15% in 1994). The order backlog, believed to be firm, as of the end of the 1996 fiscal year was approximately $14,390,000 versus $12,920,000 at the end of the preceding fiscal year. Such backlog normally is expected to be filled within two weeks of fiscal year end. A&E has approximately 7,100 active customer accounts. In fiscal 1996, no single customer accounted for more than 6% of total net sales, and the ten largest customers accounted for an aggregate of less than 22% of total net sales. A&E purchases cotton from domestic cotton merchants. There is presently a sufficient supply of cotton worldwide and in the domestic market. Synthetic fibers are bought from the principal American synthetic fiber producers and are currently available in an adequate supply. There are no material patents, licenses, franchises, or concessions held by A&E. Research and Development expenditures were $304,000 and $245,000 in fiscal 1996 and fiscal 1995, respectively, none of which expenditures were sponsored by customers. Three employees are engaged in this activity full-time. A&E has expanded into international markets as sewing thread demand has increased outside the United States in the apparel, home furnishings, and industrial markets. A&E's recorded investment in its subsidiaries in England, Costa Rica, Canada, Korea, Mexico, Hong Kong and Malaysia and in its joint ventures in Dominican Republic and Honduras totals approximately $52 million. Management expects to continue to expand foreign production and distribution operations, primarily through additional joint ventures. The industrial sewing thread industry is highly competitive. A&E is the largest producer in the U.S. industrial thread market. Principal competitors include Coats/American and imported products sold primarily through distributors. Principal competitive factors include quality, service and price. Less than 4% of A&E's fiscal 1996 sales were in the consumer thread market, in which market A&E competes with a number of large, well-established companies, including Coats/American. A&E employed approximately 3,400 persons worldwide as of the end of fiscal 1996. A&E considers its employee relations to be good. 5 HARRIS TEETER Harris Teeter operates supermarkets in North Carolina (92), South Carolina (23), Virginia (13), Georgia (5), and Tennessee (1) for sales of groceries, produce, meat and seafood, delicatessen items, bakery items, wines and non-food items such as health and beauty care, floral and other products normally offered for sale in supermarkets. Harris Teeter has a program in place whereby each retail store will undergo a major remodel every eight years. Harris Teeter remodeled five stores during fiscal 1996 and expects to remodel twelve stores in fiscal 1997. In addition, nine new stores were opened and fourteen older, less profitable, stores were sold or closed in fiscal 1996. In fiscal 1993, a reserve was established in anticipation of closing 12 smaller, less competitive stores and replacing them with larger stores offering increased variety and drawing from a larger market area. Four of the stores closed in fiscal 1996 were covered by this reserve. As of fiscal year end, Harris Teeter had 134 stores in operation. Its principal offices and cold storage perishable distribution facilities are located near Charlotte, North Carolina, and its dry grocery and frozen storage distribution facilities are located in Greensboro, North Carolina. Harris Teeter produces some dairy products, but buys most of the products it sells, including its private label brands. Harris Teeter's sales constituted 86% of the Registrant's consolidated sales in fiscal 1996 (85% in 1995 and 85% in 1994). The supermarket industry is highly competitive. Harris Teeter competes with local, regional, and national food chains, some of which are larger in terms of assets and sales, as well as with independent merchants. Principal competitive factors include store location, price, service, convenience, cleanliness, product quality and product variety. No one customer or group of customers has a material effect upon the business of Harris Teeter. At fiscal year end, Harris Teeter employed approximately 8,600 persons full-time and 8,100 part-time. Warehouse employees and drivers at Harris Teeter's warehouse near Charlotte, North Carolina are represented by a union, but Harris Teeter is not party to a collective bargaining agreement covering such employees. Harris Teeter considers its employee relations to be good. RUDDICK INVESTMENT Ruddick Investment makes direct venture investments from its own capital base and from internally generated funds primarily for the development of retail sites for Harris Teeter stores. Additionally, the company's venture capital portfolio is invested in a limited number of industries and may include securities of start-ups and early stage firms, as well as publicly traded securities. Some of the products and services produced by the current portfolio holdings include proprietary building products, textiles, pharmaceuticals and medical diagnostic instrumentation. Ruddick Investment's principal objective is to achieve long-term gains on each of its investments. It is not an operating company and does not offer a service or product in the normal course of business. ITEM 2. PROPERTIES The executive offices of the Registrant are located in approximately 8,086 square feet of leased space in a downtown office tower at 2000 Two First Union Center, Charlotte, North Carolina 28282, in which it is a tenant under a lease which expires in May 1998. A&E's principal offices and fourteen domestic manufacturing plants are all owned by A&E and are all located in North Carolina. Manufacturing plants have an aggregate of 2,225,093 square feet of floor space and an insured value of $418,599,000. A&E has the capacity to produce annually 6 approximately 41,300,000 pounds of industrial sewing thread and 3,250,000 pounds of sales yarn and has a dyeing capacity of approximately 46,900,000 pounds per year. Capacities are based on 168 hours of operations per week. A&E also leases 22 distribution centers scattered throughout its domestic markets at an approximate annual rent of $1,738,000. Through subsidiaries, A&E also owns seven international manufacturing plants with an aggregate of 338,599 square feet of floor space and an insured value of $51,215,000. These subsidiaries have sewing thread dyeing capacity of approximately 10,000,000 pounds per year. Capacities are based on 168 hours of operations per week. In addition to its subsidiaries, A&E has minority interests in two joint ventures. Harris Teeter owns its principal offices, which consist of 116,000 square feet of space located on a 10 acre tract of land near Charlotte, North Carolina. Harris Teeter also owns a 104 acre tract east of Charlotte where its cold storage distribution facility is located. This facility contains approximately 176,000 square feet, most of which is equipped to store refrigerated or perishable goods. Harris Teeter also owns a 49 acre tract in Greensboro, North Carolina, where its dry grocery and frozen goods warehouses are located. The dry grocery warehouse contains approximately 547,000 square feet and the frozen goods warehouse contains approximately 130,000 square feet. Harris Teeter owns an 18,050 square foot milk processing plant located on 8.3 acres of land in Charlotte, North Carolina and an 81,900 square foot milk processing and ice cream manufacturing facility located on 4.7 acres of land in High Point, North Carolina. Harris Teeter operates its retail stores exclusively from leased properties. The base annual rentals on leased store and warehouse properties as of September 29, 1996 aggregated approximately $38,823,000 net of sublease rentals of approximately $1,010,000. In addition to the base rentals, the majority of the lease agreements provide for additional annual rentals based on 1% of the amount by which annual store sales exceed a predetermined amount. During the fiscal year ended September 29, 1996, the additional rental amounted to approximately $1,175,000. Harris Teeter's supermarkets range in size from approximately 24,000 square feet to 67,000 square feet, with an average size of approximately 36,000 square feet. The following table sets forth selected statistics with respect to Harris Teeter stores for each of the last three fiscal years: HARRIS TEETER STORE DATA 1994 1995 1996 ---- ---- ---- Stores Open at End of Period 139 139 134 Average Weekly Net Sales Per Store* $223,467 $234,656 $259,160 Average Square Footage Per Store 30,974 33,678 36,273 Average Square Footage Per New Store Opened During Period 40,154 47,348 57,610 Total Square Footage at End of Period 4,305,325 4,681,204 4,860,546 * Computed on the basis of aggregate sales of stores open for a full year. JGBF, Inc. owns corporate offices and a manufacturing facility and warehouse located near Charlotte, North Carolina. This facility, which contains 188,000 square feet and is located on 26 acres of land, is leased to The Reynolds and Reynolds Company on a long-term lease. 7 ITEM 3. LEGAL PROCEEDINGS The Registrant has entered into an Administrative Order on Consent with Region IV of the United States Environmental Protection Agency, together with 14 other parties who have been designated potentially responsible parties, to perform a remedial investigation/feasibility study at the Leonard Chemical Company Superfund site in Rock Hill, South Carolina. The Registrant's potential liability is based on the alleged disposal of waste material at this Superfund site by Pargo, Inc. Pargo, Inc. was a wholly owned subsidiary of the Registrant from 1969 to 1972. The Registrant has agreed to participate in the remedial investigation/feasibility study on the condition that its share of the costs does not exceed 1.8% of the total plus an additional payment of $4,680 for costs previously incurred by other parties. The Registrant estimates that, based on current information, the total cost of the remedial investigation/feasibility study should be approximately $500,000. Under the interim allocation of costs agreed to by the parties to the Administrative Order on Consent, the Registrant's share is 1.155% of the total cost. The Registrant does not believe that this proceeding will have a material effect on its business or financial condition. The Registrant and its subsidiaries are involved in various matters from time to time in connection with their operations, including various environmental matters. These matters considered in the aggregate have not had, nor does the Registrant expect them to have, a material effect on the Registrant's business or financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not applicable. ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT The following list contains the name, age, positions and offices held, and period served in such positions or offices for each of the executive officers of the Registrant. R. Stuart Dickson, age 67, has been Chairman of the Executive Committee since February, 1994. Prior to that time he had been Chairman of the Board of the Registrant since its formation in October, 1968. Alan T. Dickson, age 65, has been Chairman of the Board since February, 1994. Prior to that time he had been President of the Registrant since its formation in October, 1968. John W. Copeland, age 61, has been President of the Registrant since February, 1994. Prior to that time he had been President of A&E since October, 1984. Thomas W. Dickson, age 41, has been Executive Vice President of the Registrant since February, 1996. He served also as President of A&E from February, 1994 to August, 1996. Prior to that time, he served as A&E's Executive Vice President from 1991 to 1994 and Senior Vice President-Marketing and International from 1989 to 1991. Richard N. Brigden, age 57, has been Vice President-Finance of the Registrant since December, 1983. 8 Edward S. Dunn, Jr., age 53, has been President of Harris Teeter since January 1, 1989. Fred A. Jackson, age 46, has been President of A&E since August, 1996. Prior to that time, for more than five years, he served as its Senior Vice President-Industrial Thread Sales. The executive officers of the Registrant and its subsidiaries are elected annually by their respective Boards of Directors. R. Stuart Dickson and Alan T. Dickson are brothers. Thomas W. Dickson is the son of R. Stuart Dickson and the nephew of Alan T. Dickson. No other executive officer has a family relationship with any other executive officer or director or nominee for director as close as first cousin. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS The information required for this item is incorporated herein by reference to the following sections of the Registrant's 1996 Annual Report: information regarding the principal market for Common Stock, number of shareholders of record, market price information per share of Common Stock and dividends declared per share of Common Stock for each quarterly period in the 1996 and 1995 fiscal years is incorporated by reference to the Note headed "Quarterly Information (Unaudited)" to the Notes to Consolidated Financial Statements; and information regarding restrictions on the ability of the Registrant to pay cash dividends is incorporated by reference to "Management's Discussion and Analysis of Financial Condition and Results of Operations-Capital Resources and Liquidity" and the Note headed "Long-Term Debt" to the Notes to Consolidated Financial Statements. ITEM 6. SELECTED FINANCIAL DATA The information required for this item, for each of the last five fiscal years, is incorporated herein by reference to the section headed "Eleven-Year Financial and Operating Summary" in the Registrant's 1996 Annual Report. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information required for this item is incorporated herein by reference to the section headed "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Registrant's 1996 Annual Report. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Consolidated Financial Statements of the Registrant, including the Report of Independent Public Accountants thereon, are incorporated herein by reference from the Registrant's 1996 Annual Report. The required supplementary financial information is incorporated herein by reference from the Note headed "Quarterly Information (Unaudited)" of the Notes to Consolidated Financial Statements in the Registrant's 1996 Annual Report. 9 The financial statement schedules required to be filed herewith, and the Report of Independent Public Accountants thereon, are listed under Item 14(a) of this Report and filed herewith pursuant to Item 14(d) of this Report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The information required by this item with respect to executive officers is set forth above in Part I, Item 4A. The other information required by this item is incorporated herein by reference to the sections entitled "Election of Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance" in the Registrant's Proxy Statement dated December 20, 1996, filed with the Securities and Exchange Commission with respect to the Registrant's 1997 Annual Meeting of Shareholders (the "1997 Proxy Statement"). ITEM 11. EXECUTIVE COMPENSATION The information required by this item is incorporated herein by reference to the sections entitled "Election of Directors -Directors' Fees and Attendance" and "Executive Compensation" in the Registrant's 1997 Proxy Statement. