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SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-K

Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

|For the fiscal year ended: December 29, 2001 |  | Commission file number: 0-785
|-------------------------------------------- |  | -----------------------------

NASH-FINCH COMPANY

(Exact name of Registrant as specified in its charter)

|Delaware(State of Incorporation)                                                                     |  | 41-0431960(I.R.S. Employer Identification No.)
|---------------------------------------------------------------------------------------------------- |  | ----------------------------------------------
|7600 France Avenue South
P.O. Box 355
Minneapolis, Minnesota(Address of principal executive offices) |  | 55440-0355(Zip Code)                          

Registrant's telephone number, including area code:(952) 832-0534

Securities
registered pursuant to Section 12(b) of the Act:None

Securities
registered pursuant to Section 12(g) of the Act:

Common Stock, par value $1.662/3 per share
Common Stock Purchase Rights

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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, 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.  o

As
of March 4, 2002, 11,893,551 shares of Common Stock of the Registrant were outstanding. The aggregate market value of the Common Stock of the Registrant as of that date (based
upon the last reported sale price of the Common Stock at that date by the Nasdaq National Market), excluding outstanding shares deemed beneficially owned by directors and officers, was approximately
$301,668,957.

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this Annual Report on Form 10-K incorporates by reference information (to the extent specific sections are referred to
herein) from the Registrant's Proxy Statement for its Annual Meeting to be held on May 14, 2002 (the "2002 Proxy Statement").

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THIS REPORT AND THE DOCUMENTS THAT ARE OR WILL BE INCORPORATED BY REFERENCE INTO THIS REPORT CONTAIN FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995. THE WORDS "MAY," "WILL," "BELIEVE," "EXPECT," "ANTICIPATE," "INTEND," AND OTHER SIMILAR EXPRESSIONS GENERALLY IDENTIFY FORWARD-LOOKING STATEMENTS. THESE FORWARD-LOOKING STATEMENTS
ARE BASED LARGELY ON OUR CURRENT EXPECTATIONS AND ARE SUBJECT TO A NUMBER OF RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT LIMITATION:



ADDITIONAL
INFORMATION REGARDING THESE AND OTHER RISKS IS INCLUDED IN EXHIBIT 99.1, "RISK FACTORS," FILED WITH THIS REPORT.

IN
LIGHT OF THESE RISKS AND UNCERTAINTIES, THERE CAN BE NO ASSURANCE THAT THE MATTERS REFERRED TO IN THE FORWARD-LOOKING STATEMENTS WILL IN FACT OCCUR. THE FORWARD-LOOKING STATEMENTS ARE
BASED ON OUR PREDICTIONS OF FUTURE PERFORMANCE AND ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED IN THE FORWARD-LOOKING STATEMENTS. AS A RESULT, YOU
SHOULD NOT PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS. WE DO NOT UNDERTAKE TO UPDATE OUR FORWARD-LOOKING STATEMENTS TO REFLECT FUTURE EVENTS OR CIRCUMSTANCES.

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PART I

ITEM 1. BUSINESS

A. GENERAL DEVELOPMENT OF BUSINESS.

Originally established in 1885 and incorporated in 1921, today we are one of the leading food distribution and retail companies in the United States, with
approximately $4.1 billion in annual sales. Our business consists of three primary operating segments: food retailing, food distribution and military food distribution.

Our
food retailing segment is made up of 110 corporate-owned stores concentrated in the Upper Midwest region of the United States, consisting primarily of the states of Iowa, Minnesota,
Nebraska, North Dakota, South Dakota and Wisconsin. We believe that approximately two-thirds of our traditional grocery stores are #1 or #2 in their respective markets. We are focused on
becoming the leading grocery store chain in the Upper Midwest, as there are currently no national or multi-regional grocery store chains that have a significant presence in this market. Our
corporate-owned stores principally operate as traditional grocery stores under three store banners: Econofoods®, Sun Mart® and Family Thrift Center. Our
corporate-owned grocery stores have undergone a substantial transformation during the past three years. We have opened 14 new stores, remodeled 23 existing stores and acquired 53 stores in separate
transactions primarily from three regional grocery store chains in Minnesota, Wisconsin and Nebraska.

Over
the past three years, we have also developed, and are currently expanding, two new store formats, which target what we believe to be under-served demographic segments of our market
area. The financial results for each of these store formats have exceeded our expectations. Our three Wholesale Food Outlet grocery stores serve the rapidly growing Hispanic population.
These stores will operate under the AVANZA banner as we begin to expand this format. Our four BuynSave® stores are extreme value stores, which serve
the large segment of low-income, value conscious consumers.

On
August 13, 2001, we completed the acquisition of U Save Foods, Inc., a grocery store chain headquartered in Omaha, Nebraska, with annual sales of approximately
$145 million. U Save's 14 stores are located in Nebraska, Kansas and Colorado. With this acquisition, we are now the largest grocery store chain in Nebraska, with 30 stores in that state. The
stores have been integrated and converted to our primary banners.

Our
food distribution segment sells and distributes a wide variety of nationally branded and private label grocery products from 15 distribution centers to more than 1,500 grocery stores
and institutional customers located in 24 states across the United States. Since 1998, we have implemented operating initiatives that have enhanced productivity and expanded profitability while
providing a higher level of service to our distribution customers. We believe that in order to continue to grow our food distribution operations we must provide our customers with low prices,
exceptional customer service and successful marketing and merchandising programs.

Our
military food distribution segment sells and distributes a wide variety of grocery products to approximately 100 domestic and European-based U.S. military commissaries. We primarily
conduct our military distribution operations in the Mid-Atlantic region of the United States, consisting of the states along the border of the Atlantic Ocean from New York to North
Carolina. We have two distribution centers in this region that exclusively provide products to U.S. military commissaries.

Since
June 1998, when Ron Marshall joined us as our President and Chief Executive Officer, we have assembled a superior management team with extensive experience in retail and
food distribution. Through the execution of a 1998 revitalization plan, our new management team has streamlined food distribution operations, expanded retail operations in the Upper Midwest, lowered
costs, enhanced

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operating efficiencies and strengthened our appeal to new customers. We have become a performance driven, service-oriented organization, focused on managing all aspects of our business through
several performance metrics such as on-time deliveries, product fill rates, cost per case of handling and shipping goods and equipment utilization, encompassing sales, productivity,
service levels and working capital efficiency. As a result, we seek to continue to grow our revenues while expanding our operating margins.

B. FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS.

Financial
information about our business segments for the most recent three fiscal years is contained on pages 43-46, of this Annual Report on Form 10-K
(Note (13) of Notes to Consolidated Financial
Statements). For segment financial reporting purposes, a portion of the operational profits of wholesale distribution centers are allocated to retail operations to the extent that merchandise is
purchased by these distribution centers and transferred to retail stores directly operated by Nash Finch. For fiscal 2001, 34% of such warehouse operational profits were allocated to retail
operations.

C. NARRATIVE DESCRIPTION OF THE BUSINESS.

Retail Segment



Our food retailing segment is made up of our corporate-owned stores, which operate principally as traditional grocery stores under three store banners:
Econofoods, Sun Mart and Family Thrift Center. Our stores are typically located close to our distribution centers in order to create certain operating and logistical efficiencies. As of
December 29, 2001, we operated 110 corporate-owned stores, primarily in the Upper Midwest, including 102 traditional grocery stores, 3 Wholesale Food Outlet grocery stores, 4
BuynSave stores and 1 other retail store. We believe the operating and customer service initiatives implemented since 1998 have resulted in significant improvements in the
financial performance of our retail stores. As a result of acquisitions, new stores, and store remodels, our food retailing revenues have grown from approximately $736.5 million in fiscal 1998
to approximately $1.0 billion for fiscal 2001, and our EBITDA margin for our retail segment has expanded from 2.5% to 5.3% over the same period.



Our traditional grocery stores offer a wide variety of high quality grocery products and services. Many have specialty departments such as delicatessens,
bakeries, eat-in cafes, pharmacies, photo centers, dry cleaners, banks, floral and video rental departments. We emphasize outstanding customer service in our traditional grocery stores, as
well as our other retail stores. We have created our G.R.E.A.T. (Greet, React, Escort, Anticipate, Thank) Customer Service Program in order to train every associate on the core elements of providing
exceptional customer service. A mystery shopper visits each store every two weeks to measure performance, and we distribute the results to management and store personnel.

In
early 1999, we began redesigning our traditional grocery stores to incorporate our new "Fresh Place"® concept. "Fresh Place" is an umbrella banner that emphasizes our
traditional grocery stores' high-quality perishable products, such as fresh produce, deli, meats, seafood and baked goods, and takeout foods for today's busy consumer. Of our 102
traditional grocery stores, 29 carry the Fresh Place banner along with one of our other banners, and we intend to further expand this concept.

We
also offer other services for the convenience of shoppers such as Kids Korner . Kids Korner, which is offered in 15 store locations, is a secure, complimentary
in-store supervised play area for children. Upon entering the play area, each child is given a wristband, which will trigger an alarm if the

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child leaves the area, and the parents are given a pager so that they can be immediately contacted if there are any problems with their child. Video monitors are also placed throughout the store so
that parents can monitor their children.

All
of our new traditional grocery stores are planned to be approximately 55,000 square feet in size and will emphasize the "perimeter" sales in every store. Perimeter sales are
generally of higher margin items like perishables and service departments. We will continue to update our corporate-owned stores to maintain modern shopping facilities that compete in today's market.



Our Hispanic stores currently operate under the Wholesale Food Outlet banner and offer products geared to meet the specific tastes and needs of Hispanic shoppers,
with a focus on the higher profit products most frequently purchased by Hispanic shoppers such as produce, meats, baked goods and imported products from Mexico. In addition to a vast selection of
familiar Hispanic products, these stores have bilingual signs and product packaging, national magazines in both English and Spanish and Spanish-speaking personnel in a clean and festive environment.
These stores also provide services such as check cashing, fax services, money wiring and phone cards.

Our
Wholesale Food Outlet stores are located in Greeley, Colorado; Muscatine, Iowa; and Omaha, Nebraska. We plan to open additional Hispanic stores in 2002, under a new banner called
AVANZA which means "advance" Our three Wholesale Food Outlet stores will convert to this new banner as we roll out this store format. Our new store plan assumes a 30,000 square-foot store
that will generate approximately $480 of annual sales per square foot. We estimate that our average investment in this type of store will be approximately $2.5 million, including inventory.



In addition to responding to the changing demographics in the United States, we have also responded to the shift in income inequality with our extreme value
grocery stores operating under the BuynSave banner. BuynSave stores were designed to attract value-conscious shoppers, typically with household
incomes under $35,000, for whom low prices are a critical factor in selecting a grocery store. These stores provide a limited assortment of Grade A quality products, consisting of approximately 20%
national brands and 80% private label products, including our own proprietary labels, with savings up to 40% off comparable nationally branded items. A typical BuynSave store
is approximately 12,000 square feet in size and offers approximately 1,100 stock keeping units, or "SKUs," mostly in pallet displays. In contrast, a typical traditional grocery store may be
approximately 40,000 square feet in size and offer between 30,000 and 45,000 SKUs, of which 15% to 20% are private label products.

These
stores cost less to build, maintain and operate than our traditional grocery stores. We make a significantly lower capital investment in these stores because the format is small
and uses minimal signage and store fixtures. The size of a BuynSave store and the limited number of products offered make it easier to train associates and less expensive to
operate, which allows us to increase productivity and pass on the savings to our customers.

As
of December 29, 2001, we operated four BuynSave stores in Minnesota and plan to open additional stores in 2002. Our new store plan assumes a 12,000
square-foot store that will generate approximately $275 of annual sales per square foot. We estimate that our average investment in a BuynSave store will be
approximately $800,000, including inventory.

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Food Distribution Segment



Our food distribution segment sells and distributes a wide variety of grocery products to more than 1,500 grocery stores and institutional customers located in 24
states across the United States. Our customers are relatively diverse with the largest customer representing approximately 9.8%, and two others representing approximately 4.4% and 3.4%, of our food
distribution revenues, based on 2001 revenues. No other customer represents more than 3% of our food distribution business.
Approximately 60% of our food distribution volume is generated through our corporate-owned stores and customers with whom we have long-term sales and service agreements. The operating
efficiencies gained since 1998 have resulted in significant improvement in the financial performance of our food distribution business. Our EBITDA margin for the food distribution segment has expanded
from 2.6% in 1998 to 3.5% in 2001.



We primarily sell and distribute nationally advertised branded products and a number of unbranded products, principally meats and produce, which we purchase
directly from various manufacturers, processors and suppliers or through manufacturers' representatives and brokers. We also distribute and sell private label products that are branded primarily under
the proprietary trademarks Our Family®, a long-standing private label of Nash Finch, and Fame®. Under our private label line of products, we offer a wide variety of
competitively priced, high quality grocery products. We offer approximately 2,200 SKUs under the Our Family and Fame labels, which compete with national branded products and other value brand
products, respectively.



To further enhance our reputation and strengthen our relationships with our food distribution customers, we offer a wide variety of support services to help them
develop and operate stores, as well as compete more effectively. Some of these services include:



We
also provide financial assistance to our food distribution customers in connection with new store development or the upgrading and expansion of existing stores. As of
December 29, 2001, we had approximately $46.8 million of loans outstanding to 95 of our food distribution customers. We typically enter into long-term supply agreements with
these customers, ranging from two to 15 years, representing more than 40% of food distribution revenues. These agreements may also contain provisions that give us the opportunity to purchase
customers' independent retail businesses before any

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third party. In addition, we may assist food distribution customers by guaranteeing their loan and lease obligations

We
also distribute products to independent stores that carry our proprietary Food Pride® banner and the IGA banner. We encourage our independent customers to join one of
these banner groups to receive many of the same marketing programs and procurement efficiencies available to larger grocery store chains while allowing them to maintain their flexibility and autonomy
as independents. To use either of these banners, these independents must comply with applicable program standards. As of December 29, 2001, we served approximately 86 retail stores under our
Food Pride banner and 189 stores under the IGA banner.

Our
distribution centers are strategically located to efficiently serve our corporate-owned stores, our independent customer stores and other institutional customers. The distribution
centers are equipped with modern materials handling equipment for receiving, storing and shipping goods and merchandise and are designed for high-volume operations at low-unit
costs. Our distribution centers are profitable, yet we believe that we have substantial capacity to serve additional customers without materially increasing our costs.

Depending
upon the size of the distribution center and the profile of the customers served, our distribution centers typically carry a full line of national brand, private label and
perishable products. Non-food items and specialty grocery products are distributed from a dedicated area of the distribution
center located in Bellefontaine, Ohio, and from the distribution centers located in Sioux Falls, South Dakota. We currently have a modern fleet of 413 tractors and 888 semi-trailers, which
deliver the vast majority of our product to our customers.

Our
retailers order their inventory at regular intervals through direct linkage with our information systems. Virtually all of our food distribution sales are made on a market
price-plus-fee and freight basis, with the fee based on the type of commodity and quantity purchased. We promptly adjust our selling prices based on the latest market
information, and our freight policy contains a fuel surcharge clause which allows us to partially mitigate the impact of rising fuel costs.

Military Food Distribution Segment

Our military food segment distributes grocery products to U.S. military commissaries located predominately in the Mid-Atlantic region of the United
States. We also distribute grocery products for use on U.S. military ships afloat and U.S. military bases located in Europe. We have two distribution centers near the largest concentration of military
bases in the United States exclusively dedicated to supplying products to commissaries. These distribution centers are located in Norfolk, Virginia and Baltimore, Maryland. We have consistently
received the highest available service ratings from the Defense Commissary Agency, which performs monthly assessments of service to military commissaries. The ratings are based on service metrics
which include fill rate, on-time delivery and handling of order adjustments. We have an outstanding reputation as a supplier to U.S. military commissaries, with fill rates among the
highest in the industry.

Competition

We believe the two most comparable competitors of Nash Finch Company are Fleming Companies, Inc. and SuperValu Inc., both of whom are larger than
Nash Finch Company.



We compete on the retail grocery level in a fragmented market with many organizations of various sizes, ranging from national and regional grocery store chains to
local chains and privately owned unaffiliated stores. Although our target retail market has a very low presence of national and multi-

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regional grocery store chains, we compete with other independent grocery stores, wholesale club stores and supercenters. Depending upon the product and location involved, we compete based on price,
quality and assortment, store appeal, including store location and format, sales promotions, advertising
and convenience. We believe that by focusing on convenience, outstanding perishable execution and exceptional customer service, we can successfully compete with our competitors.

Our
Wholesale Food Outlet stores compete primarily with small independent retailers, which we believe lack the scale to have a meaningful impact on our targeted markets. Our primary
competitors for our BuynSave stores are Aldi and Save A Lot, neither of which currently has a significant presence in the Upper Midwest.



Competition among the top distributors in the food distribution segment is intense, both because of current trends toward consolidation and because of the low
margin nature of the business. Success of competitors in this segment will be measured by their ability to leverage scale in order to gain pricing advantages, providing superior merchandising programs
and services to the independent customer base and their ability to utilize technology to decrease distribution inefficiencies. We compete with local, regional and national food distributors, including
Fleming Companies and Super Valu, as well as grocery store chains that purchase from suppliers and distribute products themselves to their stores for sale to consumers. We face competition from these
companies on the basis of price, quality, variety and availability of products, strength of private label brands, schedules and reliability of deliveries, and the range and quality of services.



