Harris Teeter 2007 Annual Report Download - page 57

53
RUDDICK CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
Managers are expected to generate a total return consistent with their philosophy, offer protection in down
markets and achieve a rate of return which ranks in the top 40% of a universe of similarly managed portfolios
and outperforms a target index, net of expenses, over rolling three year periods.
The Investment Policy Statement contains the following guidelines:
— Categorical restrictions such as limiting the average weighted duration of fixed income investments,
limiting the aggregate amount of American Depository Receipts (ADRs), no direct foreign currency
speculation, limited foreign exchange contracts, and limiting the use of derivatives;
— Portfolio restrictions that address such things as investment restrictions, proxy voting, and brokerage
arrangements; and
— Asset class restrictions that address such things as single security or sector concentration,
capitalization limits and minimum quality standards.
Since the Company’s supplemental plan is unfunded, the contributions to this plan is equal to the benefit
payments made during the year. The Company expects to contribute $7.5 million for the pension plan and
approximately $1.3 million for the supplemental plan during fiscal 2008.
The following benefit payments, which reflect expected future service, as appropriate, are expected to be
paid by the Company’s defined benefit pension plans (in thousands):
Pension
Plan
Supplemental
Plan
2008 ........................................... $ 10,433 $ 1,287
2009 ........................................... 11,181 1,273
2010 ........................................... 11,962 1,257
2011 ........................................... 12,768 1,239
2012 ........................................... 13,585 1,326
Years 2013-2017 .................................. 79,594 10,006
The Company continues to maintain an ESOP even though participation has been frozen and the Company
has ceased any further contributions as previously discussed. Under the ESOP the Company provided cash
contributions, as determined by the Board of Directors, to a trust for the purpose of purchasing shares of the
Company’s common stock on the open market. Such contributions were based on the Company’s net income
for the fiscal year as a percentage of average shareholders’ equity. The total amount contributed was comprised
of a base contribution of 1.5% of participants’ eligible compensation and an additional contribution of up to
3.5% of eligible compensation. At September 30, 2007, approximately 13% of the Company’s common shares
outstanding were owned by employees as participants in the ESOP. The Company’s final contribution to this
plan was made in December 2005.
The Company also sponsors the Ruddick Retirement and Savings Plan which is a defined contribution
retirement plan that was authorized for the purpose of providing retirement benefits for employees of the
Company. The Ruddick Retirement and Savings Plan is a salary deferral plan pursuant to Section 401(k) of
the Internal Revenue Code. The Company provides a matching contribution based on the amount of eligible
compensation contributed by the associate. As previously mentioned, the Company implemented enhancements
to this plan to include additional contributions to individual accounts based on age and years of service.