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The information required by this item is incorporated herein by reference to the sections entitled "Principal Shareholders" and "Election of Directors-Beneficial Ownership of Company Stock" in the Registrant's 1997 Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Not applicable. 10 PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) Documents filed as part of report (1) Financial Statements: The following report and financial statements are incorporated herein by reference to the Registrant's 1996 Annual Report: Consolidated Balance Sheets, September 29, 1996 and October 1, 1995 Statements of Consolidated Income and Retained Earnings for the fiscal years ended September 29, 1996, October 1, 1995 and October 2, 1994 Statements of Consolidated Cash Flows for the fiscal years ended September 29, 1996, October 1, 1995 and October 2, 1994 Notes to Consolidated Financial Statements Report of Independent Public Accountants (2) Financial Statement Schedules: The following report and financial statement schedules are filed herewith: Report of Independent Public Accountants for each of the fiscal years in the three year period ended September 29, 1996 Schedule II - Valuation and Qualifying Accounts and Reserves All other schedules are omitted as the required information is inapplicable or the information is presented in the consolidated financial statements or related notes thereto. (3) Exhibits: The following exhibits are filed with this report or, as noted, incorporated by reference herein: 11 Exhibit No. Description 3.1 Restated Articles of Incorporation of the Registrant, incorporated herein by reference to Exhibit 3.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended March 29, 1992 (Commission File No. 1-6905). 3.2 Amended and Restated Bylaws of the Registrant, incorporated herein by reference to Exhibit 3.2 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 27, 1992 (Commission File No. 1-6905). 4.1 Revolving Credit Agreements for an aggregate of $100,000,000, entered into as of February 15, 1995, by and between the Registrant and each of First Union National Bank of North Carolina, NationsBank, National Association (formerly NationsBank, National Association (Carolinas)) and Wachovia Bank of North Carolina, N.A., incorporated herein by reference to Exhibits 4.1, 4.2 and 4.3 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended April 2, 1995 (Commission File No. 1-6905). 4.2 $50,000,000 6.48% Series A Senior Notes due March 1, 2011 and $50,000,000 Private Shelf Facility dated March 1, 1996 between Ruddick Corporation and The Prudential Insurance Company of America, incorporated herein by reference to Exhibit 4.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1996 (Commission File No. 1-6905). The Registrant has certain other long-term debt, but has not filed the instruments evidencing such debt as part of Exhibit 4 as none of such instruments authorize the issuance of debt exceeding 10 percent of the total consolidated assets of the Registrant. The Registrant agrees to furnish a copy of each such agreement to the Commission upon request. 10.1 Description of Incentive Compensation Plans.* 10.2 Supplemental Executive Retirement Plan of Ruddick Corporation, as amended and restated, incorporated herein by reference to Exhibit 10.3 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).* 10.3 Resolutions adopted by the Board of Directors of the Registrant and the Plan's Administrative Committee with respect to benefits payable under the Registrant's Supplemental Executive Retirement Plan to Alan T. Dickson and R. Stuart Dickson, incorporated herein by reference to Exhibit 10.3 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 29, 1991 (Commission File No. 1-6905).* 10.4 Deferred Compensation Plan for Key Employees of Ruddick Corporation and subsidiaries, as amended and restated, incorporated herein by reference to Exhibit 10.5 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).* 12 Exhibit No. Description 10.5 1982 Incentive Stock Option Plan, as amended and restated, incorporated herein by reference to Exhibit 10.5 of the Registrant's Annual Report on Form 10-K for the fiscal year ended October 2, 1994 (Commission File No. 1-6905).* 10.6 1988 Incentive Stock Option Plan, incorporated herein by reference to Exhibit 10.6 of the Registrant's Annual Report on Form 10-K for the fiscal year ended October 2, 1994 (Commission File No. 1-6905).* 10.7 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 12, 1992.* 10.8 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 12, 1992.* 10.9 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and John W. Copeland dated November 18, 1993.* 10.10 1993 Incentive Stock Option and Stock Appreciation Rights Plan, incorporated herein by reference to Exhibit 10.7 of the Registrant's Annual Report on Form 10-K for the fiscal year ended October 3, 1993 (Commission File No. 1-6905).* 10.11 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 18, 1993.* 10.12 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 15, 1995.* 10.13 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 18, 1993.* 10.14 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 15, 1995.* 10.15 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Edward S. Dunn, Jr. dated November 15, 1995.* 10.16 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and R. N. Brigden dated November 15, 1995.* 10.17 Description of the Registrant's Long Term Key Management Incentive Program, incorporated herein by reference to Exhibit 10.7 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 29, 1991 (Commission File No. 1-6905).* 13 Exhibit No. Description 10.18 Ruddick Corporation Irrevocable Trust for the Benefit of Participants in the Long Term Key Management Incentive Program, incorporated herein by reference to Exhibit 10.9 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).* 10.19 Rights Agreement dated November 15, 1990 by and between the Registrant and Wachovia Bank of North Carolina, N.A., incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated November 21, 1990 (Commission File No. 1-6905). 10.20 Ruddick Corporation Senior Officers Insurance Program Plan Document and Summary Plan Description, incorporated herein by reference to Exhibit 10.10 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 27, 1992 (Commission File No. 1-6905).* 10.21 Ruddick Corporation 1995 Comprehensive Stock Option Plan, incorporated herein by reference to Exhibit 10.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.22 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and Thomas M. Belk, incorporated herein by reference to Exhibit 10.2 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.23 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and Edwin B. Borden, Jr., incorporated herein by reference to Exhibit 10.3 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.24 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and Beverly F. Dolan, incorporated herein by reference to Exhibit 10.4 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.25 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and Roddey Dowd, Sr., incorporated herein by reference to Exhibit 10.5 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.26 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and James E.S. Hynes, incorporated herein by reference to Exhibit 10.6 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 14 Exhibit No. Description 10.27 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and Hugh L. McColl, Jr., incorporated herein by reference to Exhibit 10.7 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 10.28 Ruddick Corporation Nonstatutory Stock Option Agreement Between the Registrant and E. Craig Wall, Jr., incorporated herein by reference to Exhibit 10.8 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).* 11 Statement Regarding the Computation of Per Share Earnings. 13 Ruddick Corporation 1996 Annual Report to Shareholders (consolidated financial statements on pages 19 to 32 and sections headed "Management's Discussion and Analysis of Financial Condition and Results of Operations" (pages 14 to 18) and "Eleven-Year Financial and Operating Summary" (pages 12 to 13) only). 21 List of Subsidiaries of the Registrant. 23 Consent of Independent Public Accountants. 27 Financial Data Schedule. ________________________ * Indicates management contract or compensatory plan required to be filed as an Exhibit. (b) Reports on Form 8-K. The Registrant did not file any reports on Form 8-K during the three months ended September 29, 1996. (c) The following exhibits are filed herewith and follow the signature pages: 10.1 Description of Incentive Compensation Plans. 10.7 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 12, 1992. 10.8 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 12, 1992. 10.9 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and John W. Copeland dated November 18, 1993. 15 10.11 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 18, 1993. 10.12 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 15, 1995. 10.13 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 18, 1993. 10.14 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 15, 1995. 10.15 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Edward S. Dunn, Jr. dated November 15, 1995. 10.16 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and R. N. Brigden dated November 15, 1995. 11 Statement Regarding Computation of Per Share Earnings. 13 Ruddick Corporation 1996 Annual Report to Shareholders (consolidated financial statements on pages 19 to 32 and sections headed "Management's Discussion and Analysis of Financial Condition and Results of Operations" (pages 14 to 18) and "Eleven-Year Financial and Operating Summary" (pages 12 to 13) only). 21 List of Subsidiaries of the Registrant. 23 Consent of Independent Public Accountants. 27 Financial Data Schedule. (d) The financial statement schedules listed in Item 14(a)(2) above begin on Page S-1. 16 SIGNATURES Pursuant to the requirements of Section 13 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. RUDDICK CORPORATION (Registrant) By: /s/ John W. Copeland --------------------------- John W. Copeland, President Dated: December 20, 1996 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated: Name Title Date ---- ----- ---- /s/ John W. Copeland President and Director December 20, 1996 ------------------------- (Principal Executive Officer) John W. Copeland /s/ Richard N. Brigden Vice President-Finance December 20, 1996 ------------------------- (Principal Financial Officer) Richard N. Brigden /s/ Douglas A. Stephenson Treasurer December 20, 1996 ------------------------- (Principal Accounting Officer) Douglas A. Stephenson /s/ Thomas M. Belk Director December 20, 1996 ------------------------- Thomas M. Belk Director December 20, 1996 ------------------------- Edwin B. Borden, Jr. /s/ Alan T. Dickson Chairman of the Board December 20, 1996 ------------------------- and Director Alan T. Dickson /s/ R. Stuart Dickson Chairman of the Executive December 20, 1996 ------------------------- Committee and Director R. Stuart Dickson 17 Name Title Date ---- ----- ---- /s/ Beverly F. Dolan Director December 20, 1996 - ----------------------- Beverly F. Dolan /s/ Roddey Dowd, Sr. Director December 20, 1996 - ----------------------- Roddey Dowd, Sr. /s/ James E. S. Hynes Director December 20, 1996 - ----------------------- James E. S. Hynes /s/ Hugh L. McColl, Jr. Director December 20, 1996 - ----------------------- Hugh L. McColl, Jr. /s/ E. Craig Wall, Jr. Director December 20, 1996 - ----------------------- E. Craig Wall, Jr. 18 INDEX TO FINANCIAL STATEMENT SCHEDULES Page Report of Independent Public Accountants S-2 For each of the fiscal years in the three year period ended September 29, 1996 Schedule II - Valuation and Qualifying Accounts and Reserves S-3 All other schedules are omitted as the required information is inapplicable or the information is presented in the financial statements or related notes. S-1 19 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Board of Directors of Ruddick Corporation: We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in Ruddick Corporation's annual report to shareholders incorporated in this Form 10-K, and have issued our report thereon dated October 24, 1996. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed in Item 14(a)(2) is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. ARTHUR ANDERSEN LLP Charlotte, North Carolina, October 24, 1996. S-2 20 RUDDICK CORPORATION AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR THE FISCAL YEARS ENDED OCTOBER 2, 1994, OCTOBER 1, 1995 SCHEDULE II AND SEPTEMBER 29, 1996 (IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------- COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E - ---------------------------------------------------------------------------------------------------- ADDITIONS BALANCE CHARGED TO BALANCE AT BEGINNING COSTS AND AT END DESCRIPTION OF FISCAL YEAR EXPENSES DEDUCTIONS OF PERIOD - ---------------------------------------------------------------------------------------------------- FISCAL YEAR ENDED OCTOBER 2, 1994: RESERVES DEDUCTED FROM ASSETS TO WHICH THEY APPLY - ALLOWANCE FOR DOUBTFUL ACCOUNTS....... $1,820 $367 $325 * $1,862 ===================================================== FISCAL YEAR ENDED OCTOBER 1, 1995: RESERVES DEDUCTED FROM ASSETS TO WHICH THEY APPLY - ALLOWANCE FOR DOUBTFUL ACCOUNTS....... $1,862 $152 $287 * $1,727 ===================================================== FISCAL YEAR ENDED SEPTEMBER 29, 1996: RESERVES DEDUCTED FROM ASSETS TO WHICH THEY APPLY - ALLOWANCE FOR DOUBTFUL ACCOUNTS....... $1,727 $428 $757 * $1,398 =====================================================
*REPRESENTS ACCOUNTS RECEIVABLE BALANCES WRITTEN OFF AS UNCOLLECTIBLE, LESS RECOVERIES. S-3 21