We face competition in our military food distribution business from large food distributors. We believe we compete effectively based on customer service, cost
operating efficiencies and the location of our military distribution centers.

Employees

As of December 29, 2001, we employed 12,755 persons, of whom 7,149 were employed on a full-time basis and 5,606 were employed on a
part-time basis. We consider our employee relations to be good. Only 558 of our employees are represented by unions. These union employees consist primarily of the distribution center
personnel and drivers in our Ohio and Michigan distribution centers. During 2002, a collective bargaining agreement covering delivery drivers in Cincinnati, Ohio comes up for renewal.

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ITEM 2. PROPERTIES

Our principal executive offices are located in Edina, Minnesota, and consist of approximately 104,496 square feet of office space in a building that we own.

Food Retailing Segment

The table below sets forth, as of December 29, 2001, selected information regarding our 110 corporate-owned stores. We own 36 and lease 74 of these stores.

|Banner                 |  | Number
of Stores |  | Areas
of Operation         |  | Average
Square Feet
|---------------------- |  | ---------------- |  | -------------------------- |  | -------------------
|Econofoods®            |  | 57               |  | IA, IL, MO, MN, SD, WI, WY |  | 37,986             
|Sun Mart®              |  | 39               |  | NE, MN, ND, CO, KS         |  | 33,892             
|Family Thrift Center  |  | 6                |  | SD                         |  | 33,394             
|Wholesale Food Outlet |  | 3                |  | CO, NE, IA                 |  | 28,784             
|BuynSave®            |  | 4                |  | MN                         |  | 14,088             
|Other Stores           |  | 1                |  | WI                         |  | 7,200              

As
of December 29, 2001, the aggregate square footage of our 110 retail grocery stores totaled 3,837,343 square feet.

Food Distribution Segment

The table below lists, as of December 29, 2001, the locations and sizes of our distribution centers primarily used in our food distribution operations.
Various of these distribution centers, however, also distribute products to military commissaries located in their geographic areas. Unless otherwise indicated, we own all of these distribution
centers. The distribution center facilities that are leased have varying terms, all with remaining terms of less than 20 years.

|Location              |                              | Approx. Size
(Square Feet)
|--------------------- | ---------------------------- | --------------------------
|Upper Midwest Region: |                              |                           
|                      | Cedar Rapids, Iowa(1)        |                           
|                      | St. Cloud, Minnesota(2)      |                           
|                      | Omaha, Nebraska              |                           
|                      | Fargo, North Dakota          |                           
|                      | Minot, North Dakota          |                           
|                      | Rapid City, South Dakota(4)  |                           
|                      | Sioux Falls, South Dakota(5) |                           
|Southeast Region:     |                              |                           
|                      | Statesboro, Georgia(6)       |                           
|                      | Lumberton, North Carolina(3) |                           
|                      | Bluefield, Virginia          |                           
|Central Region:       |                              |                           
|                      | Bellefontaine, Ohio(7)       |                           
|                      | Cincinnati, Ohio             |                           
|                      | Bridgeport, Michigan(3)      |                           
|                      |                              |                           
|Total Square Footage  |                              | 5,058,563                 
|                      |                              |                           

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Military Distribution Segment

The table below lists, as of December 29, 2001, the locations and sizes of our distribution centers exclusively used in our military distribution business.
Unless otherwise indicated, we lease each of these distribution centers. The leases have varying terms, each with a remaining term of less than 20 years.

|Location             |  | Approx. Size
(Square Feet)
|-------------------- |  | --------------------------
|Baltimore, Maryland  |  | 350,500                   
|Norfolk, Virginia(1) |  | 568,600                   
|                     |  |                           
|Total Square Footage |  | 919,100                   
|                     |  |                           

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ITEM 3. LEGAL PROCEEDINGS

The Company is engaged from time to time in routine legal proceedings incidental to our business. We do not believe that any pending legal proceedings will have a
material impact on the business or financial condition of Nash Finch Company and its subsidiaries, taken as a whole.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this Report.

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ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth information about our executive officers as of March 1, 2002:

|Name                 |  | Age |  | Year First Elected or
Appointed as an
Executive Officer |  | Title                                                    
|-------------------- |  | --- |  | ------------------------------------------------------- |  | ---------------------------------------------------------
|Ron Marshall         |  | 47  |  | 1998                                                    |  | President and Chief Executive Officer                    
|Christopher A. Brown |  | 39  |  | 1999                                                    |  | Executive Vice President  Merchandising                 
|Jerry L. Nelson      |  | 55  |  | 2000                                                    |  | Executive Vice President  President, Food Distribution  
|Bruce A. Cross       |  | 49  |  | 1998                                                    |  | Sr. Vice President  Business Transformation             
|Robert B. Dimond     |  | 40  |  | 2000                                                    |  | Sr. Vice President, Chief Financial Officer and Treasurer
|James R. Dorcy       |  | 42  |  | 2001                                                    |  | Sr. Vice President  Corporate Retail                    
|Norman R. Soland     |  | 61  |  | 1986                                                    |  | Sr. Vice President, Secretary and General Counsel        
|Rose M. Bailey       |  | 51  |  | 2001                                                    |  | Vice President  Human Resources                         
|Jeffrey E. Poore     |  | 43  |  | 2001                                                    |  | Vice President  Distribution and Logistics              
|LeAnne M. Stewart    |  | 37  |  | 1999                                                    |  | Vice President and Corporate Controller                  

There
are no family relationships between or among any of our executive officers or directors. Our executive officers are elected by the Board of Directors for one-year
terms, commencing with their election at the first meeting of the Board of Directors immediately following the annual meeting of stockholders and continuing until the next such meeting of the Board of
Directors.

Ron Marshallhas served as our President and Chief Executive Officer and a director since June 1998. Mr. Marshall previously
served as Executive Vice President and Chief Financial Officer of Pathmark Stores, Inc., a grocery store chain, from September 1994 to May 1998.

Christopher A. Brownhas served as Executive Vice President, Merchandising since October 1999. Prior to joining us,
Mr. Brown was employed for over five years by Richfood Holdings, Inc., a food wholesaler and retailer. At Richfood Holdings, Inc., he served in various executive positions,
including Executive Vice President, Procuring and Merchandising of the Farm Fresh Division from October 1998 to October 1999, Executive Vice President, Procurement for Richfood
Holdings, Inc. from April 1997 to October 1998, Senior Executive Vice President of Super Rite Foods division from March 1996 to April 1997 and President and Chief
Operating Officer of Rotelle, Inc., a subsidiary, from August 1994 to March 1996.

Jerry L. Nelsonhas served as our Executive Vice President, PresidentFood Distribution since October 2000. He
previously served as our operating Senior Vice President, Midwest Region, from April 2000 to October 2000, and as operating Vice President, Midwest Region, from November 1999 to
April 2000. Prior to joining us, he served as Executive Vice President of Hagemeyer N.A., a specialty food distributor, from March 1997 to June 1999. From March 1995 to
August 1996, he served as Operating Group President of Fleming Companies Inc., a food wholesaler and retailer.

Bruce A. Crosshas served as our Senior Vice President, Business Transformation since May 2000. He served as Senior Vice President
and Chief Information Officer from September 1998 to May 2000.
Mr. Cross previously served as Senior Project Executive for IBM Global Services, a strategic technical outsourcing and business consulting firm, from January 1995 to
September 1998.

Robert B. Dimondhas served as our Senior Vice President and Chief Financial Officer since October 2000 and as Treasurer since
May 2001. Mr. Dimond previously served as Group Vice President and Chief Financial Officer for the western region of Kroger Co., a grocery store chain, from

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March 1999 to September 2000. From February 1992 until March 1999, he served as Group Vice President, Administration and Controller, for Smith's Food & Drug
Centers, Inc., a grocery store chain.

James R. Dorcyhas served as our Senior Vice President, Corporate Retail since November 2001. He previously served as Vice
President, Marketing and Advertising from February 2000 to November 2001. From December 1998 to November 1999, Mr. Dorcy served as Vice President, Advertising and
Marketing for Farm Fresh Inc., a grocery store chain. From November 1994 to December 1998, he served as Vice President, Advertising and Marketing for Bozzuto's, Inc., a
food wholesaler and retailer.

Norman R. Solandhas served as our Senior Vice President since July 1998, and has served as Secretary and General Counsel since
January 1986. He served as our Vice President, Secretary and General Counsel from May 1988 to July 1998.

Rose M. Baileyhas served as our Vice President, Human Resources since February 2001. She previously served as Director of Human
Resource Programs for Arcadia Financial, a buyer and servicer of automobile loans, from February 1998 to January 2001. From March 1979 to January 1997, she served as Vice
President of Human Resources for County Seat Stores, Inc., a retailer of specialty clothing.

Jeffrey E. Poorehas served as our Vice President, Distribution and Logistics since May 2001. Since 1996 Mr. Poore served in
various positions with SuperValu Inc., a food wholesaler and retailer, most recently as Vice President, Logistics from January 1999 to April 2001. Before joining SuperValu,
Mr. Poore served as the Director of Logistics for SUN TV & Appliance, Inc. from December 1995 to September 1996.

LeAnne M. Stewarthas served as our Vice President since July 1999, as Controller since April 2000, and served as Treasurer
from May 2000 to May 2001. Prior to her election as Controller, Ms. Stewart served as our Vice President, Financial Planning and Analysis. Prior to joining us, she served as
Manager, Corporate Finance for Enron Europe Limited, an international energy company, from August 1997 to March 1999. From December 1987 to July 1995, she served in various
positions ranging from staff accountant to senior manager at Ernst & Young LLP.

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PART II

ITEM 5.  MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Our common stock is listed on the Nasdaq National Market and trades under the symbol NAFC. The following table sets forth, for each of the calendar periods
indicated, the range of high and low closing sales prices for the common stock as reported by the Nasdaq National Market, and the quarterly cash dividends paid per share of common stock. Prices do not
include adjustments for retail mark-ups, mark-downs or commissions. At December 29, 2001 there were 2,710 stockholders of record.

2001

2000

Dividends
Per ShareHigh

Low

High

Low

2001

2000First Quarter

17.50

11.81

9.00

6.00

.09

.09Second Quarter

24.00

17.19

9.13

7.13

.09

.09Third Quarter

35.54

21.91

10.81

8.19

.09

.09Fourth Quarter

31.10

20.65

13.56

10.50

.09

.09


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Item 6. Selected Financial Data

Nash Finch Company and Subsidiaries
Consolidated Summary of Operations
Ten years ended December 29, 2001 (not covered by Independent Auditors' Report)

|(Dollar amounts in thousands except
per share amounts)                        |                                                        | 2001
(52 weeks) |           | 2000
(52 weeks) |           | 1999
(52 weeks) |           | 1998
(52 weeks) |           | 1997
(53 weeks) |           | 1996
(52 weeks) |           | 1995
(52 weeks) |           | 1994
(52 weeks) |           | 1993
(52 weeks) |           | 1992
(53 weeks)
|----------------------------------------------------------------------------- | ------------------------------------------------------ | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | --------------- | --------- | ---------------
|Total sales and revenues                                                      |                                                        | $               | 4,107,434 |                 | 3,955,767 |                 | 4,060,852 |                 | 4,113,463 |                 | 4,292,055 |                 | 3,301,544 |                 | 2,811,032 |                 | 2,763,916 |                 | 2,662,223 |                
|Cost of sales including warehousing and transportation expenses               |                                                        |                 | 3,645,333 |                 | 3,517,528 |                 | 3,664,107 |                 | 3,756,407 |                 | 3,899,802 |                 | 2,978,529 |                 | 2,513,325 |                 | 2,458,666 |                 | 2,372,408 |                
|Selling, general and administrative, and other operating expenses             |                                                        |                 | 344,905   |                 | 330,966   |                 | 305,843   |                 | 274,224   |                 | 286,068   |                 | 244,372   |                 | 234,989   |                 | 241,137   |                 | 230,155   |                
|Special charges                                                               |                                                        |                 |          |                 |          |                 | (7,045    | )               | 68,471    |                 | 30,034    |                 |          |                 |          |                 |          |                 |           |                
|Interest expense                                                              |                                                        |                 | 34,303    |                 | 34,444    |                 | 29,931    |                 | 27,651    |                 | 29,086    |                 | 12,991    |                 | 7,530     |                 | 8,444     |                 | 7,466     |                
|Depreciation and amortization                                                 |                                                        |                 | 46,601    |                 | 45,330    |                 | 41,563    |                 | 45,128    |                 | 45,819    |                 | 33,141    |                 | 27,803    |                 | 30,242    |                 | 27,730    |                
|Provision for income taxes                                                    |                                                        |                 | 15,025    |                 | 11,659    |                 | 11,216    |                 | (18,837   | )               | 2,320     |                 | 13,174    |                 | 10,748    |                 | 10,148    |                 | 10,047    |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Net earnings (loss) from continuing operations                                |                                                        | $               | 21,267    |                 | 15,840    |                 | 15,237    |                 | (39,581   | )               | (1,074    | )               | 19,337    |                 | 16,637    |                 | 15,279    |                 | 14,417    |                
|Earnings (loss) from discontinued operations, net of income tax (benefit)     |                                                        |                 |          |                 |          |                 |          |                 | 426       |                 | (154      | )               | 695       |                 | 777       |                 | 201       |                 | 1,457     |                
|Earnings (loss) on disposal of discontinued operations, net of income tax     |                                                        |                 |          |                 |          |                 | 4,566     |                 | (16,913   | )               |          |                 |          |                 |          |                 |          |                 |          |                
|Extraordinary charge from early extinguishment of debt, net of income tax     |                                                        |                 |          |                 | 369       |                 |          |                 | 5,569     |                 |           |                 |           |                 |           |                 |           |                 |           |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Net earnings (loss)                                                           |                                                        | $               | 21,267    |                 | 15,471    |                 | 19,803    |                 | (61,637   | )               | (1,228    | )               | 20,032    |                 | 17,414    |                 | 15,480    |                 | 15,874    |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Basic earnings (loss) per share:                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|                                                                              | Earnings (loss) from continuing operations             |                 | $         | 1.83            |           | 1.38            |           | 1.35            |           | (3.50           | )         | (0.10           | )         | 1.77            |           | 1.53            |           | 1.40            |           | 1.33           
|                                                                              | Earnings (loss) from discontinued operations           |                 |           |                |           |                |           | 0.40            |           | (1.46           | )         | (0.01           | )         | 0.06            |           | 0.07            |           | 0.02            |           | 0.13           
|                                                                              | Extraordinary charge from early extinguishment of debt |                 |           |                |           | (0.03           | )         |                |           | (0.49           | )         |                 |           |                 |           |                 |           |                 |           |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Basic earnings (loss) per share                                               |                                                        | $               | 1.83      |                 | 1.35      |                 | 1.75      |                 | (5.45     | )               | (0.11     | )               | 1.83      |                 | 1.60      |                 | 1.42      |                 | 1.46      |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Diluted earnings (loss) per share:                                            |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|                                                                              | Earnings (loss) from continuing operations             |                 | $         | 1.78            |           | 1.38            |           | 1.34            |           | (3.50           | )         | (0.10           | )         | 1.75            |           | 1.53            |           | 1.40            |           | 1.33           
|                                                                              | Earnings (loss) from discontinued operations           |                 |           |                |           |                |           | 0.40            |           | (1.46           | )         | (0.01           | )         | 0.06            |           | 0.07            |           | 0.02            |           | 0.13           
|                                                                              | Extraordinary charge from early extinguishment of debt |                 |           |                |           | (0.03           | )         |                |           | (0.49           | )         |                 |           |                 |           |                 |           |                 |           |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Diluted earnings (loss) per share                                             |                                                        | $               | 1.78      |                 | 1.35      |                 | 1.74      |                 | (5.45     | )               | (0.11     | )               | 1.81      |                 | 1.60      |                 | 1.42      |                 | 1.46      |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Cash dividends declared per common share                                      |                                                        | $               | .36       |                 | .36       |                 | .36       |                 | .72       |                 | .72       |                 | .75       |                 | .74       |                 | .73       |                 | .72       |                
|                                                                              |                                                        |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                 |           |                
|Pretax earnings from continuing operations as a percent of sales and revenues |                                                        |                 | 0.88      | %               | 0.70      |                 | 0.65      |                 |          |                 |          |                 | 0.98      |                 | 0.97      |                 | 0.92      |                 | 0.92      |                
|Net earnings (loss) as a percent of sales and revenues                        |                                                        |                 | 0.52      | %               | 0.39      |                 | 0.49      |                 | (1.50     | )               | (0.03     | )               | 0.61      |                 | 0.62      |                 | 0.56      |                 | 0.60      |                
|Effective income tax rate                                                     |                                                        |                 | 41.4      | %               | 42.4      |                 | 42.4      |                 | (32.2     | )               | 425.4     |                 | 40.5      |                 | 39.1      |                 | 40.0      |                 | 40.5      |                
|Current assets                                                                |                                                        | $               | 479,363   |                 | 433,539   |                 | 465,563   |                 | 467,108   |                 | 494,350   |                 | 525,596   |                 | 311,690   |                 | 309,522   |                 | 294,925   |                
|Current liabilities                                                           |                                                        | $               | 383,624   |                 | 324,786   |                 | 327,327   |                 | 331,473   |                 | 294,419   |                 | 297,088   |                 | 207,688   |                 | 220,065   |                 | 215,021   |                
|Net working capital                                                           |                                                        | $               | 95,739    |                 | 108,753   |                 | 138,236   |                 | 135,635   |                 | 199,931   |                 | 228,508   |                 | 104,002   |                 | 89,457    |                 | 79,904    |                
|Ratio of current assets to current liabilities                                |                                                        |                 | 1.25      |                 | 1.33      |                 | 1.42      |                 | 1.41      |                 | 1.68      |                 | 1.77      |                 | 1.50      |                 | 1.41      |                 | 1.37      |                
|Total assets                                                                  |                                                        | $               | 970,245   |                 | 880,828   |                 | 862,443   |                 | 833,095   |                 | 904,883   |                 | 945,477   |                 | 514,260   |                 | 531,604   |                 | 521,654   |                
|Capital expenditures                                                          |                                                        | $               | 43,924    |                 | 54,066    |                 | 52,282    |                 | 52,730    |                 | 67,725    |                 | 51,333    |                 | 33,264    |                 | 34,965    |                 | 36,382    |                
|Long-term obligations (long-term debt and capitalized lease obligations)      |                                                        | $               | 368,807   |                 | 353,664   |                 | 347,809   |                 | 327,947   |                 | 364,006   |                 | 403,651   |                 | 81,188    |                 | 95,960    |                 | 97,887    |                
|Stockholders' equity                                                          |                                                        | $               | 203,408   |                 | 184,540   |                 | 172,674   |                 | 156,473   |                 | 225,618   |                 | 232,861   |                 | 215,313   |                 | 206,269   |                 | 199,264   |                
|Stockholders' equity per share(1)                                             |                                                        | $               | 17.43     |                 | 16.12     |                 | 15.22     |                 | 13.80     |                 | 19.96     |                 | 21.06     |                 | 19.80     |                 | 18.97     |                 | 18.33     |                
|Return on stockholders' equity(3)                                             |                                                        |                 | 10.46     | %               | 8.58      |                 | 8.82      |                 | (25.30    | )               | (0.48     | )               | 8.30      |                 | 7.73      |                 | 7.41      |                 | 7.24      |                
|Number of common stockholders of record at year-end                           |                                                        |                 | 2,710     |                 | 2,786     |                 | 2,348     |                 | 2,214     |                 | 2,226     |                 | 2,230     |                 | 1,940     |                 | 2,074     |                 | 2,074     |                
|Common stock high price(2)                                                    |                                                        | $               | 35.54     |                 | 13.56     |                 | 14.50     |                 | 20.00     |                 | 24.88     |                 | 21.75     |                 | 20.50     |                 | 18.25     |                 | 23.25     |                
|Common stock low price(2)                                                     |                                                        | $               | 11.81     |                 | 6.00      |                 | 5.88      |                 | 13.13     |                 | 17.50     |                 | 15.50     |                 | 15.75     |                 | 15.38     |                 | 17.00     |                

---

(1)    Based
on average outstanding shares at year-end.

(2)    High
and low closing sales price.

(3)    Return
based on continuing operations.

14

---



ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

1. Fiscal 2001 vs. 2000

Revenues

Total revenues for 2001 were $4.107 billion compared to $3.956 billion for 2000, an increase of 3.8%. The increase is attributed to new food
distribution and military business Nash Finch Company (the "Company") has been able to capture during the year. The distribution of total revenues by operating segment is as follows:

Operating segments

2001

2000Food distribution

50.6
%
49.5
%Retail

25.2
%
26.0
%Military

24.2
%
24.5
%100.0
%
100.0
%


Food
distribution segment revenues for the year were $2.077 billion compared to $1.958 billion in 2000, an increase of 6.1%. The increase is primarily attributed to new
food distribution customers as the Company continues to improve service to new and existing customers. In addition, food distribution revenues were improved by the transfer of revenues from the retail
segment as a result of the sale of 18 corporate-owned retail stores, in North and South Carolina to existing food distribution customers during 2001.

Retail
segment revenues were $1.035 billion for the year, compared to $1.029 billion last year, an increase of .6%. The improvement is largely due to the acquisition of 14
stores from U Save Foods, Inc. ("U Save"), on August 13, 2001, offset by the sale of stores in the Southeast. U Save, a privately held company, operated stores primarily in Nebraska. All
of the stores acquired have been converted to the Company's primary banners. The sale of the Southeast stores allows the Company to focus its retail strategy on store operations in the upper Midwest.

The
Company has developed two specialty store formats. The first is designed to service a rapidly growing Hispanic market, which the Company believes has not been adequately served by
traditional grocery stores. The Company currently operates three Hispanic oriented stores in the Midwest, and has announced a new banner for this format called AVANZA. The first AVANZA store will open
in the second quarter of 2002 in Denver, Colorado. A second format, under the name BuynSave is targeted to service the value conscious consumer. At December 29, 2001,
four BuynSave stores were in operation, with a plan to roll out three additional stores in the first quarter of 2002.

Same
store sales for 2001 declined by 1%, a direct result of reductions in promotional activity compared to last year and competitive pressures in certain markets. During 2001, the
Company's corporate store count changed as follows:

Fiscal Year
2001Number of stores at beginning of year

118New stores

2Acquired stores

15Closed or sold stores

(25
)Number of stores at end of year

110


15

---

Military
segment revenues were $996 million for the year compared to $969 million last year, an increase of 2.8%. The improvement reflects an addition of new business in
Europe and North Carolina, awarded to the Company late last year by a major manufacturer. The deployment of military forces in response to the September 11 terrorist attacks has had some
impact, though not significant, on the military business.

Gross Margins

Gross margins were 11.3% in 2001, compared to 11.1% last year. The margin improvements are attributed to increased productivity, efficient utilization of
distribution facilities, improved sales mix of private label and value-added products in retail stores and increased procurement efficiencies. In 2001, gross margins were decreased by a LIFO charge of
$2.7 million, or .07% as a percent of sales, compared to a LIFO credit of $1.1 million, or .03% as a percent of sales, which increased gross margins in 2000. The charge in 2001 is due to
food price inflation and increased inventory levels to accommodate new business.

Selling, General and Administrative Expense

Selling, general and administrative expenses as a percent of total revenues were 8.4% in both 2001 and 2000. Selling, general and administrative expenses in 2001
include retail store impairments of $1.9 million. The write-down of long-lived assets results from the Company's intention to close two stores, as well as changes in
circumstances in three other stores indicating the carrying value of the assets may not be recoverable. There were no impairment charges recorded in 2000. In addition, selling, general and
administrative expense for 2001 and 2000 includes gains from the sale of real estate in the amounts of $2.6 million and $3.0 million, respectively. Substantially all of the gain in 2001
relates to the sale of real estate associated with a distribution center closed as part of the 1998 revitalization plan. Lease related costs associated with stores closed in 2001 and 2000 were
$1.1 million and $2.7 million, respectively.

Depreciation and Amortization Expense

Depreciation and amortization expense for the year was $46.6 million compared to $45.3 million in 2000, an increase of 2.8%. The increase primarily
reflects the addition of several new stores in 2000 and 2001 and the acquisition of U Save, partially offset by the sale of the Southeast stores. Goodwill, in the amount of $27.9 million,
recorded as a result of the U Save acquisition is not subject to amortization in accordance with new accounting pronouncements, but must be tested at least annually for impairment. Refer to New
Accounting Standards in Note (1) of Notes to Consolidated Financial Statements. Amortization of goodwill and other intangibles for the year was $8.0 million compared to
$8.4 million in 2000.

Interest Expense

Interest expense for the year was relatively flat at $34.3 million compared to $34.4 million in 2000. Higher interest costs under the revolving
credit facility resulted from the Company fixing a rate under a swap agreement which expired on December 6, 2001. The average borrowing rate under the revolving credit facility including the
impact of the interest swap was 8.48% in 2001 compared to 7.97% in 2000. The rate difference was offset by an average revolving debt level that was $23.4 million lower compared to 2000. The
acquisition of U Save was funded through the revolving credit facility.

16

---

Income Taxes

The effective income tax rate for 2001 was 41.4% compared to 42.4% in 2000. The rate reduction is attributed to a decrease in the ratio of nondeductible goodwill
to pretax income. Refer to the tax rate tables in Note (6) of Notes to Consolidated Financial Statements for the comparative components of these rates.

Net Earnings

Net earnings for the year increased to $21.3 million, or $1.78 per diluted share, compared to $15.8 million, or $1.38 per diluted share in 2000,
before an extraordinary charge related to the refinancing of the Company's revolving credit facility in December 2000. The improvement over last year is attributable to the increased
performance in each business segment. Food distribution pretax profitability increased 27% to $60.7 million from $47.8 million in 2000, due to the new business added during the year and
continuing operational improvements. Retail segment pretax profit increased 17% to $38.8 million compared to $33.3 million in 2000, due to improvements in gross margins and planned
reductions in promotional activities. Military segment pretax profit increased 6.9% to $23.1 million compared to $21.6 million last year. The addition of new business late last year
contributed to the year over year profit increase. Segment pretax profitability was partially offset by an increase of $7.3 million in unallocated corporate expenses primarily related to
performance based compensation and a LIFO charge of $2.7 million.

1998 Special Charges

During the fourth quarter of 1998, the Company recorded special charges totaling $71.4 million (offset by $2.9 million of 1997 charge adjustments)
as a result of the Company's revitalization plan designed to redirect its technology efforts, optimize warehouse capacity through consolidation, and to close, sell or reassess under-performing
businesses and investments.

In
conjunction with the implementation of the Company's 1998 revitalization plan, the Company designated five warehouses and 12 under-performing stores for closure. During 1999,
adjustments to the plan involved decisions to close four additional stores and to indefinitely defer the closure of two distribution centers and one retail store. Accordingly, during the fourth
quarter of 1999, the Company reversed $7.0 million of expected costs associated with these decisions. All actions contemplated by the original 1998 plan and subsequent revisions have been
implemented. The Company does not expect any future adverse impact on earnings to result from any of the continuing issues under the 1998 special charges.

During
fiscal 2001, the activity recorded through the remaining special charge accrual included $.7 million of pension benefits related to the distribution segment and
$.8 million in continuing lease and
exit costs related to closed retail stores. As of December 29, 2001, the food distribution portion of the special charge liability consisted of $.9 million related to certain pension and
post-employment benefits. Also, liabilities in the amount of $5.1 million remain related to continuing lease commitments and occupancy costs associated with retail stores closed
under the 1998 special charge. The Company is actively seeking to sublease these properties.

17

---

2. Fiscal 2000 vs. 1999

Revenues

Total revenues for 2000 were $3.956 billion compared to $4.061 billion for 1999, a decrease of 2.6%. The revenue decline was primarily due to the
consolidation of distribution centers in 1999 which were part of the Company's strategic plan to close underutilized facilities and concentrate sales volume into existing distribution centers, thereby
improving efficiency, service and distribution costs to the retailer. In 2000, this strategy was a factor in the Company attracting new food distribution and military business. The distribution of
revenues by operating segment is as follows:

Operating segments

2000

1999Food distribution

49.5
%
55.4
%Retail

26.0
%
21.0
%Military

24.5
%
23.6
%100.0
%
100.0
%


Food
distribution segment revenues for the year were $1.958 billion compared to $2.248 billion in 1999, a decrease of 12.9%. The decline was largely attributed to two
factors: the closure of five distribution centers in 1999, resulting in a loss of volume and the acquisitions of two previous food distribution customers, Hinky Dinky Supermarkets, Inc. ("Hinky
Dinky") in January 2000 and Erickson's Diversified Corporation ("Erickson's") in June 1999, which resulted in the reporting of 2000 revenues in the retail segment instead of the food
distribution segment. During the last half of 2000, the Company successfully gained the food distribution business of Food Farm, Inc., a consortium of 63 Piggly Wiggly stores in the Southeast,
representing more than $200 million in annualized revenues.

Retail
segment revenues were $1.029 billion for the year, compared to $853.1 million last year, an increase of 20.6%. The improvement was largely the result of the
acquisition of the 12-store Hinky Dinky chain in Nebraska in January 2000, the opening of new replacement stores in Marshalltown and Cedar Rapids, Iowa, an additional store in Rochester,
Minnesota and the acquisition of three conventional stores in the Midwest. In addition, the acquisition of 18 stores operated by Erickson's in June 1999 also contributed to the favorable year
over year comparison.

Same
store sales for the year were relatively flat compared to last year. During the year the Company's corporate store count changed as follows:

Fiscal Year
2000Number of stores at beginning of year

114New stores

5Acquired stores

15Closed or sold stores

(16
)Number of stores at end of year

118


Military
segment revenues for the year were $969 million compared to $960 million 1999, an increase of 1.0%. The improvement for the year partially reflected the addition
of new distribution business in Europe and North Carolina, awarded to the Company in the third quarter by a major manufacturer.

Gross Margins

Gross margins were 11.1% in 2000, compared to 9.8% in 1999. The increase in 2000 over the last year reflects the growth in the proportion of higher margin retail
revenues. In addition, efficiencies in

18

---

warehousing and transportation resulting from facility consolidations, operational and system improvements favorably impacted gross margins. The Company implemented processes to continuously monitor
costs by analyzing key measures of operating performance such as delivery equipment utilization, on-time deliveries, product fill rates and the cost per case of handling and shipping
goods, against predetermined standards. Improvements in product procurement resulted from leveraging the Company's buying power through three regional procurement offices and partnering with vendors
to implement more effective merchandising programs also contributed to improved gross margins.

In
2000, the Company recorded a LIFO credit of $1.1 million compared to a credit of $.9 million in 1999. Although the Company believes that there was inflation in product
pricing, it has experienced deflation in costs of products due to efficiencies and economies brought about by leveraging volume and improvements in its procurement processes.

Selling, General and Administrative Expense

Selling, general and administrative expenses as a percent of total revenues were 8.4% in 2000 compared to 7.5% in 1999. The increase in 2000 over 1999 was
substantially due to the increasing proportion of corporate-owned retail business, which typically operates at higher expense levels as a percent of revenues than does the food distribution segment.
During 2000, the Company recorded an additional provision for bad debts of $7.4 million, compared to $4.4 million last year. The increase relates primarily to certain accounts within the
Michigan and Ohio market areas, where the Company has focused efforts to minimize credit risks.

Depreciation and Amortization Expense

Depreciation and amortization expense for the year was $45.3 million compared to $41.6 million in 1999, an increase of 8.9%. The increase primarily
reflected a full year's depreciation and goodwill amortization expense related to the acquisitions of Erickson's and Hinky Dinky. In addition, an expansion of the Lumberton, North Carolina
distribution center and the construction of seven new stores and 43 remodeled stores during the year also contributed to the increased expense.

Interest Expense

Interest expense for 2000 was $34.4 million compared to $29.9 in 1999, an increase of 15.1%. The higher interest costs are attributed to higher average
borrowing rates which were 7.97% in 2000 compared to 7.04% in 1999. In addition, average revolving debt levels increased in 2000, resulting from the acquisition of Hinky Dinky and various major
capital expansion projects, which also contributed to the higher interest costs.

Net Earnings

Net earnings for 2000 increased to $15.8 million, or $1.38 per diluted share, excluding non-recurring items compared to $9.4 million, or
$.82 per diluted share, in 1999, excluding non-recurring items. The improvement over 1999 can be attributed to a number of factors: the successful integration of the Hinky Dinky stores;
the continued strong performance by the Erickson's stores; efficiency gains and new business in the food distribution segment. Including the reversal of restructuring charges,
non-recurring gains on the 1999 sales of the Company's produce growing and marketing subsidiary, Nash-DeCamp, and majority investments in two dairy operations as well as the
write off of unamortized financing costs in 2000, net earnings were $15.5 million or $1.35 per diluted

19

---

share compared to $19.8 million or $1.74 per diluted share last year. The following table illustrates the comparative results (in thousands):

2000

1999Net earnings

$
15,471

19,803Add (deduct) non-recurring items net of tax:Extraordinary charge


369

Gain on disposal of discontinued operation




(4,566
)Special charges reversal




(4,058
)Gain on sale of dairy operation




(1,807
)Comparable net earnings

$
15,840

9,372Comparable diluted earnings per share

$
1.38

.82


Income Taxes

The effective income tax rate for 2000 was unchanged from the 42.4% rate reported in 1999. Refer to the tax rate tables in Note (6) of Notes to
Consolidated Financial Statements for the comparative components of these rates.

Extraordinary Charge

In December 2000, the Company completed the refinancing of its revolving credit facility. The transaction resulted in the write-off of
unamortized financing costs associated with the previous facility, which has been classified as an extraordinary charge of $.4 million, or $.03 per share, net of income tax benefit.

EBITDA

The Company's new revolving credit facility contains various restrictive covenants. Several of these covenants are based on earnings from operations before
interest, taxes, depreciation, amortization and non-recurring items (EBITDA). The ability to generate EBITDA sufficient to satisfy the requirements of the credit facility is an important
measure of the Company's financial strategy. This information is not intended as an alternative to performance measures under generally accepted accounting principles, but rather as a presentation
important for understanding the Company's performance relative to its debt covenants.