3.1 Restated Articles of Incorporation of the Registrant, * incorporated herein by reference to Exhibit 3.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended March 29, 1992 (Commission File No. 1-6905). 3.2 Amended and Restated Bylaws of the Registrant, incorporated * herein by reference to Exhibit 3.2 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 27, 1992 (Commission File No. 1-6905). 4.1 Revolving Credit Agreements for an aggregate of $100,000,000, entered * into as of February 15, 1995, by and between the Registrant and each of First Union National Bank of North Carolina, NationsBank, National Association (formerly NationsBank, National Association (Carolinas)) and Wachovia Bank of North Carolina, N.A., incorporated herein by reference to Exhibits 4.1, 4.2 and 4.3 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended April 2, 1995 (Commission File No. 1-6905). 4.2 $50,000,000 6.48% Series A Senior Notes due March 1, 2011 and * $50,000,000 Private Shelf Facility dated March 1, 1996 between Ruddick Corporation and The Prudential Insurance Company of America, incorporated herein by reference to Exhibit 4.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1996 (Commission File No. 1-6905). The Registrant has certain other long-term debt, but has not filed the instruments evidencing such debt as part of Exhibit 4 as none of such instruments authorize the issuance of debt exceeding 10 percent of the total consolidated assets of the Registrant. The Registrant agrees to furnish a copy of each such agreement to the Commission upon request. 10.1 Description of Incentive Compensation Plans.** 10.2 Supplemental Executive Retirement Plan of Ruddick Corporation, as * amended and restated, incorporated herein by reference to Exhibit 10.3 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).**
22
Exhibit No. (per Item 601 Sequential of Reg. S-K Description of Exhibit Page No. - ------------- ---------------------- ---------- 10.3 Resolutions adopted by the Board of Directors of the Registrant and * the Plan's Administrative Committee with respect to benefits payable under the Registrant's Supplemental Executive Retirement Plan to Alan T. Dickson and R. Stuart Dickson, incorporated herein by reference to Exhibit 10.3 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 29, 1991 (Commission File No. 1-6905).** 10.4 Deferred Compensation Plan for Key Employees of Ruddick Corporation * and subsidiaries, as amended and restated, incorporated herein by reference to Exhibit 10.5 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).** 10.5 1982 Incentive Stock Option Plan, incorporated herein by reference * to Exhibit 10.5 of the Registrant's Annual Report on Form 10-K for the year ended October 2, 1994 (Commission File No. 1-6905).** 10.6 1988 Incentive Stock Option Plan, incorporated herein by reference * to Exhibit 10.6 of the Registrant's Annual Report on Form 10-K for the year ended October 2, 1994 (Commission File No. 1-6905).** 10.7 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 12, 1992.** 10.8 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 12, 1992.** 10.9 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and John W. Copeland dated November 18, 1993.** 10.10 1993 Incentive Stock Option and Stock Appreciation Rights Plan, * incorporated herein by reference to Exhibit 10.7 of the Registrant's Annual Report on Form 10-K for the fiscal year ended October 3, 1993 (Commission File No. 1-6905).** 10.11 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 18, 1993.**
23
Exhibit No. (per Item 601 Sequential of Reg. S-K Description of Exhibit Page No. - ------------- ---------------------- ---------- 10.12 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Thomas W. Dickson dated November 15, 1995.** 10.13 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 18, 1993.** 10.14 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Fred A. Jackson dated November 15, 1995.** 10.15 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and Edward S. Dunn, Jr. dated November 15, 1995.** 10.16 Ruddick Corporation Incentive Stock Option Agreement between the Registrant and R. N. Brigden dated November 15, 1995.** 10.17 Description of the Registrant's Long Term Key Management Incentive * Program, incorporated herein by reference to Exhibit 10.7 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 29, 1991 (Commission File No. 1-6905).** 10.18 Ruddick Corporation Irrevocable Trust for the Benefit of * Participants in the Long Term Key Management Incentive Program, incorporated herein by reference to Exhibit 10.9 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 30, 1990 (Commission File No. 1-6905).** 10.19 Rights Agreement dated November 15, 1990 by and between the * Registrant and Wachovia Bank of North Carolina, N.A., incorporated herein by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K dated November 21, 1990 (Commission File No. 1-6905). 10.20 Ruddick Corporation Senior Officers Insurance Program Plan Document * and Summary Plan Description, incorporated herein by reference to Exhibit 10.10 of the Registrant's Annual Report on Form 10-K for the fiscal year ended September 27, 1992 (Commission File No. 1-6905).**
24
Exhibit No. (per Item 601 Sequential of Reg. S-K Description of Exhibit Page No. - ------------- ---------------------- ---------- 10.21 Ruddick Corporation 1995 Comprehensive Stock Option Plan, * incorporated herein by reference to Exhibit 10.1 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.22 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and Thomas M. Belk, incorporated herein by reference to Exhibit 10.2 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.23 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and Edwin B. Borden, Jr., incorporated herein by reference to Exhibit 10.3 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.24 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and Beverly F. Dolan, incorporated herein by reference to Exhibit 10.4 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.25 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and Roddey Dowd, Sr., incorporated herein by reference to Exhibit 10.5 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.26 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and James E.S. Hynes, incorporated herein by reference to Exhibit 10.6 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 10.27 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and Hugh L. McColl, Jr., incorporated herein by reference to Exhibit 10.7 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).**
25
Exhibit No. (per Item 601 Sequential of Reg. S-K Description of Exhibit Page No. - ------------- ---------------------- ----------- 10.28 Ruddick Corporation Nonstatutory Stock Option Agreement Between the * Registrant and E. Craig Wall, Jr., incorporated herein by reference to Exhibit 10.8 of the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-6905).** 11 Statement Regarding the Computation of Per Share Earnings. 13 Ruddick Corporation 1996 Annual Report to Shareholders (consolidated financial statements on pages 19 to 32 and sections headed "Management's Discussion and Analysis of Financial Condition and Results of Operations" (pages 14 to 18) and "Eleven-Year Financial and Operating Summary" (pages 12 to 13) only). 21 List of Subsidiaries of the Registrant. 23 Consent of Independent Public Accountants. 27 Financial Data Schedule.
- ---------------------- * Incorporated by reference. ** Indicates management contract or compensatory plan required to be filed as an exhibit. EX-10.1 2 DESCRIPTION OF INCENTIVE COMPENSATION PLANS 1 EXHIBIT 10.1 INCENTIVE COMPENSATION PLANS The Company and its subsidiaries provide annual incentive compensation through a bonus plan maintained for most salaried personnel. The bonus plan directly links incentive pay to achievement of predetermined, objective performance goals. For employees employed directly by the holding company, incentive pay is based on return on beginning shareholders' equity. For employees employed by an operating subsidiary, incentive pay is based on pre-tax earnings, as adjusted for that subsidiary, as a percentage of beginning capital employed. Except for a limited number of senior management persons at Harris Teeter, for whom incentive pay is based on pre-tax earnings, as adjusted for Harris Teeter, as a percentage of beginning capital employed, the salaried personnel at Harris Teeter, Inc. are paid an incentive based on operating profit as a percentage of sales. If the Company, or a subsidiary, as applicable, achieves the predetermined minimum goals, employees are paid a predetermined percentage of base compensation as incentive. The percentage of base compensation payable as incentive compensation increases proportionally until a maximum performance goal is achieved with respect to the applicable measure of performance. EX-10.7 3 STOCK OPTION AGREEMENT T.W. DICKSON 11/12/92 1 EXHIBIT 10.7 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1988 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 12th day of November, 1992, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and THOMAS W. DICKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $18.31 per share, up to but not exceeding in the aggregate 4,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ T.W. Dickson (SEAL) ---------------------------------- 5 EX-10.8 4 STOCK OPTION AGREEMENT F.A. JACKSON 11/12/92 1 EXHIBIT 10.8 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1988 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 12th day of November, 1992, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and FRED A. JACKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $18.31 per share, up to but not exceeding in the aggregate 2,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ Fred A. Jackson (SEAL) ---------------------------------- 5 EX-10.9 5 STOCK OPTION AGREEMENT J.W. COPELAND 11/18/93 1 EXHIBIT 10.9 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1988 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 18th day of November, 1993, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and JOHN W. COPELAND - ---------------------------------------------------------------------------- of RUDDICK CORPORATION (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $22.6875 per share, up to but not exceeding in the aggregate 20,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ John W. Copeland (SEAL) ---------------------------------- 5 EX-10.11 6 STOCK OPTION AGREEMENT T.W. DICKSON 11/18/93 1 EXHIBIT 10.11 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 18th day of November, 1993, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and THOMAS W. DICKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $22.6875 per share, up to but not exceeding in the aggregate 6,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ T.W. Dickson (SEAL) ---------------------------------- 5 EX-10.12 7 STOCK OPTION AGREEMENT T.W. DICKSON 11/15/95 1 EXHIBIT 10.12 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 15th day of November, 1995, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and THOMAS W. DICKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $11.4375 per share, up to but not exceeding in the aggregate 12,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ T.W. Dickson (SEAL) ---------------------------------- 5 EX-10.13 8 STOCK OPTION AGREEMENT F.A. JACKSON 11/18/93 1 EXHIBIT 10.13 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 18th day of November, 1993, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and FRED A. JACKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $22.6875 per share, up to but not exceeding in the aggregate 5,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ Fred A. Jackson (SEAL) ---------------------------------- 5 EX-10.14 9 STOCK OPTION AGREEMENT F.A. JACKSON 11/15/95 1 EXHIBIT 10.14 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 15th day of November, 1995, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and FRED A. JACKSON - ---------------------------------------------------------------------------- of AMERICAN & EFIRD, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $11.4375 per share, up to but not exceeding in the aggregate 8,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ Fred A. Jackson (SEAL) ---------------------------------- 5 EX-10.15 10 STOCK OPTION AGREEMENT E.S. DUNN, JR. 11/15/95 1 EXHIBIT 10.15 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 15th day of November, 1995, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and EDWARD S. DUNN, JR. - ---------------------------------------------------------------------------- of HARRIS TEETER, INC. (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $11.4375 per share, up to but not exceeding in the aggregate 12,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ Edward S. Dunn, Jr. (SEAL) ---------------------------------- 5 EX-10.16 11 STOCK OPTION AGREEMENT R.N. BRIGDEN 11/15/95 1 EXHIBIT 10.16 RUDDICK CORPORATION INCENTIVE STOCK OPTION AGREEMENT Pursuant to 1993 INCENTIVE STOCK OPTION PLAN THIS AGREEMENT, made and entered into as of the 15th day of November, 1995, by and between Ruddick Corporation, a North Carolina corporation (the "Corporation") and R.N. BRIGDEN - ---------------------------------------------------------------------------- of RUDDICK CORPORATION (the "Optionee"). ------------------------------------------------------ WHEREAS, the Corporation has adopted the Ruddick Corporation 1988 Incentive Stock Option Plan (the "Plan"); and WHEREAS, Optionee is now in the employment of the Corporation or one of its subsidiaries as a key employee and the Corporation desires to grant Optionee and option pursuant to the Plan; NOW, THEREFORE, the Corporation and Optionee agree as follows: 1. Subject to the terms and conditions set forth herein and in the Plan, the Corporation grants to Optionee, during the seven-year period commencing on the date of this Agreement and ending on the date which is seven years thereafter (hereinafter called the "Option Period"), the option to purchase from the Corporation, from time to time, as herein more specifically stated, at a price of $11.4375 per share, up to but not exceeding in the aggregate 6,000 shares of the Corporation's Common Stock, which option may be exercised as follows: (a) The aggregate number of shares optioned shall be divided into five (5) equal installments and one such installment shall be allotted to each year commencing on the first anniversary of the Option Period and on each of the next four anniversary dates thereof which are included in the Option Period, and the option granted shall become exercisable with respect to the installment allotted to each such year, in whole or in part (subject to subsection (e) below), at any time and from time to time, commencing with the first day of such year and prior to the expiration of the Option Period. (b) To the extent not exercised, installments shall accumulate and be exercisable by the Optionee, in whole or in part (subject to subsection (e) below), in any subsequent year included in the Option Period but not later than the expiration of the Option Period. 