As
of December 29, 2001, the Company is in compliance with all EBITDA based debt covenants. The following is a summary of the calculation of EBITDA (in thousands) for 2001, 2000
and 1999.

|                                                                                 |  | 2001 |         | 2000 |         | 1999 |       
|-------------------------------------------------------------------------------- |  | ---- | ------- | ---- | ------- | ---- | ------
|Earnings from continuing operations before income taxes and extraordinary charge |  | $    | 36,292  |      | 27,499  |      | 26,453
|Special charges (reversals)                                                      |  |      |        |      |        |      | (7,045
|LIFO effect                                                                      |  |      | 2,661   |      | (1,092  | )    | (859  
|Depreciation and amortization                                                    |  |      | 46,601  |      | 45,330  |      | 41,563
|Interest expense                                                                 |  |      | 34,303  |      | 34,444  |      | 29,931
|Gain on sale of dairies                                                          |  |      |        |      |        |      | (3,137
|Other non-recurring items                                                        |  |      | 389     |      | (232    | )    | 262   
|                                                                                 |  |      |         |      |         |      |       
|Total EBITDA                                                                     |  | $    | 120,246 |      | 105,949 |      | 87,168
|                                                                                 |  |      |         |      |         |      |       

20

---

Critical Accounting Policies

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions in
applying certain critical accounting policies. Critical accounting policies are those that require the most subjective and complex judgments. The following are considered by the Company to be critical
and could result in materially different amounts being reported under different conditions or using different assumptions:

Allowance for Doubtful AccountsMethodology

We evaluate the collectibility of our accounts and notes receivable based on a combination of factors. In most circumstances when we become aware of factors that
may indicate a deterioration in a specific customer's ability to meet its financial obligations to us (e.g., reductions of product purchases, deteriorating store conditions, changes in payment
patterns), we record a specific reserve for bad debts against amounts due to reduce the net recognized receivable to the amount we reasonably believe will be collected. If circumstances change (i.e.,
further evidence of material adverse credit worthiness, additional accounts become credit risks, store closures), our estimates of the recoverability of amounts due us could be reduced by a material
amount, including to zero.

Guarantees of Debt and Lease Obligations of Others

We have guaranteed the debt and lease obligations of certain of our food distribution customers. In the event these retailers are unable to meet their debt
service payments or otherwise experience an event of default, we would be unconditionally liable for the outstanding balance of their debt and lease obligations ($26.0 million as of
December 29, 2001), which would be due in accordance with the underlying agreements. Triggering the guarantee would not however, result in cross default of the Company debt, but could restrict
resources available for general business initiatives.

Debt Covenants

Our debt agreements require us to maintain certain financial ratios and a minimum level of net worth as discussed in Note (5) of Notes to Consolidated
Financial Statements. We have complied with these covenants as of December 29, 2001. We believe maintaining our current level of operating results makes the likelihood of defaulting on our debt
covenants unlikely absent any material negative event affecting the U.S. economy as a whole. We also believe our lenders would provide us waivers if necessary. However, our expectations of future
operating results and continued compliance with our debt covenants cannot be assured and our lender's actions are not controllable by us. If our projections of future operating performance are not
achieved and our debt is placed in default, we would experience a material adverse impact on our reported financial position and results of operations.

Lease Commitments

The Company has historically leased store sites for sublease to qualified independent retailers, at rates that are at least as high as the rent paid by the
Company. The Company also leases store sites for its retail segment. Under terms of the original lease agreements, the Company remains primarily liable for any commitments a retailer may no longer be
financially able to satisfy as well as those of its own stores. Should a retailer be unable to perform under the sublease or should the Company close underperforming corporate stores, the Company
records a charge to earnings for costs of the remaining
term of the lease, less any anticipated sublease income. More often than not, the Company has been able to re-sublease such locations to other qualified retailers with minimal interruption
of sublease recoveries and cost to the Company. Should the number of defaults by sublessees or corporate store closures increase, the remaining lease commitments the Company must record could have a
material adverse effect on operating results and cash flows. Refer to Note (9) of Notes to Consolidated Financial Statements for a discussion of lease commitments.

21

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Impairment of Long-lived Assets

Impairment losses are recognized whenever events or changes in circumstances indicate the carrying amount of an asset is not recoverable. The Company considers
historical performance and estimated future results in its evaluation of potential impairment. Future results are often influenced by assessments of changes in competition, merchandising strategies,
human resources and general market conditions, which may result in not recognizing an impairment loss. No assurance can be given that these assessments and implementation of any resulting initiatives
will result in profit margins sufficient to recover the carrying value of long lived assets.

Deferred Tax Assets

As of December 29, 2001, we have approximately $18.3 million of net deferred tax assets related principally to obligations to be settled in future
periods for which no valuation allowance has been recorded. The realization of these net assets is based primarily upon estimates of future taxable income. Current operating results are sufficient to
sustain realization of these net assets. However, should significant reductions in taxable income occur, realization of net tax assets may be prevented.

LIQUIDITY AND CAPITAL RESOURCES

Historically, the Company has financed capital needs through a combination of internal and external sources. These sources include cash flow from operations,
short-term bank borrowings, various types of long-term debt and lease and equity financing.

Operating
cash flows were $89.5 million during 2001 compared to $85.5 million in 2000 and $52.1 million in 1999. The changes in operating cash flows in 2001 were
primarily due to changes in operating assets and liabilities. Accounts receivable increased due to the discontinuance of a receivables securitization program. The lower cash flows in 1999 were
primarily due to cash commitments under the 1998 special charges offset by reductions in accounts receivable and inventories. Working capital was $95.7 million at the end of 2001 compared to
$108.8 at the end of 2000, a decrease of $13.1 million, reflecting management's efforts to minimize its investment in operating assets.

Cash
used for investing activities for the year were $93.3 million compared to $85.7 million in 2000, and $54.0 million in 1999. Investing activities in 2001
consisted primarily of the following: business acquisitions of $47.7 million, primarily attributed to U-Save; and capital expenditures of $43.9 million. Investing activities
for 2000 included: capital expenditures of $54.1 million; business acquisitions of $20.0 million, which consisted of Hinky Dinky and three stores in the Midwest; and loans to customers,
net of payments received, totaling $14.9 million. In 1999, investing activities included: capital expenditures of $52.3 million; business acquisitions of $67.1 million consisting
of Erickson's and two stores each in South Carolina and Wyoming, offset by cash proceeds of $30.0 million from the sale of Nash DeCamp and two dairy operations. The Company has funded investing
activities from both cash generated from operations and its revolving credit facilities. It expects to continue to use these as its principle sources of future funding.

The
Company has certain contractual obligations that extend beyond 2002. These commitments include long-term debt and capital and operating lease obligations, primarily
related to store locations

22

---

for the Company's retail segment, as well as store locations subleased to independent food distribution customers. The following summarizes these contractual cash obligations as of
December 29, 2001:

|                                   |  | Payments Due by Period
|---------------------------------- |  | ----------------------
|
|Long Term Debt(1)                  |  | 325,028               
|Capital Lease Obligations(2)(3)    |  | 93,086                
|Operating Leases(2)                |  | 203,693               
|                                   |  |                       
|Total Contractual Cash Obligations |  | 621,807               

---

The
Company also has made certain commercial commitments that extend beyond 2002. These commitments include standby letters of credit and guarantees of certain food distribution customer
debt and lease obligations. The following summarizes these commitments as of December 29, 2001:

|                             |  |        |  | Commitment Expiration Per Period
|---------------------------- |  | ------ |  | --------------------------------
|
|Standby Letters of Credit(1) |  | 18,672 |  | 18,672                          
|Guarantees(2)                |  | 26,010 |  | 179                             

---

In
December, 2000 the Company completed the refinancing of a revolving credit facility. The agreement has a five year term and provides a $100 million term loan and
$150 million in revolving credit. Borrowings under the term loan bear interest at the Eurodollar rate plus a margin increase and a commitment commission on the unused portion of the revolver.
The margin increase and the commitment commission are reset quarterly based on movement of a leverage ratio defined by the agreement. At December 29, 2001 the margin and commitment commission
were 1.75% and .375%, respectively, compared to 2.0% and .5% at the end of 2000. The new agreement contains financial covenants which among other matters requires the Company to maintain predetermined
ratio levels related to interest coverage, fixed charges, leverage and working capital.

In
December, 2001 the Company entered into three swap agreements to manage interest rates on a portion of its long-term debt. The agreements which expire in six, twelve and
eighteen month intervals, are each based on notional amounts of $35.0 million and fix interest rates at 2.35%, 2.58% and 2.97% for the respective time intervals. The following table provides
information about the

23

---

Company's derivative financial instruments and other financial instruments that are sensitive to changes in interest rates.

For
debt obligations, the table presents principal cash flows and related weighted-average interest rates by expected maturity dates.

|           |  | Fixed Rate |         | Variable |    
|---------- |  | ---------- | ------- | -------- | ---
|
|
|2002       |  | $          | 2,057   |          | 8.5
|2003       |  |            | 4,714   |          | 8.5
|2004       |  |            | 1,493   |          | 8.5
|2005       |  |            | 1,529   |          | 8.5
|2006       |  |            | 1,711   |          | 8.5
|thereafter |  |            | 171,754 |          | 8.5
|           |  |            |         |          |    
|           |  | $          | 183,258 |          |    
|           |  |            |         |          |    

Three
swap agreements each with a notional amount of $35.0 million commenced on December 6, 2001 and expire in six month intervals through June, 2003. Notional amounts are
used to calculate the contractual cash flows to be exchanged under the contract. Agreements outstanding at year end (in thousands):

|                             |  | 2001 |         | 2000 |        
|---------------------------- |  | ---- | ------- | ---- | -------
|Pay fixed / receive variable |  | $    | 105,000 |      | 125,000
|Average receive rate         |  |      | 2.1     | %    | 6.8    
|Average pay rate             |  |      | 2.6     | %    | 6.4    

The
Company believes that borrowing under the revolving credit facility, sale of subordinated notes, other credit agreements, cash flows from operating activities and lease financing
will be adequate to meet the Company's working capital needs, planned capital expenditures and debt service obligations for the foreseeable future.

24

---



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

See disclosure set forth under Item 7 under the caption "Liquidity and Capital Resources."

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Nash Finch Company
Report of Internal Control

The consolidated financial statements have been prepared by management in conformity with generally accepted accounting principles and include, where required,
amounts based on management's best estimates and judgments. Financial information appearing throughout this Annual Report is consistent with that in the consolidated financial statements. In order to
meet its responsibility, management maintains a system of internal controls designed to provide reasonable assurance that assets are safeguarded and that financial records properly reflect all
transactions. The concept of reasonable assurance recognizes that the relative cost of a control procedure should not exceed the expected benefits. Management believes the selection and development of
qualified personnel, the establishment and communication of accounting and administrative policies and procedures (including a code of conduct), and a program of internal audit are important elements
of these control systems. The report of Ernst & Young LLP, the Company's independent accountants, covering their audit of the financial statements, is included in this Annual Report. Their
independent audit of the company's financial statements includes a review of the system of internal accounting controls to the extent they consider necessary to evaluate the system as required by
auditing standards generally accepted in the United States. The Audit Committee of the Board of Directors, composed entirely of outside directors, meets regularly with financial management, the
independent auditors, and the director of internal audit to review accounting control, auditing and financial reporting matters. The internal and independent auditors have unrestricted access to the
Audit Committee.

| |  | /s/RON MARSHALLRon Marshall
President, Chief Executive Officer                     
| |  | -----------------------------------------------------------------------------------
| |  | /s/ROBERT B. DIMONDRobert B. Dimond,
Senior Vice President, Chief Financial Officer

25

---



INDEPENDENT AUDITOR'S REPORT

The
Board of Directors and Stockholders
Nash Finch Company:

We
have audited the accompanying consolidated balance sheets of Nash Finch Company and subsidiaries as of December 29, 2001 and December 30, 2000, and the related
consolidated statements of income, stockholders' equity, and cash flows for each of the three years in the period ended December 29, 2001. Our audits also included the financial statement
schedule listed in the Index at Item 14(b). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.

We
conducted our audits in accordance with auditing standards generally accepted in the United States. 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 Nash Finch Company and subsidiaries at
December 29, 2001 and December 30, 2000, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 29, 2001,
in conformity with accounting principles generally accepted in the United States. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial
statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

Ernst &
Young LLP
Minneapolis, Minnesota
February 18, 2002

26

---



NASH FINCH COMPANY AND SUBSIDIARIES        Consolidated Statements of Income

|Fiscal years ended December 29, 2001,
December 30, 2000 and January 1, 2000
(In thousands, except per share amounts) |                                                                                                                                          | 2001
(52 weeks)                                                                  |           | 2000
(52 weeks) |           | 1999
(52 weeks) |          
|-------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | --------- | --------------- | --------- | --------------- | ---------
|Total sales and revenues                                                                                             |                                                                                                                                          | $                                                                                | 4,107,434 |                 | 3,955,767 |                 | 4,060,852
|Cost and expenses:                                                                                                   |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Cost of sales                                                                                                                            |                                                                                  |           | 3,645,333       |           | 3,517,528       |          
|                                                                                                                     | Selling, general and administrative                                                                                                      |                                                                                  |           | 344,905         |           | 330,966         |          
|                                                                                                                     | Special charges                                                                                                                          |                                                                                  |           |                |           |                |          
|                                                                                                                     | Depreciation and amortization                                                                                                            |                                                                                  |           | 46,601          |           | 45,330          |          
|                                                                                                                     | Interest expense                                                                                                                         |                                                                                  |           | 34,303          |           | 34,444          |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     |                                                                                                                                          | Total cost and expenses                                                          |           |                 | 4,071,142 |                 | 3,928,268
|                                                                                                                     |                                                                                                                                          | Earnings from continuing operations before income taxes and extraordinary charge |           |                 | 36,292    |                 | 27,499   
|Income tax expense                                                                                                   |                                                                                                                                          |                                                                                  | 15,025    |                 | 11,659    |                 | 11,216   
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     |                                                                                                                                          | Earnings from continuing operations before extraordinary charge                  |           |                 | 21,267    |                 | 15,840   
|Discontinued operations:                                                                                             |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Earnings from disposal of discontinued operations, including profit of $1,107 during the phase out period, net of income taxes of $3,587 |                                                                                  |           |                |           |                |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     |                                                                                                                                          | Earnings before extraordinary charge                                             |           |                 | 21,267    |                 | 15,840   
|                                                                                                                     | Extraordinary charge from early extinguishment of debt, net of income tax benefits of $271                                               |                                                                                  |           |                |           | 369             |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Net earnings                                                                                                                             |                                                                                  | $         | 21,267          |           | 15,471          |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|Basic earnings per share:                                                                                            |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Earnings from continuing operations                                                                                                      |                                                                                  | $         | 1.83            |           | 1.38            |          
|                                                                                                                     | Earnings from discontinued operations                                                                                                    |                                                                                  |           |                |           |                |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     |                                                                                                                                          | Earnings before extraordinary charge                                             |           |                 | 1.83      |                 | 1.38     
|                                                                                                                     | Extraordinary charge from early extinguishment of debt, net of income tax benefit                                                        |                                                                                  |           |                |           | (0.03           | )        
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Net earnings per share                                                                                                                   |                                                                                  | $         | 1.83            |           | 1.35            |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|Diluted earnings per share:                                                                                          |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Earnings from continuing operations                                                                                                      |                                                                                  | $         | 1.78            |           | 1.38            |          
|                                                                                                                     | Earnings from discontinued operations                                                                                                    |                                                                                  |           |                |           |                |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     |                                                                                                                                          | Earnings before extraordinary charge                                             |           |                 | 1.78      |                 | 1.38     
|                                                                                                                     | Extraordinary charge from early extinguishment of debt, net of income tax benefit                                                        |                                                                                  |           |                |           | (0.03           | )        
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          
|                                                                                                                     | Net earnings per share                                                                                                                   |                                                                                  | $         | 1.78            |           | 1.35            |          
|                                                                                                                     |                                                                                                                                          |                                                                                  |           |                 |           |                 |          

See
accompanying notes to consolidated financial statements.

27

---



NASH FINCH COMPANY AND SUBSIDIARIES  Consolidated Balance Sheets  (In thousands, except per share amounts)

|                                      |                                                                          | December 29,
2001                                                       |         | December 30,
2000 |        
|------------------------------------- | ------------------------------------------------------------------------ | ----------------------------------------------------------------------- | ------- | ----------------- | -------
|Assets                                |                                                                          |                                                                         |         |                   |        
|Current assets:                       |                                                                          |                                                                         |         |                   |        
|                                      | Cash                                                                     |                                                                         | $       | 10,467            |        
|                                      | Accounts and notes receivable, net                                       |                                                                         |         | 166,808           |        
|                                      | Inventories                                                              |                                                                         |         | 274,995           |        
|                                      | Prepaid expenses                                                         |                                                                         |         | 16,345            |        
|                                      | Deferred tax assets                                                      |                                                                         |         | 10,748            |        
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Total current assets                                                    |         |                   | 479,363
|Investments in affiliates             |                                                                          |                                                                         | 621     |                   | 588    
|Notes receivable, net                 |                                                                          |                                                                         | 31,736  |                   | 31,866 
|Property, plant and equipment:        |                                                                          |                                                                         |         |                   |        
|                                      | Land                                                                     |                                                                         |         | 26,979            |        
|                                      | Buildings and improvements                                               |                                                                         |         | 157,159           |        
|                                      | Furniture, fixtures and equipment                                        |                                                                         |         | 319,378           |        
|                                      | Leasehold improvements                                                   |                                                                         |         | 68,487            |        
|                                      | Construction in progress                                                 |                                                                         |         | 4,309             |        
|                                      | Assets under capitalized leases                                          |                                                                         |         | 40,860            |        
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          |                                                                         |         | 617,172           |        
|                                      | Less accumulated depreciation and amortization                           |                                                                         |         | (343,873          | )      
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Net property, plant and equipment                                       |         |                   | 273,299
|Goodwill, net                         |                                                                          |                                                                         | 137,337 |                   | 113,584
|Investment in direct financing leases |                                                                          |                                                                         | 13,490  |                   | 14,372 
|Deferred tax asset, net               |                                                                          |                                                                         | 7,549   |                   | 9,810  
|Other assets                          |                                                                          |                                                                         | 26,850  |                   | 20,553 
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Total assets                                                            |         | $                 | 970,245
|                                      |                                                                          |                                                                         |         |                   |        
|Liabilities and Stockholders' Equity  |                                                                          |                                                                         |         |                   |        
|Current liabilities:                  |                                                                          |                                                                         |         |                   |        
|                                      | Outstanding checks                                                       |                                                                         | $       | 57,750            |        
|                                      | Current maturities of long-term debt and capitalized lease obligations   |                                                                         |         | 5,364             |        
|                                      | Accounts payable                                                         |                                                                         |         | 217,822           |        
|                                      | Accrued expenses                                                         |                                                                         |         | 90,869            |        
|                                      | Income taxes                                                             |                                                                         |         | 11,819            |        
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Total current liabilities                                               |         |                   | 383,624
|Long-term debt                        |                                                                          |                                                                         | 321,761 |                   | 308,618
|Capitalized lease obligations         |                                                                          |                                                                         | 47,046  |                   | 45,046 
|Other liabilities                     |                                                                          |                                                                         | 14,406  |                   | 17,838 
|Stockholders' equity:                 |                                                                          |                                                                         |         |                   |        
|                                      | Preferred stockno par value                                             |                                                                         |         |                   |        
|                                      |                                                                          | Authorized 500 shares; none issued                                      |         |                   |       
|                                      | Common stock of $1.662/3 par value                                       |                                                                         |         |                   |        
|                                      |                                                                          | Authorized 25,000 shares, issued 11,831 and 11,711 shares, respectively |         |                   | 19,718 
|                                      | Additional paid-in capital                                               |                                                                         |         | 21,894            |        
|                                      | Restricted stock                                                         |                                                                         |         |                  |        
|                                      | Accumulated other comprehensive income                                   |                                                                         |         | (2,518            | )      
|                                      | Retained earnings                                                        |                                                                         |         | 165,317           |        
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          |                                                                         |         | 204,411           |        
|                                      | Less cost of 73 and 226 shares of common stock in treasury, respectively |                                                                         |         | (1,003            | )      
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Total stockholders' equity                                              |         |                   | 203,408
|                                      |                                                                          |                                                                         |         |                   |        
|                                      |                                                                          | Total liabilities and stockholders' equity                              |         | $                 | 970,245
|                                      |                                                                          |                                                                         |         |                   |        

See accompanying notes to consolidated financial statements.

28

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NASH FINCH COMPANY AND SUBSIDIARIES  Consolidated Statements of Cash Flows  (In thousands)

|                                                  |                                                                                          | 2001                                                |                                           | 2000    |         | 1999     |        
|------------------------------------------------- | ---------------------------------------------------------------------------------------- | --------------------------------------------------- | ----------------------------------------- | ------- | ------- | -------- | -------
|Operating activities:                             |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  | Net earnings                                                                             |                                                     | $                                         | 21,267  |         | 15,471   |        
|                                                  | Adjustments to reconcile net income to net cash provided by operating activities:        |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          | Special chargesnon cash portion                    |                                           |         |        |          |       
|                                                  |                                                                                          | Discontinued operations                             |                                           |         |        |          |       
|                                                  |                                                                                          | Depreciation and amortization                       |                                           |         | 46,601  |          | 45,330 
|                                                  |                                                                                          | Provision for bad debts                             |                                           |         | 4,812   |          | 7,361  
|                                                  |                                                                                          | Deferred income tax expense                         |                                           |         | 8,630   |          | 2,884  
|                                                  |                                                                                          | Other                                               |                                           |         | 372     |          | (318   
|                                                  | Changes in operating assets and liabilities, net of effects of acquisitions:             |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          | Accounts and notes receivable                       |                                           |         | (36,255 | )        | 23,710 
|                                                  |                                                                                          | Inventories                                         |                                           |         | 5,694   |          | (959   
|                                                  |                                                                                          | Prepaid expenses                                    |                                           |         | (4,237  | )        | (646   
|                                                  |                                                                                          | Accounts payable                                    |                                           |         | 26,200  |          | (6,457 
|                                                  |                                                                                          | Accrued expenses                                    |                                           |         | 17,312  |          | (9,503 
|                                                  |                                                                                          | Income taxes                                        |                                           |         | (875    | )        | 8,594  
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          |                                                     | Net cash provided by operating activities |         |         | 89,521   |        
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|Investing activities:                             |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  | Disposal of property, plant and equipment                                                |                                                     |                                           | 6,281   |         | 16,590   |        
|                                                  | Additions to property, plant and equipment                                               |                                                     |                                           | (43,924 | )       | (54,066  | )      
|                                                  | Business acquired, net of cash                                                           |                                                     |                                           | (47,680 | )       | (19,985  | )      
|                                                  | Loans to customers                                                                       |                                                     |                                           | (17,082 | )       | (27,656  | )      
|                                                  | Payments from customers on loans                                                         |                                                     |                                           | 17,936  |         | 12,751   |        
|                                                  | (Repurchase) sale of receivables                                                         |                                                     |                                           |        |         | (7,970   | )      
|                                                  | Proceeds from sale of dairy operations, net of gain                                      |                                                     |                                           |        |         |         |        
|                                                  | Proceeds from sale of Nash-De Camp                                                       |                                                     |                                           |        |         |         |        
|                                                  | Other                                                                                    |                                                     |                                           | (8,871  | )       | (5,340   | )      
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          | Net cash used in investing activities               |                                           |         | (93,340 | )        | (85,676
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|Financing activities:                             |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  | Proceeds from long-term debt                                                             |                                                     |                                           |        |         | 100,000  |        
|                                                  | Proceeds (payments) from revolving debt                                                  |                                                     |                                           | 12,700  |         | (102,700 | )      
|                                                  | Dividends paid                                                                           |                                                     |                                           | (4,204  | )       | (4,122   | )      
|                                                  | Payments of short-term debt                                                              |                                                     |                                           |        |         |         |        
|                                                  | Payments of long-term debt                                                               |                                                     |                                           | (3,378  | )       | (1,492   | )      
|                                                  | Payments of capitalized lease obligations                                                |                                                     |                                           | (1,620  | )       | (1,790   | )      
|                                                  | Increase (decrease) in outstanding checks                                                |                                                     |                                           | 5,708   |         | (2,932   | )      
|                                                  | Other                                                                                    |                                                     |                                           | 3,546   |         | (1,610   | )      
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          | Net cash provided by (used in) financing activities |                                           |         | 12,752  |          | (14,646
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  |                                                                                          |                                                     | Net increase (decrease) in cash           |         | $       | 8,933    |        
|                                                  |                                                                                          |                                                     |                                           |         |         |          |        
|Supplemental disclosure of cash flow information: |                                                                                          |                                                     |                                           |         |         |          |        
|                                                  | Non cash investing and financing activities
Purchase of real estate under capital leases |                                                     | $                                         | 3,866   |         | 16,049   |        
|                                                  |                                                                                          | Acquisition of minority interest                    |                                           |         | 4,294   |          |       

See
accompanying notes to consolidated financial statements.

29

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NASH FINCH COMPANY AND SUBSIDIARIES
Consolidated Statements of Stockholders' Equity

|Fiscal period ended December 29, 2001
December 30, 2000 and January 1, 2000
(In thousands, except per share amounts) |                                           | Common stock |   |   |        |   |        | Accumulated
other
comprehensive
income (loss) |         |   |        | Treasury stock |      |   |     
|-------------------------------------------------------------------------------------------------------------------- | ----------------------------------------- | ------------ | - | - | ------ | - | ------ | --------------------------------------------- | ------- | - | ------ | -------------- | ---- | - | ----
|
|
|Balance at January 2, 1999                                                                                           |                                           | 11,575       |   | $ | 19,292 |   | 17,944 |                                               | 121,185 |   |       |                | (113 | ) | (234
|Net earnings                                                                                                         |                                           |             |   |   |       |   |       |                                               | 19,803  |   |       |                |     |   |    
|Dividend declared of $.36 per share                                                                                  |                                           |             |   |   |       |   |       |                                               | (4,083  | ) |       |                |     |   |    
|Common stock issued for employee stock purchase plan                                                                 |                                           | 66           |   |   | 110    |   | 294    |                                               |        |   |       |                |     |   |    
|Amortized compensation under restricted stock plan                                                                   |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 13   |   |    
|Repayment of notes receivable from holders of restricted stock                                                       |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 43   |   |    
|Distribution of stock pursuant to performance awards                                                                 |                                           |             |   |   |       |   | 9      |                                               |        |   |       |                |     |   | 3   
|                                                                                                                     |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     
|Balance at January 1, 2000                                                                                           |                                           | 11,641       |   |   | 19,402 |   | 18,247 |                                               | 136,905 |   |       |                | (57  | ) | (231
|Net earnings                                                                                                         |                                           |             |   |   |       |   |       |                                               | 15,471  |   |       |                |     |   |    
|Dividend declared of $.36 per share                                                                                  |                                           |             |   |   |       |   |       |                                               | (4,122  | ) |       |                |     |   |    
|Common stock issued for employee stock purchase plan                                                                 |                                           | 70           |   |   | 116    |   | 309    |                                               |        |   |       |                |     |   |    
|Amortized compensation under restricted stock plan                                                                   |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 4    |   |    
|Repayment of notes receivable from holders of restricted stock                                                       |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 43   |   |    
|Distribution of stock pursuant to performance awards                                                                 |                                           |             |   |   |       |   | 8      |                                               |        |   |       |                |     |   | 5   
|                                                                                                                     |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     
|Balance at December 30, 2000                                                                                         |                                           | 11,711       |   |   | 19,518 |   | 18,564 |                                               | 148,254 |   |       |                | (10  | ) | (226
|Net earnings                                                                                                         |                                           |             |   |   |       |   |       |                                               | 21,267  |   |       |                |     |   |    
|Other comprehensive income, net of tax                                                                               |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     
|                                                                                                                     | Deferred gain (loss) on hedging activites |              |  |   |        |  |        |                                              |         |  |        | (128           | )    |  |     
|                                                                                                                     | Additional minimum pension liability      |              |  |   |        |  |        |                                              |         |  |        | (2,390         | )    |  |     
|                                                                                                                     |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     
|Comprehensive income                                                                                                 |                                           |             |   |   |       |   |       |                                               |        |   |       |                |     |   |    
|Dividend declared of $.36 per share                                                                                  |                                           |             |   |   |       |   |       |                                               | (4,204  | ) |       |                |     |   |    
|Treasury stock issued upon exercise of options                                                                       |                                           |             |   |   |       |   | 943    |                                               |        |   |       |                |     |   | 102 
|Common stock issued upon exercise of options                                                                         |                                           | 28           |   |   | 46     |   | 264    |                                               |        |   |       |                |     |   |    
|Common stock issued for employee stock purchase plan                                                                 |                                           | 92           |   |   | 154    |   | 655    |                                               |        |   |       |                |     |   |    
|Amortized compensation under restricted stock plan                                                                   |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 1    |   |    
|Stock based deferred compensation                                                                                    |                                           |             |   |   |       |   | 993    |                                               |        |   |       |                |     |   |    
|Repayment of notes receivable from holders of restricted stock                                                       |                                           |             |   |   |       |   |       |                                               |        |   |       |                | 9    |   |    
|Distribution of stock pursuant to performance awards                                                                 |                                           |             |   |   |       |   | 475    |                                               |        |   |       |                |     |   | 51  
|                                                                                                                     |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     
|Balance at December 29, 2001                                                                                         |                                           | 11,831       |   | $ | 19,718 |   | 21,894 |                                               | 165,317 |   | (2,518 | )              |     |   | (73 
|                                                                                                                     |                                           |              |   |   |        |   |        |                                               |         |   |        |                |      |   |     

See accompanying notes to consolidated financial statements.

30

---



NASH FINCH COMPANY AND SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) Accounting Policies

Fiscal Year

Nash Finch Company's fiscal year ends on the Saturday nearest to December 31. Fiscal years 2001, 2000 and 1999 each consisted of 52 weeks. The Company's
interim quarters consist of 12 weeks except for the third quarter which has 16 weeks.

Principles of Consolidation

The accompanying financial statements include the accounts of Nash Finch Company (the "Company"), its majority-owned subsidiaries and the Company's share of net
earnings of a 50% owned company. All material intercompany accounts and transactions have been eliminated in the consolidated financial statements.

Cash and Cash Equivalents

In the accompanying financial statements and for purposes of the statements of cash flows, cash and cash equivalents include cash on hand and
short-term investments with original maturities of three months or less.

Revenue Recognition

Revenues for food distribution and military segments are recognized when product orders placed by customers are shipped. Retail segment revenues are recognized at
the point of sale.

During
the year, the Company applied EITF Issue 00-22Accounting for "Points" and Other Time Based or Volume Based Sales Incentive
Offers.The new ruling requires that certain time or volume based rebates or refunds be classified as a reduction of revenues instead of an expense or cost of sale. Amounts
reclassified from expense and cost of sales reducing revenues were not material and had no impact on net earnings. Certain other reclassifications have been made in the 2000 and 1999 financial
statements to conform to classifications used in 2001. These reclassifications had no impact on net income, earnings per share or stockholders' equity.

Inventories

Inventories are stated at the lower of cost or market. At December 29, 2001 and December 30, 2000, approximately 86% and 85%, respectively, of the
Company's inventories are valued on the last-in, first-out (LIFO) method. During fiscal 2001, the Company recorded a LIFO charge of $2.7 million compared to credits of
$1.1 million, and $.9 million in fiscal 2000 and 1999, respectively. The remaining inventories are valued on the first-in, first-out (FIFO) method. If the FIFO
method of accounting for inventories had been used, inventories would have been $47.8 million and $45.1 million higher at December 29, 2001 and December 30, 2000,
respectively.

Capitalization, Depreciation and Amortization

Property, plant and equipment are stated at cost. Assets under capitalized leases are recorded at the present value of future lease payments or fair market value,
whichever is lower. Expenditures which improve or extend the life of the respective assets are capitalized while maintenance and repairs are expensed as incurred. Interest costs primarily associated
with construction projects and software development in the amount of $.1 million, $.9 million and $.6 million have been capitalized during 2001, 2000 and 1999 respectively.

31

---

Property,
plant and equipment are depreciated on a straight-line basis over the estimated useful lives of the assets which generally range from 10-40 years
for buildings and improvements and 3-10 years for
furniture, fixtures and equipment. Leasehold improvements and capitalized leases are amortized on a straight-line basis over the shorter of the term of the lease or the useful life of the
asset.

Derivative Instruments

Effective December 31, 2000, the Company adopted Financial Accounting Standard Board Statement No. 133,Accounting for
Derivative Instruments and Hedging Activities(Statement No.133) which requires all derivative instruments be recorded on the balance sheet at fair value and establishes
criteria for designation and effectiveness of the hedging relationships.

The
Company has market risk exposure to changing interest rates primarily as a result of its borrowing activities. It manages this exposure through the use of a combination of fixed and
floating rate debt. The Company's objective in managing its exposure to changes in interest rates is to minimize the impact of fluctuations on earnings and cash flows. To achieve these objectives, the
Company uses derivative instruments, primarily interest rate swap agreements, to manage risk exposures when appropriate, based on market conditions. These instruments have the effect of converting
fixed rate instruments to floating, or floating to fixed. The Company enters into these agreements with major financial institutions, for terms usually not more than two years and for notional amounts
the Company deems to be consistent with its objectives.

Interest
rate swap agreements are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those exposures. The Company
designates interest rate swap derivatives as cash flow hedges, for those agreements under which the Company agrees to pay fixed rates of interest, in exchange for a variable rate. The Company does not
enter into derivative agreements for trading or other speculative purposes, nor is it a party to any leveraged derivative instrument.