2 (c) In the event of either (i) the optionee's death or (ii) the Optionee's retirement with the consent of the Corporation or one of its subsidiaries, the option granted hereby shall become immediately exercisable in full (notwithstanding anything contained in this Section 1 to the contrary) and shall remain exercisable until exercised or terminated in accordance with Section 3(c) or 3(d) hereof. (d) Except as provided in Sections 3 and 6 hereof, no Option may be exercised prior to one year after the date it is granted. (e) Notwithstanding the foregoing, in no event may an Option be exercised at any one time to purchase less than 200 shares of the Corporation's Common Stock. 2. The option hereby granted shall be exercised by Optionee delivering to the Secretary of the Corporation, from time to time, on any business day, written notice specifying the whole number of shares Optionee then desires to purchase. Payment in full of the option price of such shares must be made at the time the option is exercised. Payment may be made in cash or by certified or official bank check payable to the order of the Corporation for an amount in U.S. dollars equal to the option price of such shares. Payment may also be made in shares of Common Stock of the Corporation previously held by Optionee or by combining cash and shares previously held. Payment in shares may be made with shares received upon the exercise or partial exercise of the option hereby granted, whether or not involving a series of exercises or partial exercises and whether or not share certificates for such shares surrendered have been delivered to Optionee. 3. The option hereby granted shall terminate and be of no force or effect upon the happening of the first of the following events: (a) The expiration of the Option Period; (b) Termination of Optionee's employment, except in case of Optionee's death or retirement with the consent of the Corporation or one of its subsidiaries; (c) The expiration of three months after the date of Optionee's retirement with the consent of the Corporation or one of its subsidiaries; and (d) The expiration of twelve months after the date of death of Optionee. Retirement by Optionee in accordance with the provisions of any retirement plan of the Corporation at the normal retirement date under such retirement plan, or if such date is not so determinable, then at or after the attainment of age 65 by 2 3 Optionee, shall constitute a retirement with the consent of the Corporation for the purposes of this Agreement. Subject to the provisions of Section 8 hereof, the chief executive officer of the Corporation (the "CEO") shall have absolute and uncontrolled discretion to determine whether any other termination of Optionee's employment is to be considered as retirement with the consent of the Corporation for the purposes of this Agreement and whether an authorized leave of absence or absence on military or government service or otherwise shall constitute a termination of employment for the purposes of this Agreement. 4. Whenever the word "Optionee" is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the estate, personal representative, or beneficiary to whom this option may be transferred by will or by the laws of descent and distribution, it shall be deemed to include such person. 5. Optionee shall not be deemed for any purpose to be a shareholder of the Corporation with respect to any shares as to which this option shall not have been exercised and payment made as herein provided and a stock certificate for such shares actually issued to Optionee. No adjustment will be made for dividends or other rights for which the record date is prior to the date of such issuance. 6. In addition to and notwithstanding anything to the contrary contained in the Plan, in the event of (i) the adoption of a plan of merger or consolidation of the Corporation with any other corporation or association as a result of which the holders of the voting capital stock of the Corporation as a group would receive less than 50% of the voting capital stock of the surviving or resulting corporation; (ii) the approval by the Board of Directors of the Corporation of an agreement providing for the sale or transfer (other than as security for obligations of the Corporation) of substantially all the assets of the Corporation, or (iii) the acquisition of more than 20% of the Corporation's voting capital stock by any person within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, other than a person, or group including a person, who beneficially owned, as of the effective date of the Plan, more than 5% of the Corporation's securities in the absence of a prior expression of approval of the Board of Directors of the Corporation; any Option granted hereunder shall become immediately exercisable in full, subject to any appropriate adjustments in the number of shares subject to Option and the option price, and shall remain exercisable for the remaining term of such Option, regardless of whether such Option has been outstanding for six months or of any provision contained herein or in the Plan with respect thereto limiting the exercisability of the Option or any portion thereof for any length of time, subject to all of the terms hereof and of the Plan with respect thereto not inconsistent with this paragraph. 3 4 The existence of this option shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Corporation's capital structure or its business, or any merger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Corporation, or any sale or transfer of all or any part of its assets or business, or any other corporation act or proceeding, whether of a similar character or otherwise. 7. Anything in this Agreement to the contrary notwithstanding, if, at any time specified herein for the issue of shares to Optionee, any law, or any regulation or requirement of the Securities and Exchange Commission or any other governmental authority having jurisdiction in the premises, shall require either the Corporation or Optionee to take any action in connection with the shares then to be issued, the issue of such shares shall be deferred until such action shall have been taken; the Corporation shall be under no obligation to take such action; and the Corporation shall have no liability whatsoever as a result of the non-issuance of such shares, except to refund to the Optionee any consideration tendered in respect of the exercise price. 8. Any dispute or disagreement which shall arise under, or as a result of, or pursuant to, this Agreement shall be determined by the CEO in his absolute and uncontrolled discretion; provided, however, that the Committee shall have the right, in its absolute and uncontrolled discretion, to overrule or modify any determination or interpretation made by the CEO pursuant to this Agreement, and in such an event the determinations or interpretations by the Committee shall be final, binding, and conclusive on all persons affected thereby. 9. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Secretary of the Corporation, at 2000 Two First Union Center, Charlotte, North Carolina 28282, or at such other address as the Corporation, by notice to Optionee, may designate in writing from time to time; to Optionee, at Optionee's address as shown on the records of the Corporation, or at such other address as Optionee, by notice to the Corporation, may designate in writing from time to time. 10. Shares of Common Stock issued pursuant to the exercise of this option will be issued only in the name of Optionee and may not be transferred into the name of any agent of or nominee for Optionee until such time as a disposition of such shares would satisfy the holding period requirements of Section 42A(a)(1) of the Internal Revenue Code of 1986, as amended. 4 5 11. This Agreement is subject to the terms and conditions contained in the Plan, a copy of which is attached hereto and incorporated herein by reference. All capitalized terms used but not defined herein shall have the same meaning as set forth in Section 1 of the Plan, unless the context clearly indicates otherwise. IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer, and Optionee has hereunto set Optionee's hand and seal, all on the day and year first above written. RUDDICK CORPORATION Attest: By: /s/ R.N. Brigden ------------------------------------- Title: Vice President - Finance /s/ D.B. Williford - ----------------------------------- Title: Secretary (Corporate Seal) OPTIONEE: /s/ R.N. Brigden (SEAL) ---------------------------------- 5 EX-11 12 COMPUTATION OF PER SHARE EARNINGS 1 EXHIBIT 11 RUDDICK CORPORATION STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
FISCAL YEAR ENDED -------------------------- SEPTEMBER 29, OCTOBER 1, 1996 1995 ------------- ---------- NET INCOME PER SHARE COMPUTED AS FOLLOWS: PRIMARY: 1. NET INCOME $42,802,071 $39,267,058 =========== =========== 2. WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 46,420,098 46,194,760 3. INCREMENTAL SHARES UNDER STOCK OPTIONS COMPUTED UNDER THE TREASURY STOCK METHOD USING THE AVERAGE MARKET PRICE OF ISSUER'S STOCK DURING THE PERIODS 198,852 341,586 4. WEIGHTED AVERAGE COMMON SHARES AND =========== =========== COMMON EQUIVALENT SHARES OUTSTANDING 46,618,950 46,536,346 =========== =========== 5. NET INCOME PER SHARE (ITEM 1 DIVIDED BY ITEM 4) $ 0.92 $ 0.84 =========== =========== FULLY DILUTED: 1. NET INCOME $42,802,071 $39,267,058 =========== =========== 2. WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 46,420,098 46,194,760 3. INCREMENTAL SHARES UNDER STOCK OPTIONS COMPUTED UNDER THE TREASURY STOCK METHOD USING THE HIGHER OF THE AVERAGE OR ENDING MARKET PRICE OF ISSUER'S STOCK AT THE END OF THE PERIODS 232,338 494,961 4. WEIGHTED AVERAGE COMMON SHARES AND =========== =========== COMMON EQUIVALENT SHARES OUTSTANDING 46,652,436 46,689,721 =========== =========== 5. NET INCOME PER SHARE (ITEM 1 DIVIDED BY ITEM 4) $ 0.92 $ 0.84 =========== ===========
EX-13 13 RUDDICK CORPORATION 1996 ANNUAL REPORT 1 EXHIBIT 13 ELEVEN-YEAR FINANCIAL AND OPERATING SUMMARY Ruddick Corporation and Subsidiaries
(Dollars in thousands, except per share data) 1996 1995 1994 1993(1) - ------------------------------------------------------------------------------------------------------------------------ NET SALES American & Efird $ 309,459 $ 297,963 $ 277,016 $ 264,814 Harris Teeter 1,833,042 1,711,813 1,578,880 1,412,315 - ------------------------------------------------------------------------------------------------------------------------ Total Net Sales $2,142,501 $2,009,776 $1,855,896 $1,677,129 - ------------------------------------------------------------------------------------------------------------------------ OPERATING PROFIT American & Efird $ 34,684 $ 34,614 $ 26,916 $ 30,551 Harris Teeter 48,459 42,114 37,032 29,845 - ------------------------------------------------------------------------------------------------------------------------ Total Operating Profit $ 83,143 $ 76,728 $ 63,948 $ 60,396 - ------------------------------------------------------------------------------------------------------------------------ Net Income $ 42,802 $ 39,267 $ 31,811 $ 33,873 Net Income Per Share $ .92 $ .84 $ .67 $ .71 Common Dividend $ .26 $ .25 $ .22 $ .21 - ------------------------------------------------------------------------------------------------------------------------ Shareholders' Equity $ 346,856 $ 316,236 $ 291,209 $ 274,740 Percent Return on Beginning Equity 13.5% 13.5% 11.6% 13.3% Book Value Per Share $ 7.47 $ 6.82 $ 6.28 $ 5.87 - ------------------------------------------------------------------------------------------------------------------------ CAPITAL EXPENDITURES American & Efird $ 35,605(2) $ 16,359 $ 20,416 $ 19,433 Harris Teeter 83,204 81,447 46,349 33,683 Corporate 4,471 399 35 27 - ------------------------------------------------------------------------------------------------------------------------ Total Capital Expenditures $ 123,280 $ 98,205 $ 66,800 $ 53,143 - ------------------------------------------------------------------------------------------------------------------------ Working Capital $ 65,134 $ 73,741 $ 93,387 $ 103,191 Total Assets $ 801,702 $ 715,318 $ 634,599 $ 580,807 Long-Term Debt - Including Current Portion $ 164,435 $ 128,952 $ 109,567 $ 104,173 Long-Term Debt as a Percent of Capital Employed 32.2% 29.0% 27.3% 27.5% Number of Employees 20,100 19,850 18,610 17,120 Number of Beneficial Shareholders Including Employee/Owners 16,700 14,500 14,100 14,600 Common Shares Outstanding 46,461,290 46,373,666 46,352,214 46,036,146 - ------------------------------------------------------------------------------------------------------------------------
(1) 53-week year. (2) Includes purchase of assets of Threads USA. 12 / RUDDICK CORPORATION / 1996 Annual Report 2
(1)1992 1991 1990 1989 1988(1) 1987 1986 - ------------------------------------------------------------------------------------------------------------------------ $ 243,324 $ 208,649 $ 199,115 $ 190,004 $ 181,733 $ 146,215 $ 108,268 1,270,430 1,213,127 1,164,445 1,053,467 894,035 798,843 731,639 - ------------------------------------------------------------------------------------------------------------------------ $1,513,754 $1,421,776 $1,363,560 $1,243,471 $1,075,768 $ 945,058 $ 839,907 - ------------------------------------------------------------------------------------------------------------------------ $ 28,510 $ 22,589 $ 18,403 $ 17,732 $ 17,645 $ 14,193 $ 11,122 31,067 34,329 32,212 27,444 21,102 16,625 9,001 - ------------------------------------------------------------------------------------------------------------------------ $ 59,577 $ 56,918 $ 50,615 $ 45,176 $ 38,747 $ 30,818 $ 20,123 - ------------------------------------------------------------------------------------------------------------------------ $ 30,789 $ 26,786 $ 24,031 $ 20,190 $ 18,379 $ 14,365 $ 13,425 $ .65 $ .59 $ .55 $ .47 $ .44 $ .35 $ .35 $ .20 $ .19 $ .18 $ .16 $ .15 $ .12 $ .11 - ------------------------------------------------------------------------------------------------------------------------ $ 255,403 $ 233,566 $ 184,371 $ 158,921 $ 144,727 $ 131,511 $ 118,736 13.2% 14.5% 15.1% 14.0% 14.0% 12.1% 12.2% $ 5.44 $ 4.98 $ 4.54 $ 4.07 $ 3.72 $ 3.38 $ 3.08 - ------------------------------------------------------------------------------------------------------------------------ $ 16,399 $ 11,417 $ 15,923 $ 14,742 $ 17,219 $ 6,930 $ 4,324 25,910 30,903 27,376 31,611 31,168 20,281 17,972 4,039 60 2,323 2,975 81 1,619 62 - ------------------------------------------------------------------------------------------------------------------------ $ 46,348 $ 42,380 $ 45,622 $ 49,328 $ 48,468 $ 28,830 $ 22,358 - ------------------------------------------------------------------------------------------------------------------------ $ 105,527 $ 79,640 $ 74,688 $ 60,724 $ 52,415 $ 57,704 $ 42,021 $ 535,407 $ 498,458 $ 468,295 $ 439,104 $ 419,465 $ 321,463 $ 263,779 $ 97,280 $ 83,850 $ 115,266 $ 115,757 $ 109,332 $ 67,832 $ 52,935 27.6% 26.4% 38.5% 42.1% 43.0% 34.0% 30.8% 13,720 13,500 13,185 13,100 12,300 10,800 9,390 12,900 11,400 11,100 11,000 10,500 9,700 8,900 46,124,798 46,002,708 39,321,300 37,551,972 37,391,660 37,343,772 36,758,408 - ------------------------------------------------------------------------------------------------------------------------