Deferred
gains and losses are amortized as an adjustment to interest expense over the same period in which the related interest payments being hedged are recognized in income. However,
to the extent that any of these contracts are not considered to be perfectly effective in offsetting the change in the value of the interest payments being hedged, any changes in fair value relating
to the ineffective portion of these contracts are immediately recognized in income. The net effect on the Company's operating results is that interest on the portion of variable-rate debt
being hedged is generally recorded based on fixed interest rates.

Impairment of Long-lived Assets

An impairment loss is recognized whenever events or changes in circumstances indicate the carrying amount of an asset is not recoverable. In applying Statement of
Financial Accounting Standards (SFAS) No. 121,Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of,assets are grouped and evaluated at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. The Company has generally
identified this lowest level to be individual stores; however, there are limited circumstances where, for evaluation purposes, stores could be considered with the distribution center they support. The
Company considers historical performance and future estimated results in its evaluation of potential impairment. If the carrying amount of the asset exceeds estimated expected undiscounted future cash
flows, the Company measures the amount of the impairment by comparing the carrying amount of the asset to its fair value, generally measured by discounting expected future cash flows at the rate the
Company utilizes to evaluate potential investments.

32

---

Intangible Assets

Intangible assets, consisting primarily of goodwill resulting from business acquisitions, are carried at cost less accumulated amortization. Costs are amortized
over the estimated useful lives of the related assets ranging from 2-40 years. Amortization expense charged to operations for fiscal years ended December 29, 2001,
December 30, 2000, and January 1, 2000 was $8.0 million, $8.4 million and $6.2 million, respectively. For acquisitions subsequent to June 30, 2001, goodwill
is not subject to amortization in accordance with new accounting standards. The accumulated amortization of intangible assets was $37.9 million and $30.2 million at December 29,
2001 and December 30, 2000, respectively. The Company re-evaluates the carrying value of intangible assets for impairment annually and/or when factors indicating impairment are
present, using an undiscounted operating cash flow assumption.

Income Taxes

Deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled.

Stock Option Plans

As permitted by the provisions of SFAS No. 123,Accounting for Stock-Based Compensation,the Company has
chosen to continue to apply Accounting Principles Board Opinion No. 25(APB 25), Accounting for Stock Issued to Employeesand related
interpretations in accounting for its stock option plans. As a result, the Company does not recognize compensation costs if the option price equals or exceeds market price at date of grant.
Note (7) of Notes to Consolidated Financial Statements contains
a summary of the pro forma effects to reported net income and earnings per share had the Company elected to recognize compensation costs as encouraged by SFAS No. 123.

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 amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

New Accounting Standards

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 141, Business
Combinations, and SFAS No. 142,Goodwill and Other Intangible Assets. These standards
require that all business combinations be accounted for using the purchase method and that goodwill and intangible assets with indefinite useful lives no longer be amortized but instead tested for
impairment at least annually. Separable intangible assets that are not deemed to have an indefinite life will continue to be amortized over their useful lives. These standards outline the criteria for
initial recognition and measurement of intangibles, assignment of assets and liabilities including goodwill to reporting units and goodwill impairment testing. The Company is required to apply the
provisions of SFAS No. 141 including the nonamortization provision of goodwill under SFAS No. 142 to all business combinations completed after June 30, 2001, while SFAS
No. 142 is fully effective at the beginning of 2002. In fiscal 2002, the Company will perform the required impairment tests of goodwill and indefinite lived intangible assets. Goodwill
amortization expense for 2001 was $5.9 million pretax and $4.7 million after tax or $.39 per diluted share.

33

---

In April 2001, the FASB's Emerging Issues Task Force ("EITF") reached consensus on Issue 00-25Vendor Income Statement
Characterization of Consideration Paid to a Reseller of the Vendor's Products. The new ruling provides guidance on income statement classification on consideration paid to a
reseller of a vendor's products and must be applied for periods beginning after December 15, 2001. The Company has evaluated this rule change and determined it will have no effect on the
financial statements.

(2) Business Acquisitions

On August 13, 2001, the Company acquired U Save Foods, Inc. ("U Save"), through a cash purchase of 100% of U Save's outstanding capital stock. U
Save was a privately held retail grocery store chain operating 14 stores, primarily in Nebraska, with annual sales of approximately $145 million. Final determination of the purchase price is
dependent upon the Company's acceptance of an independent audit of the closing balance sheet. A preliminary purchase price allocation resulted in goodwill of $27.9 million which is not required
to be amortized in accordance with SFAS No. 141. Results of operations are included in the consolidated statements from the date of acquisition.

On
January 30, 2000 the Company acquired Hinky Dinky Supermarkets, Inc. ("Hinky Dinky") through a cash purchase of all of Hinky Dinky's outstanding capital stock. Hinky
Dinky was a majority owner of twelve supermarkets located in Nebraska with annualized sales of approximately $90 million. Assets and liabilities assumed have been recorded at their fair values
at date of acquisition resulting in goodwill of $14.2 million, which is being amortized on a straight line basis over 40 years. Results of operations are included in the consolidated
statements from the date of acquisition.

(3) 1998 Special Charges

During the fourth quarter of 1998, the Company recorded special charges totaling $71.4 million (offset by $2.9 million of 1997 adjustments) as a
result of the Company's revitalization plan designed to redirect its technology efforts, optimize warehouse capacity through consolidation, and close, sell or reassess under-performing businesses and
investments.

In
conjunction with the implementation of the Company's 1998 revitalization plan, the Company designated five warehouses and 12 underperforming stores for closure. During 1999,
adjustments to the plan involved decisions to close four additional stores and to indefinitely defer the closure of two
distribution centers and one retail store. Accordingly, during the fourth quarter of 1999, the Company reversed $7.0 million of expected costs associated with these decisions. All actions
contemplated by the original 1998 plan and subsequent revisions have been implemented.

During
fiscal 2001, the activity recorded through the remaining special charge accrual included $.7 million of pension benefits related to the distribution segment and
$.8 million in continuing lease and exit costs related to closed retail stores. As of December 29, 2001, the food distribution portion of the special charge liability consisted of
$.9 million related to certain pension and post-employment benefits. Also, liabilities in the amount of $5.1 million remain related to continuing lease commitments and
occupancy costs associated with retail stores closed under the 1998 special charge.

34

---

(4) Accounts and Notes Receivable

Accounts and notes receivable at the end of fiscal years 2001 and 2000 are comprised of the following components (in thousands):

2001

2000Customer notes receivable, current

$
10,630

10,704Customer accounts receivable


147,869

123,985Other receivables


31,296

20,942Allowance for doubtful accounts


(22,987
)
(22,639
)Net current accounts and notes receivable

$
166,808

132,992Long-term customer notes receivable

$
36,168

36,177Other noncurrent receivables


4,070

4,062Allowance for doubtful accounts


(8,502
)
(8,373
)Net long-term notes receivable

$
31,736

31,866


Operating
results include bad debt expense totaling $4.8 million, $7.4 million and $4.4 million during fiscal years 2001, 2000 and 1999, respectively.

On
December 14, 2001, the Company, exercised an option to discontinue a Receivable Purchase Agreement which was entering the final year of a five year term. The $50 million
revolving receivable purchase facility allowed the Company to sell receivables, through Nash Finch Funding Corporation (NFFC), a wholly owned subsidiary, to a third party purchaser. Although no
penalties were incurred as a result of the Company's decision, accounts receivables increased by approximately $26.5 million. As of December 30, 2000 the Company had sold
$41.2 million of accounts receivable on a non-recourse basis to NFFC. NFFC sold $33.9 million of its undivided interest in such receivables to the Purchaser, subject to
specified collateral requirements.

Substantially
all notes receivable are based on floating interest rates which adjust to changes in market rates. As a result, the carrying value of notes receivable approximates market
value.

(5) Long-term Debt and Credit Facilities

Long-term debt at the end of the fiscal years 2001 and 2000 is summarized as follows (in thousands):

2001

2000Revolving credit

$
40,000

27,300Term loan 4% due in 2005


100,000

100,000Senior subordinated debt, 8.5% due in 2008


164,178

164,046Industrial development bonds, 3% to 7.8% due in various installments through 2014


8,675

9,430Term loan, 9.6% due in 2001




1,250Notes payable and mortgage notes, 3% to 11.5% due in various installments through 2018


12,175

9,386325,028

311,412Less current maturities


3,267

2,794$
321,761

308,618


In
December, 2000 the Company completed the refinancing of a revolving credit facility. The credit agreement has a five year term and provides a $100 million term loan and
$150 million in

35

---

revolving credit. At December 29, 2001 borrowings under the term loan bear interest at Eurodollar rate plus 1.75% totaling 4%. Both the premium over a Eurodollar rate and a commitment
commission, which were 2.0% and .5%, respectively, at the end of fiscal 2000, are reset quarterly based on movement of a leverage ratio defined by the agreement. The commitment commission on the
unused portion of the revolving loan was .375% per annum at the end of the year.

The
agreement contains financial covenants which among other matters, require the Company to maintain predetermined ratio levels related to interest coverage, fixed charges, leverage and
working capital. The refinancing resulted in the write-off of deferred financing costs, associated with the previous facility, which have been classified as an extraordinary charge of
$.4 million, or $.03 per share, net of tax benefit of $.2 million.

At
the end of fiscal 2001, the Company had three swap agreements in effect to manage interest rates on a portion of its long-term debt. The agreements which expire in six,
twelve and eighteen month intervals, are each based on a notional amount of $35.0 million and call for an exchange of interest payments with the Company making payments based on fixed rates of
2.35%, 2.58% and 2.97% for the respective time intervals, and receiving payments based on floating rates, without an exchange of the notional amount upon which the payments are based. Interest rate
swap agreements are reflected at fair value in the Company's consolidated balance sheet and related losses of $.1 million net of income taxes are deferred in stockholders' equity as a component
of other comprehensive income.

The
Company has outstanding letters of credit in the amounts of $18.7 million and $17.5 million at December 29, 2001 and December 30, 2000, respectively,
primarily supporting workers' compensation obligations.

At
December 29, 2001, land in the amount of $2.6 million and buildings and other assets with a depreciated cost of approximately $9.0 million are pledged to secure
outstanding mortgage notes and obligations under issues of industrial development bonds. In addition, borrowings under the credit facility are collaterized by a security interest in substantially all
remaining assets not pledged under other debt agreements, including those of wholly owned subsidiaries.

Aggregate
annual maturities of long-term debt for the five fiscal years after December 29, 2001 are as follows (in thousands):

2002

$
3,2672003


4,8242004


1,6032005


141,6392006


1,8212007 and thereafter

$
171,874


Interest
paid was $32.4 million, $37.9 million and $30.1 million, for fiscal years 2001, 2000 and 1999, respectively.

Based
on borrowing rates currently available to the Company for long-term financing with similar terms and average maturities, the fair value of long-term debt,
including current maturities, utilizing discounted cash flows is $316.0 million.

36

---

(6) Income Taxes

Income tax expense related to continuing operations is made up of the following components (in thousands):

2001

2000

1999Current:Federal

$
10,643

5,490

3,698State


2,114

1,091

795Tax credits


(11
)
(7
)
(18
)Deferred:


2,279

5,085

6,741Total

$
15,025

11,659

11,216


Total
income tax expense for the fiscal years 2001, 2000 and 1999 was $15.0 million, $11.4 million and $14.8 million, respectively, allocated as follows:

2001

2000

1999Income from continuing operations

$
15,025

11,659

11,216Discontinued operations






3,587Extraordinary item




(271
)
Total income tax expense

$
15,025

11,388

14,803


Income
tax expense from continuing operations differed from amounts computed by applying the federal income tax rate to pre-tax income as a result of the following:

2001

2000

1999Federal statutory tax rate

35.0
%
35.0
%
35.0
%State taxes, net of federal income tax benefit

4.2

4.2

4.5Non-deductible goodwill

2.9

3.7

2.8Other net

(.7
)
(.5
)
0.1Effective tax rate

41.4
%
42.4
%
42.4
%


Income
taxes paid (refunded) were $4.6 million, $(.4) million and $(.9) million during fiscal years 2001, 2000 and 1999, respectively.

37

---

The
tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 29, 2001, December 30,
2000, and January 1, 2000, are presented below (in thousands):

2001

2000

1999Deferred tax assets:Inventories

$
954

2,794

2,973Provision for obligations to be settled in future periods


33,841

28,518

29,964Closed locations


2,000

7,274

10,819Other


2,215

758

528Total deferred tax assets


39,010

39,344

44,284Deferred tax liabilities:Depreciation and amortization


8,527

4,958

3,329Acquired asset adjustments for fair values


9,590

7,171

9,503Accelerated tax deductions


1,437

386

2,287Other


1,159

407

239Total deferred tax liabilities


20,713

12,922

15,358Net deferred tax asset

$
18,297

26,422

28,926


Temporary
differences for obligations to be settled in the future consist of deferred compensation, vacation, health benefits and other expenses which are not deductible for tax purposes
until paid.

The
Company has determined a valuation allowance for the net deferred tax asset is not required since it is more likely than not the deferred tax asset will be realized through carryback
to taxable income in prior years, future reversals of existing taxable temporary differences, future taxable income and tax planning strategies.

(7) Stock Rights and Options

Under the Company's 1996 Stockholder Rights Plan, one right is attached to each outstanding share of common stock. Each right entitles the holder to purchase,
under certain conditions, one-half share of common stock at a price of $30.00 ($60.00 per full share). The rights are not yet exercisable and no separate rights certificates have been
distributed. All rights expire on March 31, 2006.

The
rights become exercisable 20 days after a "flip-in event" has occurred or 10 business days (subject to extension) after a person or group makes a tender offer for
15% or more of the Company's outstanding common stock. A flip-in event would occur if a person or group acquires (1) 15% of the Company's outstanding common stock, or (2) an
ownership level set by the Board of Directors at less than 15% if the person or group is deemed by the Board of Directors to have interests adverse to those of the Company and its stockholders. The
rights may be redeemed by the Company at any time prior to the occurrence of a flip-in event at $.01 per right. The power to redeem may be reinstated within 20 days after a
flip-in event occurs if the cause of the occurrence is removed.

Upon
the rights becoming exercisable, subject to certain adjustments or alternatives, each right would entitle the holder (other than the acquiring person or group, whose rights become
void) to purchase a number of shares of the Company's common stock having a market value of twice the exercise price of the right. If the Company is involved in a merger or other business combination,
or certain other events occur, each right would entitle the holder to purchase common shares of the acquiring company having a market value of twice the exercise price of the right. Within
30 days after the rights become exercisable following a flip-in event, the Board of Directors may exchange shares of Company common stock or cash or other property for exercisable
rights.

38

---

The
Company follows APB 25 and related interpretations in accounting for its employee stock options. Under APB 25, when the exercise price of employee stock options equals the market
price of the underlying stock on the date of the grant, no compensation expense is recognized.

The
Company has four stock incentive plans under which incentive stock options, non-qualified stock options and other forms of incentive stock awards have been, or may be,
granted primarily to key employees and non-employee members of the Board of Directors. Under these plans, outstanding stock options to purchase shares of the Company's common stock,
including incentive stock options and non-qualified stock options, have been granted at exercise prices which are not less than 100% of fair market value at date of grant and are
exercisable over terms which may not exceed 10 years from the date of grant.

Changes
in outstanding options during the three fiscal years ended December 29, 2001 are summarized as follows (in thousands):

Shares

Weighted
Average
Option Price
Per ShareOptions outstanding January 2, 1999

510

$
16.89Exercised




Forfeited

(165
)

17.27Granted

268


8.54Options outstanding January 1, 2000

613


13.15Exercised




Forfeited

(188
)

9.72Granted

519


9.01Options outstanding December 30, 2000

944


11.56Exercised

(130
)

13.63Forfeited

(137
)

13.96Granted

469


21.36Options outstanding December 29, 2001

1,146

$
15.04Options exercisable atDecember 29, 2001

454,684

$
14.55December 30, 2000

296,100


14.12


Remaining
average contractual life of options outstanding at December 29, 2001 was 2.5 years, with an exercise price ranging from $7.25 to $28.48.

The
weighted average fair value of options granted during 2001, 2000 and 1999 are $6.81, $1.99 and $1.67 respectively. The fair value of each option grant is estimated as of the date of
grant using the Black-Scholes single option pricing model assuming a weighted average risk-free interest rate of 4.4%, an expected dividend yield of 1.20%, expected lives of two and
one-half years and volatility of 47%. Had compensation expense for stock options been determined based on the fair value method (instead of intrinsic value method) at the grant dates for
awards, the Company's 2001, 2000 and 1999 net earnings and diluted earnings per share would have decreased $.7 million or $.06 per share, $.3 million or $.03 per share and
$.2 million or $.02 per share, respectively.

39

---

(8) Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share for continuing operations:

2001

2000

1999Numerator:Earnings from continuing operations
before extraordinary charge

$
21,267

15,840

15,237Denominator:Denominator for basic earnings per
share (weighted-average shares)


11,624

11,443

11,333Effect of dilutive options and awards


335

52

76Denominator for diluted earnings
per share (adjusted weighted-average shares)


11,959

11,495

11,409Basic earnings per share

$
1.83

1.38

1.35Diluted earnings per share

$
1.78

1.38

1.34


(9) Lease and Other Commitments

A substantial portion of the store and warehouse properties of the Company are leased. The following table summarizes assets under capitalized leases (in
thousands):

2001

2000Buildings and improvements

$
40,860

36,993Less accumulated amortization


(13,334
)
(11,348
)Net assets under capitalized leases

$
27,526

25,645


Total
future minimum sublease rentals related to operating and capital lease obligations as of December 29, 2001 are $87.6 million and $26.1 million, respectively.
Future minimum payments for operating and capital leases have not been reduced by minimum sublease rentals receivable under non-cancelable subleases. At December 29, 2001, future
minimum rental payments under non-cancelable leases and subleases are as follows (in thousands):

Operating
leases

Capital
leases2002

$
30,685


7,2762003


28,079


7,2462004


25,362


7,2072005


22,113


7,0742006 and thereafter


97,454


64,283Total minimum lease payments

$
203,693


93,086Less imputed interest (rates ranging from 7% to 17.2%)





43,943Present value of net minimum lease payments





49,143Less current maturities





(2,097
)Capitalized lease obligations




$
47,046


40

---

Total rental expense under operating leases for fiscal years 2001, 2000 and 1999 is as follows (in thousands):

2001

2000

1999Total rentals

$
45,648

43,431

42,919Less real estate taxes,
insurance and other
occupancy costs


(3,378
)
(2,692
)
(1,950
)Minimum rentals


42,270

40,739

40,969Contingent rentals


(175
)
51

(128
)Sublease rentals


(15,687
)
(15,575
)
(14,972
)$
26,408

25,215

25,869


Most
of the Company's leases provide that the Company pay real estate taxes, insurance and other occupancy costs applicable to the leased premises. Contingent rentals are
determined on the basis of a percentage of sales in excess of stipulated minimums for certain store facilities. Operating leases often contain renewal options. Management expects that, in the normal
course of business, leases that expire will be renewed or replaced by other leases.

(10) Concentration of Credit Risk

The Company provides financial assistance in the form of loans to some of its independent retailers for inventories, store fixtures and equipment and store
improvements. Loans are generally secured by liens on real estate, inventory and/or equipment, personal guarantees and other types of collateral, and are generally repayable over a period of five to
seven years. In addition, the Company may guarantee lease and debt obligations of retailers.

As
of December 29, 2001, the Company has guaranteed outstanding debt and lease obligations of a number of retailers in the amount of $26.0 million, including
$10.8 million in loan guarantees to two large retailers. The Company has guaranteed debt, in the amount of $8.5 million, of a third retailer currently in bankruptcy. The Company believes
the value of the underlying collateral which the Company now owns, is sufficient to cover the debt. Maturities of the underlying guarantee agreements vary and continue through 2012.

The
Company establishes allowances for doubtful accounts based upon periodic assessments of the credit risk of specific customers, collateral value, historical trends and other
information. The Company believes that adequate provisions have been recorded for any doubtful accounts.

(11) Long-Term Compensation Plans

The Company has a profit sharing plan covering substantially all employees meeting specified requirements. Contributions, determined by the Board of Directors,
are made to a noncontributory profit sharing trust based on profit performances. Profit sharing expense for 2001, 2000 and 1999 was $4.9 million, $3.3 million and $3.6 million,
respectively.

Certain
officers and key employees are participants in a deferred compensation plan providing fixed benefits payable in equal monthly installments upon retirement. Annual contributions
to the deferred compensation plan, which are based on Company performance, were expensed. Other than dividend distributions earned on accumulated share equivalents, no further contribution will be
made to this plan. The Company made no contributions in 2001 and 2000, but contributed $.4 million to the plan in 1999.

On
January 1, 2000, the Company adopted a Supplemental Executive Retirement Plan ("SERP") for key employees and executive officers. On the last day of the calendar year, each
participant's SERP

41

---

account is credited with an amount equal to 20% of the base salary for the year. Active participants in the aforementioned deferred compensation plan, which is tied to the Company's stock price, may
elect to have the total share equivalents converted to cash equivalents and credited to their SERP account. Benefits payable under the SERP vest upon attaining age 65 and at age 60 for participants
who have chosen conversion of all or a portion of their deferred compensation plan. Compensation expense related to the plan was $.6 million and $.5 million in 2001 and 2000,
respectively.

(12) Pension and Other Post-retirement Benefits

The Company has a qualified non-contributory retirement plan to provide retirement income for certain eligible full-time employees who are
not covered by a union retirement plan. Pension benefits under the plan are based on length of service and compensation. The Company contributes amounts necessary to meet minimum funding requirements.
During 1997, the Company formalized a curtailment plan affecting all participants under the age of 55. All employees impacted by the curtailment were transferred into the Company's existing defined
contribution plan effective January 1, 1998.

The
Company provides certain health care benefits for retired employees not subject to collective bargaining agreements. Employees become eligible for those benefits when they reach
normal retirement age and meet minimum age and service requirements. Health care benefits for retirees are provided under a self-insured program administered by an insurance company.

The
estimated future cost of providing post-retirement health costs is accrued over the active service life of the employees. The following table sets forth the benefit
obligations and funded status of the curtailed pension plan and post-retirement benefits.

The
actuarial present value of benefit obligations and funded plan status of December 29, 2001 and December 30, 2000 were (in thousands):

PENSION BENEFITS

OTHER BENEFITS2001

2000

2001

2000Change in benefit obligationBenefit obligation at beginning of year

$
(35,634
)
(33,595
)
(22,400
)
(8,702
)Service cost


(61
)
(92
)
(1,122
)
(887
)Interest cost


(2,716
)
(2,675
)
(1,420
)
(1,509
)Amendment






(347
)
(1,291
)Participant contributions






(778
)
(727
)Actuarial (loss) gain


(1,696
)
(1,889
)
1,079

(12,583
)Benefits paid


2,673

2,617

2,611

3,299Benefit obligation at end of year


(37,434
)
(35,634
)
(22,377
)
(22,400
)Change in plan assetsFair value of plan assets at beginning of year


38,799

40,740



Actual return on plan assets


(91
)
674



Contributions to plan




2

2,611

3,298Benefits paid


(2,673
)
(2,617
)
(2,611
)
(3,298
)Fair value of plan assets at end of year


36,035

38,799



Funded status


(1,400
)
3,165

(22,377
)
(22,400
)Unrecognized actuarial loss (gain)


4,202

(260
)
9,082

10,682Unrecognized transition obligation






2,719

2,972Unrecognized prior service cost


(91
)
(105
)
992

1,046Prepaid (accrued) benefit cost

$
2,711

2,800

(9,584
)
(7,700
)


42

---

PENSION BENEFITS

OTHER BENEFITS2001

2000

2000

2001Weighted-average assumptions
as of December 29, 2001Discounted rate

7.50
%
7.75
%
7.50
%
7.75
%Expected return on plan assets

8.00
%
8.00
%


Rate of compensation increase

5.00
%
5.00
%





At
December 29, 2001 the accumulated pension benefit obligation exceeded plan assets. Accordingly, the Company recorded an additional minimum liability in the
amount of $4.0 million, the offset of which is recorded, net of a tax benefit of $1.6 million, as a reduction of comprehensive income.

The
aggregate costs for the Company's retirement benefits included the following components (in thousands):

Components of net periodic benefit cost (income)

PENSION BENEFITS

OTHER BENEFITS2001

2000

1999

2001

2000

1999Service cost

$
61

92

144

1,122

887

402Interest cost


2,716

2,675

2,591

1,420

1,509

620Expected return on plan assets


(2,673
)
(2,900
)
(3,042
)




Amortization of prior service costs


(15
)
(15
)
(15
)




Amortization of unrecognized transition obligation








828

688

248Amortization of unrecognized net (gain) loss




(24
)






Net periodic benefit cost (income)

$
89

(172
)
(322
)
3,370

3,084

1,270


Assumed
health care cost trend rates have a significant effect on the 2001 amounts reported for the health care plans. The assumed annual rate of future increases in per
capita cost of health care benefits was 10.0% in fiscal 2001 declining gradually to 5.5% in 2007 and thereafter. A one-percentage point change in assumed health care cost trend rates would
have the following effects (in thousands):

1%
Increase

1%
DecreaseEffect on total of service and interest cost components

$
467

(379
)Effect on post-retirement benefit obligation


3,525

(2,857
)


Approximately
4.4% of the Company's employees are covered by collectively-bargained pension plans. Contributions are determined in accordance with the provisions of
negotiated union contracts and are generally based on the number of hours worked. The Company does not have the information available to reasonably estimate its share of the accumulated plan benefits
or net assets available for benefits under the multi-employer plans. Amounts contributed to those plans were $2.3 million in 2001 and 2000, and $2.5 million in 1999.

(13) Segment Information

The Company and its subsidiaries sell and distribute products that are typically found in supermarkets. The Company has three reportable operating segments. The
Company's food distribution segment consists of 15 distribution centers that sell to independently operated retail food stores, 110 corporately operated retail food stores, and institutional
customers. The retail segment consists of corporately operated stores that sell directly to the consumer. The military food distribution segment consists of two distribution centers that sell products
exclusively to military commissaries.

43

---

Information
presented below relates only to results of continuing segments. The Company evaluates segment performance and allocates resources based on profit or loss before income taxes,
general corporate expenses, interest, restructuring changes and earnings from equity investments. The accounting policies of the reportable segments are the same as those described in the summary of
accounting policies except the Company accounts for inventory on a FIFO basis at the segment level compared to a LIFO basis at the consolidated level.

Inter-segment
sales and transfers are recorded on a cost plus markup basis. For segment financial reporting purposes, a portion of the operational profits of wholesale distribution
centers are allocated to retail operations to the extent that merchandise is purchased by these distribution centers and transferred to retail stores directly operated by the Company. For fiscal 2001,
34% of such warehouse operational profits were allocated to retail operations compared to 36% and 24% in 2000 and 1999, respectively. Prior year's segment information has been restated to reflect
reclassifications of certain transactions from revenues to expense or cost of sales, changes in the method of allocating marketing revenues, and an allocation of a military management fee to the
military segment.

Schedules

|Year end December 29, 2001
(in thousands)          |  | Food
Distribution |           | Retail |           | Military |         | Total |          
|-------------------------------------------------- |  | ----------------- | --------- | ------ | --------- | -------- | ------- | ----- | ---------
|Revenue from external customers                    |  | $                 | 2,076,612 |        | 1,035,154 |          | 995,668 |       | 4,107,434
|Inter-segment revenue                              |  |                   | 575,301   |        |          |          |        |       | 575,301  
|Interest revenue                                   |  |                   | (741      | )      | (339      | )        |        |       | (1,080   
|Interest expense (includes capital lease interest) |  |                   | (724      | )      | 2,847     |          |        |       | 2,123    
|Depreciation and amortization expense              |  |                   | 12,427    |        | 12,771    |          | 1,373   |       | 26,571   
|Segment profit                                     |  |                   | 60,717    |        | 38,751    |          | 23,071  |       | 122,539  
|Segment assets                                     |  |                   | 386,088   |        | 169,051   |          | 133,223 |       | 688,362  
|Expenditures for long-lived assets                 |  |                   | 20,484    |        | 8,909     |          | 1,721   |       | 31,114   

|Year end December 30, 2000
(in thousands)          |  | Food
Distribution |           | Retail |           | Military |         | Total |          
|-------------------------------------------------- |  | ----------------- | --------- | ------ | --------- | -------- | ------- | ----- | ---------
|Revenue from external customers                    |  | $                 | 1,957,921 |        | 1,028,961 |          | 968,885 |       | 3,955,767
|Inter-segment revenue                              |  |                   | 584,216   |        |          |          |        |       | 584,216  
|Interest revenue                                   |  |                   | (2,724    | )      | (349      | )        |        |       | (3,073   
|Interest expense (includes capital lease interest) |  |                   | (221      | )      | 2,469     |          |        |       | 2,248    
|Depreciation and amortization expense              |  |                   | 14,990    |        | 12,215    |          | 1,888   |       | 29,093   
|Segment profit                                     |  |                   | 47,783    |        | 33,290    |          | 21,588  |       | 102,661  
|Segment assets                                     |  |                   | 402,234   |        | 164,202   |          | 139,329 |       | 705,765  
|Expenditures for long-lived assets                 |  |                   | 11,273    |        | 33,931    |          | 875     |       | 46,079   

|Year end January 1, 2000
(in thousands)            |  | Food
Distribution |           | Retail |         | Military |         | Total |          
|-------------------------------------------------- |  | ----------------- | --------- | ------ | ------- | -------- | ------- | ----- | ---------
|Revenue from external customers                    |  | $                 | 2,247,751 |        | 853,146 |          | 959,955 |       | 4,060,852
|Inter-segment revenue                              |  |                   | 510,433   |        |        |          |        |       | 510,433  
|Interest revenue                                   |  |                   | (3,049    | )      | (229    | )        |        |       | (3,278   
|Interest expense (includes capital lease interest) |  |                   | (438      | )      | 1,742   |          |        |       | 1,304    
|Depreciation and amortization expense              |  |                   | 15,893    |        | 9,038   |          | 2,077   |       | 27,008   
|Segment profit                                     |  |                   | 42,104    |        | 18,038  |          | 20,736  |       | 80,878   
|Segment assets                                     |  |                   | 418,154   |        | 144,890 |          | 142,498 |       | 705,542  
|Expenditures for long-lived assets                 |  |                   | 12,704    |        | 26,123  |          | 680     |       | 39,507   

44

---

Reconciliation (In thousands)

|                                                      |                                 | 2001 |           | 2000      |           | 1999      |          
|----------------------------------------------------- | ------------------------------- | ---- | --------- | --------- | --------- | --------- | ---------
|Revenues                                              |                                 |      |           |           |           |           |          
|Total external revenue for segments                   |                                 | $    | 4,107,434 |           | 3,955,767 |           | 4,060,852
|Inter-segment revenue from reportable segments        |                                 |      | 575,301   |           | 584,216   |           | 510,433  
|Elimination of intra-segment revenue                  |                                 |      | (575,301  | )         | (584,216  | )         | (510,433 
|                                                      |                                 |      |           |           |           |           |          
|                                                      | Total consolidated revenues     |      | $         | 4,107,434 |           | 3,955,767 |          
|                                                      |                                 |      |           |           |           |           |          
|Profit or Loss                                        |                                 |      |           |           |           |           |          
|Total profit for segments                             |                                 | $    | 122,539   |           | 102,661   |           | 80,878   
|Unallocated amounts:                                  |                                 |      |           |           |           |           |          
|                                                      | Adjustment of LIFO to inventory |      |           | (2,661    | )         | 1,092     |          
|                                                      | Unallocated corporate overhead  |      |           | (83,586   | )         | (76,254   | )        
|                                                      | Special charges                 |      |           |          |           |          |          
|                                                      |                                 |      |           |           |           |           |          
|Income from continuing operations before income taxes |                                 | $    | 36,292    |           | 27,499    |           | 26,453   
|                                                      |                                 |      |           |           |           |           |          
|Assets                                                |                                 |      |           |           |           |           |          
|Total assets for segments                             |                                 | $    | 688,362   |           | 705,765   |           | 705,542  
|Unallocated corporate assets                          |                                 |      | 338,907   |           | 226,959   |           | 206,557  
|Accumulated LIFO reserves                             |                                 |      | (47,753   | )         | (45,092   | )         | (46,184  
|Elimination of intercompany receivables               |                                 |      | (9,271    | )         | (6,804    | )         | (3,472   
|                                                      |                                 |      |           |           |           |           |          
|                                                      | Total consolidated assets       |      |           | 970,245   |           | 880,828   |          
|                                                      |                                 |      |           |           |           |           |          

Other Significant Items2001

|                                      |  | Segment
Totals |        | Adjustments |        | Consolidated
Totals
|------------------------------------- |  | -------------- | ------ | ----------- | ------ | -------------------
|Depreciation and amortization expense |  | $              | 26,571 |             | 20,030 |                    
|Interest expense                      |  |                | 2,123  |             | 32,180 |                    
|Expenditures for long-lived assets    |  |                | 31,114 |             | 12,810 |                    

Other Significant Items2000

|                                      |  | Segment
Totals |        | Adjustments |        | Consolidated
Totals
|------------------------------------- |  | -------------- | ------ | ----------- | ------ | -------------------
|Depreciation and amortization expense |  | $              | 29,093 |             | 16,237 |                    
|Interest expense                      |  |                | 2,248  |             | 32,196 |                    
|Expenditures for long-lived assets    |  |                | 46,079 |             | 7,987  |                    

Other Significant Items1999

|                                      |  | Segment
Totals |        | Adjustments |        | Consolidated
Totals
|------------------------------------- |  | -------------- | ------ | ----------- | ------ | -------------------
|Depreciation and amortization expense |  | $              | 27,008 |             | 14,555 |                    
|Interest expense                      |  |                | 1,304  |             | 28,627 |                    
|Expenditures for long-lived assets    |  |                | 39,507 |             | 12,775 |                    

45

---

The reconciling items to adjust expenditures for depreciation, interest revenue, interest expense and expenditures for long-lived assets are for unallocated general corporate
activities. All revenues are attributed to and all assets are held in the United States. The Company's market areas are in the Midwest, Mid-Atlantic and Southeast United States.