1996 Annual Report / RUDDICK CORPORATION / 13 3 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Ruddick Corporation and Subsidiaries RESULTS OF OPERATIONS - FISCAL 1996 COMPARED TO FISCAL 1995 For fiscal year 1996, consolidated sales of $2.14 billion increased 6.6% over the $2.01 billion reported in fiscal 1995. Consolidated net income of $42.8 million was up 9% from the $39.3 million reported last year. On a per share basis, earnings were $.92 for fiscal 1996, an increase of 9.5% when compared to $.84 reported in fiscal 1995. Fiscal 1996 consolidated operating profit increased 8.4% led by gains at Harris Teeter. Net income per share from continuing operations for fiscal 1996 was $.92 compared to $.84 for the prior year. The discontinued operations of the printing business segment, the assets of which were sold in January, 1996, generated no significant earnings or loss during the current fiscal year or comparable prior year. On June 3, 1996, American & Efird completed the acquisition of certain assets of Threads USA. The assets included the plants and equipment at four manufacturing facilities in Gastonia, N.C. and the equipment at one manufacturing facility in Puerto Rico. AMERICAN & EFIRD, INC. sales increased 4% over fiscal 1995. This sales increase was achieved during a period of poor demand for thread due to weak retail sales of apparel and home furnishings. Gradual improvement in U.S. market conditions was evidenced toward the 1996 fiscal year end. The purchase of the assets of Threads USA in the June quarter, by which A&E became the largest U.S. industrial sewing thread company, contributed $24.8 million to the sales increase although only four months of sales from this acquisition were reflected in fiscal 1996. The sales increase was primarily industrial sewing thread as consumer thread and notions sales recorded a modest decline for the year. Operating profit of $34.7 million was slightly ahead of last year. Utilizing sales from the Threads USA acquisition resulted in improved operating schedules which had a positive impact on operating profit for the year. A&E responded to the weak demand for thread by exercising tight control of inventories and operating costs while improving quality and customer service. Significant progress has been achieved in the operational plan for integrating Threads USA into A&E, and progress was also made in reducing costs in the Threads USA facilities. A&E remains focused on integrating the Threads USA operations into those of A&E. The nature and location of product lines and facilities of the two companies are enabling A&E to combine and streamline manufacturing, reduce duplicative general and administrative expenses, and integrate a qualified, skilled workforce of Threads USA. Sales by foreign operations comprised 18% of A&E's total sales and 7% of its operating profit. While not material to the Company's consolidated financial results, foreign sales and operating profits increased over the prior fiscal year, with all foreign subsidiaries except Canada and Costa Rica reporting improved earnings. NAFTA has stimulated growth of apparel manufacturing in Central and South America. As a result, A&E subsidiaries in Mexico, Costa Rica and the Dominican Republic are displaying growth and A&E's U.S. production has benefited from export growth. Additionally, commitments to establishing operations in China and India should strengthen A&E's position in Asia. 14 / RUDDICK CORPORATION / 1996 Annual Report 4 HARRIS TEETER, INC. sales in fiscal 1996 increased 7% over fiscal 1995. Sales for stores in operation in both periods were ahead 3.9% compared to 6.5% last year. Sales increases were attributable to customer acceptance of larger, new-format stores, strong feature plans, merchandising and advertising, strong holiday sales, and a 4% increase in store square footage during the year. Grocery sales were up 6% which accounted for 43% of the sales increase. Dairy, meat, produce and frozen products had sales increases ranging from 4% to 10% accounting for 38% of the sales increase. Operating profit showed an improvement of 15% over last year, derived mainly from higher sales volume, a favorable product mix of higher gross margin items, and continued control of ongoing operating expenses. Preopening expenses associated with aggressive new store openings and major remodels served to increase operating expenses in the year. The development of several prototypes of varying sizes permits right-sizing to specific markets, providing amenities to customers, and standardizing and reducing construction costs. At the end of fiscal 1996, 134 stores were in operation, compared to 139 a year ago. During the year, seven smaller stores in less urban markets were sold at no significant gain or loss. Nine new larger stores were opened during the year, four of which were replacement stores, and three smaller stores were closed. Four of the stores closed in fiscal 1996 were closed under a previously announced marketing strategy for which a restructuring reserve of $5.3 million before taxes was established in fiscal 1993. Charges incurred in fiscal 1996 against this reserve were $1.5 million. A cumulative total of $3.1 million has been charged for all periods to date. The plan called for the replacement of an anticipated 12 smaller, less competitive stores with larger stores offering increased variety and drawing from a larger marketing area, with related store closings occurring through fiscal year 1996. Management anticipates that the remaining charges associated with the closed stores will be incurred through fiscal year 2000. Management expects that the effect on operating results of any fiscal year and on liquidity will not be material. OTHER EFFECTS ON RESULTS OF OPERATIONS During the second fiscal 1996 quarter, the Company elected to begin paying directly to its ESOP employee-shareholders the cash dividends on ESOP shares instead of accumulating such dividends within the ESOP Trust. Favorable tax treatment of the ESOP dividend pass-through under the applicable income tax statutes along with favorable tax attributes of Company owned life insurance reduced the effective income tax rate of the Company. The favorable tax attributes of COLI were significantly diminished as of January 1, 1996 as a result of recently enacted federal legislation which will phase-out interest deductions on policy loans by January 1, 1999. The tax benefits of both the COLI and the ESOP dividends are subject to the potential of adverse future tax legislation, if any. On January 23, 1996, certain assets of Jordan Graphics, Inc. were sold to The Reynolds and Reynolds Company. The revenues of the discontinued operations for the fiscal year prior to the sale were $17.3 million. The operating results for the fiscal year were not significant. The Company retained certain land and buildings, which assets have been valued at the lower of cost or net realizable value. Substantially all the value of assets of Jordan was realized during the fiscal year by collection or sale, except for the Charlotte, N.C. plant site which is leased to Reynolds on a 10-year term. The disposition had no significant impact on the consolidated earnings or the financial condition of Ruddick. The business forms segment is reported as discontinued operations. 1996 Annual Report / RUDDICK CORPORATION / 15 5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Ruddick Corporation and Subsidiaries Ruddick Investment Company, a subsidiary of the Company, has redefined its business. Emphasis will be on the development of selected sites for Harris Teeter stores. Venture capital investment holdings will continue to be managed but future equity investment will be limited. Due to continued growth of the American & Efird and Harris Teeter businesses, Ruddick Investment's relative size to the consolidated Company has declined. As a result, Ruddick Investment is no longer considered an operating company. Effective with the beginning of fiscal year 1996, and for all comparable periods, the Harris Teeter retail site activities of Ruddick Investment were assigned to the retail business segment for financial reporting; and other activities, to the Parent Company as "other administrative expense." RESULTS OF OPERATIONS - FISCAL 1995 COMPARED TO FISCAL 1994 For fiscal year 1995, consolidated net sales of $2.01 billion increased 8.3% from $1.86 billion generated in fiscal 1994. Consolidated 1995 net income of $39.3 million was up 23% from the $31.8 million reported last year. On a per share basis, earnings were $.84 for fiscal 1995, an increase of 25% when compared to $.67 in fiscal 1994. As a result of the January 23, 1996 sale of certain assets of Jordan Graphics, Inc., all financial statement categories have been restated to reflect the printing business segment as discontinued operations. Net income from continuing operations in fiscal 1995 of $39.1 million increased 20% from $32.7 million in fiscal 1994. Per share earnings from continuing operations in fiscal 1995 were $.84 compared to $.69 in fiscal 1994. Earnings per share reflect a two-for-one split of the common stock effected in the form of a 100% stock dividend in fiscal 1995. Fiscal 1995 consolidated operating profit increased 20% led by gains at both American & Efird and Harris Teeter. AMERICAN & EFIRD, INC. sales increased 8% over fiscal 1994. Sales increases were recorded in most major domestic market segments, particularly as a result of a relatively strong apparel trade over most of the year, and in export and international markets except Canada. Thread and notion sales increased 8% and represented 98% of all sales by A&E. This sales increase resulted primarily from additional business from existing customers, greater domestic market share and growth in foreign markets. Strong sales demand allowed A&E to consistently operate on a five day or more manufacturing schedule. This generated very favorable operating efficiencies and enhanced operating profit, which increased 29% over last year. However, rising raw material prices in the last half of the year resulted in increasing pressure on margins, although cost reductions and operating efficiencies offset most of these price increases. In the fourth quarter, weak retail sales of apparel and home furnishings caused A&E's customers to drastically reduce production. As a result, thread demand abated and through the fall, sales were near or below levels of a year ago. While profits in Canada and Mexico were below the prior year, total international operating profit increased slightly. HARRIS TEETER, INC. sales in fiscal 1995 increased 8% over fiscal 1994. Sales of stores in operation in both periods were ahead 6.5% compared to 7.5% the prior year. Same-store sales growth rates declined from the prior year as more stores passed the first anniversary of the switch to 24-hour operations. Sales increases were attributable to strong feature-oriented merchandising, additional operating 16 / RUDDICK CORPORATION / 1996 Annual Report 6 hours and an 8.7% increase in store square footage during the year. Grocery sales were up 9%, which accounted for 53% of the sales increase. Dairy, meat, produce and frozen products had sales increases ranging from 2% to 14%, accounting for 31% of the sales increase. Operating profit showed improvement as increased gross profit, derived mainly from higher sales volume and a good product mix of higher gross margin items, more than offset an increase of 15% in operating expenses. Operating expenses as a percentage of sales were up less than 1.4%. Additionally, Harris Teeter's first Atlanta, Georgia store which opened in fiscal 1994 became profitable during fiscal 1995. The Columbia, South Carolina market continued to show improvement in part as a result of store remodels. Both of these markets generated increased sales and more efficient store operations. At fiscal year end, 139 stores were in operation, the same number as the prior year. Eleven new stores were opened during fiscal 1995 replacing eleven older stores thereby closed. Seven of those stores were closed under the marketing strategy for which a restructuring reserve of $5.3 million before taxes was established in fiscal 1993. The resulting charges in 1995 were $1.5 million. A cumulative total of $1.6 million has been charged in all periods to date for nine store replacements. Harris Teeter continues to incur liability for rent expense for six of those stores. The plan calls for the replacement of an anticipated 12 smaller, less competitive stores with larger stores offering increased variety and drawing from a larger marketing area, with related store closings planned to occur through fiscal 1996. Management anticipates that on average approximately half of the charges associated with each store closing will be incurred in the year of closing and the balance within four years thereafter. Management expects that the effect on operating results in any fiscal year and on liquidity will not be material, and that capital resources will be adequate to complete such restructuring. CAPITAL RESOURCES AND LIQUIDITY Ruddick has an overall financial goal of earning at least a 15% return on beginning shareholders' equity. In fiscal 1996, the return on beginning equity was 13.5%, the same as in the prior year. At the same time, Ruddick seeks to limit long-term debt so as to constitute no more than 40% of capital employed, which includes long-term debt and shareholders' equity. As of the end of fiscal 1996, this percentage was 32.2%, an increase from last year's 29.0%. The Company's principal source of liquidity has been revenue from operations. The Company also has the ability to borrow up to an aggregate of $100 million under established revolving lines of credit with three banks. The maximum amount outstanding under these credit facilities during fiscal 1996 was $100 million, and $48.6 million was outstanding at year end. The majority of the borrowings under Ruddick's revolving credit facilities were used for capital expenditures, including American & Efird's acquisition of certain assets of Threads USA. Borrowings and repayments under these revolving credit facilities are of the same nature as short-term credit lines; however, due to the nature and terms of the agreements allowing up to five years for repayment, all borrowings under these facilities are classified as long-term debt. On March 1, 1996, the Company executed an unsecured $50 million 6.48% Senior Promissory Note, due March 1, 2011 with The Prudential Insurance Company of America (Prudential). Proceeds from this note were used to reduce the amount borrowed under the 1996 Annual Report / RUDDICK CORPORATION / 17 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Ruddick Corporation and Subsidiaries revolving lines of credit. Also on March 1, 1996, a non-committed $50 million Private Shelf Facility was executed with Prudential. Neither the Company nor Prudential is committed or required to fulfill on the terms of the Private Shelf Facility. No borrowings under this $50 million Private Shelf Facility had been undertaken as of September 29, 1996. Working capital as of the fiscal years ended 1996, 1995 and 1994 was $65.1 million, $73.7 million and $93.4 million, respectively. Most of the $8.6 million decrease in fiscal 1996 from fiscal 1995 was the result of the disposition of the business forms segment and increases in accrued liabilities of continuing operations. The current ratio was 1.3 at September 29, 1996, and at October 1, 1995. Covenants in certain of the Company's long-term debt agreements limit the total indebtedness that the Company may incur. Management believes that the limit on indebtedness does not significantly restrict the Company's liquidity and that such liquidity is adequate to meet foreseeable requirements. In fiscal 1996, capital expenditures were $123 million, which included the purchase of certain assets of Threads USA. In fiscal 1997, capital expenditures are expected to be not more than $151 million. In order to complete the integration of Threads USA and to further modernization and expansion, American & Efird expects to spend $47 million. In the very competitive Southeast U.S. grocery market, Harris Teeter has capital expenditure plans totaling $104 million. The Harris Teeter estimate includes the fiscal 1997 opening of 14 new stores, of which five are replacements, and the closing of four stores. New store markets include one new store in Virginia, three in Atlanta, Georgia, one in Nashville, Tennessee, and four in North Carolina. Additionally, the expansion of Harris Teeter's two distribution centers to meet distribution capacity requirements for the foreseeable future is estimated to require $30 million in fiscal 1997 and $13 million in fiscal 1998. Management expects that internally generated funds, supplemented by available borrowing capacity, will be adequate to finance such expenditures. OTHER MATTERS During the fiscal year 1996, the Company announced to its shareholders the adoption of a Dividend Reinvestment and Stock Purchase Plan available to all shareholders of record. The foregoing discussion contains some forward-looking statements about the Company's financial condition and results of operations, which are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's judgment only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events and circumstances that arise after the date hereof. Factors that might cause actual results to differ materially from these forward-looking statements include (1) the passage of future tax legislation that could have an adverse impact on the tax benefits of the COLI and the ESOP dividends, (2) management's ability to accurately predict the adequacy of the Company's present liquidity to meet future requirements, and (3) changes in the Company's capital expenditures, new store openings and store closings. 18 / RUDDICK CORPORATION / 1996 Annual Report 8 CONSOLIDATED BALANCE SHEETS Ruddick Corporation and Subsidiaries September 29, 1996, and October 1, 1995
(Dollars in thousands) 1996 1995 - ------------------------------------------------------------------------------------------------------------------------ Assets CURRENT ASSETS Cash and Cash Equivalents $ 21,033 $ 18,959 Accounts Receivable, Less Allowance For Doubtful Accounts: 1996 - $1,398; 1995 - $1,727 70,809 57,906 Inventories 183,649 177,395 Other Current Assets 22,569 32,131 Net Assets of Discontinued Operations 413 13,063 - ------------------------------------------------------------------------------------------------------------------------ Total Current Assets 298,473 299,454 - ------------------------------------------------------------------------------------------------------------------------ PROPERTY Land and Buildings 109,999 96,143 Machinery and Equipment 462,102 400,708 Leasehold Improvements 113,850 92,833 Assets Under Capital Leases 1,920 1,920 - ------------------------------------------------------------------------------------------------------------------------ Total, at Cost 687,871 591,604 Accumulated Depreciation and Amortization 277,304 252,077 - ------------------------------------------------------------------------------------------------------------------------ Property, Net 410,567 339,527 - ------------------------------------------------------------------------------------------------------------------------ INVESTMENTS AND OTHER ASSETS Investments 29,841 28,729 Other Assets 62,821 47,608 - ------------------------------------------------------------------------------------------------------------------------ Total Assets $801,702 $715,318 ======================================================================================================================== Liabilities and Shareholders' Equity CURRENT LIABILITIES Notes Payable $ 7,118 $ 5,852 Current Portion of Long-term Debt 5,247 9,192 Dividends Payable 3,252 6,491 Accounts Payable 134,780 143,537 Federal and State Income Taxes 1,945 (253) Accrued Compensation 34,677 28,911 Accrued Interest 20,530 13,623 Other Accrued Liabilities 25,790 18,360 - ------------------------------------------------------------------------------------------------------------------------ Total Current Liabilities 233,339 225,713 - ------------------------------------------------------------------------------------------------------------------------ NON-CURRENT LIABILITIES Long-term Debt 159,188 119,760 Deferred Income Taxes 43,598 34,527 Other Liabilities 18,721 19,082 - ------------------------------------------------------------------------------------------------------------------------ Commitments and Contingencies - ------------------------------------------------------------------------------------------------------------------------ SHAREHOLDERS' EQUITY Common Stock -- Shares Outstanding: 1996 - 46,461,290; 1995 - 46,373,666 55,599 54,816 Retained Earnings 293,654 262,921 Cumulative Translation Adjustments (2,397) (1,501) - ------------------------------------------------------------------------------------------------------------------------ Shareholders' Equity 346,856 316,236 - ------------------------------------------------------------------------------------------------------------------------ Total Liabilities and Shareholders' Equity $801,702 $715,318 ========================================================================================================================
The accompanying notes to consolidated financial statements are an integral part of these balance sheets. 1996 Annual Report / RUDDICK CORPORATION / 19 9 STATEMENTS OF CONSOLIDATED INCOME AND RETAINED EARNINGS Ruddick Corporation and Subsidiaries For the Fiscal Years Ended September 29, 1996, October 1, 1995, and October 2, 1994
(Dollars in thousands, except per share data) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ Net Sales $2,142,501 $2,009,776 $1,855,896 - ------------------------------------------------------------------------------------------------------------------------ Cost of Sales 1,556,216 1,479,339 1,394,688 Selling, General and Administrative Expenses 503,142 453,709 397,260 - ------------------------------------------------------------------------------------------------------------------------ Operating Profit 83,143 76,728 63,948 - ------------------------------------------------------------------------------------------------------------------------ Net Interest Expense 12,155 10,480 8,329 Other Administrative Expense 9,102 7,327 4,119 - ------------------------------------------------------------------------------------------------------------------------ Income From Continuing Operations Before Taxes 61,886 58,921 51,500 Taxes 19,160 19,839 18,826 - ------------------------------------------------------------------------------------------------------------------------ Income From Continuing Operations 42,726 39,082 32,674 Income (Loss) From Discontinued Operations Net of Taxes 76 185 (863) - ------------------------------------------------------------------------------------------------------------------------ Net Income 42,802 39,267 31,811 Retained Earnings at Beginning of Fiscal Year 262,921 235,219 213,389 - ------------------------------------------------------------------------------------------------------------------------ Total 305,723 274,486 245,200 - ------------------------------------------------------------------------------------------------------------------------ Dividends: Preference -- 1994: $.38 a share -- -- 27 Common -- 1996: $.26 a share; 1995: $.25 a share; 1994: $.22 a share 12,069 11,565 9,954 - ------------------------------------------------------------------------------------------------------------------------ Total Dividends 12,069 11,565 9,981 - ------------------------------------------------------------------------------------------------------------------------ Retained Earnings at End of Fiscal Year $ 293,654 $ 262,921 $ 235,219 ======================================================================================================================== Net Income Per Share: Income From Continuing Operations $ .92 $ .84 $ .69 Income (Loss) From Discontinued Operations -- -- (.02) - ------------------------------------------------------------------------------------------------------------------------ Net Income Per Share $ .92 $ .84 $ .67 ========================================================================================================================
The accompanying notes to consolidated financial statements are an integral part of these statements. 20 / RUDDICK CORPORATION / 1996 Annual Report 10 STATEMENTS OF CONSOLIDATED CASH FLOWS Ruddick Corporation and Subsidiaries For the Fiscal Years Ended September 29, 1996, October 1, 1995, and October 2, 1994
(Dollars in thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ CASH FLOW FROM OPERATING ACTIVITIES Net Income $ 42,802 $ 39,267 $31,811 Non-cash Items Included in Net Income Depreciation 48,275 41,888 37,920 Deferred Taxes 6,863 (215) 2,566 Restructuring Charge (1,512) (1,480) (82) Other, Net 2,902 5,286 3,605 Decrease (Increase) in Accounts Receivable (12,903) (2,634) (2,999) Decrease (Increase) in Inventories (6,254) (2,881) (9,415) Decrease (Increase) in Other Current Assets 11,466 (13,903) (3,683) Increase (Decrease) in Current Liabilities 11,874 37,860 28,958 - ------------------------------------------------------------------------------------------------------------------------ Net Cash Provided by Operating Activities 103,513 103,188 88,681 - ------------------------------------------------------------------------------------------------------------------------ Net Cash Provided by Discontinued Activities 12,650 2,538 289 - ------------------------------------------------------------------------------------------------------------------------ INVESTING ACTIVITIES Capital Expenditures (123,280) (98,205) (66,800) Cash Proceeds from Sale of Property 4,127 126 973 COLI, Net (9,098) (9,345) (8,265) Other, Net (10,668) 1,985 (2,693) - ------------------------------------------------------------------------------------------------------------------------ Net Cash Used in Investing Activities (138,919) (105,439) (76,785) - ------------------------------------------------------------------------------------------------------------------------ FINANCING ACTIVITIES Proceeds from Long-term Borrowings 44,950 25,777 11,400 Payments of Principal on Long-term Debt (8,285) (5,408) (5,624) Dividends Paid (12,069) (11,565) (9,981) Other, Net 234 (4,663) (5,841) - ------------------------------------------------------------------------------------------------------------------------ Net Cash Provided by (Used in) Financing Activities 24,830 4,141 (10,046) - ------------------------------------------------------------------------------------------------------------------------ Increase in Cash and Cash Equivalents 2,074 4,428 2,139 Cash and Cash Equivalents at Beginning of Year 18,959 14,531 12,392 - ------------------------------------------------------------------------------------------------------------------------ Cash and Cash Equivalents at End of Year $ 21,033 $ 18,959 $14,531 - ------------------------------------------------------------------------------------------------------------------------ SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash Paid During the Year for: Interest $ 11,201 $ 11,357 $ 8,455 Income Taxes $ 11,056 $ 23,959 $16,295 ========================================================================================================================
The accompanying notes to consolidated financial statements are an integral part of these statements. 1996 Annual Report / RUDDICK CORPORATION / 21 11 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ruddick Corporation and Subsidiaries SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of Ruddick Corporation and its wholly owned operating companies, American & Efird, Inc. and Harris Teeter, Inc., collectively referred to herein as the Company. Jordan Graphics, Inc. is included in consolidation as a discontinued business segment. All material intercompany amounts have been eliminated. CASH EQUIVALENTS For purposes of the statements of consolidated cash flows, the Company considers all highly liquid cash investments purchased with a maturity of three months or less to be cash equivalents. INVENTORIES Inventories are valued at the lower of cost or market with the cost of substantially all inventories being determined using the last-in, first-out (LIFO) method. The LIFO cost of such inventories was $19,047,000 ($19,215,000) less than the first-in, first-out (FIFO) cost method at September 29, 1996 (October 1, 1995). PROPERTY AND DEPRECIATION Property is at cost and is depreciated, using principally the straight-line method, over the following useful lives: - -------------------------------------------------------------------------------- Land improvements 10-40 years Buildings 10-50 years Machinery and equipment 3-20 years - --------------------------------------------------------------------------------