(14) Sale of Subsidiaries

On July 31, 1999 the Company sold the outstanding stock of its wholly-owned produce growing and marketing subsidiary, Nash-De Camp.
Nash-De Camp has previously been reported as a discontinued operation following a fourth quarter 1998 decision to sell the subsidiary. As a result of the sale, the Company realized cash
proceeds of $17.1 million and recognized an $8.2 million reversal of a $27.5 million provision recorded for the expected sale at the end of 1998.

On
June 30, 1999 the Company sold its majority interests in two dairy operations, Gillette Dairy of the Black Hills, Inc. and Nebraska Dairies, Inc. The Company
received $15.9 million for the sale of stock and, recognized a pre-tax gain of $3.1 million on the sale recorded as part of continuing operations.

(15) Subsidiary Guarantees

The following table presents summarized combined financial information for certain wholly owned subsidiaries which guarantee on a full unconditional and joint and
several basis, $165.0 million of senior subordinated notes due May 1, 2008, which were offered and sold by the Company on April 24, 1998:

Summarized
financial information for the year ended December 29, 2001 (in thousands):

Nash
Finch

Guarantor
Subsidiaries

Elimination

ConsolidatedCurrent assets

$
333,720

145,507

136

479,363Non-current assets


589,208

127,668

(225,994
)
490,882Current liabilities


348,358

48,150

(12,884
)
383,624Non-current liabilities


371,163

23,901

(11,851
)
383,213Sales and revenues


3,126,893

1,164,959

(184,418
)
4,107,434Operating expenses


3,107,834

1,147,726

(184,418
)
4,071,142Operating profit


19,059

17,233



36,292Net earnings


10,886

10,381



21,267


Summarized
financial information for the year ended December 30, 2000 (in thousands):

Nash
Finch

Guarantor
Subsidiaries

Elimination

ConsolidatedCurrent assets

$
282,800

146,946

3,793

433,539Non-current assets


554,965

106,331

(214,007
)
447,289Current liabilities


293,911

42,764

(11,889
)
324,786Non-current liabilities


334,370

44,944

(7,812
)
371,502Sales and revenues


2,937,987

1,175,595

(157,815
)
3,955,767Operating expenses


2,923,476

1,162,607

(157,815
)
3,928,268Operating profit


14,511

12,988



27,499Net earnings


8,005

7,466



15,471


46

---

Summarized
financial information for year ended January 1, 2000 (in thousands):

Nash
Finch

Guarantor
Subsidiaries

Elimination

ConsolidatedSales and revenues

$
2,992,725

1,129,217

(61,090
)
4,060,852Operating expenses


2,974,715

1,120,774

(61,090
)
4,034,399Operating profit (loss)


16,095

10,358



26,453Net earnings (loss)


13,837

5,966



19,803


Non-guarantor
subsidiaries, all of which are wholly owned, are inconsequential.

47

---



Quarterly Financial Information (Unaudited)

|                                                                                  |                                      | First Quarter
12 Weeks |         | Second Quarter
12 Weeks |         | Third Quarter
16 Weeks |         | Fourth Quarter
12 Weeks
|--------------------------------------------------------------------------------- | ------------------------------------ | ---------------------- | ------- | ----------------------- | ------- | ---------------------- | ------- | -----------------------
|
|
|Net sales and revenues                                                            |                                      | $                      | 904,939 |                         | 877,275 |                        | 949,559 |                        
|Cost of sales                                                                     |                                      |                        | 801,873 |                         | 782,144 |                        | 842,447 |                        
|Earnings before income taxes and extraordinary charge                             |                                      |                        | 5,554   |                         | 3,910   |                        | 9,016   |                        
|Income taxes                                                                      |                                      |                        | 2,299   |                         | 1,658   |                        | 3,733   |                        
|Net earnings before extraordinary charge                                          |                                      |                        | 3,255   |                         | 2,252   |                        | 5,283   |                        
|Extraordinary charge from early extinguishment of debt, net of income tax benefit |                                      |                        |        |                         |        |                        |        |                        
|Net earnings                                                                      |                                      |                        | 3,255   |                         | 2,252   |                        | 5,283   |                        
|Percent to sales and revenues                                                     |                                      |                        | 0.36    |                         | 0.26    |                        | 0.56    |                        
|Basic earnings per share                                                          |                                      |                        |         |                         |         |                        |         |                        
|                                                                                  | Earnings before extraordinary charge |                        | $       | .28                     |         | .20                    |         | .46                    
|                                                                                  | Net earnings                         |                        | $       | .28                     |         | .20                    |         | .46                    
|Diluted earnings per share                                                        |                                      |                        |         |                         |         |                        |         |                        
|                                                                                  | Earnings before extraordinary charge |                        | $       | .28                     |         | .20                    |         | .44                    
|                                                                                  | Net earnings                         |                        | $       | .28                     |         | .20                    |         | .44                    

48

---



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 under the captions "Election of DirectorsInformation About Directors and Nominees" and "Election of DirectorsOther Information About Directors
and Nominees" in the Company's 2002 Proxy Statement is incorporated herein by reference.

Information
concerning executive officers of the Company is included in this Report under Item 4A, "Executive Officers of the Registrant".

Information
under the caption "Section 16(a) Beneficial Ownership Reporting Compliance" in the Company's 2002 Proxy Statement is incorporated herein by reference.

ITEM 11.  EXECUTIVE COMPENSATION

The information under the captions "Election of DirectorsCompensation of Directors" and "Executive Compensation and Other Benefits" in the Company's
2002 Proxy Statement is incorporated herein by reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information under the captions "Security Ownership of Certain Beneficial Owners" and "Security Ownership of Management" in the Company's 2002 Proxy Statement
is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information under the captions "Election of DirectorsOther Information About Directors and Nominees" and "Certain Transactions" in the Company's
2002 Proxy Statement is incorporated herein by reference.

PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K



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The
following financial statement schedules are included herein and should be read in conjunction with the consolidated financial statements referred to above:





A
copy of any of these exhibits will be furnished at a reasonable cost to any person who was a stockholder of the Company as of March 25, 2002, upon receipt from any such person
of a written request for any such exhibit. Such request should be sent to Nash Finch Company, 7600 France Avenue South, P.O. Box 355, Minneapolis, Minnesota, 55440-0355, Attention:
Secretary.

The
following is a list of each management contract or compensatory plan or arrangement required to be filed as an exhibit to this Annual Report on Form 10-K pursuant
to Item 14(c):



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Schedule II

NASH FINCH COMPANY and SUBSIDARIES        Valuation and Qualifying Accounts        Fiscal Years ended December 29, 2001, December 30, 2000 and January 1, 2000  (In
thousands)

|                                  |                                                             |   |        | Additions |        |       |     |     |       |      
|--------------------------------- | ----------------------------------------------------------- | - | ------ | --------- | ------ | ----- | --- | --- | ----- | -----
|
|
|52 weeks ended January 1, 2000:   |                                                             |   |        |           |        |       |     |     |       |      
|                                  | Allowance for doubtful receivables(c)                       |   | $      | 34,417    |        | 4,388 |     | 280 |       | 268  
|                                  | Provision for losses relating to leases on closed locations |   |        | 6,236     |        | 1,915 |     |     |       |      
|                                  |                                                             |   |        |           |        |       |     |     |       |      
|                                  |                                                             | $ | 40,653 |           | 6,303  |       | 280 |     | 268   |      
|                                  |                                                             |   |        |           |        |       |     |     |       |      
|52 weeks ended December 30, 2000: |                                                             |   |        |           |        |       |     |     |       |      
|                                  | Allowance for doubtful receivables(c)                       |   | $      | 30,430    |        | 7,361 |     |    |       | 23   
|                                  | Provision for losses relating to leases on closed locations |   |        | 5,650     |        | 2,722 |     |    |       |     
|                                  |                                                             |   |        |           |        |       |     |     |       |      
|                                  |                                                             | $ | 36,080 |           | 10,083 |       |    |     | 23    |      
|                                  |                                                             |   |        |           |        |       |     |     |       |      
|53 Weeks ended December 29, 2001  |                                                             |   |        |           |        |       |     |     |       |      
|                                  | Allowance for doubtful receivables(c)                       |   | $      | 31,012    |        | 4,812 |     |    |       | 1,083
|                                  | Provision for losses relating to leases on closed locations |   |        | 6,075     |        | 1,105 |     |    |       |     
|                                  |                                                             |   |        |           |        |       |     |     |       |      
|                                  |                                                             | $ | 37,087 |           | 5,917  |       |    |     | 1,083 |      
|                                  |                                                             |   |        |           |        |       |     |     |       |      

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

|Dated: March 8, 2002 |  | NASH-FINCH COMPANY
|-------------------- |  | ------------------
|                     |  | By:               

Pursuant
to the requirements of the Securities Exchange Act of 1934, this Report has been signed below on March 8, 2002 by the following persons on behalf of the Registrant and in
the capacities indicated.

|/s/RON MARSHALLRon Marshall, President,
Chief Executive Officer (Principal Executive
Officer) and Director                      |  | /s/LEANNE M. STEWARTLeAnne M. Stewart, Vice President
and Corporate Controller (Principal
Accounting Officer)
|------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------
|/s/ROBERT B. DIMONDRobert B. Dimond, Senior Vice President,
Chief Financial Officer and
Treasurer (Principal Financial Officer) |  | /s/CAROLE F. BITTERCarole F. Bitter, Director                                                                
|/s/JAMES L. DONALDJames L. Donald, Director                                                                                     |  | /s/RICHARD A. FISHERRichard A. Fisher, Director                                                              
|/s/JERRY L. FORDJerry L. Ford, Director                                                                                         |  | Allister P. Graham, Director                                                                                 
|/s/JOHN H. GRUNEWALDJohn H. Grunewald, Director                                                                                 |  | /s/ROBERT F. NASHRobert F. Nash, Director                                                                    
|/s/LAURA STEINLaura Stein, Director                                                                                             |  | /s/JOHN E. STOKLEYJohn E. Stokley, Director                                                                  
|/s/WILLIAM R. VOSSWilliam R. Voss, Director                                                                                     |  |                                                                                                              

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NASH FINCH COMPANY  EXHIBIT INDEX TO ANNUAL REPORT  ON FORM 10-K  For Fiscal Year Ended December 29, 2001

|Item
No. |  | Item                                                                                                                                                                                        |  | Method of Filing                                                                                                                                  
|-------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------
|2.1      |  | Agreement and Plan of Merger dated as of October 8, 1996 among the Company, NFC Acquisition Corporation, and Super Food Services, Inc.                                                      |  | Incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K dated November 22, 1996 (File No. 0-785).                    
|3.1      |  | Restated Certificate of Incorporation of the Company                                                                                                                                        |  | Incorporated by reference to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1985 (File No. 0-785).
|3.2      |  | Amendment to Restated Certificate of Incorporation of the Company, effective May 29, 1986                                                                                                   |  | Incorporated by reference to Exhibit 19.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended October 4, 1986 (File No. 0-785).  
|3.3      |  | Amendment to Restated Certificate of Incorporation of the Company, effective May 15, 1987                                                                                                   |  | Incorporated by reference to Exhibit 4.5 to the Company's Registration Statement on Form S-3 (File No. 33-14871).                                 
|3.4      |  | Bylaws of the Company, as amended effective November 21, 1995                                                                                                                               |  | Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995 (File No. 0-785).
|4.1      |  | Stockholder Rights Agreement, dated February 13, 1996, between the Company and Norwest Bank Minnesota, National Association                                                                 |  | Incorporated by reference to Exhibit 4 to the Company's Current Report on Form 8-K dated February 13, 1996 (File No. 0-785).                      
|4.2      |  | Indenture dated as of April 24, 1998 between the Company, the Guarantors, and U.S. Bank Trust National Association                                                                          |  | Incorporated by reference to Exhibit 4.2 to the Company's Registration Statement on Form S-4 filed May 22, 1998 (File No. 333-53363).             
|4.3      |  | Form of Company's 8.5% Senior Subordinated Notes due 2008 Series A                                                                                                                          |  | Incorporated by reference to Exhibit 4.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 20, 1998 (File No. 0-785).     
|4.4      |  | Form of Company's 8.5% Senior Subordinated Notes due 2008 Series B                                                                                                                          |  | Incorporated by reference to Exhibit 4.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 20, 1998 (File No. 0-785).     
|4.5      |  | First Supplemental Indenture of Trust dated as of June 10, 1999 between the Company, the Subsidiary Guarantors, Erickson's Diversified Corporation and U.S. Bank Trust National Association |  | Incorporated by reference to Exhibit 4.5 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2000 (File No. 0-785).  

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|4.6  |  | Second Supplemental Indenture of Trust Dated as of January 31, 200 between the Company, the Subsidiary Guarantors, Hinky Dinky Supermarkets, Inc., and U.S. Bank Trust National Association |  | Filed herewith.                                                                                                                                     
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------
|4.7  |  | Third Supplemental Indenture of Trust dated as August 13, 2001 Between the Company, the Subsidiary Guarantors, U Save Foods, Inc., and U.S. Bank Trust National Association                 |  | Filed herewith                                                                                                                                      
|10.1 |  | Credit Agreement dated as of December 19, 2000 among the Company, Bankers Trust Company, as administrative agent, and various lenders                                                       |  | Incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2000 (File No. 0-785). 
|10.2 |  | Nash Finch Profit Sharing Trust Agreement (as restated effective January 1, 1994)                                                                                                           |  | Incorporated by reference to Exhibit 10.6 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994 (File No. 0-785).   
|10.3 |  | Nash Finch Profit Sharing Plan2001 Revision (as restated effective generally January 1, 2001)                                                                                              |  | Filed herewith.                                                                                                                                     
|10.4 |  | Nash Finch Profit Sharing Plan2001 RevisionFirst Declaration of Amendment                                                                                                                 |  | Filed herewith.                                                                                                                                     
|10.5 |  | Nash Finch Executive Incentive Bonus and Deferred Compensation Plan (as amended effective September 30, 2001)                                                                               |  | Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the period ended October 6, 2001 (File No. 0-785).     
|10.6 |  | Excerpts from minutes of the November 11, 1986 meeting of the Board of Directors regarding Nash Finch Pension Plan, as amended, effective January 2, 1966                                   |  | Incorporated by reference to Exhibit 10.9 to the Company's Annual Report on Form 10-K for the fiscal year ended January 3, 1987 (File No. 0-785).   
|10.7 |  | Excerpts from minutes of the November 21, 1995 meeting of the Board of Directors regarding Nash Finch Pension Plan, as amended                                                              |  | Incorporated by reference to Exhibit 10.13 to the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995 (File No. 0-785).
|10.8 |  | Excerpts from minutes of the April 9, 1996 meeting of the Board of Directors regarding director compensation                                                                                |  | Incorporated by reference to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1996 (File No. 0-785).
|10.9 |  | Excerpts from minutes of the November 19, 1996 meeting of the Board of Directors regarding director compensation                                                                            |  | Incorporated by reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1996 (File No. 0-785).

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|10.10 |  | Excerpts from minutes of the November 17, 1998 meeting of the Board of Directors regarding director compensation                   |  | Incorporated by reference to Exhibit 10.35 to the Company's Annual Report on Form 10-K for the fiscal year ended January 2, 1999 (File No. 0-785).  
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------
|10.11 |  | Excerpts from minutes of the February 22, 2000 meeting of the Board of Directors regarding director compensation                   |  | Incorporated by reference to Exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended January 2, 1999 (File No. 0-785).  
|10.12 |  | Form of letter agreement specifying benefits in the event of termination of employment following a change in control of Nash Finch |  | Incorporated by reference to Exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended December 29, 1990 (File No. 0-785).
|10.13 |  | Nash Finch Income Deferral Plan                                                                                                    |  | Incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994 (File No. 0-785).  
|10.14 |  | Nash Finch 1994 Stock Incentive Plan, as amended                                                                                   |  | Incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the period ended June 14, 1997 (File No. 0-785).       
|10.15 |  | Nash Finch 2000 Stock Incentive Plan                                                                                               |  | Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the period ended June 17, 2000 (File No. 0-785).       
|10.16 |  | Nash Finch 1995 Director Stock Option Plan, as amended                                                                             |  | Incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the period ended June 17, 2000 (File No. 0-785).       
|10.17 |  | Nash Finch 1997 Non-Employee Director Stock Compensation Plan                                                                      |  | Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the period ended June 14, 1997 (File No. 0-785).       
|10.18 |  | Nash Finch 1999 Employee Stock Purchase Plan, as amended                                                                           |  | Filed herewith.                                                                                                                                     
|10.19 |  | Nash Finch Supplemental Executive Retirement Plan                                                                                  |  | Incorporated by reference to Exhibit 10.27 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2000 (File No. 785).    
|10.20 |  | Non-Statutory Stock Option Agreement dated as of June 1, 1998 Between Nash Finch and Ron Marshall                                  |  | Filed herewith.                                                                                                                                     
|21.1  |  | Subsidiaries of the Company                                                                                                        |  | Filed herewith.                                                                                                                                     
|23.1  |  | Consent of Ernst & Young LLP                                                                                                       |  | Filed herewith.                                                                                                                                     
|99.1  |  | Risk Factors                                                                                                                       |  | Filed herewith.                                                                                                                                     

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