Leasehold improvements are depreciated over the lesser of the estimated useful life or the remaining term of the lease. Assets under capital leases are amortized on a straight-line basis over the lesser of 20 years or the lease term. Maintenance and repairs are charged against income when incurred. Expenditures for major renewals, replacements and betterments are added to property. The cost and the related accumulated depreciation of assets retired are eliminated from the accounts; gains or losses on disposal are added to or deducted from income. INVESTMENTS The Company holds a financial position in certain shopping centers in which Harris Teeter, Inc., is an anchor tenant. Additionally, it makes loans to and equity investments in a number of emerging growth companies, as well as selected publicly traded companies. Financial investments are carried at the lower of cost or market. In management's opinion, the net aggregate carrying value of financial instruments of $7,335,000 and $7,690,000 held for investment approximated their aggregate fair values at September 29, 1996 and October 1, 1995, respectively. 22 / RUDDICK CORPORATION / 1996 Annual Report 12 OTHER ASSETS Other assets include cash surrender value of Company owned life insurance (COLI), investment in unconsolidated foreign subsidiaries and various acquisition costs. The cash surrender value of life insurance is recorded net of policy loans. The net life insurance expense, including interest expense of $18,564,000 in 1996, $12,845,000 in 1995 and $5,761,000 in 1994, is included in other administrative expense in the statements of consolidated income and retained earnings. Acquisition costs allocated to other assets, including favorable lease rights, are being amortized over 10-15 years. INCOME TAXES Ruddick and its subsidiaries file a consolidated federal income tax return. Tax credits are recorded as a reduction of federal income taxes in the years in which they are utilized. Deferred tax liabilities or assets at the end of each period are determined using the tax rate expected to be in effect when taxes are actually paid or recovered. Accordingly, income tax expense will increase or decrease in the same period in which a change in tax rates is enacted. PER SHARE AMOUNTS Primary and fully diluted net income per share amounts were determined based on the weighted average number of shares of common stock and common stock equivalents (non-cumulative, voting $.56 convertible preference stock and stock options) outstanding. The weighted average primary shares outstanding were 46,618,950 in 1996, 46,536,346 in 1995 and 47,193,122 in 1994. Common stock equivalents had no material effect on the per share amounts in 1996, 1995 and 1994. DISCONTINUED OPERATIONS On January 23, 1996, the assets of the business forms segment were sold under a plan of disposition established during the first fiscal quarter of 1996. The Company retained certain land and buildings, which assets have been valued at the lower of cost or net realizable value. The revenues of the discontinued operation were $17,293,000 (16 weeks), $60,991,000, and $52,541,000 in fiscal 1996, 1995 and 1994, respectively. Operating profits (losses) were $123,000, $336,000 and ($1,432,000) for the same respective periods. USE OF ESTIMATES 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 disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from those estimates. 1996 Annual Report / RUDDICK CORPORATION / 23 13 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ruddick Corporation and Subsidiaries RECLASSIFICATIONS To conform with classifications adopted in the current year, the financial statements for prior years reflect certain reclassifications, which have no effect on net income. LEASES The Company leases certain equipment under agreements expiring during the next six years. Harris Teeter leases most of its stores under leases that expire during the next 22 years. It is expected that such leases will be renewed by exercising options or replaced by leases of other properties. Most store leases provide for additional rentals based on sales, and certain store facilities are sublet under leases expiring during the next 11 years. Rent expenses were as follows:
(In thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------- Operating Leases: Minimum $43,282 $36,111 $33,923 Contingent 1,175 1,277 971 - ------------------------------------------------------------------------------------------------------- Total $44,457 $37,388 $34,894 - -------------------------------------------------------------------------------------------------------
Future minimum lease commitments at September 29, 1996 (excluding leases assigned or expected to be assigned - see below) were as follows:
CAPITAL OPERATING (In thousands) LEASES LEASES - ---------------------------------------------------------------------------------------------------------------- 1997 $ 268 $ 46,427 1998 268 44,904 1999 268 42,774 2000 268 41,284 2001 268 39,106 Later years 476 395,558 - ---------------------------------------------------------------------------------------------------------------- Total minimum lease payments $1,816 $610,053 - ---------------------------------------------------------------------------------------------------------------- Less amount representing interest (Store premises, 6.75%-10.25%, store equipment, 8%-15%) 921 - ---------------------------------------------------------------------------------------------------------------- Present value of minimum lease obligations 895 Less current portion 93 - ---------------------------------------------------------------------------------------------------------------- Long-term capital lease obligations $ 802 - ---------------------------------------------------------------------------------------------------------------- Total minimum sublease rentals to be received under noncancelable subleases $ 2,842 - ----------------------------------------------------------------------------------------------------------------
In connection with the closing of certain store locations, Harris Teeter has assigned leases to other merchants with recourse. These leases expire over the next 13 years, and the future minimum lease payments of $13,819,000 over this period have been assumed by these merchants. In addition, Harris Teeter leases certain store locations which are not currently in use but are expected to be assigned to other merchants. These leases expire over the next 16 years, and the future minimum lease payments related to these locations total $19,686,000 (approximating $2,175,000 per year for each of the next five years). 24 / RUDDICK CORPORATION / 1996 Annual Report 14 LONG-TERM DEBT Long-term debt at September 29, 1996 and October 1, 1995 was as follows:
(In thousands) 1996 1995 - ------------------------------------------------------------------------------------------------------------------------ 8.57% Term Note due $1,167 quarterly through May 2007 $ 50,167 $ 54,833 6.48% Senior Note due March 2011 50,000 -- Revolving line of credit, variable rate, due February 2001 48,600 62,100 5.7% Term Note due April 1996 - Repaid in l996 -- 2,666 Industrial revenue bond, variable rate, due November 2000 2,500 2,500 Industrial revenue bond due August 1997 - Repaid in l996 -- 542 Obligations under capital leases and other 13,168 6,311 - ------------------------------------------------------------------------------------------------------------------------ Total 164,435 128,952 Less current portion 5,247 9,192 - ------------------------------------------------------------------------------------------------------------------------ Total long-term debt $159,188 $119,760 - ------------------------------------------------------------------------------------------------------------------------
Long-term debt maturities, excluding obligations under capital leases, in each of the next five fiscal years are as follows: 1997 - $5,152,000; 1998 - $7,429,000; 1999 - $5,116,000; 2000 - $4,962,000; 2001 - $7,327,000. Additionally, in fiscal 2001 the revolving line of credit ($48,600,000 as of September 29, 1996) would mature; however, management expects to obtain the one-year extension of term upon receipt of the mutual consent of lenders under the "evergreen" provisions of the loan agreement. During fiscal 1995, the Company increased its revolving line of credit with three banks to $100,000,000. During 1996 (l995) the maximum outstanding borrowing under the revolving line of credit was $100,000,000 ($78,600,000) and the average for the 364 days outstanding was $70,562,000 ($61,817,000). The daily weighted average interest rate (a variable rate related to the current published CD rate) was 5.9% (6.7%) and a commitment fee of 1/8% of the unused line is charged. During fiscal 1996, the Company executed an unsecured $50,000,000 6.48% Senior Promissory Note, due March 1, 2011, with a major insurance company. Proceeds from the Note were used to reduce the amount borrowed under the revolving line of credit. At the same time, a non-committed $50,000,000 Private Shelf Facility was executed with the same insurance company. As of September 29, 1996, no commitments had been initiated under the Private Shelf Facility. In management's opinion, the recorded amounts of the fixed rate obligations of the Company approximate their fair value at September 29, 1996 and October 1, 1995 based on borrowing rates then available to the Company for loans with similar terms and maturities. Various loan agreements provide, among other things, for maintenance of minimum levels of consolidated shareholders' equity. At September 29, 1996, consolidated tangible net worth exceeded by $58,578,000 the balance which, under the most restrictive provisions, must be maintained through September 28, 1997. The requirement shall increase annually by 40% of consolidated net income for such year. Total interest expense on long-term debt was $12,748,000, $10,649,000 and $8,563,000 in 1996, 1995 and 1994, respectively. 1996 Annual Report / RUDDICK CORPORATION / 25 15 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ruddick Corporation and Subsidiaries CAPITAL STOCK The capital stock of the Company authorized at September 29, 1996 was 1,000,000 shares of Additional Preferred, 4,000,000 shares of Preference-noncumulative $.56 convertible, voting ($10 liquidation value), and 75,000,000 shares of Common. Changes in shares issued and outstanding and in shareholders' equity accounts other than retained earnings are summarized as follows:
PREFERENCE-NONCUMULATIVE $.56 CONVERTIBLE (1) COMMON (In thousands except share amounts) Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------ Balance at October 3, 1993 97,286 $486 46,036,146 $62,523 - ------------------------------------------------------------------------------------------------------------------------ Preference conversion (95,170) (476) 761,360 476 Shares issued under exercised stock options -- -- 299,330 1,684 Shares purchased and retired (2,116)(1) (10) (744,622) (7,370) Tax effect of disqualifying option stocks -- -- -- 307 - ------------------------------------------------------------------------------------------------------------------------ Balance at October 2, 1994 0 $ 0 46,352,214 $57,620 - ------------------------------------------------------------------------------------------------------------------------ Shares issued under exercised stock options -- -- 704,052 3,639 Shares purchased and retired -- -- (682,600) (6,952) Tax effect of disqualifying option stocks -- -- -- 471 Other -- -- -- 38 - ------------------------------------------------------------------------------------------------------------------------ Balance at October 1, 1995 0 $ 0 46,373,666 $54,816 - ------------------------------------------------------------------------------------------------------------------------ Shares issued under exercised stock options -- -- 94,424 661 Tax effect of disqualifying option stocks -- -- -- 117 Other -- -- (6,800) 5 - ------------------------------------------------------------------------------------------------------------------------ Balance at September 29, 1996 0 $ 0 46,461,290 $55,599 - ------------------------------------------------------------------------------------------------------------------------
(1) As of May 23, 1994, the remaining 2,116 shares of $.56 Preference stock were called for redemption. The redemption price was $10.10 per share inclusive of the pro rata dividend of $.10 per share. During fiscal 1995, the Company declared a two-for-one split of the common stock effected in the form of a 100% stock dividend. All common stock and per share data included in the consolidated financial statements and footnotes have been restated to reflect the stock split. The 1982, 1988, 1993 and 1995 incentive stock option plans authorized options for 4,000,000 shares of common stock. The plans provide that options may be granted at 100% of the fair market value of the shares on the date of grant. At the discretion of the Company, a stock appreciation right may be granted and exercised in lieu of the exercise of the related option (which is then forfeited). Under the plans, as of September 29, 1996, the Company may grant additional options for the purchase of 936,600 shares. 26 / RUDDICK CORPORATION / 1996 Annual Report 16 A summary of the option transactions for the years ended September 29, 1996, October 1, 1995 and October 2, 1994 follows:
1996 1995 1994 - ----------------------------------------------------------------------------------------------------------------------- Options outstanding, beginning of year 696,384 1,364,062 1,446,992 Options granted 573,000 124,000 240,000 Options exercised 97,600 756,878 299,330 Options canceled or forfeited 56,000 34,800 23,600 Options outstanding, end of year 1,115,784 696,384 1,364,062 Options exercisable, end of year 297,984 403,584 1,027,262 Exercise price $5 15/64 - $11 15/16 $5 15/64 - $11 11/32 $5 15/64 - $11 11/32
One preferred share purchase right is attached to each outstanding share of common stock, which rights expire on November 15, 2000. Each right entitles the holder to purchase one four-hundredth of a share of a new Series A Junior Participating Additional Preferred Stock at $26.25. The rights will become exercisable only under certain circumstances related to a person or group acquiring or offering to acquire a substantial portion of the Company's common stock. If certain additional events then occur, each right would entitle the rightholder to acquire common stock of the Company, or in some cases of an acquiring entity, having a value equal to twice the exercise price. Under certain circumstances, the Board of Directors may exchange all or part of the outstanding rights at an exchange ratio per right of one share of common stock, or one four-hundredth of a share of Series A Junior Participating Additional Preferred Stock, or may redeem each right at a price of $.0025. There are 200,000 shares of Series A Junior Participating Additional Preferred Stock reserved for issuance upon exercise. INCOME TAXES The provision for income taxes consisted of the following:
(In thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ CURRENT Federal $10,509 $15,844 $12,990 State and other 2,486 3,983 3,599 - ------------------------------------------------------------------------------------------------------------------------ 12,995 19,827 16,589 - ------------------------------------------------------------------------------------------------------------------------ DEFERRED Federal 5,196 (151) 2,134 State and other 969 163 103 - ------------------------------------------------------------------------------------------------------------------------ 6,165 12 2,237 - ------------------------------------------------------------------------------------------------------------------------ Provision for income taxes $19,160 $19,839 $18,826 - ------------------------------------------------------------------------------------------------------------------------
Income from foreign operations before income taxes in fiscal 1996, 1995 and 1994 was $1,390,000, $560,000 and $1,020,000, respectively. 1996 Annual Report / RUDDICK CORPORATION / 27 17 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ruddick Corporation and Subsidiaries Income tax expense differed from an amount computed by applying the statutory tax rates to pre-tax income as follows:
(In thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ Income tax on pre-tax income at the statutory federal rate of 35% $21,660 $20,622 $18,025 Increase (decrease) attributable to: State and other income taxes, net of federal income tax benefit 1,802 2,826 1,959 Company owned life insurance (4,261) (3,646) (2,020) Other items, net (41) 37 862 - ------------------------------------------------------------------------------------------------------------------------ Income tax expense $19,160 $19,839 $18,826 - ------------------------------------------------------------------------------------------------------------------------
The tax effects of temporary differences giving rise to the Company's consolidated deferred tax liability at September 29, 1996 and October 1, 1995 are as follows:
(In thousands) 1996 1995 - ------------------------------------------------------------------------------------------------------------------------ DEFERRED TAX ASSETS Employee benefits $ 6,215 $ 6,129 Reserves not currently deductible 6,426 6,649 Other 1,835 3,011 - ------------------------------------------------------------------------------------------------------------------------ Total deferred tax assets $ 14,476 $ 15,789 - ------------------------------------------------------------------------------------------------------------------------ DEFERRED TAX LIABILITIES Property, plant and equipment$(46,996)$(41,884) Other capitalized costs (3,094) (3,272) Other (6,134) (6,216) - ------------------------------------------------------------------------------------------------------------------------ Total deferred tax liabilities $(56,224) $(51,372) - ------------------------------------------------------------------------------------------------------------------------
28 / RUDDICK CORPORATION / 1996 Annual Report 18 INDUSTRY SEGMENT INFORMATION The Company operates primarily in two businesses: textiles - American & Efird, and retail grocery (including the real estate and store development activities of the Company ) - Harris Teeter. American & Efird manufactures sewing thread for the apparel and other markets. Harris Teeter operates a regional chain of supermarkets. Summarized information for fiscal 1996, 1995 and 1994 is as follows:
RETAIL (in millions) TEXTILES GROCERY(1) CORPORATE(2) CONSOLIDATED - ------------------------------------------------------------------------------------------------------------------------ 1996 - ------------------------------------------------------------------------------------------------------------------------ Net Sales $309.5 $1,833.0 $2,142.5 - ------------------------------------------------------------------------------------------------------------------------ Gross Profit 93.9 492.4 586.3 - ------------------------------------------------------------------------------------------------------------------------ Operating Profit 34.7 48.4 83.1 - ------------------------------------------------------------------------------------------------------------------------ Assets Employed at Year-End $263.5 $ 476.9 $61.3 $ 801.7 Depreciation and Amortization 11.8 35.2 1.3 48.3 Capital Expenditures 35.6(3) 83.2 4.5 123.3 1995 - ------------------------------------------------------------------------------------------------------------------------ Net Sales $298.0 $1,711.8 $2,009.8 - ------------------------------------------------------------------------------------------------------------------------ Gross Profit 87.4 443.0 530.4 - ------------------------------------------------------------------------------------------------------------------------ Operating Profit 34.6 42.1 76.7 - ------------------------------------------------------------------------------------------------------------------------ Assets Employed at Year-End $214.1 $ 437.2 $64.0 $ 715.3 Depreciation and Amortization 11.0 29.3 1.6 41.9 Capital Expenditures 16.4 81.4 .4 98.2 1994 - ------------------------------------------------------------------------------------------------------------------------ Net Sales $277.0 $1,578.9 $1,855.9 - ------------------------------------------------------------------------------------------------------------------------ Gross Profit 77.7 383.5 461.2 - ------------------------------------------------------------------------------------------------------------------------ Operating Profit 26.9 37.0 63.9 - ------------------------------------------------------------------------------------------------------------------------ Assets Employed at Year-End $206.5 $ 365.6 $62.5 $ 634.6 Depreciation and Amortization 10.0 26.6 1.3 37.9 Capital Expenditures 20.4 46.4 -- 66.8 - ------------------------------------------------------------------------------------------------------------------------
(1) Retail Grocery Assets Employed include $22,131,000, $19,080,000 and $20,957,000 in 1996, 1995 and 1994, respectively, related to store investment activities of the Company for the development of retail sites. (2) Corporate Assets Employed include the net cash surrender value of Company owned life insurance and the net assets of discontinued operations. (3) Includes the purchase of certain assets of Threads USA. 1996 Annual Report / RUDDICK CORPORATION / 29 19 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ruddick Corporation and Subsidiaries QUARTERLY INFORMATION (UNAUDITED) The following table sets forth certain financial information, the high and low sales prices and dividends declared for the common stock for the periods indicated. The Company's common stock is listed and traded on the New York Stock Exchange. As of September 29, 1996, there were 1,943 holders of record of common stock.
FIRST SECOND THIRD FOURTH (In millions, except per share data) QUARTER QUARTER QUARTER QUARTER 1996 - ------------------------------------------------------------------------------------------------------------------------ Operating Results Net Sales $529.7 $522.3 $532.6 $557.9 Net Income 8.1 9.5 13.6 11.6 Net Income Per Share .17 .21 .29 .25 Dividend Per Share - Common .06 .06 .07 .07 Market Price Per Common Share High 14 1/8 13 1/4 15 1/4 14 Low 9 5/8 10 5/8 12 1/4 11 1/4 1995 - ------------------------------------------------------------------------------------------------------------------------ Operating Results Net Sales $493.6 $493.8 $510.2 $512.2 Net Income 8.3 10.3 11.3 9.4 Net Income Per Share .17 .23 .24 .20 Dividend Per Share - Common .03 .04 .04 .14(1) Market Price Per Common Share High 10 1/4 10 11/16 10 15/16 13 7/8 Low 8 1/2 9 3/8 9 5/8 10 7/16
(1) Includes $.08 extra dividend in fiscal 1995. COMMITMENTS AND CONTINGENCIES Substantially all domestic full-time employees of the Company and its subsidiaries participate in non-contributory, defined benefit pension plans. Employees in foreign subsidiaries participate to varying degrees in local pension plans, which, in the aggregate, are not significant. Employee retirement benefits are a function of both the years of service and compensation for a specified period of time before retirement. The Company's current funding policy is to contribute annually the minimum amount required by regulatory authorities. 30 / RUDDICK CORPORATION / 1996 Annual Report 20 The following table sets forth the defined benefit plans' funded status and amounts recognized in the Company's consolidated balance sheets at September 29, 1996 and October 1, 1995:
(In thousands) 1996 1995 - ------------------------------------------------------------------------------------------------------------------------ Actuarial present value of benefit obligations: Vested benefits $ 71,585 $64,984 Non-vested benefits 2,934 2,507 - ------------------------------------------------------------------------------------------------------------------------ Accumulated benefit obligations 74,519 67,491 Effect of projected future compensation levels 19,612 20,026 - ------------------------------------------------------------------------------------------------------------------------ Projected benefit obligations 94,131 87,517 Plans' assets at fair market value 72,642 69,951 - ------------------------------------------------------------------------------------------------------------------------ Projected benefit obligations in excess of plans' assets (21,489) (17,566) Unrecognized net asset at September 30, 1985, net of amortization, being amortized over 15-20 years 1,935 2,330 Unrecognized net loss due to past experience different from assumptions made (12,412) (12,234) - ------------------------------------------------------------------------------------------------------------------------ Unfunded accrued pension cost $(11,012) $(7,662) - ------------------------------------------------------------------------------------------------------------------------
The plans' assets consist primarily of U. S. government securities, corporate bonds, cash equivalents and domestic equities, all managed by two banks. The contribution payable was $ 6,986,000 and $ 2,039,000 at September 29, 1996 and October 1, 1995, respectively. In 1996 and 1995, an 8% weighted average discount rate and a 5% rate of increase in future payroll costs were used in determining the actuarial present value of the projected benefit obligations. The expected long-term rate of return on assets was 8% for both years. Pension expense for defined benefit plans for fiscal 1996, 1995 and 1994 included the following components:
(In thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ Benefits earned by employees $4,033 $3,835 $3,822 Interest on projected benefit obligations 7,135 6,608 5,934 Actual return on plan assets (4,635) (7,134) 2,546 Net amortization and deferral (1,143) 1,873 (7,045) - ------------------------------------------------------------------------------------------------------------------------ Net pension expense $5,390 $5,182 $5,257 - ------------------------------------------------------------------------------------------------------------------------
The Company also has an Employee Stock Ownership Plan (ESOP) and a profit-sharing plan. Expenses under these plans were as follows:
(In thousands) 1996 1995 1994 - ------------------------------------------------------------------------------------------------------------------------ ESOP $7,866 $7,651 $5,205 Profit-sharing 1,699 1,652 866 - ------------------------------------------------------------------------------------------------------------------------
The Company is involved in various lawsuits and environmental matters arising in the normal course of business. Management believes that such matters will not have a material effect on the financial condition or results of operations of the Company. See "Leases" for additional commitments and contingencies. 1996 Annual Report / RUDDICK CORPORATION / 31 21 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS Ruddick Corporation and Subsidiaries To the Board of Directors of Ruddick Corporation We have audited the accompanying consolidated balance sheets of Ruddick Corporation (a North Carolina corporation) and subsidiaries as of September 29, 1996, and October 1, 1995, and the related statements of consolidated income and retained earnings and consolidated cash flows for each of the three years in the period ended September 29, 1996. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Ruddick Corporation and subsidiaries as of September 29, 1996, and October 1, 1995, and the results of their operations and their cash flows for each of three years in the period ended September 29, 1996, in conformity with generally accepted accounting principles. ARTHUR ANDERSEN LLP Charlotte, North Carolina, October 24, 1996. 32 / RUDDICK CORPORATION / 1996 Annual Report EX-21 14 LIST OF SUBSIDIARIES OF THE REGISTRANT 1 EXHIBIT 21 RUDDICK CORPORATION Affiliated Companies as of December 20, 1996 Listed below are the domestic subsidiaries of the Corporation, all of which are wholly owned and are owned directly by the Corporation, unless otherwise indicated. American & Efird, Inc. The Kaim Company(1) American & Efird Services, Inc.(1) A&E Export, Inc.(1) Harris Teeter, Inc. Harris-Teeter Services, Inc.(2) JGBF, Inc. Ruddick of Delaware, Inc. R. S. Dickson & Company Ruddco Management, Inc.(3) ---------------- (1) Owned by American & Efird, Inc. (2) Owned by Harris Teeter, Inc. (3) Owned by R. S. Dickson & Company Listed below are the foreign subsidiaries of the Corporation, all of which are wholly owned through American & Efird, Inc., unless otherwise indicated. American & Efird (HK) Limited - 100% A&E Korea Ltd. - 100% American & Efird (GB) Limited - 100% American & Efird Canada, Inc. - 100% Hilos A&E de Costa Rica, S.A. - 100% American & Efird International (FE) Limited - 100% American & Efird de Mexico, S.A. de C.V. - 100% American & Efird Mills (S) Pte. Ltd. - 100% American & Efird (M) SON BHD - 100% Hilos A&E Dominicana, Ltd. - Joint venture, 49% owned Hilos A&E de Honduras, S.A. de C.V. - Joint venture, 45% owned In addition, in the normal course of business, R. S. Dickson & Company from time to time makes investments in corporations and partnerships that may result in ownership of capital stock or other interests as an investment. EX-23 15 CONSENT OF ARTHUR ANDERSEN LLP DATED 12/19/96 1 EXHIBIT 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our reports included in this Form 10-K, into Ruddick Corporation's previously filed Registration Statements on Form S-8, Registration No. 33-26302 and No. 33-56567. It should be noted that we have not audited any financial statements of the Company subsequent to September 29, 1996 or performed any audit procedures subsequent to the date of our report. ARTHUR ANDERSEN LLP Charlotte, North Carolina, December 19, 1996. EX-27 16 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF RUDDICK CORPORATION FOR THE FISCAL YEAR ENDED SEPTEMBER 29, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. YEAR SEP-29-1996 OCT-02-1995 SEP-29-1996 21,033,000 0 72,207,000 1,398,000 183,649,000 298,473,000 687,871,000 277,304,000 801,702,000 233,339,000 159,188,000 0 0 55,599,000 291,257,000 801,702,000 2,142,501,000 2,142,501,000 1,556,216,000 2,059,358,000 9,102,000 0 12,155,000 61,886,000 19,160,000 42,726,000 76,000 0 0 42,802,000 .92 .92
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